no one has ever left a meeting with me wondering what I meant when I say something it is clear candid and often blunt am I being too subtle is my punchline when I deliver a message that I consider obvious I can seem Gruff I know that and I can be impatient I have an embedded sense of urgency what I
can't figure out is why so many other people don't have that but from an early age I realized that I had a fundamentally different perspective from my peers and I was willing to trade Conformity for authenticity even when that meant being an outlier which it usually did and even if it meant being on my own in this book I share the story
of how a Restless curious boy who grew up in Chicago made it to the Forbes 400 I'll describe the risks that paid off and those that didn't and I'll tell you what I learned in the process I'll take you inside my world of companies I'm probably best known for creating several of the largest companies in commercial
real estate and for helping establish today's $1 trillion public real estate industry you could say that I'm an investor or an allocator of capital but what I really am is an entrepreneur that is an excert from the introduction of the book that I'm going to talk to you about today which is am I
being too subtle Straight Talk from a business Rebel and is the autobiography of Sam zel the introduction of this book is perfectly named cuz he named it no BS no one's going to read this book and then after like hey I wonder what Sam zel really thought he tells you in very plain language I want to jump right into
the introduction because something that I found really fascinating is how much he preaches the gospel of Entrepreneurship not only for people running their own companies but also for teaching the people inside of your companies to think like an entrepreneur and so he starts out defining what an
entrepreneur is to him in my definition an entrepreneur is someone who doesn't just see the problems but also sees the solutions the opportunities and what I loved about reading that was that that is not a New Perspective the best way to think about how entrepreneurs look at the world based on what you and I have
read in these books is that they see problems that are just opportunities and work clo that is a actual that's an old quote that came came from Henry Kaiser Henry Kaiser was this entrepreneur read his biography did uh did an episode all the way back on Founders number 66 but he had built like a hundred different
companies over his career he made the majority of his wealth all the way back in the 1940s and 1950s and one of Kaiser's talking points that he repeat over and over again is that you should be see looking at problems as problems you see you should see every problem as an opportunity and based on my reading
of Sam zel's philosophy of company building I think that's very much an alignment with the way Henry Kaiser looked so he says a fundamental part of being an entrepreneur aligns with my tendency to walk out of step with the norm I have a saying so these sayings he's going to repeat over and over again
throughout the book They're widely known they're called sisms and this is the first time he mentions one of them he says I have a saying if everyone is going left look right conventional wisdom is nothing to me but a reference point and he gives examples throughout the book of multiple Decades of this
trait working very well for him another way he puts this is that when everyone is going right that you should look left so he says I make a point of shutting out the noise doing what makes sense to me I want everyone's opinion because there's tremendous value in being a good listener but then I determine my own
path and once I form my opinion I have to trust my perspective enough to act on it that means putting my own money behind it my level of commitment is usually high and I stay with my decision even when everyone else is telling me that I'm wrong which happens a lot and another thing I liked about Sam's
philosophy is that he's all about long-term Partnerships in many cases he's doing deals and working with people for 20 30 sometimes 40 years and so he talks a lot about the importance of having long-term building long-term relationships so he says when you're a repeat player when your world is your
business and your business is your world it is all about long-term relationships and any negotiation I believe in leaving a little bit on the table and in any relationship I believe in sharing the stakes I've been doing deals with many of the same people for decades because the goal is for us to all come out ahead
and many of my employees have been with me for 20 or 30 or more years because if I if I do well they do well these long-term relationships reflect the most important lesson in parted to me by my father he taught me simply how to be he often told me that nothing was more important than a man's honor than a good
name reputation is your most important asset everything you do everything you say is part of the permanent record your name reflects your character no matter how successful I got I never forgot that lesson and so I like the fact that he starts with hey keep yourself to a high standard and then immediately goes into
the fact that I am imperfect and I wasn't even able to to hold myself to the standard I have not that I'm a saint I've been married three times and I admit that when I was younger my career competed with my role as a husband and father and my career often one and I have to bring that to your attention
because that is a very common mistake and regret in these books that you and I go through more often than not they over optimize for their professional life at the detriment of their personal life and then they wind up regretting it when they're older in Sam's case he changed his perspective on this but of course
you know child like uh the the founder of Ikea had the best quote on this ever because he talks about sacrificing he he miss seeing his three sons growing up as he was building Ikea and he says childhood does not allow itself to be reconquered that is the best description of this very common mistake and regret
that a lot of entrepreneurs have and so Sam says today I have a better perspective as most of us get over time the first thing you see when you walk into my office is a screen with scrolling photos of my wife my kids and my grandkids I relish my time with each of them my life is more balanced
now and then he goes into what motivated him why was he drawn to a life of Entrepreneurship and of course everybody's like oh it's got to be the money and they say that because done at the highest levels entrepreneurship brings the most Financial rewards but the personality types that stay in the game for as long as Sam has and he's
been in the game for 50 years usually describe entrepreneurship as a calling and an obsession and we see that here in fact let me read I'm going to read my note to you before I read this section because as I went went through Sam zel's quote I'm like man this sounds a lot like Sam Walton so all the way back on
Founders number 234 when I read Sam Walton's autobiography for the second time there's just this fantastic quote um that I think just hits on the on the ethos of an entrepreneur he says the great thing about Entre this is Sam Walton speaking now the great thing about entrepreneurship is you get to
spend your time building something you enjoy most people don't get to do this they're stuck in jobs that they hate I had the time of my life and that is exactly what Sam zel is about to tell us here I'm not solely motivated by the accumulation of wealth there's a line from an old movie called wheelers and
dealers that says you don't go wheeling and dealing for the money you do it for the fun that's exact same word that Sam Walton used right money is just a way of keeping the score and that's how I see it I I've always been much more drawn to the experience my life is about testing my limits and having fun in the process
business is not a battle to be waged it's a puzzle to be solved that's a great line business is not a battle to be waged it's a puzzle to be solved the end goal isn't to accumulate a lot of toys and then kick back I want to pause there he's going to go on for a little bit longer but think about what he's
saying there once you find your life's work ex strategy is death it's not retirement the end goal isn't to accumulate a lot of toys and then kick back he is 75 when he writing the book he is 80 today and he is still working if I'm being intellectually challenged if I'm doing things I've never done
before if I'm using my creativity and resources to solve problems if I'm constantly learning then that is fun really think about that paragraph that's another way to describe entrepreneurship I'm being intellectually challenged I'm doing things I've never done before I'm using creativity and resources to solve
problems and I'm constantly learning and so yes he's got a lot of dark periods in his career just like anybody else is going to have he goes into detail but he tries to make everything he does fun I adopted a philosophy I call the 11th commandment Thou shalt not take thyselves too seriously The Wall Street
Journal back in 1985 did a front a front page story on me and quoted me saying if it ain't fun we don't do it so the know I left myself there is optimized for irreverence and keep in mind we're still in the introduction he's giving us like his overview of the way he looks at life and philosophy and he's already we're a
couple pages in he's already repeating over and over again he's like listen I'm making my own rules I'm not just going to accept what other people tell me or I'm not going to act the way other people want me to act and so it says one of the biggest raps about me is that I've been known to use profanity
sometimes my real estate colleagues will make bets on whether or when I'll drop the F-bomb on stage at a conference I simply do not buy into many of the madeup rules of social convention I think people often get distracted by these superficialities for example I've been wearing jeans to work since the
1960s long before it was acceptable later on the book I laugh cuz he literally says I mean he's got a giant personality jumps off the page which makes the you learn lot reading the book but it also makes it fun but he like he's like I I invented business casual and I don't know if that's true I just
think it's funny that he would even say that so it says for example I've been wearing jeans to work since the 1960s long before it was acceptable the bottom line is if you're really good at what you do this is his main point of what this entire paragraph I'm reading to you which is I think is probably true uh the
bottom line is if you're really good at what you do you have the freedom to be who you really are and I just love Founders like this because he says people often ask me when are you going to retire and I and I answer retire from what I've never worked a day in my life everything I've done is because I love
doing it because it was enthralling I never stopped pushing myself I'm 75 I work out every morning at 4:45 in the morning and I'm at the office by 6:30 a.m. and I don't get at home from work until 7 at night now here I'm going to pause there because there's still a lot there's two more sentences here that are
absolutely fantastic but he just got done telling us that he's more balanced now right with his family life and look that doesn't seem like he's leaving a lot of time for family so imagine imagine what his schedule was when he said that he was unbalanced that work one out you know the fact that he got
married and divorced a bunch of times but he says I'm 75 I work out every morning at 4:45 then I'm off I'm in I'm in the office at 6:30 a.m. and I don't get home from work until 7:00 at night I have plenty more to do and a lot more to say every day is an adventure here's my story have fun with it so then he goes
into the unbelievable story of his father and mother and his older sister escaping from Poland right before the Holocaust if you want a great book that is dedicated to this entire story it's a very similar story I did it back on episode 159 it's Andy Groves Memoir swimming across it's a memoir about the
first 21 years of his life there's a lot of stories in there like you could take from like the O overcoming unbelievable odds and actually surviving Andy Grove was widely considered maybe the best technology CEO of all time but there's nothing about actual business in that book but I think understanding why Andy
was the way he was is it's like reading that book is fundamental to understanding who he was as a person and and how he approached his career for the last 50 years of his life once he actually gets to America so Sam zel's family is Jewish his father is seeing all the events that are happening in
Germany and Austria at the time and he's realizing we got to get the hell out of there and the rest of his family stays I think between his Sam's father and mother I think they they lose I want to say like 14 or 16 siblings are killed in the Holocaust and I just want to pull out a few highlights here because I
think it illustrates how tenuous like just one decision the decision by his father changed his entire life he got out on the last train if he did not make this quick decision there's a good chance that Sam is never born because his father and mother and his sister die his train arrived home at 2 p.m. it was
a 10-minute walk home and when he got there he told my mother to pack all that she could carry they were boarding the 4:00 train out that afternoon he made one last effort to beg the family to leave Poland with them it felt like a Race Against Time but again they refused so my parents and sister started
out alone on a near 2-year Odyssey the Germans invaded Poland the next day at dawn my father this is crazy my father had caught the last train out before the nais bomb the railroad tracks my father mother and sister traveled after the Train on foot by bus by horse drawn carts and by cattle train so think about
the independence of mind that you have you're like no I have to leave now everybody else your entire family saying no no stay stay you take your your wife and your baby little girl and you leave and then this is the result most of all the family was murdered their parents and all but two of their brothers and
sisters so I was wrong all of their siblings 18 children I got to repeat that again most of the family was murdered their parents so that would be Sam's grandparents all but two of their brothers and sisters and all of their siblings 18 children it took them two years they finally get to America and it says every year for
the rest of their lives they celebrated the date of their arrival with the toast to America my sister and I grew up keenly aware of how fortunate we were to be in this country the no left myself there is no one loves America like an exile from a hostile regime loves America I just had dinner with the twin
founders of this company called Lula they're trying to build like the stripe for insurance and we just had the same conversation cuz they're they're sons of Cuban immigrants my dad I've told you before but my grandfather decided when he saw Castro take over Cuba he's like we got it he made this a very similar
decision he's like we got to get the hell out of there and he did that with no money no education and a wife and a and a baby boy which was my father and so even though our families came from a different area than Sam zel's family we completely understand why their parents would do this where they celebrate the
date of their arrival every year so then we get the relationship that Sam had cuz Sam was the first one I'm pretty sure the first one of his family to be born in America and then we get he he spends a lot of time in the book actually talking about an idea that you and I have spoken about over and over again
and it's the fact that you can always understand the son by the story of his father that's the story of the father is embedded in the son and so Sam just starts to describe the what the relationship was like his father dies in the 1980s I think he dies in like 1986 so he's describing this many decades
later 30 years after his father died as a matter of fact he was very strong willed and authoritarian and because I had a strong personality as well we often clashed he continually attempted to re me in and I always bristled at being told no consequently we had a rather contentious relationship but the difference was he always respected him
he said I had an enormous respect for my father and that respect was absolute and so Sam talks about the fact that what his father had to survive he didn't provide Sam a lot of time to be a kid this may be the reason why Sam was able to start businesses like he he builds this like massively successful real
estate business when he's still in college in fact he gets to law school and I think the last year of of law school if I'm not mistaken he makes the equivalent of like $2.5 million or maybe like $1.5 million like his last year of law school and part of that is because he had to grow up his dad forced him to
grow up and I was thinking about this like as I reread my highlights yesterday I was like okay look at it from his dad's perspective imagine being in your late 30s you're you see that the anti-Semitism you see that Hitler is like on the rise you escape with your wife and your daughter you get to
America 2 years later all of your family is dead like how could you not approach the raising of your family in a very serious Manner and saying hey there's no time for there's no time for games like you need to go out and build a set of skills to be able to take care of yourself and survive in this very crazy
world so it says he he would tell his his dad would tell his son like you don't have time for fun like he'd go to like he like Hey Dad I want to go see a basketball game he's like his dad said something that was kind of like humorous looking back at he's like you saw one last week why did you have to see
another one so it says you have plenty of time in your life for fun now you have to focus you have to achieve you have to be directed you've got to understand that the world is a hard place this was a typical conversation that I had with my father and so one of Sam's sisms is that we we suffer from knowing the numbers and he talks a lot
about how like other sloppy like Real Estate Investors and entrepreneurs are and that they're just very undisciplined and he was like obsessed with understanding risk and understanding what the numbers of his business actually are and part of this he thinks that he got from his father or from his
parents because even after his father dies Sam's rather wealthy his mom would not let Sam give her like a ride home he winds up I think following her I forgot how he finds out this information but she was so Frugal in the sense that like Sam at this point in his life you know had basically unlimited resources his
mom would make up excuse that oh no you can't take me home or you can't give me right home or you can't pay for a cab or whatever because I got to go to Walgreens and so he finds out that that's not she's going to Walgreens because there's a bus stop right in front of Walgreens instead of spending
$3 on a cab she would spend 50 on the bus ticket and in some cases this is very irrational considering that her son is wealthy and would obviously give her the money to have a taxi right and then so I just gave you like a summary of the story but I want to hit you with his punchline because I think this is the
best takeaway and he says a refugee never forgets and part of the background to that story also is the fact that the only way they were a able to escape was that Sam's dad saw this coming so he was able to get money out of Poland and deposit it I forgot where the money went I can't remember went to London or Pal
at the time but he was able to sneak about 10 with the equivalent of like $10,000 today out of the country in advance of him escaping and if he didn't do that there was a good chance that they wouldn't have never made it to America so that's what he's talking about like being careful of like
watching your cost and a refugee never forgets now he talks goes back to his childhood and he tells us his first like he's like I've always thought like an entrepreneur I don't like and he says later on he's not entirely sure that entrepreneurship could be taught it's most likely an inherent like characteristic and part of your
personality and so he's going to tell us a story of like the first time you realize hey I can buy something for a dollar or I think 50 cents and then sell it for more money later on so it says this was my first entrepreneurial Adventure it was 1953 and a provocative new magazine called Playboy had just
made his debut featuring Marilyn Moro on the cover uh the magazine sold for 50 cents and I bought a copy so he's doing this in Chicago but he's growing up I think he's in Highland Park he's like in a suburb of Chicago so he goes back and he's like I can buy something in the city that is not available in the
suburbs and because it is scarce in the suburbs I can charge more so he goes back shows it to his friends and he says I showed it to my friends one of them offered to buy it three bucks I said after that I started a little magazine import business and in the process learned a lasting business lesson when
there is scarcity price is No Object this basic tenant of supply and demand would later become a governing principal of my investment philosophy let's fast forward to high school and we see he opened up the introduction of the book talking about being comfortable standing out being comfortable being an outlier
being comfortable going left when other people are going right this is something that he he did even when he was a young person and this is very already a pronounced trait when he's in high school I discovered that fitting in just wasn't important to me I was more comfortable standing apart than I was in
searching for a common denominator with others I could embrace my tendency to go against conventional wisdom and it would later end up defining my career and that embracing the fact that he was a misfit I mean look at the subtitle of the book Straight Talk from a business Rebel I've also seen it published under the
subtitle of The Adventures of a business Maverick he's wearing that as a badge and so he tells a quick story about doing something that he could not tell his parents about cuz they thought it would be too dangerous and he's like I want to see the entire country he goes and enrolls I think he's taking like a
summer class at UCLA he's like well I don't know how to get there let's just hitchhike so him and his friend decide hey we're just going to hitchhike across the country I was going to use the extra two weeks to hitchhike across the country I don't know if it was Rebellion but I didn't want my parents to worry so
I never told them about the trip I do know that it was a two-e adventure that it was too that was too good to pass up up so while he's in college this is how he accidentally enters into the real estate industry and from this point in the story to where we are in modern day is about 50 years where Sam builds he's
regarded essentially as like one of the most successful real estate Professionals of his time he's going to sell his real estate company for 38 I think it's like $ 38 billion to Blackstone in 2007 and his education in this industry starts right here one day in the middle of my junior year I was at
a friend's apartment and he mentioned that his landlord had just bought the house next door that we were going to knock down both houses to build a 15 unit student housing apartment I'm pretty sure this is in an Arbor Michigan let's pitch them to manage it I said who's better than us we're students we
know what students want and we'll run the building and maintain it maintain it and each get a free apartment so I've heard him talk in addition to reading the book I also went and listen to he was on this there's a fantastic episode of Tim Ferris podcast and I listen to a bunch of his videos on YouTube and he
talks about like my real estate career started just by trying to get free a free apartment so that's what he's talking about we didn't know how to manage or rent apartments we had no clue but this is something he's about to say the sentence for the first time and it really is is like part of his operating
system it says it just never occurred to me that I couldn't do it that's how you know you're born to be an entrepreneur the desire take risk to test my limits and to ask why not was just part of my DNA and I do not think that I've changed that much since then he goes into much more detail in the book but essentially
he did a good job with this first opportunity you and I have talked about this all the time just focus on being you have one opportunity right in front of your face do that the best you can and it will unlock opportunities you cannot possibly predict going down the road so he does a good job with the one
then he gets a second one then a third one and just kind of steamrolls from there the same landlord built a second student apartment building and gave it to ma gave it to us to manage as well and then he gave us a third so in addition to managing all these student Apartments he gets a summer job where he
has to be a door-to-door salesperson and this is extremely important because he thinks this was foundational to the success that he that is going to happen later on in his life and so he says if you've never sold anything through cold calls or without appointments it may be hard to imagine but I can promise you
that it is humbling most responses are no you will build up a tolerance for rejection you're you learn to keep asking and find ways to get a conversation going while I was unaware of it at the time my real compensation for that job was not money I was learning about and getting comfortable with rejection and as I would later
realize indifference to rejection is a fundamental part of being an entrepreneur that is a great line want to read it again indifference to rejection is a fundamental part of being an entrepreneur so he graduates then his dad is like listen I know you're into real estate but you have to have a
profession he would tell him if everything goes bad you need to have a profession that you can fall back on so he so Sam goes to law school and this is what he says about it he says law school was boring beyond belief I just wasn't built for the Arcane attention to detail and the endless rules and sub rules and
subub rules the not I left myself here here as I got into now we're I think we're in the second second uh chapter is are are you noticing a pattern he needs control over how he spends his time you're going to see another pattern in this real estate deal he does so while he's in law school he's buying up he
still has this idea for doing student housing so it's like I bought my first building during my second year of law school I bought it for $199,500 with $1,500 down this is where he build he buys out like an entire block by one by one a couple months later I bought another building next door and then I
bought the house that was in between them I had some money saved from my various Ventures and I was able to bootstrap my way into these early deals with a combination of my own savings and then bank loans I was 23 I didn't know anything about financing and here is what I mean about you see patterns over
and over in this book but it never crossed my mind that I might be too young to start an investment business or that I couldn't do it and so once these first three transactions Works he's like well can we buy the whole block and his pitch was unique he's like listen you guys are older families maybe you have
kids maybe your kids have left the home this is all this neighborhood J is changing it's going to be a bunch of drunk college kids you don't want that around your house right and so it says as I explained to the homeowners that that we were going to build student housing and that they could either stay
and put up with loud music at night and beer cans over the lawn or they could move to the other side of Ann Arbor it worked I kept buying houses and eventually acquired one full block of land this project eventually grows bigger and gets more sophisticated so then he goes to his dad and saying hey
can you invite can you do you want to invest first of all do you want to invest with me and can you introduce me to other people and this was more about like their relationship like the unspoken part of their relationship being able to invite my father to participate in this investment and his willingness to do so were big confidence
builders for me like any kid I wanted my father's approval and knowing that he viewed me as a legitimate businessman even though he's only 23 right was a milestone for me he was a Gruff guy stoic in an oldw World way he would never say that he thought I had done well so I learned to appreciate the
small signs that I had his Blessing and so since his idea was like let me buy these individual plots and I can put them together and they'll be more valuable in time he had to overcome like if there was one hold out out of 10 or 15 that's a big problem and so one person one of these deals just takes a
long time to actually get him out of there but Sam's Relentless and really I'm skipping over the story and I just want to get to the lesson he learned because I think it's very very important and he something he repeats over and over again I remember this event so clearly because it was at this point in
my career that I fully realized the value of tenacity I just had to assume that there was a way through any obstacle and then I would find it this and this is why I'm reading this to you this sentence in particular this is perhaps my most fundamental principle of Entrepreneurship and to success in general the value of
tenacity and so one thing I skipped over that I need to explain to you now is like at the time you know successful business other businessmen and things like that would take the money that their businesses produce and they would to invest in real estate and they were looking for like returns of like 4% 5%
and most of their Investments were concentrated in in big developed cities the idea that Sam built his early career on was going where there was no competition and this is something that he's going to repeat over and over all he's like competition is for other people it is not for me and this is also
where he gets the value of hey when everybody else is going right I'm going left when everybody else is going left I'm going right the cost of construction in these cities where he's doing these deals okay the cost of construction was significant L Less in smaller cities and even more important there was no
competition there was no real Capital looking for assets in these smaller markets where he's doing this okay without competition I could set the price and the market this was my first real investment thesis if I could replicate what I was doing in Ann Arbor in other markets I could realize some serious upside I would build a portfolio
of assets in smaller high growth markets with a focus on University towns that is the very Foundation the first idea of this business Empire that's going to grow and morph and change over the next several decades into something that he can sell for $38 billion okay I would build a portfolio of assets and smaller
high growth markets with a focus on University towns that all seems logical and hindsight today but back then nobody was doing it and then he compares the returns he's like we weren't getting four or 6% we were getting 20 25 18 30% returns as James Dyson says episode 200 if you haven't listened to it and it's
going to be episode 300 cuz I think instead of reading that book every year like I've told you I'm going to do this is against the odds and autobiography of James license still my number one um recommendation for autobiographies if you can only read one autobiography for an entrepreneur that's the one I'd make
it I think I'm just going to like like every hundred episodes so I did on 200 for the second time I'll do it on episode 300 episode 400 and so on and so forth but main theme of Dyson's book which is very which is really what's happening in Sam's life when he's a young person in law school is difference
for the sake of it that is where all the outsid returns are and we're seeing that exactly in a young Sam zel's life so he tries to get a job as an attorney and he's his idea is like I'm going to be an attorney and do deals on the side he goes through 43 rejections finally gets hired last four days I'm skipping
through that because what happens is after four days like man I don't want to do contracts so the the guy that owns the law firm is like hey why don't you just do your real estate deals we'll co-invest with you and then we'll do the legal work and so he does that for a little bit but then he's making so much
more money than even other people that other people in the law office are getting jealous and this is where he's just like man I'm just going out on my own this is ridiculous and the reason I'm reading this this paragraph to you is because even today when there is some kind of like entrepreneurship industry
per se it's still a very weird thing to do but you know that it's what you're meant to do because it never felt weird to you and so Sam is relating this conversation between a a partner in the office and they're just they can't understand the way he thinks and he's like oh I am kind of weird so he says
the conversation was a revelation until then I hadn't recognized that that my career was so radically different from the mainstream I had thought I was just offc Center I hadn't realized that it was on a completely different road but that partner's perspective Jarred me into an epiphany I have to leave this
Law Firm I remember coming home after I quit and my wife the first wife at this time was pregnant you quit she asked alarmed what are you going to do just what I do I replied which is real estate deals at this time my orientation towards being an outlier was going how many times how many times has repeated
this like this is extremely important part to understand szel and what he I you can read through between the lines he's like giving he's giving future generations of entrepreneurs that same advice lean into your eccentricities be comfortable standing out from the crowd that in and of itself the ability to do
so is an advantage right my orientation towards being an outlier was going to Define my future I was going to do what I love doing and I wasn't going to be encumbered by anyone else's rules so I left and opened open my business in a spare office at my brother-in-law's Law Firm that was the precursor to the
investment firm that I still run today so this is when he goes into one of the most important relationships that he ever has and there's this extremely famous and Wealthy family in Chicago that still exists to this day but I think goes back multiple Generations I'm going to go to Google to figure out how
to pronounce it I think it's pritsker I don't know if you can hear that it's pritsker pritsker and the point of the story is that he's going to turn down a job offer from an extremely famous entrepreneur and he says everyone knew the pritzkers they were one of the most prominent business families in Chicago
and they had started the Hiatt Hotel chain Jay pritzer which is going to be his partner one of his partners and like basically his mentor he talks I mean even many years I I heard Sam talking I think Jay died like 20 or 30 years ago he still talks about all the lessons that he learned uh from Jay Jay pritzker
was legendary in the investment world he had built and now controlled a staggering Empire and so Jay is looking for a young person that knows law and that is interested in real estate and Sam fits all these bills so he's introduced he's like hey go talk to this guy and Sam didn't understand why he
should do that because he's like I'm Not For Hire there's no way in hell I'm working for anybody else so it says the idea of meeting Jay pritzer was intriguing to me but I already knew I didn't want to work for anyone but his friend convinces him just go meet him and it'll be worth your time the next
morning I went over to see Jay I got there at 9:00 in the morning and I did not leave until 4:30 that afternoon and so Jay's trying to recruit him he's like listen come here we have a lot of resources you can do deals and you'll end up owning 5% and Sam's like that's ridiculous like why would I ever accept
5% but they got along so it says I stayed and kept talking truth is Jay and I instantly clicked I was having fun even though I knew I wouldn't take the job finally at the end of the day I said Jay I'm not going to work for you or anybody else but why don't we do a deal together and he said fine that was a
really smart idea that Sam did because Jay winds up being he says Jay was like new risk better than anybody else and he just learned how like even at that that level like how fast they make decisions how there's just he calls it no I think at one point he comes to Jay in a bad situation like I need $50 million
and by this time they done a couple deals together and Jay just trusted them so I think that also Echoes why Sam talked about hey you really need to be optimizing leave money on the table optimizing for these return relationships that that last for 10 20 30 years because then it just helps you go faster later in life because you have
this shared like web of trust the meeting with Jay was the beginning of the most influential relationships of my career Jay was the smartest fincial guy I ever met so the first deal that they do together is somewhere in Lake Tahoe this is really important because he wasn't sure at this point in his career
like what part of the real estate chain do I want to be in he's like oh maybe I'll be a developer so he tries to do a development deal he's like oh this is terrible I'm never doing this again as a result I was cured of any inclination to become a developer I think that to stay in that business most developers must
get 50% of their returns from real cash flow and the other 50% from the intangible benefit of seeing their phallic symbols rise out of the ground Sam was hilarious if you I hope you buy the book The book's pretty easy to read too you can read in a weekend it's just hilarious uh but that idea it's like oh
you're only getting 50% of your return from actual money and 50% of the intangible benefit of seeing their phallic symbols rise rise out of the ground otherwise I cannot see the reward my takeaway was a whole new respect for Simplicity that's something he repeats over and over again two development
required multiple steps and every step meant one more chance for something to go wrong and then he goes right into another lesson that he learned from Jay he's like you just bet on the person you bet you cannot make a bad deal with excuse me you cannot make a good deal with bad people and so Jay TR Jay
developed a trust with Sam that allowed him to work quickly and you see it manifest in stuff like this listen I said we closed this deal but I just realized we never drew up a formal partnership agreement between the two of us Jay and Jay's response was yeah yeah he said not really interested that was
indicative of Jay trust was one of his abiding principles he'd always bet a lot more more on the person than on the deal once Jay decided decided that I was honest and smart he was on board he never called me to check in on things he never questioned where we were in our investment he continues he just this
entire chapter I'm if you buy the book I'm in the chapter called my own rules I think it's important to read this because it's really what's what I find fascinating is just how many of these ideas that he got from a older more experienced entrepreneur that he used for the rest of his life that he talks
about many decades after Jay dies and it's this idea like listen you might have seven things eight things nine different variables and whatever you're working on but really you can always identify there's going to be one important variable and he learned that from Jay where he'd be describing a deal
to Jay he's like okay we got seven you know 12 steps here and Jay's like actually the only step that's important is seven step seven like if we can rent this commercial office bace then everything else all of our assumptions are going to be proven true and if we failed that one assumption then the whole deal falls apart that's one
example that he used Jay's level of in intellectual rigor really applied to me and I immediately LED on to the understanding that it could cut right to the heart of something complex if I broke the problem into pieces it was a matter of organizing my thinking it was a discipline meaning it is an actual
skill that you can learn and really for me that was one of the most important parts of the book it's just this constant reminder that there is usually just a handful of variables I remember I did that three-part um series on Larry Ellison it's Founders uh episode 124 126 and 127 and that was his belief too
where his his assistant or his Partners would be like hey there's things we got to talk about like no there's four there's like the handful of really important things that I know that that that require my attention and I'm going to ignore everything else even if people get upset at me for that and then I was
reminded how important this principle was in a past highlight uh when I did the the um the biography of Johnny Carson back on episode 183 Johnny Carson at this point in his career he's like am I going to am I going to leave at there's you know I think there's only like three or four channels on TV at the
time and it's like do I want to leave NBC for ABC or it could be vice versa but whatever like am I going to leave the channel I'm on for another Channel and so Johnny and his team were going through and they're like okay let's make a list of this are the pros and the cons and what are we going to do and so he
goes and seeks advice from Lou werman Lou werman is like they consider he's like the most powerful and influential person in Hollywood he was like a Hollywood Mogul for like four decades and so Johnny Goes to see him lays out all these things like I don't know what to do and and Lou gets the reason I'm
going to read this paragraph to you from Johnny's biography is because it's almost exact what Sam zel is learning from from Jay priter it's like what's the most important variable focus on that and so it says like most oracles werman gave an opinion that was simple and sensible it is not prudent he replied to ask people to change their
nightly viewing habits once they are used to turning into a given Channel they find it hard to make the move no matter how good an alternative is being provided elsewhere that's the end of his quote this is what Johnny says was that it all of our thinking and talking and arguing and agonizing came down to the
belief that Americans won't change the dial and so as a result Johnny stays put and this is the deal he gets one of the most lucrative deals ever offered to a single individual in the history of Television let me read this to you this this is it blew my mind Johnny's salary was set at $25 million a year for that
he worked 1 hour a night from 11:30 p.m. to 12:30 a.m. three nights a week 37 weeks a year he had 15 weeks off so he is getting 25 million a year to work 1 hour night three nights a week 37 weeks a year okay so let's go back to Sam zel's autobiography Sam just like everybody else that we studyed on the
podcast read biographies learned from biographies and autobiographies of the great people that came before him exactly what you and I are doing at this moment around the same time I was spending a lot of time with Jay I read the book zindorf The Autobiography of the man who played a real life game of
Monopoly and won the largest real estate Empire in history that is a very very long subtitle it reinforced the approach of viewing the whole through its individual pieces but for different purposes William zindorf was perhaps one of the greatest real estate developers of the modern era and so this one idea
he picks up from this book changes the trajectory of Sam's career his autobiography is packed with colorful stories but what fascinated me most most was his strategy zondor viewed assets as a sum of parts so he could increase the value of the whole various parts were more valuable to different buyers so
zindorf would maximize the value of his Holdings overall in effect making 1 + 1 equal 3 he calculated this is the main punchline of what he learned from him okay he calculated everything separately the building's title the building's land the leases the individual mortgages I thought this was brilliant I adopted the
approach both inside and later outside of the real estate industry and I just realized I'm going to I'm going to buy while I'm talking to you right now I am buying this book zond dorf's book um that's how I like when I hear like a book recommendation or in this case when you normally a lot of the book
recommendations come from you but whenever I receive them and in this case this guy we have Sam Z saying hey I read this book I got a great idea I made a ton of money from this idea like it's a no-brainer my point is like I don't I don't think it's smart to deliberate on the purchasing of books what's cool is
I'm looking at the page now it's already bought so I just ordered it while I'm recording the podcast this book was first published May 6 1971 so now he talks about the building of his real estate Empire he does a bunch of deals with different people but he only had one like true partner and this guy named
Bob lurry who unfortunately dies I think he's in his 40s when he dies from an aggressive form of cancer but he really talks about that they had different personalities but they had the same passion it says Bob and I both saw business as a puzzle to be solved and we both had an insatiable intellectual
curiosity and so this Rebel and Maverick nature applies to the way they build their business they have you walk in the business or you walk in the office and it's like bright co colors everywhere he doesn't allow office doors to be shut and this is where I started laughing cuz he says he invented business casual we
have been in all pretense and esta estblished a casual dress office policy which believe me was unheard of in the rigid world of Finance in the 1970s we invented business casual our thinking was that if you dress funny and you're great at what you do you're eccentric but if you dress funny and you're just
okay at what you do you're a schmuck we were determined to show everyone that we could Excel without conforming in the early days they were asset rich and cash poor because they kept pumping all their cash flow back into the business and part of their ability to do that is that Bob was extremely resourceful he watched all the
cost this was a fantastic paragraph for you uh Bob watched every single Nickel in our business Bob was constantly on the lookout for anything that could be reused he used to walk into somebody's office and while talking would casually rummage through the person's trash can he' take out stacks of paper that still
had paper clips on them all while continuing his conversation as though nothing out of the ordinary was occurring Bob would pull off those paperclips or Bob would just pull those paper clips off and hand them back to the employee conclude the conversation and walk out and so when I read that
immediately thought of this hilarious story I did all the way back one of my favorite books I should reread it and re-record another podcast on it's called The Invisible billionaire by Daniel lwig very hard to find book but it's uh episode 68 of Founders and he was very much like Bob through his entire
gigantic organization where I remember one time in the book he's like admonishing an employee because they put paper clips like there's documents that had to be signed for this massive deal if I remember correctly and like fedexing it or whatever way that you could it back then I don't even know if
FedEx existed at this point in history but they're like fedexing the paperwork and Daniel is just going ape because they included the paperwork and I think he said something like or the paper clip in there he's like we don't send iron mongery he used this weird word I had to look up which I didn't
know what the definition was it's like we don't send Iron mongery by mail or by air it was just hilarious and it's really memorable writing too because I could just see Bob like in my mind's eye when I'm reading this I just see Bob like having this convers ation imagine sitting in your office your boss comes and he starts
rumaging through your trash can and he just doesn't even admonish you he just like pulls him out it's like oh here hands the back and then just walks out the door when the conversation's finished I just love that so Sam zel's nickname is the grave dancer and the reason he's called the grave dancer is because he accumulated a lot of uh
assets when their price was depressed by like some kind of financial crisis and this is the first time he talks about that he says between 1974 and 1977 we brought roughly four billion in assets with a dollar down and a hope certificate I didn't know what a hope certificate was before reading this book
and it says hope certificates were prominently used during downturns uh they would allow a seller that was reluctant to unload at an asset at a depressed price the opportunity to participate in the potential postale appreciation and so he gives an overview of what he was thinking at this point uh
in his career he says the 1970s could have been a disaster for us they were for many in real estate instead they were a they were a great great ride our firm ended the decade with an enormous diverse portfolio some of which would later seed two of the largest REITs in the industry REITs are Real Estate
Investment Trust some people say sam zel invented the Reit he says he was not the inventor he's just the one I think he says it's like I'm just the one that made REITs dance and the way he would describe what a Reit is to an outsider is it's liquid real estate there's a lot more detail in the book on that years
later people would ask me how did you know when and what to buy but all did was basically create a massive Arbitrage a this is the the grave dancing strategy he's using between 1974 and 1977 that's what he's describing okay but all I did uh was create a massive Arbitrage a fixed rate instrument in an inflationary
environment I essentially took on $4 billion of non-recourse debt at an average interest rate of 6% in an environment with inflation of 9% or higher that means I was already making 3% Returns the second the deal closed without doing a thing to the assets and so there's several times throughout his
career where he writes these like Marquee articles or pieces explaining his philosophy and usually his philosophy at the time is completely counter to whatever else is occurring in his industry says I ended my 1986 article called the grave dancer dancer with an important warning grave dancing is an art that has many potential
benefits but one must be careful while prancing around not to fall into the open pit and join the cab there is often a thin line between the dancer and the danced upon and so as he continues to build up his real estate business he realizes hey a lot of the principles that I'm learning through experience and
learning from more experienced people like Jay pritzer and all my other partners it's like they can apply not just to real estate and so that's where he starts buying into and in some cases grave dancing into other Industries and it came from just this question that he's asking himself if we've been a
successful in real estate as we have been aren't we really just good businessmen and if we're good businessmen then why couldn't the same principle r that apply to buying real estate apply to buying anything else so then he talks about some of the ideas he has between acquiring or buying into or investing into other companies and I
really want to pull this out because it's really fundamental understanding his his distaste he hates competition he says frankly there's no substitute for limited competition you can be a genius but if there's a lot of competition it will not matter I've spent my career trying to avoid its destructive
consequences competition skews people's assessment as buyers get competitive the demand for assets inflate pricing often Beyond reasoning later on I got to finish the sentence but later on he talks about he's like I hate auctions unless I'm the one doing the auction so he says competition skewes people's assessments
as buyers get competitive the demand for assets inflates pricing often Beyond reason I jokingly tell people that competition is great for you me I'd rather have a natural monopoly and if I can't get that I will take an olop and so one thing he looked for when he's buying into other companies is just
poorly run companies that did not have control he's like I don't think you can it's realistic to think hey you know they're doing this amount of sales and I'm just going to go in there and you know 5x sales but it's always these poorly run companies you can always make returns by getting rid of expenses and
this story this paragraph I'm about to read to you is if you listen to last week's podcast with John on John Malone he did he had the exact same thing happen he actually threatened to throw the manager of one of his subsidiaries out of a window for Behavior like this throughout the 1970s it was a giant and
flamboyant company known for its corporate excess so this is a company he's buying into the management threw lavish parties filled the drinking Fountains at headquarters with perier installed Persian rugs and Executive offices and gave massive bonuses to senior Executives even while the company
was struggling it sent its stale staff on a 1.5 million Caribbean cruise so that's what they were doing in 1970s the company's called Intel or not Intel it it's Intel without the end so itel or I think itel in so that's what they were itel was doing in 1970s in 1981 itel was one of the largest bankruptcies in
history of the country the reason I just point that out is like hey they're a giant inflam company uh known for corporate excess they throw lavish parties they fill their drinking F Fountains at the H at the headquarters with perier they're installing Persian rugs let me ask you a question is having
a Persian rug in executive office doing anything for your customer so then why does it exist it's ridiculous and then gives massive bonuses and has a a huge travel uh a travel budget even though they're not doing well financially and the reason I included that is because really the note that popped to my mind
when I got to that section I said every single entrepreneur that you and I have studied on the podcast would mollywop mediocre business managers like this and the world of business surprisingly is full of mediocre business managers that do stuff like this that is insane why are you putting Perry a in drinking
fountains why why are you buying Persian rugs for your office it should not be surprising that 6 years later that company is bankrupt and so that leads to one of his main points that redundancies are much more predictable and transparent than theoretical opportunities to add value my focus is
always on the downside overly optimistic assumptions lead to the graveyard of corporate Acquisitions so my interpretation of what he's telling you and I at that point most companies are poorly run if you buy one focus on cutting waste as opposed to thinking that you can quickly grow revenue and so even though he's working the time
definitely workaholic he takes these he he's traveling the world and he takes breaks to do these they sound really fun um motorcycle trips and so he lands in Nepal and him as a group pull over and this is what they were doing we were enjoying the sunny day drinking wine and eating sandwiches when an old woman
carrying a shopping bag down the nearest Mountain walked towards us it was filled with high quality cannabis and she offered to sell it to us for $10 so sounds like him and his friends are smoking weed so we bought it and shared it enthusiastically with our new friends at some point the guy I was sitting next
to you turned to me and asked so what do you do I replied this is while I'm reading this whole section to you I'm a professional opportunist and that has been my response to that question ever since what do you do for a living I'm a professional opportunist and then we move on to a devastating part of his life because not
only is he have his biggest Financial challenge in the company in the in the early 1990s but this is when his partner dies Bob and I had been partners for about 20 years Bob was only 46 in 1987 when he was diagnosed with Advanced colon cancer he did not tell anyone even me for a long time as he explained to
his wife I'm not going to be able to stand it if people mourn me before I'm gone when Bob got sick I went into irrational denial we talked two or three times a day but I didn't see him so he stopped coming to the office and so this is going on for like two years and then Bob finally shows up and it hits him
like he can't be in denial anymore a couple month uh Sam can't be in denial Bob wasn't in denial the whole time a couple a couple months after Bob had stopped coming in he walked into my office I was dumb struck by his appearance at how frail he was to me this is the absolute worst way to die
and then not only like to be on to be an actual person suffering from cancer but then to see I went through this with my mom back in uh 2015 2016 and 2017 she had metastatic breast cancer that went everywhere all over her body and I think there's actually an important lesson there that I was way too late for me to
learn is so I we me and her had been in a fight and so I hadn't talked to her for 6 months and then we found the family found out that she she had cancer Advanced cancer so I go to visit her remember I wasted six she she's only going to survive 2 years less I think a little less than two years from the
point the story I'm telling you right now and I go to visit her and I see her and I burst out crying because she had literally Shrunk the cancer was in Her Bones everybody else in my family lives in the same city so they would see her all the time and so they didn't notice it but because I hadn't seen her in so
long i' had immediately noticed that she had literally got shorter and she was young she was in her late 50s at this time and the reason I bring this up is because I'm so disappointed with myself let's say she had 24 to months to live right the previous 6 months we hadn't talked so she had 30 months left to live
we didn't know at that time I wasted 20% of the time that she had left on this Earth being a a dick and letting an argument get me from stopping to talk like stop talking to her and the worst part is I don't even remember what the hell we were arguing over because I couldn't swallow my pride
because I couldn't see it through her perspective because I was just being there's no other way to describe it I was being a dick I missed out on the last 20% of her life and then from there the rest of the 80% she had left was unbelievably heartbreaking because they literally you you see somebody that gave
birth to you somebody raised you slowly Whitt their body whittles away and they die and there's nothing I can do about it like I can't that's a mistake I can never get back so I'm telling you in case you're in a position where your parents or somebody you love is still around it's it's just not worth it it's
like the how I don't even remember what the fight was about that's heartbreaking and so when Sam is talking about in this book I know exactly what he's talking about you see something it's like you were shocked at how different and the the physical manifestation of what cancer makes people look like is just
it's one of the cruelest things that life has to offer something I'll never ever ever understand I was dumb struck by his appearance at how frail he was and he said we had to talk he looked at me straight in the eye said Sam you have to understand I'm going to die and I'm going to die soon it was the first time
I had really faced the truth I was devastated I think he dies like six months after this his death coincided with the most challenging time in our business to date just Weeks Later the economy tipped into a full-blown recession there was no financing for high no no refinancing for highly leveraged asset owners which is exactly
what Sam is at this point okay we were rich in assets but stared for cash and in the and we had an satiable need for Capital that dominated my waking hours there were weeks when our billion dooll company was scrambling to scrape up enough money to make payroll I didn't know it then but this phrase in my
career or this phase excuse me this phase in my career was the gener Genesis of a mantra that I would repeat regularly for decades to come liquidity equals value and that's something Sam would repeat over and over again he even talked about it later on like the do the technological uh like the technology.com
bubble in the late 90s where people like Sam it took you you know multiple decades to become a billionaire you must be frustrated that these people are become billionaires you know in a few months or in a year and he has a great line he's like yeah he he says call me when that actually turns into cash in the bank I
don't care what your valuation is what is the cash that you actually have is his point and this is where he realizes like to get the capital I need I have to go to the public markets he winds up taking a couple P companies that he had been like investors in and actually taking him public through an IPO he
talks about the fact that he had never done an IPO before he had to figure out like learn this process and he does it over and over again and he gets the idea where he says that I think it was in 1993 19 early 1990s that there was no such thing as uh like institutional investors in real estate that they had
to invent something they had to invent a Reit as a way to draw in uh institutional capital and I think as far back in like the late 80s he thought if there was a way to make uh real estate liquid that would be a trillion dollar industry and I'm pretty sure if I'm not mistaken he actually is on like public
record like he actually wrote it and published that and two decades later winds up hitting almost a trillion dollars or maybe I think it might be over a trillion now so the reason I bring that to your attention is because like understanding the IPO process of very like private companies influences
his thinking on building all these reats later on and so in addition to his business struggling at this time his one of his closest friends and and best partner ever dies he ALS also goes through his second divorce and he's like I'm having personal failures too but then he starts to learn more about
himself and this is his realization over the years I had just resolved that someone who had the responsibilities I had and whose goals required such an enormous amount of attention simply had to make a trade so he's saying I made a trade for my work over my personal life it caused the dissolution of two
marriages and at this point he is 53 years old so then he goes into what it's like trying to raise a lot of money at this point in history like how is his message being received I guess is the way to think about this and so he lays it out for us here he says imagine the scene I'd walk in the door and announce
we're about to have the worst real estate debacle in history and the guy would look at me and say what do you mean we're at 12% this year in real estate 12% return I think I had to get him to come to grips with what was really going on before I could even start to talk about the opportunity I had to show him the vacancy rates and
related metrics and prove to him that all the conditions were aligned for an epic fall and then I had to assure him that we were going to make money lots of it by picking up the pieces sure enough over the next few years in the early 1990s the devastation became increasingly apparent most private real
estate was leveraged at 80 to 90% And with falling occupancies and rents Debt Service became unsustainable many of the big real estate players that had dominated the industry for decades had lost their shirts it was called the worst real estate crisis since the Great Depression and this is this punchline
here it did not matter how smart you were if you didn't have staying power if you were not able to hang on to your assets that kind of Echoes Warren Buffett's uh quote that to win you must first survive and so he goes more into like his role that he's playing in this field I mentioned this quote earlier I
did not invent the modern Reit industry but I helped make it dance my goal was to secure the industry as an independent asset class with its own allocation among institutional investors it took a lot of lobbying and preaching in front of my peers Pension funds insurance companies Banks and politicians
the idea that real estate could graduate into the upper class of corporate America was absurd at the time but by force of will I knew we could get there and so this part's a little confusing to me because he says Hey in 1992 it's actually Morgan Stanley that created this first structure it was called an
UPR so the word or the the acronym Reit and then put up in front of it but I wanted to read this part to you because it's important because he's saying why like why did he want to start doing this and so he says he goes through like stuff I don't understand and then he kind of breaks it down for something I
can't understand hope I can read to you in other words the UPR established a methodology for large holders of real estate to create liquidity without triggering a taxable event so this is the why he wanted to do this as long as the holders didn't sell their shares the structure allowed the majority of major
private real State holders to incorporate their portfolios into the public sector and he Compares this invention like being an oil boom for private real estate holders like himself okay and the reason I'm going to read this to you because this is fantastic and something I've noticed over and over
again do not be surprised if your best idea comes after decades and Decades of experience I see this all over and over again whether it's Enzo Ferrari Sam Walton even Steve Jobs their best idea came after Decades of experience we see the exact same thing happening in Sam zel's Life by the time of the first
modern Reit in 1993 I had the advantage of having spent the last decade schooling myself in the public markets for our corporate companies I was very familiar with what worked on Wall Street and what ex what was expected of great companies and I knew the real estate industry was starting to was starting
with a reputational deficit I said our latest entry into the public markets reminded me of a bumper sticker I once saw in Houston Texas in 1984 that said please God give us one more oil boom and we promise we won't screw it up and this sentence is just unbelievable we ended up growing the industry from $7 billion
in the early 1990s to over a trillion dollars by 2016 the simple Genius of public REITs is that they turn brick and mortar into transparent and predictable liquid assets so now I have to get to what samel is most well known for I'm sure people in within his industry knew who he was but vast majority of people when
you say samel they're like oh that's the guy that almost that sold his company for almost $40 billion and the reason he sold is because he said he received a Godfather offer that's obviously from one of my favorite movies where it's like hey I I'll give him an offer he can't refuse timing is everything that's
another thing that he says over and over again in the book timing is everything that's just a trip phrase until you actually find yourself in a situation where you've closed the BS biggest transaction in history on the cusp of a catastrophic collapse in the global real estate market but perfect timing is
revealed only in hindsight so when I completed the $39 billion sale of equity office that's his company in early 2007 I didn't yet know how the story would play out so he says Equity office was the largest Reit in the country we had spent a decade acquiring an Irreplaceable collection of over 500 of
the best Office Buildings in every Major Market in the US it was my baby truth is had I had I kept the company private I probably would have never considered selling but when I took it public I assumed a fiduciary responsibility to shareholders in exchange for their capital I made a commitment to give them
the best return on their investment that was my primary obligation and nothing stood before that over the years he gets a bunch of different offers they they keep going higher and higher and higher Blackstone called us informally with an offer of $40 to $42 a share we told Stone the bid was insufficient still we
were a little bit surprised to have such a robust offer suddenly I realized that my big my what he what he thought at the time so he says suddenly I realized that my too big to sell company might sell after all he thought like he had built a business so big like there was no acquires like no one's going to spend
$40 billion on an acquisition and then he's realizing oh wait they actually might do that and what's crazy the time is the the guy doing this deal for Blackstone his name is John Gray at the time he was 36 years old so he's the 36y old head of blackstone's real estate uh division so he sends out this this float
of an offer at 40 to 42 a share like no you know it's still insufficient so it says serious and detail oriented gray didn't Overlook even a strain remark when Richard this is somebody working with Sam told him that our board had decided against selling the company gray asked under what circumstances that
decision might change recalling what I often told him Richard says Sam says it has to be a Godfather offer it has to be an offer that's too good to refuse so they come back now they're saying okay we'll do 4750 and Sam's like now we have to listen blackstone's offer is well north of what we knew the value of our
real estate was then I've always believed that this is a really important point because he repeats this over and over again on how to value your assets or at least his opinion on how you should value your assets I had always believed that every day you choose to hold an asset you're also choosing to
buy it would I buy our building at the price Blackstone was quoting nope and why does he say that because this is going to wind up being the biggest deal in real estate history so once the Blackstone bid comes comes out there's another deal by another offer by this company called Vado and this is Sam's
response to what's happening he says the game was on if you do deals for a living like he does you know the energy that big that a big deal generates it's intoxicating the air crackles with the energy of anticipation you're bouncing on your toes all day every day it is quite simply really really fun
Blackstone winds up winning the deal and this was actually pretty surprising and I guess it gives insight into Sam that he's really about deals and not company or I guess to put another way his love is for the deal not for any particular company so it says As for the attachment I felt for the company had nurtured from
its infancy I had moved on once the deal was done it was over for me I had no remorse I didn't think about it anymore and so he's got a bunch of other deals and companies he goes into detail on the book I just want to pull out a couple other things they're just really to me pieces of advice on life and building a
business says time is much more important to me at this stage than money I am highly judicious about where I put my time and at this point that he's writing he is 67 at this time in the story so of course I think that's something that we should work on trying to make time obviously way more
important to money even when you're younger but it sure as hell to time is way more important when you have less of it and it's a byproduct of him being 67 as opposed to like 37 or 47 he's got he knows he's got less time then he's got some good advice for other entrepreneurs as an entrepreneur I am nature I am by
Nature an optimist the word failure is not in my lexicon I don't spend a lot of time lamenting on what could have been done my mental is that my head doesn't turn the other way around I am always compelled towards what is next another piece of advice he's quoting this one of his favorite poems does Our Fate lie in
the stars or in ourselves I believe it is in the latter I think this is just good advice for life when I read or hear about a place in the world that intrigues me I go there I've always been that way and then he goes into detail how the world now like World Markets he was trying to do like International
Investments you know decades ago it's very difficult he just talks about like how interconnected like we have truly world markets today as opposed to like what he had when he was growing up and really a large part of that is like how the internet enables like these truly Global World Markets and he says I don't
think we've even begun to understand the various ways that interconnection and interdependency will evolve over the next couple of decades and I definitely see that from my vantage point in fact um one of my friends is a synonymous account on Twitter it's called mostly borrowed ideas and I was able to get to
know him through the podcast and he sent me a message the other day that was fascinating he says David I just want to let you know that your podcast reached many of my Bangladeshi friends that's where he's from most of whom discovered it even before I shared it with them so you're definitely reaching all the nooks
and crannies of the world so I like that idea I don't even think we've even understand the various ways the inter interconnection and interdependency will evolve over the next couple of decades he also talks about really understanding who you are and what your skill set is and making making sure you're designing
a business to to around what you're what you're good at and what you actually like to enjoy he says I'm a CH I often say I'm chairman of everything and the CEO of nothing I stick to what I'm good at Vision Direction strategy that is where I add the most value I pick great people to run my businesses I do not
involve myself in the day-to-day management but I stay close to those who do and then I think if you read in between the lines he's really encouraging you to think about like the culture you're building and the company you're building and I think what I'm what I learned and I I feel this way
myself but what I'm learning from this paragraph in this book is that people really really dislike formality and bureaucracy and they had they sure as hell don't like the slow movement that accompanies formality and bureaucracy and here's an example of that one of the few senior managers whoever voluntarily
left my company ended up coming back he left after 20 years for a job that paid more money and gave him more power so when he returned I was curious to know why I don't understand I said you were earning twice as much money you had a much higher position why you why did you come back he said it's really simple
when I was was here if I had a problem I walked down to your office and asked a question and you'd answer it I had instant access in my new company every issue involved writing memos to half a dozen people and by the time we got to the end all creativity had been stifled you could hardly remember the idea you
started with fast decision- making and autonomy had become Like Oxygen to him just two great quotes about entrepreneurship I'm often asked can entrepreneurship be taught or is an innate my answer is that there is an inherent entrepreneurial Gene all be it it's stronger in some than others that's
my guess too that there's an there's an inh inherent entrepreneurial Gene and then another great line critical thinking is the Hallmark of an entrepreneur I'm often asked what I want my legacy to be my best answer is he made a difference he also talks that he just consumes way more information than most people he reads like five
newspapers a day three magazines a week uh reads a book and he says this part was kind of funny I and I experienced this myself I go through about one book a week I usually remember remember nothing about them unless all of the sudden something becomes relevant it's just amazing how we have to constantly
remind ourselves about what we read this part made me laugh out loud I suffer from being very competitive and that is not limited to things I can do well and then I may have saved the best for last and he says let me leave you with this an entrepreneur is consumed with making the most out of what he already has he
is all in an entrepreneur is always looking for new opportunity he is always reaching this isn't a dress rehearsal I try to live Full Throttle I believe I was put on this Earth to make a difference and to do that I have to test my limits go for greatness and that is where I'll leave it highly recommend buying the book if
you buy the book using the link that's in the show notes on your podcast player or we going to Founders podcast podcast.com you'll be supporting the podcast at the same time if you want to remember more of what you read and you want to use the app that I use to store all my highlights and all my notes and
really the app I use to to help make the podcast you can it's called readwise you can get two months free by going to read wise. Founders that link of course will be in the show notes and available at Founders podcast.com like everything else that is 269 books down 1,000 to go and I'll talk to you again soon