5 Things the Medici can Teach Entrepreneurs
To grow a business empire, master this Medici formula.
In the 1400’s there was one family everyone was trying to keep up with, the House of Medici.
The Medici family had their hands in everything, wool, silk, alum— they were pretty much the main sponsor of a thing we now call the Renaissance, but personal banking was their main money maker.
There were other family banks in Italy at the time, so what made the Medici rise to the top to become Europe’s wealthiest family? They had a proven system built for success.
Here are some of their winning trademarks, and one warning that entrepreneurs should heed today.
1. They kept great company.
The Medici’s made friends and did business with Popes, royalty, military leaders, and people who lived lavish lifestyles. They knew how to work connections and use one connection to get to another.
Robert Greene, author of The 48 Laws of Power says, “There is only power and good fortune to be obtained by associating with the fortunate.”
The Medici understood branding before that was a thing. They built their social network into an international empire, eventually becoming the official bank of The Vatican. By making connections and constantly going after bigger fish, the Medici name became synonymous with wealth and power.
2. They didn’t reinvent the wheel, they just rolled better than everyone else.
Unlike many of the inventors and artists they nurtured, The Medici weren’t constant innovators. What they were great at was spotting an advancement and taking full advantage of it.
When Italians started using bills of exchange, and double-entry accounting, the Medici’s adopted it too, but on a much bigger scale than everyone else.
As other Italian banks started using the branch system, the Medici’s followed and opened more branches than the Bardi’s and Peruzzi’s before them.
3. They knew their way around rules that inhibited profits.
The Roman catholic church was strictly against usury, and prohibited the charging of interest. So the Medici’s would lend to people outside of the churches command, or even craftier still — lend in one currency and collect in another, thereby setting the rate of exchange to include interest.
Any rebel can buck the system. It takes a strategist to do it while keeping both sides happy.
4. They invested their profits in people.
The Medici family sponsored and fostered all the popular Renaissance painters (think ninja turtle names). In addition to financially supporting some of the greatest artists and thinkers of theirs or any day, they also used their political clout to ensure laws favored artists, philosophers, and scientists.
It’s estimated that half of Florence’s citizens were at one time employed by Medici banks or franchises. By putting wealth back into Florence citizen’s pockets, they made their city and country better while increasing their footprint in the community.
5. WARNING: They let ego be their downfall.
After the Medici family was in power for over a century, they got a little weird. Medici seniors started commissioning portraits of themselves not as bankers, but as priestly Magi. They also wasted precious time and resources chasing titles and political offices that invited enemies to conspire against them.
Not content to have just a financial dynasty, Medici men married for blood as they joined with European royalty to become dukes — even while their banking empire was crumbling all around them.
If you want to be a modern-day Medici: rub shoulders with the greats, find ways to use new tech better, know when and how to bend the rules, and invest in people while keeping your ego in check.
