Do entrepreneurs need to do illegal things and break the law? When is breaking the law justified?

More of a political answer than anything to be honest.

Laws are created by politicians, politicians make their decisions based on lobbyists & public opinion. Lobbyists and public opinion can both be bought. One person only has one vote, a company can persuade millions of votes. Imagine what would happen if Facebook (or Reddit) put a tiny icon that say "Vote ________ for president", how many people that would influence to vote.

Businesses are what influence & create laws in the end. Even your personal opinions come from businesses. Is it something you read in a book? Author makes money, textbook makes money. Read it on the internet? The website makes money. Learned it in school? University makes money, professor makes money.

A business that is breaking a law is really just fighting the status quo of the established businesses, which might be why often new businesses think or might assume they need to do something illegal to get ahead. While established businesses such as Comcast or Facebook can break laws and it be "legal" (because they do it in the right way of course).

But no, entrepreneurs don't need to do illegal things and break the law. Pick a business model, any business model, and then do it better.

Honore de Balzac said that "Behind every great fortune lies a great crime". And you can extend your list above to include Bill Gates of Microsoft and Steve Jobs of Apple and many others. However, there are also many great companies that have been created without having to resort to doing anything illegal. And there are also lots of people who tried to break the law and got caught. My advice to you is that it's always easier (and safer) to work legally within the system, than to try to fight it. So look for an idea that you can implement that doesn't require breaking the law, and look very skeptically at one that requires you to potentially break it.

It is not usually a question of breaking a law or not. It is usually a question of the interpretation of the law. This can be both a challenge and an opportunity.

You also have to look at what you have to lose. If it is a law involving moral or social issues you may lose more than money or things of monetary value.

Lastly, in all decisions you have to weigh the potential loss vs the potential gain. If for example, you are in a position to gain large amounts of fame, advertising, or even money and the most you can lose is a little money or a little embarrassment you may be more inclined to "break the law."

If you try to obtain documents from a large company in a court battle, the big company may withhold the documents until they are in contempt of court. Why? Well, in a recent NYC case the company which withheld the documents was only fined $500. The company's lawyers knew that they could delay the case and aggravate the plaintiff and it would only cost them $500 to do it.

Then there is breaking the law for social change. Of course we all know about social injustice and the price people have paid to correct it.

I hope this helps. In any case make sure that your means is justified by your end founded on good moral footing and don't be deliberately stupid.
Michael T. Irvin
www.michaelirvin.net

I ask my clients to focus on the sustainability of their actions, whether within the formal sphere (following or breaking the law) or informal sphere (relationships and social norms). Unsustainable practices lead to unsustainable business models.