I Asked a $15BN Investor for Life Advice

Summary

In this insightful discussion, Graham Duncan shares his journey to building a successful private equity firm, emphasizing the importance of persistence, identifying and nurturing talent, and the power of daily habits. He stresses that success is built on a foundation of small, consistent efforts rather than overnight achievements. Duncan also highlights the significance of setting clear goals, overcoming limiting beliefs, and finding flow in one's work to achieve true happiness and fulfillment. His advice challenges the notion of instant gratification, advocating for a long-term perspective and a deep understanding of one's desires to build a meaningful career.

Takeaways

• 😀 Building wealth and success is a marathon, not a sprint; it takes consistent effort over a long period, often a decade or more.
• 💪 The importance of habits in achieving success cannot be overstated; small daily habits compound over time to create significant results.
• 🚀 Don't expect overnight success; instead, focus on the daily work and embrace the journey with patience and persistence.
• 💡 Success often comes from doing the 'boring' things well, such as diligently managing a simple business like a car wash and scaling it up.
• 🔍 In business, look for opportunities where others aren't, such as in unsexy industries, to find potential for growth and differentiation.
• 📈 Private equity can be a path to wealth creation by identifying undervalued businesses, acquiring them with leverage, and improving their operations.
• 🤓 Learning from failure is crucial; many successful people have lost money in early deals but learned valuable lessons that contributed to later success.
• 💼 The value of experience and attributes in hiring; focusing on hiring 'A' players with the right attributes can be more important than specific experience.
• 🛑 Recognize and write down limiting beliefs to transform them from abstract fears into actionable items that can be addressed and overcome.
• 🏋️‍♂️ The concept of 'flow' is essential for finding happiness and success; being fully present and engaged in the task at hand leads to enjoyment and peak performance.
• 🛤️ Embrace the journey of life as an adventure; rather than seeking instant gratification, find joy in the process and the pursuit of one's goals.

Q & A

What is the key takeaway from the interviewee's experience in his first eight business deals?

The key takeaway is the importance of persistence and learning from mistakes, as the interviewee lost money on five of his first eight deals but learned valuable lessons from those experiences.

What does the interviewee suggest as the foundation for building a successful career or business?

The interviewee suggests that the foundation for success is the development of good habits, such as working out daily, sleeping well, writing down goals, and consistently working towards them.

What is the common misconception about success that the interviewee addresses?

The common misconception is that success comes from big, sweeping moves or a single life-changing event. The interviewee emphasizes that success is actually the result of consistent, small habits and daily efforts.

How does the interviewee define 'flow' and why is it important for happiness and success?

Flow is defined as being completely present in the moment and fully engaged in whatever activity one is doing. It is important for happiness and success because it aligns one's life with their goals and allows for enjoyment and fulfillment in the journey, not just the destination.

What advice does the interviewee give for dealing with the feeling of being stuck in life or career?

The advice given is to take action first before waiting for motivation. Start with small habits that move you towards your goal, such as writing down three things you could do each day to move towards your desired career or life change.

What is the interviewee's perspective on the importance of setting goals?

Setting goals is crucial because it helps to direct the subconscious mind towards a specific destination. This focus helps to manifest one's desires and aligns energy and effort towards achieving those goals.

How does the interviewee describe the process of identifying and hiring A+ players in a company?

The interviewee describes a structured interview process that focuses on identifying attributes such as persistence, drive, and the will to win, rather than just experience. The process aims to discern if candidates are A+ players who can significantly impact the company's success.

What is the interviewee's view on the role of an executive coach and its impact on personal growth?

The interviewee views an executive coach as instrumental in personal growth, providing insights and challenging one's thinking. The coach helped the interviewee realize the importance of talent in key roles and the need to continuously improve and innovate.

How does the interviewee approach the challenge of managing energy and avoiding burnout?

The interviewee prioritizes sleep, maintains a strict diet, avoids caffeine and alcohol, and focuses on physical health to manage energy. They recognize that being energetic and feeling great leads to better decision-making and overall life enjoyment.

What is the interviewee's advice for someone in their early 20s looking to build a successful career or business?

The advice includes understanding one's current situation, being clear on what one truly wants, and working backward from long-term goals to develop daily habits and actions that move towards those goals.

What does the interviewee believe is the most effective way to enjoy the journey of life and find happiness?

The interviewee believes that finding happiness and enjoying life's journey is about pursuing one's authentic desires and spending time in a state of 'flow', where one is fully engaged and present in their activities.

Outlines

00:00

💼 Entrepreneurial Journey and Habits

The speaker reflects on their path to making their first million, emphasizing the importance of habits over big sweeping moves. They discuss the expectation of a long-term commitment to a business or career, akin to a 10-year education. The speaker, a successful private equity investor, shares their initial failures in business deals and the gradual learning process that led to success. They stress the significance of daily habits such as working out, sleeping well, and consistently working towards goals, even when not inspired.

05:01

🏆 Overcoming Failures and Building a Track Record

This paragraph delves into the speaker's early struggles with business investments, losing money in five out of their first eight deals. They recount the challenges of fundraising and the setbacks faced during the Great Recession, which tested their resilience. The speaker highlights the importance of persistence and learning from mistakes, drawing parallels to their high school wrestling and college rowing experiences, which taught them the value of commitment and hard work.

10:01

🚀 The Path to Private Equity Success

The speaker outlines their strategy for building a private equity empire, starting from acquiring small businesses like car washes and leveraging debt to finance them. They discuss the importance of operational excellence and the gradual acquisition of multiple businesses to scale up. The speaker also emphasizes the value of going against the crowd and focusing on 'boring' yet stable and profitable businesses, rather than following the latest trends.

15:02

💡 The Power of Flow and Enjoying the Process

In this paragraph, the speaker introduces the concept of 'flow' as a key to happiness and success. They argue that true satisfaction comes from being fully present and engaged in one's work, rather than seeking external pleasures. The speaker encourages embracing the journey of life as an adventure and finding joy in the daily tasks that contribute to long-term goals, suggesting that this approach can transform even the most mundane activities into sources of fulfillment.

20:03

🌱 Cultivating Self-Belief and Persistence

The speaker shares insights on building self-belief and the importance of not giving up, even in the face of adversity. They discuss the common misconceptions about success and the unrealistic expectations of instant gratification. The speaker advocates for a mindset shift, encouraging individuals to embrace the journey and view the process as an adventure, which can lead to true happiness and fulfillment.

25:04

🛠️ The Role of Talent in Business Success

The speaker reveals the pivotal role that talent plays in their private equity business, emphasizing that the quality of people in key roles is more critical than industry or financial structures. They discuss their realization that retaining top talent is essential for success and share their approach to making their firm an attractive destination for the best professionals, highlighting the importance of hiring for attributes over experience.

30:05

🔍 Identifying and Hiring Top Talent

In this paragraph, the speaker focuses on the process of identifying and hiring A+ players for their firm. They dispel the myth of hiring based on experience alone and instead advocate for hiring based on attributes such as persistence, drive, and the will to win. The speaker shares their structured interview process to discern these qualities and the importance of creating a firm culture that attracts and retains top talent.

35:05

🎯 Setting Goals and Overcoming Limiting Beliefs

The speaker discusses the importance of setting clear goals and overcoming limiting beliefs that may hinder progress. They suggest exercises to identify and confront these beliefs, emphasizing the need for self-awareness and honesty. The speaker encourages individuals to dream big, think long-term, and suspend concerns about 'how' to achieve their goals, focusing instead on 'what' they want to accomplish.

40:06

🚧 Building a Legacy and Inspiring Others

In the final paragraph, the speaker shares their personal goals, including building the greatest private equity firm and expanding their impact as an educator. They express a desire to reach a broader audience through social media and share the insights they've gained with students at Stanford Business School. The speaker also provides a piece of advice that they would give to everyone: 'Great things take time,' underscoring the importance of patience and persistence in achieving success.

Keywords

💡Habits

Habits refer to regular practices or behaviors that are performed automatically. In the video's theme, habits are underscored as the building blocks of success, emphasizing the importance of daily routines like working out, sleeping well, and writing down goals. The speaker illustrates this by stating that success is a sum of tiny habits rather than big sweeping moves.

💡Private Equity

Private Equity (PE) is a type of investment where investors acquire ownership stakes in companies that are not publicly traded. The speaker's playbook for making the first million dollars involves buying small private businesses, such as a car wash, using as much debt as possible to finance the purchase, and then scaling the business by improving operations and customer satisfaction.

💡Compounding

Compounding refers to the process where gains generate additional gains over time, leading to exponential growth. The video's speaker discusses the concept of compounding in the context of success and wealth accumulation, noting that it takes time and consistent effort for results to become significant.

💡Flow

Flow is a psychological state of complete immersion in an activity, where a person is fully engaged and focused. The speaker mentions the concept of flow as a key to happiness and success, suggesting that being present and absorbed in the task at hand is more fulfilling than seeking external pleasures or rewards.

💡Persistence

Persistence is the continued effort to achieve a goal despite difficulties or obstacles. The video emphasizes the importance of persistence in the journey to success, with the speaker sharing personal stories of overcoming setbacks and failures through sheer determination and commitment.

💡Talent

Talent refers to a person's natural abilities or skills. In the context of the video, the speaker highlights the importance of identifying and hiring top talent for key roles within a business. The belief is that having high-quality people in critical positions is more impactful on success than other factors such as industry or purchase price.

💡Limiting Beliefs

Limiting beliefs are thoughts or perceptions that restrict a person's potential or actions. The speaker discusses the need to identify and overcome limiting beliefs that prevent individuals from pursuing their goals, suggesting that these beliefs can be transformed into actionable items to be addressed.

💡Goals

Goals are the objectives or targets that a person aims to achieve. The video emphasizes the importance of setting clear goals and writing them down to harness the power of the subconscious mind. The speaker provides examples from his own life, such as his college rowing experience, to illustrate how goal-setting can drive success.

💡Innovation

Innovation refers to the process of creating new ideas, methods, or products. The speaker talks about scheduling innovation within his private equity firm, emphasizing the importance of asking the right questions and giving permission for ideas to be messy and evolve, which leads to breakthroughs.

💡Attributes

Attributes in the context of the video refer to the personal qualities or characteristics of an individual, such as persistence, drive, or will to win. The speaker explains that his firm hires for attributes over experience, believing that these innate qualities are more indicative of a person's potential for success.

💡Success

Success is the achievement of a goal or the accomplishment of something desired. Throughout the video, success is discussed in various contexts, including the accumulation of wealth, the building of a business, and personal fulfillment. The speaker emphasizes that success is a long-term process that requires consistent effort and the right mindset.

Highlights

The importance of habits in achieving success, emphasizing the accumulation of small daily efforts.

The misconception that success comes from big, sweeping moves or a single life-changing event.

The value of daily routines like working out, sleeping well, and writing down goals and tasks.

The expectation of a long-term commitment to success, often around 10 years or more.

The analogy of building a business like running a car wash, focusing on the fundamentals and customer experience.

The strategy of financing business acquisitions with a combination of seller notes, mortgages, and bank loans.

The concept of building a track record in business to eventually raise a private equity fund.

The reality of making mistakes and learning from them in the early stages of business deals.

The impact of the Great Recession on businesses and the importance of resilience during economic downturns.

The role of persistence and the story of overcoming setbacks in sports to build a successful business.

The idea of finding joy and happiness in the process of working towards goals, rather than in the achievement of them.

The concept of 'flow' as a state of being completely present and engaged in an activity.

The advice against seeking instant gratification and the importance of compounding efforts over time.

The discussion on the importance of self-belief and how to cultivate it for long-term success.

The significance of setting goals and how they help direct subconscious thoughts towards achievement.

The advice on taking action first to generate motivation and the power of writing down daily goals.

The importance of identifying and addressing limiting beliefs to move towards one's desired career or business.

The distinction between working hard at something you're passionate about versus feeling stressed due to conflict of interest.

The emphasis on the importance of hiring 'A' players and the impact of talent on business success.

The advice for aspiring entrepreneurs to focus on building skills and gaining experiences that align with their long-term goals.

The discussion on the importance of energy management for decision-making and overall well-being.

The strategy of manufacturing management teams to acquire businesses without leadership.

The concept of playing a different game in business to stand out and achieve success against established competitors.

Transcripts

if I was going to make my first million

what I would do would you mind sharing

some of your worst or Hardest Mistakes

that you I mean I lost money on five of

my first eight deals if you're going to

go start a business or pursue some

career go in with the expectation that

it's going to take like 10 years and

people don't want to hear that you know

what I'm realizing is the people who

watch this whole episode are going to

get the whole value of the $250,000

education that a stand for business

school all right gram ready to dive in

let's do it all right you have a star

studed resume at this point um one of

the top professors at Stanford Business

School 11 billion private Equity Fund

family man and then now I was just

checked today I was like almost a

million followers on Tik Tok so when you

look back and you think back to your

early 20s if you were to give advice to

your younger self what would that be I

think that a lot of it comes down to

your habits and and you can you people

people think that they are going to be

successful with these big sweep in moves

and that they're going to you know

they're going to have some massive event

that's going to change their life but

really if I look back it's it's a sum of

tiny tiny little habits working out

every day sleeping really well writing

down my goals writing down the things

I'm going to do each day to work toward

my goals doing stuff when you don't want

to do it and just throwing yourself into

you know the things you're supposed to

do as opposed to the things you want to

do but doing it daily like day after day

after day after day I love that so it's

kind of a boring answer but that's

that's the answer so so like I I I think

people just sometimes sit around waiting

for some great inspiration or some you

know someone to you know some some big

crypto thing that's going to change

their life or whatever the real answer

is like the work that you are supposed

to be doing today is all you really need

to do I love that and I I think I've

learned that myself over time as well is

the simple boring things are actually

the way to success over life it just

takes commitment and compounding over

years if not decades to get there it

takes compounding over years and in my

case decades yeah and and so when you

think about that today and you think

about the market environment today if

you were let's say in your early 20s now

if you wanted to make your go from zero

to your first million dollars what would

you do what would be your playbook all

right my playbook so I I'm in private

Equity so my playbook would be private

Equity so what I would do if I was going

to make my first million is I would go

around and I'd look for a small private

business and I use the example of like a

car wash so I you know I might go I

might go find all the different car

washes that are in the in the area and I

might see who has the best location and

what's you know what's the car wash that

I I think has has the best potential and

I'd probably talk to the owners of those

and try to get them to sell me their car

wash and then I would Finance the vast

majority of that with with debt you know

first off the owner can give you a

seller note meaning they'll take back a

note to to finance a part of the

purchase let's say you buy the car wash

for half a million dollars you might get

him to finance a $100,000 so now you

only need to come up with 400,000 and

then there might be a building that has

some value could get a mortgage on and

then there might be some value of the

business you get a bank loan on and you

can get the equity that's required to go

into that down to a pretty small amount

of money and if you don't have that

money you could go around and try to you

know raise money from investors but then

you go buy that car wash then I would

run the hell out of that car wash I

would have the best car wash in in the

world you know I would go in I would you

know I would make sure every customer

walked out of there just thrilled with

their you know with their experience and

word would travel and then eventually I

would learn how to run it really really

well and then I'd buy another one and

another one and another one and that's

basically how I started I did that with

label printing companies in uh when I

was 25 years old I started buying these

little label printing companies same

same concept but uh but but what what I

think people the mistake people make is

they go do what everyone else is doing

yeah like I can pretty much tell you

that your fortune if you're listening to

this and you're and you haven't you

haven't been in crypto your Fortune's

not in crypto because everyone in the

world's doing that and so like it's

almost like you want to go where other

people aren't going it actually there's

a theme there to your first piece of

advice around doing the boring simple

things you know everyone's always

fascinated with the sexy AI Tech crypto

thing but there's something to be said

to these boring unsexy companies like a

car wash or a laundromat if you can just

op like operate the hell out of them

like you said and just generate stable

consistent cash flows that compounds and

accumulates over time and it sounds like

exactly you started with this label

printing business how do you take a

single label printing business and then

turn that into the private Equity Empire

that you have today well it took a long

time you know I mean I bought this label

printing company in 1997 you know it's

2023 right now so it didn't happen

overnight you know and the by the way

the first one I bought didn't do that

well and I bought another one and and it

was the third one I bought that did

really well and then you know I learned

a lot because I I I made a lot of

mistakes on the first one I made a

couple more mistakes on the second one

by the third one I knew exactly what I

was looking for and I bought the right

one and then that one did really well

and then I bought another one and then I

started to build up a track record and

then based on that track record I was

able to raise like a a small fund which

is what most people think of as private

Equity but private Equity actually is

everything I mean that all those little

deals I did is actually that's all

private Equity too that's just financed

a little bit differently eventually I

had a track record where I could walk in

and get someone to give me like what you

think of as a private Equity Fund but

that that took you know that took a that

took a long time to get there and what

I'm hearing from a long time too I can

there probably a lot of Battle Scars a

lot of mistakes made you alluded to them

would you mind sharing some of your

worst or hardest mistakes that you I

mean I mean well I'll just tell you the

track record first and then I'll tell

you some of the mistakes but I mean I

lost money on five of my first eight

deals and then not a very good investor

at first yeah so I I mean and then when

and then our first once we finally

raised a fund which took me a year to

get actually just the fundraising itself

took a year I lost money on that fund so

I mean we started off horrendously um so

those were some that that that's kind of

battlecar grouping number one and then

battle score grouping number two was the

time of the Great Recession I mean we

just got flattened I mean we we had

companies in default we it took us five

years to raise a another fund I drained

my savings account for this for another

the second time to make payroll so yeah

definitely had some some battlecars

along the way in terms of Lessons

Learned I

mean do you want them specific for

investing or just more generally about

building a business I'm actually just

curious how do you persist through that

kind of pain and like self questioning

I'm sure that comes up well you know I

had the benefit of I I'll tell you I had

the benefit of an experience that helped

me which was I'll go back a little bit

in time so I was when I was in high

school I wrestled and I was a pretty

good wrestler and I had this match my

junior year I was the number one ranked

kid in the district and I was wrestling

the number two rank kid and I lost and I

was so distraught that I quit and that

was the last match I ever wrestled in my

life and I never wrestled again and then

for the next rest of my junior year and

my senior year I like regretted that and

I was like I I felt horrible I was like

I I I so I just would was like I should

have just kept going like it was one

match it was one loss like but I

regretted that for the rest of my senior

so then I went to college and I rode

crew freshman year get cut was horrible

go down and use the the rowing machines

in the morning to try to get better

sophomore year like two weeks weeks

before the Big Race I got seat raced out

of the boat come back anyway just keep

going and keep going and I I I literally

wrote down every single day in my

journal like I am the best rower in the

United States and I am never going to

quit no matter what happens I wrote that

like every day in my journal and then by

my senior year I was Captain of a

National Championship rowing team and I

had one of the top urg times in the in

the world um and so I just saw that like

it just takes time and so when I got to

Alpine and started Alpine I was like it

was it was it was I had the

expectation that it was going to take

some time and I also had the the

knowledge that if I stay that I was

going to stay with it and that if I did

like eventually it would work out but it

took it took a long time I mean I I love

that story of sheer persistence because

having spoken I I've got I've been lucky

to speak to so many like billion dollar

entrepreneurs and you meet so many

different kinds of people and the one

consistent pattern I've seen between all

of them is just they never gave up yeah

just like actually the only thing but I

think that requires an immense

self-belief that you've cultivated over

time I think a lot of folks that are

let's say younger and haven't you know

grown into themselves yet how would you

recommend they actually build that

self-belief to just persist well the

thing is I I I think like you're set up

to not have the expectation you're set

up for the wrong expectation you're set

up that things are going to happen fast

and that if they don't happen fast you

know then you're doing it wrong you're

set up that all you have to do is pay

$9.99 for this you know option trading

program and you two can make $30,000 a

month a passive income I mean all that's

just nonsense like I don't know anybody

I don't know I know a lot of people that

have made a lot of money starting

companies we've invested in over 400

companies cashed out 400 entrepreneurs

I've met all of them I've met tons of

people in my my space and teaching at

Stanford i' I've met literally thousands

and thousands of of people and I've

never met anyone that I can think of

that you know had some overnight success

that's just like a pipe dream but that's

what gets sold to us over and over and

over so I think the first part is like

go in with the expectation that if you

that it's going to take like 10 years

like and people don't want to hear that

but that's what I mean I think if you're

going to go start a business or um

pursue some career like go in with the

expectation that it's going to be a long

ride and that's okay because your whole

life is that ride like you know it it

that that's that's the fun of life is

that is that process of going toward it

so

if it takes 10 years that's great that's

your adventure that's your adventure of

life and just kind of have a different

mindset I'd say that's the number one

thing is to have just have a different

mindset at the beginning one thing that

clicked for me there is just around

you're right we live in this world of

instant gratification right you post the

Tik talk and then you wait for the

dopamine it's almost like you're you're

building for the long term but one thing

you said there around Adventure really

hit with me because before this we were

talking about how do you enjoy the

journey right how do you how do you not

just feel pain and misery the whole time

time you're trying to build a company

I'm curious if you can share advice with

us of like how do you actually enjoy

this wild ride that is life well that's

a pretty deep

question I mean that's kind of the

that's kind of the question of like all

of life is you know how do you how do

you enjoy it and I'll tell you one of

the best Concepts I've come up with is

this there's a book called flow and I'm

I I I I I would I'm going to butcher the

author's name uh so I'm not even going

to say it because it's impossible to say

but but basically what what the author

is goes through and uh talks about is

the things that we think make us happy

are actually not the things that make us

happy yeah what we think makes us happy

is having our feet up on the uh on a on

a lounge chair on the beach in Mexico

and like having you know some attractive

person feeding us grapes or something or

pleasure like seeking seeking pleasure

like that's that's the thing that makes

us happy but what he what he his

research has actually shown what really

makes you happy is being completely

present in the moment in whatever you're

doing and that could be cooking it could

be uh writing a book it could be reading

a book it could be doing this podcast it

could be anything like anything where

you're just locked in and he calls that

state flow and his basic solution to

life is like align your life so you're

spending as much of it in flow as you

can and that's really what's going to

make you happy now ju opposed that with

the earlier conversation we had about

building a business and now your whole

your whole life and your 10 years and

all that is this adventure you're going

on and you're just putting yourself in

these flow States the whole time and

there's no good or bad you know you can

have flow I could have I have flow in a

management meeting I have flow in a

one-on-one with an employee I have flow

in a fundraising meeting I have flow

when I'm evaluating a business when I'm

sitting in a board meeting like you just

kind of like throw yourself into it and

like that actually is

the joy of life you know and and so I

know we got kind of deep there but

that's that's sort of my the way that

I've kind of tried to frame it is flow

is not or you know life and happiness

and all that is not what you get at the

end when you achieve some goal because

as you know as I know that's really

fleeting and actually can be really

depressing yes hitting your goal can be

I I know this sounds really weird to say

but it can be one of the most depressing

things you you'll ever do because

because you expected it to be really

different than that and it wasn't so

realize that the actual love is that is

that is that flow that you're in in in

that 10 years you're going you know

while you're while you're working toward

it I I love the piece around hitting the

goal can can be a curse in some ways you

meet so many successful entrepreneurs

who finally sell their business for a

billion dollars and the next day they

wake up and they're depressed yeah

totally because they they didn't realize

the journey was was the the process and

the enjoyment so I'm curious for you

because I think a lot of folks struggle

with what flow actually means it's such

an abstract concept what is flow feel

like to you and then if maybe you can

translate that into how that's actually

helped you be successful I think it's

just it feels like you're totally in the

moment and your present you're

challenged a little bit you're not

thinking about you know the future and

the past you're really just giving

yourself permission to not have to

stress about what happened before what

happened after and you're just locked in

in the moment and that's that's when

you're going to have the most fun and

enjoyment and you're going to be better

at your job anyway so that's kind of

what it feels like that's great and then

I I'm actually going to have a channel

our past selves because I I think we

share something in growing up pretty

middle class you know yeah when you when

you grow up in in a lower socio economic

class you're you're told you know do

these things to be successful and happy

you get those things and then you

realize it's about the journey one thing

I love about your story is you know you

grew up mowing lawns to just like take

care of yourself pay the bills all that

kind of stuff and I what I want to help

people feel is like I actually believe

that given the fact that I grew up with

a single mom immigrant kid no

connections I actually think that helped

me be successful for a number of reasons

because it taught me the value of hard

work all that kind of stuff I'm curious

if you could share how being in these

circles now the ones you're in and you

seeing you know a lot of people grew up

a lot more privilege how actually has

your background not having a silver

spoon actually LED you to be successful

well I think I think it you know I had

jobs at a very young age I mean I

started mowing lawns when I was 10 I

started like actually focusing on making

and saving money when I was 10 you know

if I wanted to buy something I had to

take theci side that I was going to

spend you know

for example a month of lawnmowing money

or two months to buy a Sony Walkman to

start to listen to motivational tapes

but that was my money so when then when

I got those tapes I like really really

listen to them because I I had invested

in it and and so I think I think it it

it totally helped um and and I and I

think I think you know no matter what

your background or situation is The

Narrative of the most dangerous

narrative you can have is I'm a victim

like that that that's that's just you

know life's not fair woe is me and and

again I'm a white male okay so I I I I I

I say that with with a lot of

trepidation to even to even make that

statement

but but the victim

mentality whether it's true whether

you've had hardship or not no matter

what your situation is it is going to

kill you yeah like like irrespective of

what what your your situation is that

the idea that I'm a victim of this

unfair life no matter what your

situation is that that will that will

kill you because you're you're basically

putting the power outside of yourself

and you're giving you're giving it away

and there's really no you know the

empowering it's a really just

disempowering uh mentality yeah it's

don't let them take the agency away from

you cuz when you lose your agency as a

human being you you lose a lot of that

will to live and that will to just be

yourself I mean I think Victor Frankle

talks about a lot in man search for

meaning if you've read that um so I

think one frustration I would have

watching this in terms of like oh you

know you have agency just just don't

give up believe in yourself I feel stuck

like I feel genuinely stuck so how do

you get through that yeah I I I think a

lot of that happens a lot is you're

you're in a job or you're in a routine

and you and you just you you you don't

you want to make changes but you're not

really sure where to start and you and

you have all these reasons why you can't

change anything and I think think I

think that the first thing is you is

people are people are confused about

like where motivation comes from they

think that they're going to have some

divine inspiration that's going to you

know lead them to a new job or a new

career that's not actually what's going

to happen what's going to happen is

you're going to take action first before

you have the motivation and so think of

one small habit that you could start

that would move you toward your goal a

simple one a really simple one that's

one of my favorites that I've shared

with with you

is let's say you're in a career and

you're you're in career X and you

actually want to be in career Y and and

you're not sure how to change or start

just just write down every single day

this takes five minutes write down three

things you could do to move to Career Y

and then do those things or schedule

those things and then wake up tomorrow

and do it again and wake up the next day

and do it again and wake up the next day

and do it again and in like 3 months

you'll basically have career y I mean

it's it's you will compound those

efforts you know so quickly I've hit

more I've had more success what I what I

would say to to listeners is you will

have you will have more success and move

further toward your goal in three months

with this simple thing of writing three

things down every day then you will in

three years of not doing that I love

that you've dispelled the notion of like

the creative inspiration that Apple

falls on Newton it's much more about

creating momentum inertia exactly and

you do talk a lot about setting goals

right how important that is to Our

Success could you share a little bit

more about why that's so important yeah

like think about how you're wired you

know you're you have there's different

studies on this but somewhere between

two to 5% of your thoughts are conscious

and that means 95 to 98% are

subconscious your subconscious is kind

of like the Wild Wild West you know and

it's rooted in and it it has a tendency

to go negative and I think that's from

like the caveman days or something when

you had to worry about the the noise in

the bushes or something so so you're you

have 95 to 98% of all your thoughts that

are kind of wired

negative what happens when you start to

set goals in and write them down is you

start to you start to grab hold of that

95 to 98% of your subconscious and you

start to point it somewhere and you're

not just pointing it anywhere you're

pointing it exactly where you want to go

yeah and and then that's like when

people talk about manifesting about to

make a jug about manifestation everyone

I mean there's so much content on here

about manifesting but what actually

happens is you've got

95% of your all your energy now is

directed toward a place you want to go

and like good things happen when that

when that

happens the most magical thing that I've

had of about writing my goals is I'll

use an example from from college I wrote

down I was a novice rower I'd never

didn't even know the boats went

backwards I mean I was literally from I

was from Ohio there's no there's no

water like in Ohio so I I wrote down I

am this is what one of my self-help

books told me to do write it in the

present tense you know about the goal

you wanted I wrote down I am the best

rower in the United States and then by

the way I I was getting cut from the

third third freshman novice vat at the

time I wrote these goals but what

happened is a when you write your goal

every day a part of you starts to assume

the identity of someone who's already

achieved that goal it's that's like that

will happen because your subconscious

that 95 to 98% is going in toward that

direction so like in four years never

once when my alarm went off in the

morning did I hit snooze and go back to

bed CU I'm like well the best rower in

the world gets up and goes to practice

and I did that every single day for four

years so there's a lot of power in

writing out your goals Beyond just like

the tactics you're actually you're

getting your whole subconscious moving

that way so you've made it sound really

easy I I even feel inspired I'm like I

should go do that right now what are

some of the footfalls or the mistakes

someone might make in that

process I mean it's like any habit

where the mistakes people make in any

habit are they fail for a couple days

and they get off they fall off the wagon

and then they they they get they they

just throw in the towel and you're going

to have d where you don't write them

down you're going to have days where you

write down the three things and you

don't actually do them so just get up

tomorrow and do it the next day you know

and so it's I think it's the same

failure you have in any habit but if you

do it for a week you'll see so much

progress that I think you'll keep you'll

continue doing it I love that I for some

reason I'm called to ask questions about

Stanford Business School students let's

do it which is something that's been

nagging me a lot recently because you

talk a lot about doing your own thing

and this is going to ruffle some

feathers but all right I like it already

I was really disappointed with the

percentage of my class that went into

jobs like Consulting at McKenzie or what

have you one can argue like there's some

value to it but like I you could be

solving cancer or like building there's

a lot that I Stanford pitches like being

the entrepreneural center right so I

think the argument for the benevolent

way to look at it is like someone's just

like looking to build it's a great place

to build skills I'm very grateful for my

time in banking I got to make so many

caveats here but like I think a lot of

people their souls go to die at like

those kinds of desk jobs right so when

does someone know when to do that kind

of job to learn to build skills to build

uh like relationships and when to

actually go off and do their own thing

and ideally make the world a better

place well I love that you asked that

question so I I started teaching there

in

2014 and for the first four years all I

taught I taught the skills right here's

how you hire here's how you fire here's

how you fund Raise You know here the

here are the skills that you're going to

need as an entrepreneur and that my

whole class was about that I mean put

tons of energy I'd case guest flying in

to talk about these things and then I

realized none of the students actually

did it you know like they they they like

they they they learned all these things

and my class got high ratings but no one

actually went and did it so then I'm

like okay hang on I'm teaching the wrong

thing you know I got to like back up and

I got to re I got to figure out why are

students not actually doing the thing

they want to do and when I say like this

is the distinction I don't care what

someone wants to do if someone wants to

go to Goldman Sachs great wonderful but

the thing is the student wrote their

essay about X yeah and X might have been

curing cancer or whatever X is solving

homelessness or whatever it is I just

want them to do the thing that they

wrote their essay on because that's what

they really want to do so I I started

saying what's holding them back so I

spend a lot of energy on like

where what what do you really really

want and are you clear on that and the

students actually are usually pretty

clear on what they want you know if they

knew they weren't going to fail what

would they do if it took them 10 years

what would they do they're pretty clear

on that and then then I have to say well

why aren't they doing that and then we

get into like what are all the limiting

beliefs so we write down the limiting

beliefs and we put them on paper because

when you write them down all of a sudden

they're no longer swirling in your head

they're just like to-do items like

they're not as scary to yeah like for

example I one of my limiting beliefs is

I don't know how i' finance my startup

just becomes I need to finance my

startup well that's just a to-do item

it's not this big scary fear that's this

nebulous ephemeral thing that you can't

figure out it's like no you can figure

out how to start I bet other people have

figured out how to get a business funded

so let's work on that now it's just a

it's just a problem that we solve like

any other problem so I started working a

lot on that content limiting beliefs

like getting you know clear on our goals

we spend a whole day on like what do you

really want to do how do you move toward

it what habits do you need to develop

and I started seeing a larger percentage

of people going into the thing that they

really want you know what I'm realizing

is the people who are who watch this

whole episode are going to get the whole

value of the $250,000 education that a

stand for business school you just given

like truly I hope people I was like guys

pause the video and just do this

exercise right now because it's it's

it's you've made it so simple which is

think deeply about what you truly

genuinely want authentically not what

Society tells you then write out the

fears limiting beliefs that scare you

from that and then let's Crush through

them exactly yeah ex and then and then

let's build habits to start moving

toward them on a daily basis and that's

it you know and and then you're you know

as we talked about earlier in the

podcast like you'll be in flow I'm I'm

going to go off on a little bit of

another RI which is where does stress

come from stress comes from like we

stress comes from hard work or this or

I'm TI whatever stress actually comes

from conflict it comes from when like

you have two values or two things that

are are in Conflict that's actually like

hard work doesn't actually create stress

stress is when you're working hard on

something that you're not excited about

or when you're working hard on something

and you want to be at your son's you

know little Le game like that's where

the stress is it's when there's a

conflict so if you can like figure out

what your real heart is set upon and you

start spending your energy on those

things you're not that stressed you know

I mean there's stressful things that

come up but like on a daily basis you're

getting out of bed moving in the

direction that your heart is set upon it

eliminates a lot of friction you know

and I think people don't really realize

how how how they show up and how much

energy they have when they get rid of

that friction like I showed up totally

differently when I was running starting

Alpine and running it then when I was

working at a corporate job I was I I had

thought if you'd asked me how I was how

much my potential I was using in my

corporate job I would have said oh I'm

using like 80% and now actually having

used 100% I would go back and I would

revise that number and I'd say I was

using like

5% that was a huge unlock for me there

Graham which is like if you would ask me

back in my banking days how much of my

capacity I was using I'd be like 120%

I'm working 110 hour weeks I'm staying

up late formatting SL decks from green

to blue or whatever I was doing then and

now the thing about entrepreneurship

about believing in yourself that I've

learned in my journey so far is it's all

about learning how to grow your capacity

so yes I think at the time I was using

100% of what I thought I was deeply

uninspired deeply unpassionate about

what I was doing very unfulfilled now in

order to chase this fulfillment and

excitement I have about our mission what

we do I have to continue grow my

capacity grow yeah you have to grow

right so I I I'd still say I'm probably

using a lot of my capacity I'm tired all

the time burnt out but which is a whole

another thing to not discuss now but my

capacity is like 10x or 100x since that

person that I started as yeah I mean

when I when I was in also in banking I

mean I was using 100% of my hours I was

just using about 2% of my meal Mental

Cap creative side yeah creative

leadership uh thoughtful yeah thoughtful

analysis I mean I I was I was just doing

Root Road stuff yeah yeah cuz it's funny

the one thing I'm curious how you deal

with this in terms of managing your

energy is often times feel frustrated

now where I think back when I was

younger and I was cranking for 100 hours

a week and I have to recognize that it's

cuz I wasn't thinking right I was just

like plugging away at a financial model

that done 100 times in these moments now

you're kind of pioneering now right

there's no playbook for what you're

doing what number one how do you

navigate that just ambiguousness that

loneliness and then how do you think

about managing your energ within that to

do the right thing for you a couple

things um I'm going to talk first about

pioneering so we probably have without

hyperbole 20 things that we do at our

private Equity Firm that no one else

does which is kind of surprising because

it's a it's a pretty it's an industry

that has 5,000 firms that's been around

a long time I would say we we we

probably have 20 things that only we do

those come from we we actually schedule

Innovation we put it on the calendar we

get the right people in the room we ask

the right questions and we give

ourselves permission to have it be messy

and come up with crazy ideas I'll give

you the questions we ask which is what's

what's not going well we need to fix

where's our process getting bottle where

are bottlenecks breaking down what could

kill us that we need to kind of

extinguish and then the most important

question of all what's going well that

we need to that we could scale that last

question is probably where we made 90%

of our money what's going well that we

could do more of in scale so we we

schedule we actually schedule Innovation

we put it on the calendar we do this

probably more than any I bet we do this

more than a lot of the firms you would

think of as traditionally Innovative and

that and that's led to just unbelievable

breakthroughs that we've had so on on

your first point about pioneering yes we

are pioneering and we make we make a

point to do that your point about

managing energy is huge I mean I am so

committed to this like uh because like

when I'm energetic and I feel great I

make better decisions like and I just

enjoy life like when I and and and I

realize like the the converse of that is

also true you know when I'm exhausted

and miserable I I don't and so I had

this switch where all of a sudden I I

switched from how little can I sleep to

how much can I sleep so what what what's

foundational for me is sleep first of

all I think is the biggest life Cher and

so I have whole routine around that I

make you I mean I don't want to tell you

when I go to bed you know but all right

grandpa yeah I go to bed early I get up

early I sleep a lot and then my diet is

crazy strict um I learned a lot I've

learned a lot about my diet and getting

the right supplements and what I'm

eating um I don't drink caffeine I don't

drink alcohol I don't take sleeping

pills I don't eat gluten and like I'm I

have the same energy now I'm 51 than I

did when I was 21 I probably have more

but it takes a lot more dials turning

when you're 21 you can go do lots all go

you do lots of stuff but but you but I

but I I I spend a ton of energy trying

to or a ton of yeah a ton of energy

trying to manage you know how I feel and

and the physical part because that that

makes a big

difference um I have one last question

on this private Equity Empire piece that

you're building before we Shi to the

tactical which is if you're allowed to

share I I just love your energy around

I'm going to build the very best private

in the world because I know what you're

going up against I'll name them how if

you're allowed to share the play like

any Vision here can you paint for us how

are you going to go up against the

blackstones the cares the Apollo of the

world and build a better firm than them

you just have to play a different game I

mean I mean like I I I I think a huge

important part of life is are you

playing a winnable game if you're going

out and bidding on the same things that

everyone else is bidding on you're not

you're not playing a winable game it's

going to get bid down to the whatever

the lowest guy is solving for in terms

of his returns which is by the way about

12%

14% in short what we're doing is we're

we're we we we manufacture our own

management teams meaning we hire people

out of Stanford and Harvard and all

kinds of different Business Schools and

we we build our own leaders and that

allows us to go buy companies that don't

come with leadership corporate car outs

or business where the founder wants to

Tire or exit or whatever and that's a

very that that pond doesn't have a lot

of people fishing in it cuz it's really

hard to do so we that that's just one

example but in general we try to play a

game that's totally different if we if

we're playing the same game as everyone

else you know we're not going to be the

best in the world um and but and and by

the way all of them playing the same

game kind of have all the same returns

yeah you're you're competing all the

alpha away yeah cool so shifting

conversation now when I think about your

private Equity business today you very

spefic specific Philosophy for how you

run a business could you share more

about what that is and I kind of want to

press you on itz it sounds like a lot of

corporate so I I'll go back to this uh

time around the recession I hired my

first ever executive coach and this

guy's amazing his named JP Flom and so

we're having this conversation and and I

tried to can we had a we had a weekly

coaching conversation by the way I

couldn't afford an executive coach back

then I don't even know what compelled me

to hire him but it was a great decision

and we can talk more about Executive

coaching if you want but so we had this

conversation and I tried to cancel it

like three times and he's like no this

is our deal we have you know every

Tuesday at 8: a.m. we talk so he starts

asking me what's what's was so stressful

and I said oh you know I got to fly to

Dallas and I got to fix this thing and

then I got to go to uh Chicago and deal

with this and then I got to DC and do

this and like I'll keep the story kind

of short but like when we went to Dallas

and he you know we did like the root

cause why why why why why at the end of

all of that was I had the wrong CEO

running the

company and then when we talked about me

flying so I was going to go do this

diving save you know and then when we

talked about Chicago we were going to

lose this deal and why why why why why

well because the vice president at my

firm was the wrong person it was like a

BB minus person that's why I was doing

that and then same one about DC all of a

sudden I realized like I'm running

around trying to extinguish all these

fires but the you know the the actual

fuel that's giving these fires is is

Talent you know and and and so like

that's actually the thing I need to be

solving I don't need to go to these

situations and do these diving saves I

got to get to the root of the problem

which is I got to have a players in all

these key roles in my so so we get

through this and he says Graham you know

you've told me you want to build the

number one private Equity Firm in the

world you know are you going to do that

with and B minus people in these key

roles I'm like obviously it's a

rhetorical question I'm like no but then

he says the next thing he says to me is

okay Graham if you're somebody as a

leader who keeps BNC people in these key

positions how would you rate yourself as

a

CEO and I was like

oh that

hurt and all of a sudden I was like okay

I get it and at that moment I I

literally wrote down in my journal like

I am in the talent business I'm not in

the private Equity business I'm not in

the software business I'm in the talent

business first and foremost so my job is

to get the very very best people here at

Alpine and at these companies and then

you say well obviously everyone wants to

do that so that's not that's not really

that I mean maybe the thing that's that

most people wouldn't expect is that's

way more correlated than the industry

the purchase price of the business you

know the Finance structure the talent is

way more highly correlated to the

returns so that's probably surprising

but to say like oh we want the best

people kind of everyone says that so the

magic is you got to make your firm a

place where the very best people want to

go and I spend

probably more than half of my time on

that problem like how do I make the role

at these portfolio companies something

where the best people want to go uh and

take those roles how do I make the roles

at Alpine where we can attract the very

best people so and and then how do we

make make sure it's a place where they

stay and spend their career so it's it's

it sounds like Mom and apple pie but it

actually ends up being on my calendar as

my number one thing that I spend time on

it's the highest form of Leverage and to

dispel another I think social narrative

we're given it's the most successful

people are the ones who are hyper

talented themselves very individualistic

and and you I think in order to be in

your position you have to be hyper

talented

but it's actually I think the smartest

people recognize that the most leverage

you'll ever get is actually by hiring a

bunch of people who are even better than

you ideally to do jobs for you well the

math is really simple which is I'm one

person yes and I could be super

effective but if I spend my energy

hiring one person I've more or less

doubled my output in then if I hire

another one and another one the other

thing that's probably not obvious is the

difference between an a and a b is not

like

10% over the course of a decade it could

be

like 200 times yes 300 times so like

it's it's not it's it like it's it's

wildly

asymmetric and and so once you realize

that and you can you start to realize

what an a is and you start to have

worked with A's and know how to spot

them and and know how to evaluate them

then you get you you you realize that

the real power is that that Delta

between the the A and the B and I

totally hear you on that I've made so

many mistakes already in my career

around the a versus B player piece I

think it's a lot easier said than done

to identify them so I'm curious what are

the traits or how do you discern there's

so many bb+ players out there how do you

truly discern an a A+ player all right

so I'll again dispel a really common

myth which is you know let's say that

I'm hiring a CEO for a healthc care

software business here's everyone else

does it in my business in private Equity

they they hire Russell Reynolds or hydri

and they say I want a CEO of a

Healthcare company they say great they

go find all the people who Run

Healthcare companies there's whatever

number of people then they want the

people that are available at this comp

that want to work at this company and

they're down to like three people you

know so they're hiring for experience

right that's their number one criteria

what we've found is the most highly

correlated thing is attributes like I

don't care what you've done as much as I

care about who you are so attri we hire

we hire for attributes attributes is

like your persistence your drive you

know we we the number one thing is the

will to win you know are you someone who

just like when you put your name on

something it happens that will leap out

of an interview it will just come out

it'll be so obvious when you talk to

someone if you we have a real structured

interview process we go which I probably

won't go into today but like but by the

end of that process that leaps out of

there or doesn't and if it doesn't then

that's your answer too so we're hiring

for attributes over experience I love

that and makes me feel a little bit

better about our hiring process where we

have a rubric and we lay out the values

of our company and how much they align

with that and then also the technical

side of the job itself like do they fit

that functionally but I want to end the

interview off really focusing on some

more tactical advice of how you live

your life every day and a way that

anyone can follow immediately today I'm

curious for you once again early 20 self

what advice tactically would you give to

that person to be like if you do all of

these things I promise you on a 20 year

or 10 year time Horizon you will be

successful yeah I I think the I'm G to

I'm going to go ahead and say like kind

of three three parts um you kind of have

to know where you are know where you

want to go and kind of know how to get

there okay so let me go through each one

in terms of who you are it's like who

are you at your very very best and also

what are some limiting beliefs you have

what's the story you're writing you know

really do some work on like where are

you right now and be intellectually

honest write it down like I I used to

write down all my limiting beliefs the

things I thought you know I wasn't good

at like all that has to come out so

where are you right now next is where

what do you actually want I can't tell

you how many people I talk to you know

students or or or Folks at Alpa they

they actually don't know what they want

this is a great place to spend some

energy you know like like what is

success look like like how could you how

could you hit a goal you don't have so

spend some time and on the on the on the

what do you want three pieces of advice

one is um decide what you would do if

you knew you wouldn't fail like that's

the thing you're going to be most

excited about so number one when you

like give yourself really permission to

dream number two is think in terms of

five or 10 years out don't think in

terms of one year or two years because

there's way too many constraints in one

or two years you have to get you have to

push that out and and because in five or

10 years almost any anything you can

imagine is g to is going to yield and

the third one is this um quote from it's

a Executive coaching quote which is the

how is the killer of all great dreams so

don't so suspend the how so so five

years out 10 years out what would you do

if you didn't fail and don't worry about

how you're going to do it and that's

really where you want to go once you get

clear on that then working backwards

from that it's actually not that hard

you know and there's a bunch of

different tactics you can use a couple

that I'll throw out one is you know make

a list of 30 things you could do to move

toward that goal like literally sit

there and sit down and don't move until

you have 30 things make a list of six

people that could help you on that make

a list of things you could read to help

you on that make a list of people that

have done that before you know just just

like the tactics of getting there

believe it or not are actually the easy

part it's you being super clear on where

you're going and where you're starting

from that's that's the thing that most

people Miss I love that and I couldn't

agree more and what I'm reflecting on is

you say that is how much throughout our

lives our goals actually change because

if you had asked me a couple years ago

what my goals were I would have said

start a company that's successful go to

Stanford Business School all these

things and now for me I'm you just

saying that I was like asking myself

what do I want I was like like want to

be happy and so I'm curious for you you

once told me a couple months ago that

you want to build the the greatest

private Equity Fund of all time you you

want to be the very best at whatever you

do so I'm curious what are your goals

now now that you've achieved

conventional success yeah I I mean I

think I think that with respect to you

know my my private Equity Firm that's

still my goal I mean I still want to be

the greatest private Equity Firm of all

time I just don't I don't I don't know

how to approach it any other way I don't

know even why you would come to work if

that wasn't your goal so I mean that is

definitely our goal and we wake up every

day thinking about how to do that today

next year five years 10 years we start

putting in place you know we start

planting trees today that are aren't

even going to yield any shade fruit for

5 10 years so we're constantly like

fighting on that on that goal you know

one of my other goals is I I I do teach

at Stanford and I've really I feel like

I've been able to have an impact with

students and you know H have them think

a little bit more deeply about what they

really want and who they really are and

where they want to go and I've noticed

that and and I'd like to do that on a

broader scale and I I guess that's why

I'm on social media is to try to have an

ability to bring that to a broader

audience than just the students at stand

for business school so I'm still sorting

that out I'm not sure how you know

exactly how to do that but I'm I'm

working on it well what I'd say to

everyone watching is if you're not

already following Graham on Tik Tok he's

the cool dad with a great advice so you

should follow him on Tik Tok almost in a

million so congratulations thank you U

final question for you which is if you

could put one thing on a billboard so

like the one piece of advice you could

give everyone out there what would it

be it probably be great things take

time I love it it's uh I think we've

dispelled a lot of Notions today around

instant

gratification what truly makes one happy

like really you have to think through

that and make mistakes through that and

then compounding so gram I appreciate

the time thank you John it's

[Music]

fun