Brent Steak
In case you missed it, our CEO Brent wrote recently about the herculean self-sacrifice he made during Covid to iterate his way into learning how to cook the world’s best steak (it was a lot of online shopping, grilling, and eating) and to share his secrets. And I’ll vouch for his technique. “Brent steak” is a thing at my house even though my kids will tell you that I don’t execute it nearly as well as he does.
And it was good timing for Brent to share his insights into the best beef you’ll ever eat because we’re in the time of year when, if I find enough, I will trade him morels for Brent steak and red wine (another topic he’s pretty dialed in on), so we both end up having a pretty good meal. (And it’s probably not a coincidence that I honed my morel hunting skills alone in the woods during Covid as well.)
Of course, now you might be asking yourself why Brent is giving me premium beef and expensive wine in exchange for some fungus I found for free on the forest floor. But you might also ask why I’m handing Brent incredible, hard-to-find delicacies for stuff I could buy online.
Those are both logical questions that look at the situation the wrong way.
Brent has put considerable effort into becoming an expert in steak and wine. I could buy steak and wine online, but I wouldn’t curate it the same way. Similarly, Brent could start wandering around Missouri for mushrooms, but it would take him a while to figure out where to look and how.
In other words, the vectors of any trade – any deal, really – are opportunity, scarcity, effort, and value.
Our business at Permanent Equity is dealmaking, and our experience is that the best deals – the win-wins – happen when both sides believe they are getting back more than they are giving. Our annual (if I find enough) Brent steak/morel trade is an example of that.
Fair deals, on the other hand, are when both sides think they’re getting back about what they’re giving. Most money-for-business transactions are that since the sides are just exchanging present for future value (hopefully…and adjusted for risk).
But bad deals are what happen when people try to transact in currencies they don’t value the same, so someone feels short-changed even as the other thinks they’re overpaying. This is why negotiations around compensation can get so contentious. Employees tend to value salary most, while employers attach a real cost to things like healthcare, 401k match, bonus plans, and stock options.
That’s one reason we don’t do a 401k match at Permanent Equity. We’d rather just offer a higher salary – which usually means more to the employee at the same cost to us.
Opportunity, scarcity, effort, and value. That’s what makes the world turn.
And steak. Also, steak.
– Tim
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