Success Means Survival
and my review of Value, interview with Sebastian Mallaby, and a detailed SMB acquisition turnaround company
There are not many shows like The Bear that depict the realism of both the boring and stressful moments in life. Some episodes make me wonder if I’m watching the world’s most boring documentary about restaurants. And then some scenes remind me of what a restaurant manager once told me in NYC, “I don’t watch The Bear because TV is supposed to be my escape from work”.
There’s one scene that stands out. The main character is a new owner of a mismanaged restaurant his late brother left to him. He’s lighting a cigarette in the kitchen and accidentally starts a fire. His first reaction is to put it out with an extinguisher but then he hesitates. Instead the flames dance before his eyes. But then suddenly someone else notices and sensibly grabs the fire extinguisher and puts the fire out.
Afterwards when asked what happened he says, “If I don't do anything. This place will burn down. And all my anxiety will go away with it.”
In the last few weeks, I felt sharp moments of stress through building the foundation of Interview Query and working towards the larger vision. It’s been days of managing people, analyzing metrics, and steering the behemoth beast of the core business along with pushing on widely new initiatives. But when outcomes lag behind laying down the plumbing of systems, processes, and product, you wonder if the stressful cycles are even worth doing. I begin to secretly relish waking up one day and deleting Slack. Taking a step on a plane and just disappearing into the life of the surf bum.
It’s easy to forget that a typical week now is my imagined success five years ago. In those days I was bringing myself to work at a job that I did not love and attending meetings that I did not want to attend. And the price for the freedom and flexibility of removal from the job is where I am now beholden to a ship that must be steered through winds blowing in all sorts of directions.
Last week however, I found some resolve an interview Tim Ferriss did with Jerry Seinfeld. Ferriss asks him what he defines as success:
I don't know if I mean it as a joke—but I say a lot these days that 'survival is the new success.' In my business, if you're 60 plus, or even if you're 55 and you're getting paid to work, you have crushed it. When you have seen the attrition that I have seen, it's like in 'In the Heart of the Sea', when they're dropping like flies."
Someone asked me the other day how many people whose careers were made on 'The Tonight Show with Johnny Carson' are still working. I didn't want to answer the question. I always tease my friend Jimmy Fallon that these talk show gigs are like a sick experiment. Let's take a human being, put him in a studio for decades, doing an hour of television a day, and let's see what breaks. It's sick. It's a sick human experiment, like it's a pope job—who does it until you're dead.
That's my concept of success. Did you beat them at their game? They designed this thing (stand up) to kill you. To travel, to go to the airport in your 50s, in your 60s, to fly on planes, to go to strange cities, to go to hotels, to put on a suit, to go out on stage at 8 o'clock at night, and run around and yell, and project your physical energy for an hour in front of thousands of people... They're trying to kill you.
It’s hyperbole but at it’s core stands to wonder if any of this is worth pursuing. Even this newsletter is an artifact of this. Is it crazy to try to write a newsletter every week when your subscriber graph looks like the shape of a trapezoid? Is it supposed to be all fun and games when your businesses’s MRR graph is a constant zigzag?
The key thing I realized was that if I go into my vision board and specifically isolate what I want to achieve in 10 years, whether that’s running a business with 10x as much revenue or allocating capital to 10 different businesses as an investor, I will have to admit something that is hard to swallow. Which is the fact that I will still have hard days and weeks like I do now. And my day to day will be dealing with challenges towards striving to ever greater thresholds of what I define as success.
You don’t get to where you want to be, by being okay with what you’ll have when you’re there. But I think learning to deal with the day to day stress is part of the process towards making those changes that will push you to ever greater heights.
Whether it’s enough or not, is another question entirely. But if success is survival, then it’s really about sticking around for as long as possible. And remembering to just putting the fire out. And then moving along.
Things to Share
Value: The Four Cornerstones of Corporate Finance was an extremely practical book in terms of understanding investing. Moreover one thing that was hammered into me repeatedly was the equation of “Return on Incremental Capital” and how that turns companies into value creation machines. I’ve always considered myself a lucky long term investor where I’ve mostly made money from buying dips in popular tech stocks that have long term managed to stick around. Each time I was buying in, I would do so with the notion that since I used Instagram or because I personally had an iPhone, it was probably long term a great bet. But it didn’t work out so well when I thought Beyond Meat tasted pretty good. Turns out, there are more value creation factors at play than product quality that affect the stock price and long term prospects.
This interview I read with Sebastian Mallaby was illuminating to me as I continue my self-paced learning towards a mini-MBA. Mallaby is the creator of multiple finance books including More Money Than God which I’m starting this month. One thing I gleaned was how he distinguishes venture capitalists from hedge funds in terms of how each relates to innovation and which career you might go into depending on how extroverted you are.
You read posts like this on small business acquisitions and you think → how the fuck do I get to where this guy is at. Buying million dollar businesses with no money down and turning them into cash flowing machines after a year or so. What I’m slowly beginning to learn? Deal flow is everything. Only part of the work is probably the turnaround of the business detailed in the article. Most of the legwork is probably in the guy writing a weekly newsletter for 2+ years, being a CFO for 20+ years, and spending a lot of time building a Twitter following. Oh yeah, did I mention that I’m interested in buying businesses too?