Chapter 13: President James

Posted: July 19, 2011 - 05:32:40 pm

At a very personal level, Dexter didn’t like the idea of a corporation. It was strange to him that a legal fiction produced a virtual entity that had what he felt were greater rights than a human being. The only punishment for violating some law that a corporation could receive, was a fine. Those fines usually had little or no impact at on the corporation’s bottom line.

Unlike a person who broke a law, a corporation could not spend time in jail. Products engineered and sold by a corporation could kill people, but the corporation could only be sued for monetary compensation for the deaths. It was not charged with murder or manslaughter. Some very large corporations actually performed a cost-vs-benefit analysis to determine what made the most economic sense when a product was determined to be unsafe.

It was true that the people involved in some corporate wrongdoing might go to jail, but in a strange convolution of the legal system, they were more often than not found guilty of a crime against the corporation. Individuals who committed felonies could lose the right to vote. Corporations did not have the right to vote, but there were other ways to influence politicians, and they certainly did not lose access to those other mechanisms. Dexter had a feeling that one day, corporations would get the right to vote.

Dexter wondered how much different the world would be if corporations could be ‘executed’ for major crimes? What would happen if a corporation that has been charged with a crime had to suspend doing business, until the matter was solved by a court, or had to post a bail in order to be able to continue to perform business? What would happen if a corporation, upon being found guilty of a crime, was disbanded? How would business be conducted if all stockholders could lose their investments, all employees could be laid off, and the warranties could be voided upon conviction of a crime committed by a corporation? Would employees continue to accept the risks that executives placed upon them or would they demand greater visibility into corporate decision making? Would investors continue to allow Boards of Directors of major corporations to be filled with individuals who had no clue about the real nature of the business, and who rubber-stamped the decisions of the executives in charge? Would the world start to celebrate whistle-blowers who turned in crooked executives?

Dexter, feeling somewhat hypocritical, had just finished signing the papers that would create a corporation. There was a pile of paperwork stacked in front of him. They had just incorporated in the state of Maryland. Apparently, the tax laws for businesses incorporated in Maryland were less complex than elsewhere.

“Is twenty-two million dollars going to be enough to get this business started?” Dexter asked for the hundredth time.

“Yes,” Ed answered patiently.

“We’ve already spent over twenty thousand dollars, and all we’ve done is become a company,” Dexter said.

The majority of the money hadn’t been spent on the required fees for incorporating; that was relatively cheap. The money had gone towards setting up the roles, responsibilities, and obligations of each of the investors. Dexter was the President of the company – a position that he didn’t want. Ed Daimler was the CEO.

Dexter had not known Janet was the third investor in the company until contacting Charlie after the Phil Xander interview had finished. Now she was seated at the table with him and Ed, in her new role as CFO. Her accounting background made her the logical choice for that position. He wasn’t sure how he felt about being in business with his ex-wife.

Legacy Coffee Machines was now a legal entity, with a full compliment of officers, stockholders, and ties to accounting firms and lawyers. They didn’t have an office, employees, or even a single paper clip, but they were a legal entity. Dexter hoped that meant something.

That didn’t mean they didn’t have any potential employees. The website had been inundated with resumes from individuals who designed coffee makers. A lot of the resumes were from very experienced individuals. Dexter had a feeling that they could have wiped out the competition just by hiring all of their engineers.

“Don’t worry about it. Right now is the time to avoid mistakes at all costs. We just spent the money necessary to avoid some very major and costly mistakes,” Ed said dismissing Dexter’s concerns.

Janet said, “In my opinion, it was money that was well spent.”

The corporate bylaws had been quite complex. Allocation of initial ownership, outstanding shares, and the terms and conditions on selling outstanding shares had been hammered out with the help of the lawyer. The procedures by which corporate business decisions were to be made had taken another week to establish. Dexter had been the difficult one in that area.

One of the bylaws required a three-quarters majority vote by the stockholders, to approve any new product line. The goal was to prevent the business from expanding into some sort of international conglomerate that had its fingers in all kinds of products. It might prevent the business from becoming a Fortune 500 company, but they were going for long-term, slow, managed growth rather than explosive expansion.

Dexter wanted to make sure that a hundred years from now, people were still buying Legacy Coffee Machines to make coffee. He didn’t want it to turn into a toaster company or have a product line of chain saws.

He was well aware of the history of a certain pen corporation that had decided that it was time to expand its product offerings. First, it introduced a line of disposable lighters. Two years later, the company launched a disposable shaver product. The core commonality among the new business areas was that the products were made of plastic, were cheap, and were disposable. After seventy-years in business, that company had three core product lines: stationary goods, disposable shavers, and lighters. He felt like that was the kind of growth that companies should strive to achieve.

“What next?” Dexter asked.

“We get over to the bank, deposit our money, get a place of business, and then hire some people,” Ed answered.

Dexter wondered how much of his time was going to be spent on this business. After a year away from a full-time job, he had gotten used to working on his own schedule. He feared that this was going to result in a bigger change in lifestyle than he could possibly imagine.

“Let’s get it over with,” Dexter said.

“Do you have a bank that you prefer?” Ed asked looking over at Janet.

“Not really,” Janet answered.

“As a matter of fact, I do,” Dexter said.

“Excellent. Let’s go there,” Ed said.

It took half an hour for them to make it to the bank. Each of them had taken their own car since they each had different plans for after the bank visit. Dexter waited in his car while Ed and Janet went inside to create an account. The idea was that he would join them after they had established the account. It was kind of stupid, but he wanted them to have the full experience of service without him being present. He was afraid they would mistake their regular level of service as being special because he was there with them.

He wondered how they would react to the level of service they would receive while opening an account. No matter how many times he had gone into the bank, he always emerged overwhelmed by the individual attention that he received while there.

Sitting alone in his car, he thought about the strange direction his life had taken since the interview on The Phil Xander Show. He had always considered himself to be an engineer. Now, he was Dexter the Entrepreneur: President of Legacy Coffee Machines. It was a strange thought.

Despite the fact that his website was making money, he didn’t really view it as a business. He viewed it as a public service that was making enough money to support itself. He definitely hadn’t gone into it with the expectation of making money off of it.

Although it was to be expected, he was almost as busy now as when he had been working full time at the old company.

It was different though, and the differences were significant. He was in charge of his time. There were no six in the morning calls from his boss. He returned to his apartment before six in the evening. His evenings were spent visiting with people, reading, or even just eating a relaxed dinner at some nice restaurant.

In terms of material goods, his standard of living had actually decreased (ignoring, for the moment, the camper). His home had gone from a substantial four-bedroom house, to a two-bedroom apartment. He no longer had a lawn to maintain. There were a lot fewer gadgets in his home. He didn’t have a DVD or a Blu-ray player. He didn’t have a stereo system. If he wanted to watch a movie or listen to music, he played it on his home computer. He didn’t have a landline telephone, using his plain vanilla cell phone for that purpose.

No longer was he carrying his work environment around with him. His cell phone kept him in contact, but it didn’t have the data plan that had once bombarded him with emails. He let everyone know that his cell phone would not accept ANY texted messages. His experience with text messages had left him gun shy of that particular feature.

In modern terms, Dexter had stepped back in time regarding his connectivity to the world. He had a cell phone that he carried with him and a basic computer at home. His office had a computer, but that was it. He had a website and two email accounts, but he wasn’t a participant in the social networking brouhaha. The fact was, Dexter wanted to interact with people – not machines.