You can't be a famous secret

The following is based on one of The Covenant Group’s clients. All of the names and telling details have been changed.

Helen Karrs had developed a unique and powerful investment strategy she was certain would take her business to the next level. But eighteen months later, her revenue had barely budged.

Helen had been an advisor for over fifteen years, making roughly $150K annually. A year and a half before I met her she had read an article in a financial newspaper that inspired her to come up with a creative tax-saving investment strategy. To her, the idea seemed original and after doing some research she discovered some literature on similar ideas but nothing exactly like what she was proposing. She knew she was on to something. At first, she was excited about the impact her idea would have on her business, but then she started to worry about protecting it. It was a paradox that frustrated her. To make money off the idea she’d have to let it out of the bag, but she couldn’t let too many people know because then other advisors would run with the idea and she’d get no credit for developing the concept.

When I asked her how she resolved the paradox, she told me she had so far only approached a small handful of discreet clients, people who were private about their financial affairs and who were unlikely to talk about the concept to others.

“But your market for this concept is considerably larger than this small group, isn’t it?”

“Sure, I can think of dozens of others who are perfect candidates.”

“But you’re afraid to approach them?”

“I don’t want to lose control of the idea. It’s my idea and it’s killing me to think that other advisors might get their hands on it.”

“But after a year and a half of lying low, you haven’t benefited from the power of your idea. Why don’t you do the opposite and tell as many as people as you can.”

Helen looked horrified. “What good would that do?”

“I think it would transform your business.”

“But there’s no way for me to protect the idea. It’s not something I can patent or copyright or trademark. It’s just an idea, and there’s no way I can stop people from making money off of my idea. People get ideas stolen all the time.”

“You’re right. You can’t legally protect your idea. And even if you could, suing people would only cost you money, time and energy, ultimately dragging your business down.”

“So there’s no solution then?”

“There certainly is a solution, Helen,” I said. “One of my mentors, David Cowper, who wrote Mega-Selling, used to say, ‘You can’t be a famous secret.’”

Helen gave me a curious look.

“In the 70s, David developed an insurance concept, which he called ‘The Substitute Creditor’. It was brilliant, allowing business owners to protect an insurance-protected business loan from turning into an asset upon their death, thus protecting it from tax. Today this concept can be found in standard financial textbooks - largely because David’s strategy was to spread the idea as quickly as possible.”

Helen thought that was a crazy approach.

“Helen,” I said, “David knew he couldn’t own the idea in a legal sense, but he knew he could own it in another sense. His plan was to become identified in the financial services community as the go-to expert for ‘Substitute Creditor’ opportunities. People would see him as its champion and immediately connect the idea to his name. He wrote about the idea, spoke about the idea, spreading it wherever he could.” 

“But didn’t other advisors take the idea and run with it?”

“Of course. That’s always going to happen, but the benefit to David of going public with his idea was so great that it didn’t matter. In fact, as David writes about in his book, the biggest case he ever closed was a direct result of speaking about the concept to an audience of other professionals.

“Just like your idea, David’s concept had a lot of intrinsic value. In other words, it’s a powerful financial strategy that can save and/or make clients lots of money. It’s the strength of that intrinsic value that makes you want to keep a tight lid on it. But your idea’s intrinsic value represents only a small portion of its total value. David recognized this - he knew that the real value of his idea lay in its extrinsic value.”

Helen asked what I meant. 

“The extrinsic value of an idea is the value it has outside of itself. You need to ask yourself what your idea can give you beyond just its application in client situations. Let’s look at David’s example again. David used his idea to raise his profile - both inside and outside the financial services community. He created hundreds of opportunities to speak and write about it, exposing himself to a massive audience of potential clients as well as strategic partners, and other professionals who could bring him cases or work on cases with him. While some advisors appropriated the concept for themselves, this actually increased the value of the idea and therefore David’s status. The marketplace saw David as a creative, original thinker - someone capable of solving challenging financial problems for his clients. The increase in David’s prestige was so great that even if he never made any money off the idea itself (off of its intrinsic value), going public with it still would have been the right thing to do. But of course, he did apply the concept with his own clientele and with clients that came to him through other advisors.

“Helen,” I said, “your challenge shouldn’t be to keep the idea under wraps for as long as possible but to get the idea out there as quickly as you can. Like David, you want to be the champion of the idea. To do that, you have to create as many speaking and writing opportunities as possible. You have a window of opportunity wherein you’ll be able to establish yourself as the creator and champion of the idea. But don’t be afraid, or concerned, that others take the idea. As I said, that only increases the value of the idea - for everyone.

“You may have heard me talk about playing the ‘infinite game’. Many advisors play the finite game - they think there’s only so much business to go around and so try to get as much of it as they can. They try to get a big piece of a small pie. But when you play the infinite game, you create a bigger pie. When you publicize and promote your concept, you create a market, not just for yourself, but for other advisors - but that potential market is huge, and getting even a small piece of a huge market is considerably better than getting a big piece of a tiny market.”

Helen began to see the wisdom of going public with her idea. She committed herself to developing a marketing and promotional plan for her idea. Over the next few months, she wrote articles and arranged speaking engagements. When I caught up with her a year later, she was ecstatic. The month before she had spoken on the main platform of an industry conference and had since been swamped with calls from other advisors wanting to bring her in on joint cases. She’d already grown her business by 25% over the year due to her idea and was expecting to double her income within two years.

Lessons Learned

Helen learned four important lessons about having an original concept:

• The intrinsic value of an idea (its application) is only a small portion of its total value.
• The real value of an idea is its capacity to establish you as the idea’s champion and boost your profile in the marketplace.
• When you publicize your idea, you increase the value of the idea for everyone - especially you, if you have managed to promote yourself as the leading authority on the idea.
• While other professionals might appropriate your idea, others will bring you opportunities you never would have had before. The net effect on your business will be positive.

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The Covenant Group is referred to by many as the place entrepreneurs go to become Business Builders. They are considered to be thought leaders and have authored the best-selling books, The 8 Best Practices of High-Performing Salespeople, The Entrepreneurial Journey, and The Business Builder.