Thread by @MichaelMartocci

So this @WSJ article blew up a bit…

Taking a stand against traditional/popular ways of doing things is a sure fire way to garner alot of attention

But with most things, there’s nuance that matters

So let’s dive into how I think about investing 👇

https://twitter.com/wsj/status/1457852981735530500

First it’s important to acknowledge that investing is super specifc to the person and their situation - our stories, needs, obligations, goals etc are each unique and therefore blanket advice isn’t super helpful

And this off the bat is an issue with FAs…

Can they really tailor a strategy to your needs and the needs of all of their other clients in a way that may diverge from their own personal beliefs

And no, some Merrill Lynch tool where you plug in inputs and it spits out portfolio construction is not sufficient

Next, the most impactful investment I can make (and anyone else can) is investing in myself

This plays itself out in 1) the time I spend educating myself (I read a lot, talk to smart people, ask tons of questions) and 2) how “irrationally” long I am on @swaguphq

My stake in SwagUp is the most important and valuable asset I have and basically all of my actions are orientated around maximizing it’s value

In proportion to my investable assets, nothing will have as big an impact as driving growth in SwagUp

Running SwagUp as a boostrapped hyper growth company, cash is our jet fuel and we’ve proven to generate crazy returns on the finite cash we have

Therefore, every dollar we take out of the business has incredibly high opourtunityncost and should be avoided if possible

This plays out for me personally as avoiding relying on SwagUp profits to fund my life(style)

For the first 3 years, my salary didn’t get past $60k (now $150k ish), and 4.5+ years later we have never taken a dividend out of the business - we plow it all back into the company

As such, many of my investment decisions outside of SwagUp (which are still somewhat limited) are centered around decreasing my reliance on cash out of SwagUp

This results in looking for high upside potential oppurtunities given the risk of going to $0 is outweighed…

By the potential upside of keeping as much cash in the business for as long as possible and being able to live off of investments

I also see many founders take secondaries off the table, and while im not opposed to it, I’ve also seen many founders regret taking them too early

If you have something great, and you know it, doing whatever you can to maintain as much equity as possible has huge long term implications when you finally realize the outcome in some way (or even decide to cash flow the business)

So if you think about the investing landscape,which assets have assymeteic upside potential and to me (beyond my own startup) that has been crypto and more specifically ETH

I’ve long been an ETH fan (since it was about $30) but didn’t really start buying it until it’s run in ‘17

Not to get too deep in the weeds on ETH, but beyond the benefits of the blockchain, I’ve always loved the idea of programmable money…code with incentives

And ETH really put a focus on building a community (@ConsenSys really ignited this) and the network effects shows

So I got into it somewhat early and because of that I also saw it’s value drop over 90% in a matter of months…I’m fully aware of the risks …but I also don’t trade it

I buy it and have the conviction to hold it, not even look at it, and get back to my day to day job

I invest less in stocks rn, but it’s the same concept, where is there assymetric upside potential, something that seems obvious that others don’t see yet

In equities example, to me that looks like Opendoor - they are transforming a massive market and not getting credit yet

With whatever cash is left, I try to pick a few high upside potential startup investments with teams that execute at the highest levels with products that I understand and could possibly be helpful for SwagUp + also helps build a network around me

The funny part of all of this is I’m a Ben Graham disciple

I regard The Intelligent Investor as the Bible of Investing and first picked it up when I was 16 (I bought my 1st stock at 13)

I went to William & Mary for finance before dropping out

I use to make DCF models for fun

To a degree, these are unprecedented times that even BH couldn’t predict, but it’s actually very similar

Value is still value, but value has just changed a bit, growth needs to be factored in and improving unit economics and we are bad at pricing those things in ahead of time

And that’s where opourtunity exists these days

So whether you think I’m crazy, smart, or crazy smart…my journey is my journey and is highly dependent on my personal situation and no ones knows it better than me

End 🚀