Sourcing, underwriting and constructing a portfolio of investments that produce attractive investor returns is tough and sloppy work. That is why I liked this quote from Michael Mauboussin on putting process around investing.
“We have no control over outcomes, but we can control the process. Of course, outcomes matter, but by focusing our attention on process, we maximize our chances of good outcomes.” — Michael J. Mauboussin
I recently came across the below life tips from Byron R. Wien, Vice Chairman, Multi-Asset Investing, at Blackstone. Good reminders to keep life heading in the right direction!
1. Concentrate on finding a big idea that will make an impact on the people you want to influence. The Ten Surprises, which I started doing in 1986, has been a defining product. People all over the world are aware of it and identify me with it. What they seem to like about it is that I put myself at risk by going on record with these events which I believe are probable and hold myself accountable at year-end. If you want to be successful and live a long, stimulating life, keep yourself at risk intellectually all the time.
2. Network intensely. Luck plays a big role in life, and there is no better way to increase your luck than by knowing as many people as possible. Nurture your network by (more…)
“We don’t buy and sell stocks based upon what other people think the stock market is going to do, (I never have an opinion) but rather upon what we think the company is going to do. The course of the stock market will determine to a great degree, when we will be right, but the accuracy of our analysis of the company will largely determine whether we will be right. Who would think of buying or selling a private business because of someone’s guess on the stock market?” -Warren Buffett
My dad recently sent me this quote. I like it because it helps keep short-term commentary from affecting long-term analysis and opinion, the true focus of investing (in my opinion). Through the SIF, I have had the chance to hear similar thoughts on investing from people such as Dave Iben at Tradewinds; he doesn’t want to hear anything unless it will be meaningful in five years. It’s nice to hear that others try to ignore CNBC and the like, too.
I didn’t fully appreciate how much I admired Steve Jobs until he passed away yesterday. This man lived life and revolutionized three industries: Computers, music and cell phones. Steve was impressive and inspiring not just because of his accomplishments, but also because of his perspectives. I thought it would be nice to share two of Steve’s quotes that I find particularly salient and timeless to commemorate his passing.
“You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.” (more…)
Here is a speech by Steve Blank, a professor at Stanford and Berkeley, and a thought leader in the start-up community. Blank’s talk is from the Staford Graduate School of Business Entrepreneurship Week. Below is a great quote; maybe I like it so much because it helps me cope with the one-size-fits-all solutions that I’m hearing over and over at business school…
“Everything you learn in the business school about large company management is destructive for an early-stage venture. Big idea. It’s not kind of useful, or geez I’ll just change it. What you’ll hear later and I’ll explain why, it’s desctructive. Good news is, in the entrepreneurial group at GSB, we teach the right things about early-stage ventures. But they are not interchangeable. And you’ll hear me say this throughout this talk: Large corporations execute existing business models, start-ups search for them. The tools needed, techniques needed, and people needed for execution versus search is what we now know to be radically different.“
When one of the younger partners in the firm started, Don took him aside and drew a four square quadrant. Along one axis, he put “easy to get along with” on one end and “hard to get along with” on the other end. One the other axis, he put “normal” on one end and “brilliant” on the other end.
He then said, “sometimes we make money with brilliant people who are easy to get along with, most often we make money with brilliant people who are hard to get along with, but we rarely make money with normal people who are easy to get along with.”
Some classmates and I had the chance to sit down with Marshall Heinberg, the head of Oppenheimer’s investment banking practice, for an overview of his firm and an outlook on the investment banking industry. Mr. Heinberg’s insights were unique and bold; below are three general takeaways from our conversation.
If you’re an MBA student looking to get into banking, he suggested that you consider industry versus product roles carefully. He recommends finding a career that will provide you with a depth of non-commoditized intellectual knowledge. I took this to mean select industry coverage over product investment banking, as industry coverage gives you the chance to develop a deep knowledge base of a particular industry, which brings me to the next great insight… (more…)
I came across a great quote from Howard Marks, the Chairman of Oaktree Capital Management. In his memo titled Tell Me I’m Wrong, he states, “As I see it, every investor is either predominantly a worrier or predominantly a dreamer.”
I love this quote because it succinctly sums up the personality trait differences and the job function differences of debt versus equity holders. Which one are you?