A free programme in twelve courses
The Spinoza MBA
Business administration rebuilt on the Ethics. Strategy, finance, marketing, risk, leadership and good faith, each derived from one idea: a business is a striving to persist, and it grows strong only through adequate ideas of its causes.
No tuition, no admissions, no alumni network. Twelve weeks, one course a week, each with a tool to use at work on Monday.
Why Spinoza
He was a merchant before he was a philosopher.
Baruch Spinoza ran his family’s import business in Amsterdam, then the centre of world trade, in the city where the Dutch East India Company had invented the modern corporation. War with England hurt the trade, the firm carried his father’s debts, and he went to court to be free of them. He spent the rest of his life grinding lenses and writing, in the form of Euclid, a rigorous account of what moves human beings.
That account is exactly what business schools leave out. They teach the rational actor, then spend their careers surprised by panics, bubbles, burnout, office politics and fraud. Spinoza starts where they end: people are moved by affects, every affect has causes, and power comes from understanding them. The rest of this programme is that idea applied, course by course.
The foundations
Four axioms for the whole course.
- Axiom I
A business is its striving.
“The endeavour, wherewith everything endeavours to persist in its own being, is nothing else but the actual essence of the thing in question.”
Know what your company actually strives to persist as. Everything else is decoration.
- Axiom II
Good means useful, certainly known.
“By good I mean that which we certainly know to be useful to us.”
Measure what increases power. Applause, rank and vanity metrics are not evidence.
- Axiom III
Utility is mutual.
“As every man seeks most that which is useful to him, so are men most useful one to another.”
The strongest deals, teams and markets are those in which every party is more able after.
- Axiom IV
Only a stronger affect moves an affect.
“An emotion can only be controlled or destroyed by another emotion contrary thereto, and with more power for controlling emotion.”
Memos do not change behaviour. Causes do. Build the conditions that produce the affect you need.
Two schools
What changes when you start from causes.
| Question | The usual MBA | The Spinoza MBA |
|---|---|---|
| Purpose of the firm | Maximise shareholder value | Increase the power of acting of the firm and of everyone it touches |
| Model of the person | A rational chooser who responds to incentives | A body and mind moved by forty-eight affects, every one of them caused |
| Strategy | Find a competitive advantage | Form adequate ideas of your own causes, then deepen them |
| Customers | Segments, funnels and demand | What joy does the product cause, and whose power does it increase? |
| Motivation | Carrots and sticks, which is to say hope and fear | Joy in the work, and understanding of why it matters |
| Risk | Forecast the future | Map the causes and size every bet for necessity |
| Failure | Find who is responsible | Find what caused it, and change the cause |
| Ethics | Compliance, a cost of doing business | Good faith, as a form of strength |
| Success | Status, the exit, the number | Blessedness is not the reward of virtue, but virtue itself |
The curriculum
Three terms, twelve courses.
Open a course for its thesis, the usual mistake, the principle in Spinoza’s words, a tool and a week’s exercise. Tick the exercise when you have done it; your progress stays in this browser.
Term one
Seeing clearly
What the business is, how you know anything, and what customers are really buying.
Term two
Building the engine
Capital, risk, operations and culture: the causes that keep a company alive.
Term three
Power among people
Leading, dealing, learning from failure and acting in good faith.
Term one · Seeing clearly
StrategyThe conatus of a firm
A company is not its mission statement. It is what it actually strives to persist as, and Spinoza says that striving is its essence. Strategy is knowing that essence and increasing its power of acting.
The usual mistake
Strategy as a wish list: vision decks written from the image of the company you would like admired, rather than from the causes that actually keep it alive.
The principle
“The endeavour, wherewith everything endeavours to persist in its own being, is nothing else but the actual essence of the thing in question.” E3p7
The tool: The conatus statement
- List what the business does that customers would pay for even if nobody praised it.
- List what it does only to be seen doing it. Spinoza calls that ambition: acting solely to please men.
- Name the few causes which, if removed, would end the company. That is its essence. Defend and deepen it first.
- Write one sentence: we persist by ___, for ___, because ___. Test it against last quarter’s calendar.
This week
Compare your conatus statement with how the leadership team spent its last twenty working hours. The gap between them is your real strategy problem.
Readings
Decision scienceThree kinds of knowing
Most bad decisions are not bad arithmetic. They are good arithmetic run on inadequate ideas: effects known without their causes. Spinoza’s own example of the three kinds of knowledge is a merchant’s sum.
The usual mistake
Treating a dashboard, an anecdote or a consensus as knowledge. Spinoza calls it knowledge of the first kind, opinion or imagination, and says falsity is exactly the privation of knowledge. Of the illusion of free choice: “men are mistaken in thinking themselves free; their opinion is made up of consciousness of their own actions, and ignorance of the causes by which they are conditioned.” E2p35 note
The principle
“Tradesmen without hesitation multiply the second by the third, and divide the product by the first”, from a rule received without proof, from trial on simple numbers, or from the proof in Euclid. Same answer, three kinds of knowing, and only the last survives when the numbers change. E2p40 note 2
The tool: The adequacy audit
- Write down every belief the decision rests on, one line each.
- Tag each one: heard (someone said it), seen (a few cases of your own), derived (you can state its cause), or known at a glance (long derivation turned into instinct).
- For every derived belief, ask: what would I expect to see if it were false? If you cannot say, it is not derived.
- Any heard or seen belief carrying real weight must be converted into a derived one, or hedged.
This week
Take your most important open decision to the Decision Clinic below and tag each belief behind it.
Readings
MarketingThe affect economy
Customers do not buy products. They buy an increase in their power of acting, which they feel as joy. Love, by Spinoza’s definition, is joy joined to the idea of its cause. A brand is that idea.
The usual mistake
Marketing that manufactures hope and fear: countdown timers, manufactured scarcity, insecurity for sale. It works, and it builds customers who are passive, resentful and gone the moment the fear lifts. “Emotions of hope and fear cannot be in themselves good.” E4p47
The principle
“Love is pleasure, accompanied by the idea of an external cause.” Definitions of the Emotions VI
The tool: The power map
- For your best customer, write two columns: what they could do before your product, and what they can do after.
- Every claim in your marketing should be a line from the right-hand column.
- List every tactic you run and mark the affect it runs on: joy, hope, fear, ambition or envy.
- Cap or cut what runs on fear and envy. They borrow against the relationship.
This week
Rewrite your homepage headline so it names the power the customer gains, not the fear they avoid.
Readings
PricingPrice reveals desire, not truth
We do not desire things because they are good; we call them good because we desire them. A price is a reading of desire, which makes pricing the most direct way to learn what your customer’s striving actually wants.
The usual mistake
Cost-plus pricing, which prices from your inside, and competitor-anchored pricing, which prices by imitation. Both ignore the only cause of willingness to pay: the power the customer expects to gain.
The principle
“we deem a thing to be good, because we strive for it, wish for it, long for it, or desire it.” E3p9 note
The tool: Value-anchored pricing
- Quantify the power gained: hours returned, revenue made, risk removed.
- Price at a fraction of it that leaves the buyer plainly better off. Utility is mutual or it is not utility.
- Test by asking customers, not by guessing in a meeting.
- Treat a request for a discount as information about an affect (fear of risk? envy of a cheaper peer?), not as an insult.
This week
Ask three customers what would have to be true for the product to be worth twice its price. Write the answers down verbatim.
Readings
Term two · Building the engine
FinanceCapital and the long horizon
Reason is affected equally by a good in the future and a good in the present. That is the whole theory of investment in one proposition, and it is why most of finance is a problem of affect, not arithmetic. E4p62
The usual mistake
Treating money as the goal. Spinoza noticed that “money has furnished us with a token for everything”, so the mind of the multitude can hardly conceive pleasure without it (Appendix to Part IV, XXVIII). Pursued past its use, avarice is among the passions that “are species of madness” E4p44 note
The principle
“We may, under the guidance of reason, seek a greater good in the future in preference to a lesser good in the present” E4p66
The tool: Three capital tests
- Self-funding. Can the business fund its own striving from operations? Dependence on outside capital is dependence on other people’s hope and fear.
- Equal time. For every allocation, imagine its payoff arriving today. If you would choose differently, the present is bribing you.
- Enough. Fix the measure of wealth to actual needs; “they who know the true use of money, and who fix the measure of wealth solely with regard to their actual needs, live content with little.” Surplus is capital for power, not for display.
This week
Write two numbers, enough cash for the company and enough for you, and one sentence on what the surplus is for.
Readings
RiskNecessity, not luck
Reason regards things as necessary, not contingent. Luck is the name we give to causes we have not mapped. Risk management is mapping them, and sizing every bet so that no single outcome can take your judgment. E2p44
The usual mistake
Forecasting as prophecy, and hope as a plan. Hope is an inconstant pleasure about a doubtful issue, and “there is no hope unmingled with fear, and no fear unmingled with hope.” Definitions of the Emotions XIII
The principle
“The free man is as courageous in timely retreat as in combat” E4p69 cor.. And the limit on every plan: “human power is extremely limited, and is infinitely surpassed by the power of external causes” (Appendix to Part IV, XXXII).
The tool: Sizing for necessity
- Write the premortem as a chain of causes, not a list of fears.
- Size every commitment so the worst case is survivable. No position should be existential.
- Write the retreat conditions before you begin, while reason is in charge. Retreat is courage too.
- When a loss comes, understand it as necessary, change the cause, and move.
This week
For your largest current commitment, write the one sentence that would make you stop, and name who holds you to it.
Readings
OperationsArrange the causes, not the willpower
Knowledge alone cannot check an emotion. So Spinoza’s own method is to arrange conditions in advance: frame fixed precepts, commit them to memory, apply them at once. That is the checklist, the runbook and the good default.
The usual mistake
Relying on heroic effort and good intentions. “A true knowledge of good and evil cannot check any emotion by virtue of being true, but only in so far as it is considered as an emotion.” E4p14
The principle
The best we can do is “to frame a system of right conduct, or fixed practical precepts, to commit it to memory” E5p10 note
The tool: Operations by design
- Find the three recurring moments where mistakes happen.
- For each, write the precept before the moment arrives: when this, do that.
- Change the environment so the right act is the easy act: defaults, templates, friction removed.
- Review the precepts each month against what actually went wrong.
This week
Write the runbook for your single most-repeated failure, and put it where the failure happens.
Readings
Organisational behaviourA company is an emotional regime
Every policy produces affects. A company is the sum of the affects its structures reliably produce, and those affects decide what people do far more than any memo.
The usual mistake
Management by fear. It gets compliance, never contribution. “He who is led by fear, and does good in order to escape evil, is not led by reason.” E4p63
The principle
“Desire arising from pleasure is, other conditions being equal, stronger than desire arising from pain.” E4p18
The tool: The emotional regime audit
- List the incentives, reviews, rituals and meetings people live inside.
- Name the affect each one reliably produces.
- Replace what runs on fear, envy and ambition with what produces joy in the work and self-approval.
- Run the Culture Ledger below, anonymously, each quarter.
This week
Run the Culture Ledger with your team. Share the result and one change you will make because of it.
Readings
Term three · Power among people
LeadershipFortitude: courage and highmindedness
Spinoza names the strength of an active mind fortitude and divides it in two: courage, the desire to preserve one’s own being by reason, and highmindedness, the desire to aid others by reason. A leader is someone in whom both are visible.
The usual mistake
Reactive leadership. Affects spread by imitation, so a leader who is ruled by a passion broadcasts it down the organisation. E3p27
The principle
“By highmindedness I mean the desire whereby every man endeavours, solely under the dictates of reason, to aid other men and to unite them to himself in friendship.” E3p59 note And the method: “An emotion, which is a passion, ceases to be a passion, as soon as we form a clear and distinct idea thereof.” E5p3
The tool: Before a hard conversation
- Name the affect you are in. Spinoza’s Mirror has all forty-eight.
- Find its cause: body, pressure, an old association, a story about someone’s freedom.
- Wait until it is an idea rather than a passion. Then speak.
- Answer hostility with highmindedness, not revenge. “He who chooses to avenge wrongs with hatred is assuredly wretched.” E4p46 note
This week
For one week, note each time you raised your voice or went silent in anger, and next to it write the cause.
Readings
NegotiationMutual utility
The best deal is not the largest share of a fixed pie. It is an arrangement in which both parties’ striving is stronger afterwards, because “As every man seeks most that which is useful to him, so are men most useful one to another.” E4p35 cor. 2
The usual mistake
Negotiation as combat, with a winner and a loser. The loser remembers, and the deal decays. Or its counterfeit: “The goodwill, which men who are led by blind desire have for one another, is generally a bargaining or enticement, rather than pure goodwill.” E4p71 note
The principle
On favours from people who do not understand you: “in declining favours, we must look to the requirements of utility and courtesy.” E4p70 note
The tool: The mutual utility map
- Write each party’s conatus: what must they persist in?
- List what each gains in power from the deal, in their terms.
- Find the terms that serve both, and propose those first.
- Set your walk-away from your own necessity, never from anger or fear.
This week
Before your next negotiation, write the other side’s conatus in their own words, and show it to someone who knows them.
Readings
AccountabilityThe blameless postmortem
We hate more what we imagine was free. Blame imagines a free cause and stops looking. Understanding treats the failure as necessary and keeps looking until the causes are found and changed.
The usual mistake
Postmortems run as trials. They produce repentance, and “he who repents of an action is doubly wretched or infirm.” E4p54 They also teach people to hide causes.
The principle
“Love or hatred towards a thing, which we conceive to be free, must, other conditions being similar, be greater than if it were felt towards a thing acting by necessity.” E3p49
The tool: The five rings
- Body. Fatigue, load, hours, hunger.
- Affect. Fear, haste, pride, the wish to be seen.
- Idea. What was believed, and from which kind of knowledge.
- World. Systems, incentives, tools, deadlines.
- History. The old decisions this one rested on. Change one cause in every ring you can reach. No names in the conclusions, only causes.
This week
Rerun your last real failure through the five rings. Notice what the first version of the story left out. “the pain arising from the loss of any good is mitigated, as soon as the man who has lost it perceives, that it could not by any means have been preserved.” E5p6 note
Readings
Business ethicsGood faith as strength
Good faith is not a rule imposed on business from outside. It follows from freedom: fraud needs another person’s inadequate idea, and a business that lives on its customers’ confusion has to keep them confused.
The usual mistake
Ethics as compliance, a cost of doing business. Or business run on hatred of a rival, a regulator or a class of customer. “Hatred can never be good.” E4p45
The principle
“The free man never acts fraudulently, but always in good faith.” E4p72 And law is not the enemy: “The man, who is guided by reason, is more free in a State, where he lives under a general system of law, than in solitude, where he is independent.” E4p73
The tool: The adequacy test
- Ask of any deal, price or policy: would this still work if the other party understood everything I understand?
- If yes, proceed with a clear conscience.
- If the profit depends on their confusion, fear or inattention, it is fraud or its near neighbour. Redesign it.
- Apply the test to your fine print first. That is where confusion is usually kept.
This week
Walk through your pricing page, contract and cancellation flow as a customer who understands everything. Fix what only works on confusion.
Readings
Instrument one
The Decision Clinic.
Seven questions about a decision you have not yet made. The clinic reads which kind of knowledge it rests on and which affect is steering it, then writes the prescriptions and a decision memo you can copy. Nothing leaves your browser.
Instrument two
The Culture Ledger.
How often does your organisation produce each of these in its people? The ledger balances the affects that increase power against the passions that decrease it, and names the first changes to make.
The capstone
Twelve precepts to commit to memory.
Spinoza’s own advice, since understanding arrives slowly and pressure arrives fast, is “to frame a system of right conduct, or fixed practical precepts, to commit it to memory” E5p10 note, so that the right idea is ready before the moment needs it.
- Know what you strive to persist as, and spend your hours there. E3p7
- Call good only what you know to be useful. E4 Def. 1
- Before acting on a belief, ask how you know it. E2p40
- Sell the power a customer gains, never the fear they feel. E4p47
- Judge a future good as though it were present. E4p62
- Size every bet so no outcome can take your judgment. Retreat is courage too. E4p69
- Arrange the causes. Do not rely on the will. E5p10
- Lead by joy. Fear buys compliance, never contribution. E4p63
- Name the affect before you act on it. E5p3
- Meet hostility with highmindedness. E4p46
- Look for causes, not culprits. E3p49
- Never profit from another’s confusion. E4p72
Commencement
There is no graduation.
You finish this programme the day your business acts from adequate ideas more often than from passions, and you start it again the next morning. The reward is not the exit or the number. “Blessedness is not the reward of virtue, but virtue itself” E5p42.
For the career half of the question, how to work inside someone else’s company while you build your own, read The Spinoza Career Guide and take the Asymmetric Life course. For markets, The Spinozan Trader. And keep the last line of the Ethics near your desk: “all things excellent are as difficult as they are rare.”
An educational programme, not an accredited degree, and not financial, legal or investment advice. Quotations are from the Elwes translation published in the site’s Ethics reader.