What is a good reason to start a business? Stay tuned to find out today on the Inside BS Show. Good morning. I am Nikki G. This is the Inside BS Show.

With me this morning is Dave Lorenzo, the godfather of growth. Good morning, Dave. Hey now, Nikki G. How are you? I'm great.

How are you? I'm doing well. Thank you. This morning, we are talking about a good reason to start a business.

Not just a reason, but a good reason. If you are a Curb Your Enthusiasm fan, you may remember the episode about the Spite Store. If you are not, let me give you a little bit of background.

This is a show written by Larry David, where he stars in the show. He has a run-in with a business owner of a coffee shop known as Mocha Joe's. Larry gets himself out of Mocha Joe's after making a number of complaints.

The coffee is cold. The tables are wobbling. Eventually, Mocha Joe's had enough.

Boots him out of the store. What does Larry do? Larry comes up with what he thinks is a great idea for a business. He refers to it as a Spite Store.

What does he do? He leases out the space next door to Mocha Joe's, and he opens up his own coffee shop. What does he call it? Latte Larry's. He's excited about his idea and marches over to Mocha Joe's.

Mocha Joe's says to Mocho of Mocha Joe's, says, Larry, I thought I told you to get out of here. Larry said, I have only come over here to tell you that I opened up my own coffee shop next door to put you out of business. I thought this was a great opening for what is a good reason to open a business, Dave? You work with a lot of entrepreneurs.

I'm sure they come to you and they want to throw around the next idea they have for a business. So tell us, what's a good reason to open a business? Well, thanks a lot, Nicola. I love, by the way, I love the Spite Store episode of Curb Your Enthusiasm.

I love everything about Curb Your Enthusiasm because there are so many parallels between that show and real life. A good reason to open a business is, I guess there's three real good reasons to open a business. Number one is to fill a need in the market, right? If there's a need in the market that is unmet right now, that's a really good reason to open a business.

I'll give you an example and we'll talk about that. Number two is if you have built a better mousetrap, so the market is saturated or the market has a number of solutions, but you've got a better solution. And my great example for that is something like Uber or Airbnb, right? The market was full of taxi cabs, market was full of hotels, yet Uber came up with a better way to get from point A to point B than a taxi cab.

Airbnb was in a market where people had hotels already, but they came up with a better way to have a stay experience, have a lodging experience. So that's reason number two. And then reason number three to start a business is if your business fulfills a higher purpose that many people have bought into, right? So reason number one, you're filling a need that currently is unfilled.

Reason number two, you got a better mousetrap. Reason number three is you're fulfilling a higher purpose that other people are completely bought into. And so a great example for reason number three is one of these crowdsourced funding operations, like either crowdfunding for startups and people are really into that, or a GoFundMe page to help someone who's experiencing some sort of hardship.

That is actually a for-profit business. So it appeals to a sense of higher purpose, which you didn't hear in those three examples, Nicola, was I'm starting a business because I'm really good at this, right? That's the worst reason. The worst reason to start a business is your reasons.

The best reason to start a business are those three things. My favorite is the filling a need in the market because that's where you're basically pouring water in glasses to a thirsty crowd. That to me is the number one reason.

So if you want an example, let's say you were the only gas station. So I go to the West Coast quite a bit, and my wife and I own a timeshare in Palm Springs. So once a year we get on a plane, we fly out to LA, we hang out in LA for business, and then that weekend we'll get in the car and we'll drive from LA to Palm Springs to go to the timeshare to relax for a week.

That drive is a drive through the desert. So if you're the only gas station along that route, or you're the gas station on that route right when you get outside of LA and there's an hour ride until Palm Springs, and the sign says last gas station for 60 miles, you are filling a need that is unfulfilled. So that is a great business to open.

That is a great tangible example of filling the need. An intangible example would be from, let's say from your world, Nicola, let's say you're the only intellectual property attorney who joins an association of business transactional attorneys. You're the only IP attorney in that group.

You're filling a need for those people that is unfulfilled in that group. You're the unicorn. It's much easier for you to be attractive.

So that's the first one. The second one, building a better mousetrap. I gave you Uber as an example.

I gave you Airbnb as an example. Let's say it's local, right? And let's say there's a Starbucks in your town and the Starbucks is always crowded. It's always, you know, overwhelmed with people.

I'll be honest and tell you that Starbucks coffee doesn't taste like the best coffee. So if you opened up Nikki G's coffee shop a mile and a half down the road from Starbucks, and you decided that you were going to be the old style coffee house where you had people doing spoken word performances at night or open mic comedy night or like a beatnik poetry night, or, you know, come display your talent night, you would be fulfilling the differentiating factor. You would be building the better mousetrap in that you serve coffee, but you also provided entertainment and an experience that was different than the wait in line for 45 minutes for somebody to call out the wrong name and hand you a really bitter cup of coffee experience that Starbucks provides.

So you, as a local purveyor of coffee, would be providing a better or a different experience, and that idea would be a good enough reason, in my opinion, if there was a great coffee crowd in your town to open a business. And then the third one is the the sense of higher purpose, right? And the sense of higher purpose is it can be anything. And the greatest example that I'll give you is a friend of mine from high school who is in North Carolina.

There was no dog training place anywhere within like 100 miles of where she was, and she volunteered at the pet rescue. And in volunteering at the local pet rescue, what she found was people would rescue the dogs and they would bring them right back because they wouldn't know how to take care of the dogs, how to handle the dogs. And this broke my friend's heart.

I mean, literally would break her heart to see these dogs get adopted and the would love them so much and they take them home. And then two weeks later, after their couch was all chewed up, and they had like one shoe missing from every pair of their shoes, because the dog would take the shoes and hide them, they would be bringing the dog right back and it totally broke her heart. So she formed first, just a way to give back.

She was doing classes in her backyard. She had a huge backyard teaching people who had adopted pets, how to care for the pets when they initially got home, and she would give them checklists. And then the people came back to her and they said, okay, well, we got, you know, we taught Rex the stuff you taught us.

Now, how do we get them to sit? How do we get them to roll over? How do we get them to go to the bathroom outside? And she was like, this is, you know, a need that the market needs filled. It also fulfills my mission. It fulfills my sense of higher purpose.

So she took her job as a realtor and made that a part-time gig and created in her backyard, an entire training facility, eventually moved to a warehouse and hired people who also were passionate about training pets and use that as a complete for-profit business that helped her fill her mission. And now I think she sells maybe three or four homes a year and her main income comes from the pet rescue. So in my opinion, those are the three really good reasons to start a business.

And, you know, I know people are going to get great value out of that and that's terrific, but I got a question for you, Nikki G, because here's the thing. We can't talk about spite. And by the way, you can tell me how great those things were, that's fine.

But we can't talk about spite without talking about business owners who sue for spite because you're a litigator. How often do you see people in court or do people come to you and they want to sue because they want to extract their pound of flesh? How often do you find that people sue for spite? I see it quite often. And people also come to me and ask about bringing lawsuits for reasons that include spite, which, by the way, is not a good reason for bringing a lawsuit, just like it is not a good reason for building a business.

So when I'm asked the question, will you go ahead and bring this lawsuit? I want to bury this person on the other side, or I want to bury this company, right? My response is no, because that's not a good reason for bringing a lawsuit. I will personally not take that case. Someone might.

I will not. You have to really understand why it is that you want to bring a lawsuit, right? What is the reason? And it can't just be a reason. You need a good reason.

Why? Because that impacts your business. So you really need to think about, does this make sense for my business? And I know that sounds a little crazy, wondering, does the lawsuit make sense for my business? But let me give you an example where it does. Let's say you have a protected brand, like we're looking at Dave in your background, right? That's your brand.

And I know that you have the right IP protections in place to make sure that someone is not using your brand in the marketplace. So if you see someone else opening up a podcast, right, that is now a spite podcast because they want to now use your brand to develop a better podcast, right? You would go after that, and you would protect your IP. How would you do that? You would initiate an IP lawsuit.

You would get an IP litigator. You would bring a lawsuit about the improper use of your protected copyright materials. That's a good reason.

There are many other good reasons. What's important is having a discussion about why am I going to bring this? Because the reality is, lawsuits are stressful. Lawsuits can go on for years, and all of those things can impact your business and will.

They have to. Because you are going through that process, it's not simply outsourcing it to a lawyer or a law firm to handle. You as a business owner are going through that process with the lawyers you're working with.

And so you need to really make sure it is a good reason to initiate a lawsuit before you do it, and be prepared for what's to come. And part of our role as effective counsel is to make sure that you understand all of that before you get involved in it. Yeah, you know, it's funny that you say that.

So a dear friend of mine, a gentleman by the name of Gary Rosen, who's an outstanding litigator. He's the managing shareholder of a large law firm here in South Florida. He told me one time, and this has stuck with me forever.

I'm curious, Nicole, about your thoughts on this. You know, he said one of the first things he tells clients when they come in and they want to sue someone, he says to them, lawsuits, you know, litigation, it's not designed to be quick, it's not designed to be cheap, and it's not designed to be fair. If you're okay with those three things, we can move forward.

Well, how do you how do you feel about that? I agree. It's great advice. The first thing that I will ask if someone comes to me and wants to file a lawsuit is why I need to understand the why and then we'll talk through it.

But you really need to understand that big picture, right? You need to understand that that's the reality of bringing a lawsuit and need to make sure that you're prepared for that. So let me I'm going to bring this back to the point that we opened with about the spite store, right? Here's how that ends. Larry's store burns to the ground literally in the episode as a result of some errors that occurred.

But the point the takeaway point from that is, that's not a good reason to open a business is as a spite store. It's also not a good reason to file a lawsuit or open a store for some of the other reasons that we discussed here today, right? You need to have a good reason if you're going to start a business, you need to have a good reason if you're going to initiate a lawsuit. And so that's important to understand what goes into that what that reason is going to be before taking a step forward.

Yeah, spite unproductive emotion. This is a productive podcast. Thank you so much for joining us today.

I'm Dave Lorenzo, the godfather of growth and she's Nikki G. You can find us back here every single day wherever you get your podcasts. If you like what you heard, or you like what you saw and you're watching on YouTube, watch the next video that comes up. If you're listening on the podcast, scroll down, listen to another episode.

We'd love to continue to develop the relationship with you. I'm the godfather of growth. I'm with Nikki G. We'll see you right back here again tomorrow.

Until then, here's hoping you make a great living and live a great life. Transcribed by https://otter.ai