Top 5 Movies to Learn About Business
A great way to spend your time while social distancing.
Steve Carell and Ryan Gosling in The Big Short
Do you want an entertaining way to learn a little more about what really happens in the business world? Well you are in luck. Here is our list of five of the best movies with which to do just that. The list included both documentaries and regular movies. The documentaries are so enthralling with such compelling characters that they feel like a real movie. And one of the movies almost feels like a documentary.
So even if you don’t have a lot of spare time because of the Covid shutdowns, even if you saw these movies already, you should find them online and watch them.
Startup.Com
Do you want to learn about the dotcom bubble at the end of the 90s and why there were so many startups bringing in so much capital? Then watch this movie. The 2001 documentary film directed by Jehane Noujaim and Chris Hedgedus was originally supposed to be an inside story of a startup success. The filmmakers wanted to document how a startup gets off the ground. Instead they found themselves in the middle of the dotcom bust.
This movie offers a textbook example of how not to start a business while showing, from the inside, how a bubble can cloud the judgement of people who should have known better.
It follows Kaleil Isaza Tuzman as he founded govWorks.com together with his friend Tom Herman. You follow the two as they continue to raise money for the startup; even though, they had not even gotten their software to work yet. Their whole idea was to offer a service which would people to pay anything government related from tax bills to parking tickets online. Even if the bubble had not burst before they could make an exit, their idea would have been mooted quickly as very and any business/government agency offered such a service on their websites soon thereafter.
The important thing to follow in this movie is people became so obsessed with raising funds and looking towards their big exit that they did not even bother to think things through. The duo behind the company should have had a working software in place first and not just an idea. They should have also had a real business plan in place, but throughout the film you see that they disagreed on what their company would offer.
See this movie as a “what not to do” guide for starting a new business. And also a way to better understand why debacles like the dotcom bubble can happen.
You can watch the entire movie on YouTube:
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Other People’s Money
This is a delightful little movie from 1991 staring Dant DeVito and directed by Norman Jewison. It also features Gregory Peck, Penelope Ann Miller and Piper Laurie. This is the movie that “Wall Street” pretended to be. It accurately depicts how the corporate raiders of the 1980’s operated and why they did what they did.
Danny DeVito in Other People’s Money
Unlike Michael Douglas’ Gordon Gecko, here Danny DeVito does not play a cartoonish villain. Lawrence Garfield is a man who has good reason for doing what he does. He finds public companies which are way undervalued; their market caps are much lower than the value of their total assets, usually due to mismanagement. . So he buys up their stock so he can take over the companies and then sell off their assets for a profit. He does not break up successful companies just to make a buck.
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Enron: The Smartest Guys in the Room
This documentary from Alex Gibney explains exactly what it was that Enron did. It was basically the company about nothing. Its entire business model was a fraud.
Enron’s executives found unbelievable ways to fake their company’s assets. This included creating holding companies owned by Enron which held nothing more than their own stock options. So the paper value of these options became a corporate asset which increased Enron’s total wealth. This in turn led to a higher stock price and so the options in question rose in value. Since the stock went up the Enron execs were rewarded with more stock options which they of course put into the holding companies. So the Enron assets went up again.
Even though there never were any real assets as the stock options only existed on paper, this cycle continued for some time. The bubble only burst when the execs so the writing on the wall and exercised their options and cashed out. Of course that then caused the company’s value to plummet and its stock to crash.
And this is just part of the story.
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The Big Short
Directed by Adam McKay and based on the bestselling book by Michael Lewis, this movie tells the story of what exactly caused the 2008 subprime mortgage debacle. It is based on the true story of people like Michael Burry and Steve Eisman who saw the crash coming. So they invested in credit default swaps against the collateralized debt obligations (CDOs) which were at the heart of the bubble. Credit default swaps are in effect insurance on investments. Somehow they were able to take out these insurance policies, in spite of not actually owning the investments which they insured.
And there is a whole lot more to the story. Think of this movie as a dramatized documentary.
Steve Carrel, Christian Bale, Ryan Gosling, Marisa Tomei ad Brad Pitt all appear.
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Generation Startup
The title says it all. Generation Startup captures the struggles and triumphs of six recent college graduates who put everything on the line to build startups in Detroit. Shot over 17 months, it’s an honest, in-the-trenches look at what it takes to launch a startup.
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Read more about: Enron: The Smartest Guys in the Room, Other People’s Money, Startup.Com, The Big Short
