The Exchanges

Q What keeps you going? I mean, you could just fold up, walk away, live an amazing life, you and generations of your, your heirs. What keeps you sort of pushing through this, confronting this dragon?

A I do think that I get a level of enjoyment from it. You know, this idea of like, uh, you know, can I beat it? I like how I feel When I'm more connected to the things that make me happy. I like how I feel when I think like, when I think that I am doing things that the younger version of me would be proud of. Not the older version. It's interesting. Like a lot of people think like, you know, like at your deathbed. And, uh, I think the exact opposite. I think like, you know, with the 22 year old self, you know, interacting with this person, you know, with the 16 year old person. Like think, wow, that guy is, uh, that's a legit human being. Like he's, you know, he's putting himself out there trying. So I'm motivated to keep kind of grinding and getting better. Just seeing what the upper bound is.

AI assessment note: “I do think that I get a level of enjoyment from it.”

Q You said successful investing is about behavior and psychology. Can you expand on that?

A I think that, um, When push comes to shove, what you're always going to be fighting is yourself. Panicking, overreacting, underreacting, refusing to observe the present, living too much in the past, wanting too much to believe in the future. So it's all psychological traps, um, because the data is there if you want to observe, and then just clinically re-underwriting how it sits You know, as, as part of your risk equation, you know, which bucket does it sit in? How big is that little bet inside the bucket? And so I've tried to really understand how to create an edge. And I don't think an edge comes from, you know, attending conferences or, you know, writing some crazy algorithmic software. Maybe a few people can do those things and find an edge, but what is a more kind of like mainstream accessible idea? And I think it is that if you define certain behavioral principles that protect you from the worst parts of your psychology, that's a winning strategy. Um, and so, you know, I have like a handful of these rules that I try to live by and they, these behavioral rules around, you know, trying to think about things like buying companies versus buying stocks that trying to think about You know, the quality of the CEO, the quality of the business, trying to think in long duration, not looking at the stock price every day, you know, reading annual reports, avoiding quarterly reports, …

AI assessment note: “if you define certain behavioral principles that protect you from the worst parts of your psychology”

Q Or chin check me, like, am I completely wrong?

A Um, I think in part, it's not totally true what you're saying. Um, meaning like, you know, if you look at sort of the EU budget, um, an enormous percentage of that budget is going to, um, you know, a carbon neutral EU by, you know, Frankly, not even 2050. They're trying to pull it forward and do it 2040 in some industries, you know, 2030. So I think the spending is actually going, uh, in, in reasonable places. I think that there are, there's always waste. And the reason is that, you know, politics and political bodies don't know enough to write specific legislation. So they get influenced by all kinds of folks. And so that's what creates waste. And so you have to be okay with that. It's just the natural dynamic of democracies. And, you know, the waste, we, we, we deal with the waste because in return, we get freedom, you know, a different kind of freedom, right? Right. I mean, like, you know, maybe you can have the most, you know, efficient thing in country in the world, but if it's autocratic, you may not want that.

AI assessment note: “I think in part, it's not totally true what you're saying.”

Q these correct automatic behaviors that put you on the path to success by either addressing your blind spots or sort of like showing you more. Are there, are there sort of like personal rules that you have as well? Or they're like, let's, let's go deep on that. Like, what do you do to overcome your blind spots in all areas of your life? Not just investing, but personally too.

A I talk. And, um, again, I go back to the same thing. I just, I just talk. I, and then when I feel, when I find that I revert into a comfort zone where I'm repeating past behaviors that I don't like, it's because I've stopped talking to Nat, to a couple of friends that I rely on, to, you know, two therapists that I talk to on a regular basis. It's all about my mental health. Um, the healthier I am mentally, the more I'm able to To overcome these natural inclinations to revert to comfortable patterns that have been very well-established and well-worn. They're not healthy, but they're just habits. You know, by talking, what happens is people who know me, they develop a pattern recognition, and then they start to tell me, hey, you're being really insecure there. Hey, why are you, you know, talking in that way or talking about this thing? And now what I can do before I would get very defensive and insecure, and I would attack the person when they would say that. So it also needs people who really deeply at the end of the day, love you and care, care about you. And that's hard to find. I mean, it's not like those, those folks really grow on trees. I have two people, Nat, my friend Rob, and I really talk to them a lot. Um, and then I have two therapists and I talk to them, um, weekly. Um, and so that's really helpful. So yeah, it's just pattern. It's just their pattern recognition. Yo…

AI assessment note: “by talking, what happens is people who know me, they develop a pattern recognition”

Q Can we double click on that for a second? I mean, you've got an interesting background, right? You worked at AOL. You went to Facebook. You were a billionaire at 32. You're on a sports team. From the outside looking in, you had the most amazing life, but on the inside looking out, you didn't feel that way.

A Yeah. I think a lot of people have To do things that are motivated by other people's perceptions of them, and also motivated by the pressure that's exerted by the people that are very closely around you, that sometimes can be your friends, it can be your family, and I was very much of that category, so I was kind of just You know, meandering through life. Now, that meandering turned out to have really good outcomes in some respects. The problem was that all it was doing was just sort of like, you know, avoiding the inevitable, and the inevitable is this moment that I think everybody goes through where they're asking themselves whether they've lived a completely fulfilling life the way that they defined it. You know, what I'll say, Shane, is that I think that sort of, not even necessarily millennials, but, you know, Zoomers underneath them, They're the most honest of any generation about what makes them happy, and you see that in, you know, the way that they dress, the music that they listen to, the media that they consume, the way that they, you know, sort of like push back on kind of like a more corporate kind of, you know, tone and things, and they're willing to be happy in a way that they've defined for themselves. In my generation, I'm 44. That's not how it goes down. The way that it goes down is you go to the best school you can. You take on as much debt as you need to. Yo…

AI assessment note: “motivated by other people's perceptions of them... I was very much of that category”

Q So it sounds like part of your process is to go through this and figure out what's not changing. And try to allocate there. Do you also look at what do you, where you see massive change and how you could possibly take advantage of that? Or is that a category you just don't evaluate?

A Not, not in that language. I, I kind of tend to think about things that are just, will they be more important? Um, and if they're going to be more important, how can we accelerate the right outcomes? I think climate change is a really good example of that, where it doesn't matter whether you believe in climate change or not. I think that what we know to be true, we don't like, which is that, you know, the places we used to ski at, we can't ski at anymore. The places we used to go and bathe on the beach may disappear and not exist, and so, if nothing else, just because of our own selfish desire to be happy, we should probably want to better control, at least to the extent that we can, our impact on, you know, taking our own happiness away. So, you know, I don't think people in the Midwest want, you know, hurricane season, and if there are experiments that we can run, Where we can observe whether they help, we should run them. And so, you know, if you have all these gigatons of carbon being emitted, and you can run an experiment that takes them out, we should probably do it. And we'll know conclusively whether, you know, it, it'll change hurricane season. So why not just run the experiment in an unemotional detached way? But like, you know, if you view climate change in that lens, it's a multi decade, multi deca trillion dollar opportunity. The, the world's first trillionaire wil…

AI assessment note: “Not, not in that language. I, I kind of tend to think about things”

Q Oh, talk to me about that. How do you measure the difference between good and like getting better for yourself?

A We all like asymptote at some, at some trajectory. And I think that I am now one to one and a half orders of magnitude away from my asymptote. So you can kind of see it. But it's very faint. Now I think I have a toolkit to implement a process that can get me close to my asymptote. And I would love for me to be able to talk to you in 40 years. I'll be 84 and say, I'm like within a couple of terms of the asymptote. So for me, it's, it's believing in myself more. It's knowing how to take smarter risk, being risk on in larger quantum. So I can write You know, hundred, multi-hundred million dollar checks now and feel okay about it. I need to be able to do that with 1,000,000,010 of billions, and this sounds crazy, but Five or six people in the world really know how to do that. Well, it's not, it's not a shot that a lot of people get a chance to take, you know, even if you're running like, you know, the largest private equity fund in the world, the quantums of money that people are investing that is, that is of their own is still relatively limited and small. Um, even if the, you know, the headline numbers are big. So I want to learn to do that. I want to learn to feel like less of an imposter. The more I do that, I think the smarter I can get at distilling and observing the present, acting on that, And then passing that through to other people so that they can act on it too. And so,…

AI assessment note: “So for me, it's, it's believing in myself more. It's knowing how to take smarter risk”

Q What, what, what is your decision process for when you're making a capital allocation decision? I know you've made a few recently, like, without any specific names, so I don't want to get anybody in trouble, but what's that process in your head like? Like, how are you actually, what, what's, what are you talking to yourself about mentally to make sure? Because it's all on you.

A Yeah, I, uh, I, I really, I really love it. Like, you know, we do a lot of work. Like, I mean, I have great partners. I have a team that I work with who are just exceptional people. They are the most high integrity people I've ever worked with, and they give me enormous energy. I have, uh, some, some, you know, folks that I've partnered up with, um, who have their own organizations as well. Those folks are super high integrity. And so all these people that I spend my day with every day are just kind people. Good, earnest people. Each of us, I don't think are the smartest ones, but when we put ourselves together, we are really, really smart collectively. And that's, that's awesome. And so we all do different things and everybody's bringing different things to the table. And then what happens, it allows me to kind of synthesize all kinds of different inputs and learnings and You know, variations on a model, regulatory research, market research, you know, consumer marketing research, all of this stuff, and learn about it, which is super fun. And in my mind, what's happening is basically like, Here's how this can go right. Here's how this can go wrong. Here's how this can go right. Here's how this can go wrong. And I'm bouncing back and forth. And all of these things are just oscillating. And if I had to characterize it, this is going to sound nuts, but it's like a, and then that o…

AI assessment note: “Here's how this can go right. Here's how this can go wrong.”

Q What do you tell yourself in those moments?

A First of all, I talked to my partner. She has been my spiritual partner, my kind of like co-pilot, because she really has an enormous level of empathy and care around her own mental health and, you know, uh, the mental health of our family. So we talk a lot, you know, and we talk about nonsense and serious things and everything in between, but we just talk. And Uh, I found that as a man, I was taught that talking is weak. Uh, I also found that as a immigrant man, I was taught that talking about emotions was doubly weak, and then I was, you know, sort of taught as kind of You know, like in this industry that, um, you know, talking is awkward. You put all these things together and, you know, the biggest thing that I found that has helped me is just talking and being open. And it starts with her. My kids, I'm really open and, you know, transparent with my kids. They think I'm a, you know, basically a fucking loser. Uh, I think that that's really cool. Um, You know, they, they just, they just roll their eyes every time I start talking because it's like some stupid diatribe, but all of these things help me stay really connected to the goal of being truthful. That helps me stay connected to the goal of being happy to celebrate these oh wow kind of moments in my life. That helps me. But to be honest with you, that has to be an active process for me because the, that thing that you jus…

AI assessment note: “the biggest thing that I found that has helped me is just talking and being open”

Q Yeah, no, I thought that was, that was excellent. Do you think government should bail out public companies? Industries? Which ones?

A I think that the government should really be plowing money into the next generation of industries. And I think that the government should always be on the bleeding edge of not needing to make money. In, in some critical, important industries for the future. And so in the absence of doing that, we've lost touch with the things that have really propelled the United States forward. For example, you know, why was the space race so important? Um, you know, on the one hand, it was about, you know, American determinism, right? Like we are going to do this, this is going to happen, but it was also that it created an entire generation of industries that were derivative from the space industry. Because you were training people with a level of skill and precision and capability that they could then apply to other markets. So we always need to be in space. You know, we always need to be pushing the boundaries. You know, we need to go, you know, not just to the moon, but now to Mars and beyond. Um, it can't just be Elon's task. That's not fair. You know, you put him against the wall and he's got to raise an enormous amount of capital that, you know, if, if we had government sponsorship for it, Uh, we could have, we could have done a lot more sooner. In many ways, you know, that this deflationary super cycle really started in 1970 when we basically ended the space program in the early versio…

AI assessment note: “government should really be plowing money into the next generation of industries”

Q They're going to go crazy when I don't ask you who you predict will win. But what I really want to know is how do you take that? And then what do you do with that in the future? You said it. Okay. Well, This is going to be a predictable path of spending. How do you as an investor then take that knowledge

A Fabulous question. So this goes back to what I'm trying to do, which is if I can observe the present in a reasonably unemotional and detached way, to your point, I can put a plan together. And when I have a plan, you know, that plan is specifically for me oriented around how I'm going to make sure that the ideas that I want to see exist in the world win. And this is going to sound Maybe turn people off the way I say, but at my level of capital, that's what I can do. I can vote with my dollars to really make things come to life. And I think that that, um, I really take that job seriously. And I, and I, and I aim to do that now, which is like, okay, I'm learning how to be happy. You know, I, I've achieved a level of freedom, but now it's about change. And I want to implement my form of change. And I want to see that in the world. So I'm trying to figure out how my ideas have a better chance of succeeding. And then I want to make sure that I implement a plan to make that happen. And then that adds to my knowledge base. And then my hope is to share that with other people so that they can then learn from that as they will. And maybe they can, they can also do their version of the, of the same thing. So, you know, if I was really, I was six years old in 1980, no, four years old in 1980, but imagine I was 34 years old or 44 years old. I would have woken up and I would have said, read …

AI assessment note: “I can vote with my dollars to really make things come to life.”