Much has been written about how to start a venture firm, how to raise money from LPs, how to build one’s product and reputation and how to invest. Precious little has been written about how to return value to LPs and the venture firm/CEO dynamics associated with this process. This is one of those areas that while there isn’t a “right” answer, I believe the question subjects itself to a rigorous thought process and decision trees that are well-articulated and robustly debated. I recently shared some thoughts on the topic.

And I later added some more nuanced observations on the possibility of CEO/firm misalignment. …

It has taken some time for me to get used to Major League Baseball circa 2020. I’ve seen dozens of games cancelled hours before the first pitch, loads of (utterly predictable) injuries decimate teams and empty stadiums with piped in sounds that seem almost dystopian relative to our previous non-pandemic world. That all said, I’ve also witnessed some beautiful and unexpected things that have arisen from this odd, stilted season thus far. 7-inning games with loads of doubleheaders has added rapid fire action and strategic nuance like never before. Amazing performances from players who would still be deep on the bench or in the minors if not for illness or injuries that have showcased the game’s bright young talent. And I’ve seen a level of camaraderie, humanity and team unity that has risen above in the face of extremely challenging conditions both on the field and outside the game. …

Just minutes ago the MLB Players Association (PA)just voted down the owner’s last offer to resurrect the already tortured 2020 season. This will predictably lead to the MLB imposing a shortened schedule, some players opting out of playing at all, the PA filing a grievance against the league and the upcoming free agent class getting mauled. We’ve reached the point where there is nary an intersection in the Venn Diagram of each party’s requirements, with the likely result being a shotgun marriage of two reluctant participants merely adhering to the words of a contract. As a negotiator, this is absolutely the last place you want to end up: in my business life I’ve come to call this region the “inefficient frontier”. Neither party wins; both parties lose. And as is the case with so many negotiations, better, more trusting, more open-minded parties could have changed both dynamics and outcomes given identical facts resulting in a mutually beneficial, fair agreement that leaves neither side feeling burned. But this simply was not possible because the structure of the game is broken, and has come to resemble the game in the of the 1960s and early 1970s. This was, in John Helyar parlance, when the Lords of the Realm (the owners) ran the game as if it was their own personal money machine without much regard for those actually creating value for the game (read: the players) or the people who paid the bills (the fans). Players were property; transparency was a no-no; and spreading access to the game was not a priority. It was all about monetization. …

I love baseball and have my entire life. Baseball has played a massive role in my family culture and in our community through having raised two accomplished baseball players, coaching our sons’ Little League teams for years and through leadership in and evangelism for the sport. Professionally I’ve had nothing to do with baseball: the first half of my career was spent in trading and senior management on Wall Street, while for the past 15 years I’ve been investing in and enabling brilliant founders to build ethical, impactful, fast-growing technology companies. These businesses now employ many thousands of people globally and provide good pay, good benefits and cultures that are designed to align the interests of founders, investors, employees and customers. In short, I know what successful business leadership looks like. I am also a person who understands corporate finance and statistics, so funny stuff with numbers doesn’t fool me. It is with this deep passion for baseball and my three decades of business building that I can say this: MLB’s leadership is ruining the game of baseball to the point where the game faces existential risk, notwithstanding a current league enterprise value of over $50 billion. Companies routinely lose billions in value as technologies change, customer preferences shift and business models disrupt legacy approaches. This is what I fear is happening to America’s Game, and league leadership’s ruthlessness, greed, myopia and mismanagement are largely to blame for the current impasse with the Major League Baseball Players Association (MLBPA). …

Quite simply, the decision as to whether or not there will be Major League Baseball in 2020 turns on the following facts:

Fact 1: Games paid (for) is a function of games played. This means prorated salaries. Players have contracts and are creditors. Owners own teams and enjoy the risks and rewards of the equity. The obligation is clear: the owners owe prorated salaries to the players.

Fact 2: Owners care less about regular season games than the playoffs for monetary reasons. This is why they’re happy offering proration on a 50 game season because of the value of playoffs, especially if they’re extended. By offering straight proration for 50 games isn’t a “give” on the owners part — it’s merely a way to save 32 games worth of money (by playing without fans and the associated revenues) and juicing their per game yield once the playoffs are taken into account. …

If the MLB owners hadn’t gotten rich in whatever field enabled them to buy a baseball team, they could all start their own PR firms — or be politicians. Reading the cries of poverty by multi-billionaire owners around short-term cash flow issues leaves me cold. But somehow, some way, they get mainstream media to go along with the notion that pandemic-induced cash flow problems are the players’ problem, and that the players have to be the ones to bridge a large share of the cash flow gap suffered by the clubs in 2020. So, in rough times, you effectively ask your creditors (read: players) to restructure their debt to help cushion your pain. Oh, and you use the court of public opinion to put pressure on your creditors to restructure or else they’re “greedy” or “ungrateful”. Conversely, in good times, you simply pay your creditors what you owe them and give them -0- of the upside associated with the rising tide. Tails, you lose. Heads, I win! …

Since the MLBPA does such a poor job communicating the nature of the players’ relationship with the MLB to the pubic, let me take a crack at it. As mentioned in my first article on the current conflict, the players almost always lose to the owners in the court of public opinion, substantially hampering their negotiating position. Why?

• Most baseball fans don’t understand the restrictive nature of the Uniform Player’s Contract, as well as the terms in the Collective Bargaining Agreement dealing with issues of service time (remember Kris Bryant?) …

Let me start by saying that I don’t know Tony Clark. I enjoyed watching him play ball and have heard he’s a really good guy. But what I do know is that the MLBPA, as a tactical matter, has been on a slippery slope for quite some time and it’s only getting worse. It’s easy to get caught up in the emotions of what’s going on between the owners and the players: I mean, who doesn’t wan’t (read: NEED) the beautiful game of baseball to be played safely and in short order. But what I want or need isn’t really at issue, and what I believe to be “fair” or “right” isn’t, either. …