What I Learned about Wealth Management from the Grateful Dead

By: Philip "Flip" O'Toole

A Long Strange Trip

Two of my hobbies are watching documentaries about music and reading books about business. Recently they intersected in an incredible way. In the spring of 2020 during the throes of the Covid lockdown, I stumbled across a 6-part documentary on Amazon Prime titled “A Long Strange Trip, The Untold Story of the Grateful Dead”. I went into the documentary as a casual fan of the band and left a newly minted Deadhead. To my surprise, at the end of 2020 when I received my annual notification from Spotify detailing my listening preferences for the year, I learned that the Grateful Dead shot up to the #1 spot on my list, which they maintain to this day.

Shortly thereafter I learned there was a book written in 2011 titled “Everything I Know About Business I Learned from The Grateful Dead” by Barry Barnes. The book details ten innovative lessons that The Dead stumbled upon almost accidentally and in many ways were driven by their distrust of the music industry. In the interest of keeping this post digestible, I will not cover all ten (although I love them all). Instead, I will focus on a couple lessons that I believe will resonate most with our clients.

How the Dead Learned to Plan and Act at the Same Time

In our opinion, Wealth Management should arguably be the most highly customizable service one group of human beings can provide another. There are no two people, couples or families, that have the same priorities, goals, assets, liabilities, cash flow, expenses, savings, tax challenges, mindset or psyche. Shouldn’t the service provided be malleable and as differentiated as the clients they serve? We think so.

According to Barnes, “most rock bands play predetermined arrangements of their music and practice obsessively to deliver note-perfect versions of their songs”. The Grateful Dead however “prided themselves on never playing the same song the same way twice”. To do that they focused not on the notes in the music but on each other. While each member of the band was a master musician, what made The Grateful Dead truly unique was their ability to strategically improvise. Because they worked off each other so well, they could plan, act, and pivot in real time delivering a truly one-of-a-kind experience for their fans.

How The Dead Learned Do-it-yourself Business

To scale any business, or just to remove the most painful pebbles from your shoes, outsourcing certain functions is a must. However, there is a fine line between outsourcing tasks for which we have no talent or interest and outsourcing tasks that are most crucial to the success of our clients just to free up our time. For example, we outsource the custody of assets. We have no talent or desire to do so and there are many trusted organizations that will take that task off our plates at a fair price. By contrast, we would never outsource financial planning or asset allocation. Why not? Because we are the ones who interact with our clients daily and we know their stories better than anyone.

The Grateful Dead were ahead of their time. Some of the functions they brought in-house were a concert venue, a record company and a ticketing operation. In 1967, Jerry Garcia explained that “we’re trying to change the whole atmosphere of music, the business part of it by dealing with it on a more humanistic level”. Band employee Cameron Sears later added that “control in the creative process is how we maintain our integrity. The more people that come between us and the final delivery of our art, the more diluted it becomes”.

Ripple

“Ripple”, The Grateful Dead song that feels most relatable to Wealth Management was written in London in 1970 by The Dead’s great lyricist Robert Hunter. Like much of Hunter’s work, it is open to interpretation. The song is highlighted by the following lyrics…

“Ripple in still water

When there is no pebble tossed

Nor wind to blow

If you should stand then who’s to guide you?

If I knew the way I would take you home”

My interpretation is that regardless of one’s situation, sometimes storm clouds appear on the horizon without warning. When they do, who is your guide to help take you where you want to go? Our job is to be that guide.