”To have “skin in the game” is to have incurred risk (monetary or otherwise) by being involved in achieving a goal. In the phrase, “skin” refers to an investment (literal or figurative), and “game” is the metaphor for actions on the field of play under discussion. The aphorism is particularly common in business, finance, and gambling, and is also used in politics… It has commonly been attributed to Warren Buffett, referring to his own investment in his initial fund…
In business and finance: The term is used to ask or convey an owner(s) or principals undefined but significant equity stake in an investment vehicle where outside investors are solicited to invest. The theory is that principal’s equity contribution is directly related to the stability of the investment and confidence that management has in the venture and is also (falsely) strongly correlated to the expected yield of the investment…”
Well-known author Nassim Nicholas Taleb has issued a book in 2018 with the title “Skin in the game: hidden asymmetries in daily life”. On the Wise Words Blog there is great summary:
”…It is not just that skin in the game is necessary for fairness, commercial efficiency, and risk management: skin in the game is necessary to understand the world.
Skin in the Game is about the distortions of symmetry and reciprocity in life: If you have the rewards, you must also get some of the risks, not let others pay the price of your mistakes. If you inflict risk on others, and they are harmed, you need to pay some price for it.
Do not mistake skin in the game as just an incentive problem or just having a share of the benefits (as it is commonly understood in finance). No. It is about symmetry, more like having a share of the harm, paying a penalty if something goes wrong.
Skin in the game, applied as a rule, reduces the effects of the following divergences that grew with civilization: those between action and cheap talk, consequence and intention, practice and theory, honor and reputation, expertise and charlatanism, concrete and abstract, ethical and legal, genuine and cosmetic, merchant and bureaucrat, entrepreneur and chief executive, strength and display….”
We are strong believers in behavioral economics. This is a field of study that examines psychological, social, and emotional factors that influence economic decisions of individuals and institutions.
We want this Financial Advisory and Participation firm to operate under the principles of skin in the game, as a true partner of our customers at eye level, sharing risks of our recommendations.
We do this fulfilling our mission (support small cap companies and startups with consulting and funding) and following our values (be agile, genuine and cognizant) to achieve our vision that skininthegame is immediately associated with ideal support for healthy growth of small cap companies and startups.
AND WHY DID WE CHOOSE AN ELEPHANT FOR THE COMPANY LOGO?
As a child we are immediately impressed by the elephant the first time we enter a zoo. The positive connotations are confirmed over a lifetime, as we read more and see documentaries about elephants:
It is big, courageous, confronts issues
It is smart, has good memory, learning capabilities
It is sensitive, emotional, likes to socialize
It is a loyal companion of mankind, hard worker
… and it has a lot of skin!
=> These are virtues that our company stands for!
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