Greetings and welcome to session 5 performing, funding and launching a technology startup company. In this session, we're going to focus on launching and growing the business. There's a number of important things that we need to consider as the organization begins to operate and develop its products and services. One is supportive environment that encourages business ethics in terms of how we do what we do. Another which is intimately related, is cultivating a learning organization, the ability to learn from mistakes, gather new information, and make changes as may be needed and to help adapt and change with changing conditions cultivating practices of resilience and adaptive management, and the ability to learn from failure and making mistakes and letting that to some extent be okay and recognizing failure is another piece of information that can inform our overall progress. We will also talk about growth strategies and then exit strategies as we conclude our creation of a new technology business. In this video, we're going to talk about business ethics. What are business ethics? Well, when we distinguish business ethics from other types of ethics, we begin to recognize that really, they're all one and the same. Personal ethics, professional ethics, business, it's all about how we manage our behavior in a moral context, than a shared environment. Sometimes we've heard that dimension of, hey, that's nothing personal, it's strictly business. I would suggest, well, that's really not the case. It's all personal, it's all professional, and it's all about business when it comes to ethics. When we think about ethics in the business operating environment, both internally and externally, it's like there's an ecosystem. The ecosystem essentially, we talked about that earlier, is complex network of stakeholders and concepts and things that we're striving to do and accomplish. In that context are groups of moral standards of human behavior. What are the principles and guidelines that are generally accepted as norms and the sense of what it is to do the right thing and being guided by that. Moral perception and interpretation is often distinguished, or can be distinguished among individuals and groups. Meaning that some may perceive and interpret moral behavior or moral acceptability differently than others to the extent there are shared values that represent the rules of order, if you will, or the cultural structure of an operation. Then that begins to form the environment where all business ethics can be cultivated and nurtured. It's reflected in the words, in the actions, the behaviors of especially the founders and the core management team, but how individuals interact with others and how they conduct their business with other stakeholders. There are also legal and cultural considerations. Because oftentimes perception and interpretation may be through a legal lens or a cultural lens. We know, for example, there are certain behaviors that are acceptable in some cultures are not considered to be acceptable in other cultures. Learning to distinguish those factors, but also to ground ourselves and understanding of what is morally true for us as an individual and for the shared values that we reflect within our organization. The ecosystem involves not just the participants, but there are what we might think of as enablers, those who make the system possible, create the environment or contribute to that environment. Entrepreneurs are often challenged because there's conflicting goals. On the one hand, we want to please a customer and support their needs and provide them with a solution to their problems. We also have this internal commitment in our organization to earn a profit. Then the tug of war sometimes may become, what is it to do the right thing and who ultimately decides that? We all know there are conditions where a business may be legal in terms of how it's operating, but it may not be entirely ethical. There are just fringe considerations where the interpretation of moral principles may be reflected in the words and the actions and behaviors of the founders and the core management team. It's important to recognize in this larger context that the ethics that we uphold as individuals, as founders are personal values to the extent that those values are shared with the core management team and perhaps promoted across the company that creates an ethical and supportive environment. This notion of moral human development was developed by the scholar Lawrence Kohlberg. Kohlberg identified stages of moral maturity. Meaning that across a lifetime, there are distinct shifts or changes in one's capacity to comprehend and act morally. The very concept and interpretations of moral behavior also change with time, often to be more inclusive of others. Cultivating an environment that supports business ethics is very critical. One of the examples that we've had just recently is FTX, the cryptocurrency exchange. It was very high-profile for a while, and then it just crashed and burned in November, this is November 2022. Interesting, I follow this, I'm interested in cryptocurrency. I've been following it for a few years. To witness this company coming unraveled in such a public way was truly extraordinary. An individual named John Ray III, who is also the person who came in when Enron failed, and some of you might recall Enron was a Texas accompany that had a very high-profile failure of some number of years ago as well, and he came in to resolve, if you will, or shut down or transition FTX in the midst of this bankruptcy and has been very open and transparent about what he's found, and simply acknowledged that there was a complete breakdown of corporate controls, that there was no real management or sophistication around how customer finances and financial information were controlled and managed. There was ultimately even a bigger mess than Enron, which is quite extraordinary. I realize some of you might not be familiar with Enron, but you can Google that if you're interested to learn more. But the point here being that this company in particular had received something like nearly was it one or two billion? A lot of venture capital money, hundreds of millions of dollars in venture capital funds that have essentially been lost. A very high-profile failure. It's still happening as this video is being made. This is mid-December of 2022. It will be something to follow, and to see what becomes of this. But it's a great example of the importance of cultivating ethics in a company environment and especially in a startup company environment. Allowing the ethical domain or orientation, if you will, to drive the business operations. That brings us to the end of video 1 of 7.