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in 1978 Monty mon creef was 84 years old he was still very much the patriarch of his clan the man who made the decisions in his family and in his family's business family and business were in fact the same thing with him the desire
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to found the one being in separately tied to the desire to found the other when speaking of his business he never mentioned himself specifically he would always say we signed this deal we figured out what was best this is a we kind of business he explained we don't
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tolerate any of that eye stuff around here in Texas in the oil business one sees as nowhere else that the ideal of capitalism is the ideal of founding a family and conferring the right of inheritance upon it passing a legacy on we're oilmen Monty mree would answer
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when asked about ranching or about real estate or about anything else were oilman meant that anything which extended beyond the realm of oil was not a proper Moncrief concern we're 100% family-owned unincorporated and independent and we intend to stay that
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way in the world of oil promoters one sometimes meets with Independents who have bought and sold their way through six or seven businesses who indeed start those businesses with the aim of going public and selling out as soon as
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possible toan Moncrief such a strategy is unimaginable Moncrief oil is synonymous with him himself his dynasty continuity is what his blood demands he was at the age of 84 as big and as strong as a bull he possessed the directness and the utter Simplicity of
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the old and truly great he walked without a stoop and he carried his large frame without a trace of fat he seemed impervious to age or to Changing Times his unquestioning confidence in the worthiness of his Enterprise made him seem impervious as as well to the doubts
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and the questions about motives and meanings that inevitably beset the later generations of his family he kept his faith in the absolute value of building of progress of getting things done when he spoke of his belief in the Enterprise
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of producing oil in America one could almost forget that he has made hundreds of millions of dollars doing so such benefits sounded almost incidental to the task of settling the land and Mining its resources perh perhaps this confidence is what set free the huge
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energies of this first generation of giants the stories told about monim mon creef all reveal him as tough canny given to understatement a man of action who wastes few words but can when he wishes move mountains that is an excert from the
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book I'm going to talk to about today which is wildcatters a story of Texans oil and money and is written all the way back in 1981 by Sally hel helus there's a bunch of characters in this book they talk about other oil families but once I got to that part
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that's when I realized oh no no what I want to talk to you about is Monty monrie and so I think that excert gives you and I a good idea on why we should focus on Monty monrie and the shadow that because at the time the book is published he's still alive his son is
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still alive and his grandson is still alive and so I was always curious like well what are they up to now so after I read the book started researching to see what I could find out about them and there's a line in the book that I think is very fascinating cuz it's like why is
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this guy so interesting to me he reminds me mon mrie he reminds me of a lot of other people we studied and there's just this random sentence and it was talking about the fact that his grandson was essentially like measuring his life and
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his success based on his grandfather which I think is honestly a bad idea um but it says the Shadow by which dick Moncrief measured himself was cast by his grandfather Monty and I think that word Shadow is really important in fact
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I went back and searched uh Founders notes for the word Shadow because like this sounds very familiar to me there's two things that are fascinating here that I think uh you and I should spend some time talking about and it's one that an institution is the lengthen
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shadow of one man and so that that that's from Edwin L one of Edwin L's biographies right so it's not only the founder is the shadow of the company that they found but you'll also know uh that's true for Monty for the the company he founds but his shadow also
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looms over his entire family and Monty's Shadow loomed over his entire family while he's alive and it still has an effect in present day I wind up looking up the characters in the book to see what like if they were still alive
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Moni's son winds up living to 101 he passed away relatively recently now the whole family is essentially fighting over this Fortune This multiple billion dollar fortune that really stems from the work that the grandfather did 60 70 years ago and this usually ends one of
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two ways most of the time the this the future Generations cannot obviously live up uh to the Shadow or the example that the founder of the family uh usui set so I was thinking of as I was going through searching Founders notes for shadow came
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across an idea uh when you study JP Morgan you realize I said this on the multiple JP Morgan podcasts uh that I've made he's very you know obviously an impressive figure but I found his dad to be even more impressive and so there's a
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line from the house of Morgan written by Ron chernell that talks about this he says the Morgans always believe an absolute monarchy while Junius Morgan lived that J that's JP's dad he ruled the family and the business until Junius died his massive Shadow dominated his
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son's life and so I think the importance of the family business aspect of this is really important so I want to read this section to you because this is what's part of what makes this story unique is the setting in which it takes place and
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the belief that family is Destiny so it says what makes Texas different is not so much its money as it's blood and it's awareness of that blood Bloodlines human Bloodlines in Texas there's always an awareness of exactly whose blood runs through a man men's or women's veins and
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what that blood demands and so I'm going to pause right there before I continue his grandson which we'll talk a little bit about but there's a lot more detail in the book and I'd highly recommend getting the book it was a really fun book to read uh but I feel his this
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pressure that he has where it's like oh you're Mon's grandson causes dick to maybe do things that like take risks that were unnecessary because he was trying to not only match what his grandfather did which is nearly impossible uh but also try to go one
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step further basically supersede his achievement which he obviously failed to do so let's go back to this uh you understand the blood that runs through a man or woman's veins and what that blood demands people in Texas are raised to be
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what others in their families have been family is Destiny here success is measured by what one achieves beyond what those who went before achieved future generations of the family feel the need to surpass them in order me the founders of the family surpass them in
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order to prove themselves worthy of their blood okay so with that background I want to jump into Monty's life and really what's fascinating is because he's born in the 1800s right he serves in World War I and comes back and gets into the oil business and that's really
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important decision because he essentially picked uh an industry or a field where the opportunity before him was really without limit and that's not what his that that same opportunity was not open to his son and his grandson and so when I read the
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stories like this what I'm I'm obviously not trying to build an oil company but I am very interested in finding these areas like where today like what I want to know is like today where is opportunity Without Limits available today and I think reading history like
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this gives you insight into like what these opportunities look like and what to look for and so this a little bit about that the old Bulls in this story so people like Monty mree Sid Richardson there's a bunch of oil uh one why up
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becoming oil billionaires in the story but the old Bulls in the story The Giants the men of Monte monrie generation came into the oil business in the wild old days of the open Frontier everywhere they looked they saw opportunity Without Limits the land
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itself was empty and so these men built cities upon it and they founded dynasties they left behind them a world made in their own image they gave shape to a business and to a way of life and their deeds made them Legends the major oil companies which one day would almost
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destroy the independence so think about that as like they're going to talk about Exxon Exxon was once an independent so these giant uh major oil companies right and then The Independents are like the startups or the family-owned businesses
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obviously the monre at this time were Independence the major oil companies which one day destroy the independence had not yet Consolidated their power those companies were still Independents themselves and so they mentioned at this time in the story where Monty monrie is
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setting out what what is going to one day turn into Exxon was just this company called humble humble oil and the way people would describe it at the time is like oh humble is just a fly by night little Rinky Dink company and so one of
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the first takeaways there is okay if you want to look for opportunities where there's uh essentially uh or Industries where there's opportunities Without Limits you it can already be Consolidated uh second thing as frontiersmen the old wild Wildcats had
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neither the time nor the inclination to question their own purposes or to agonize about what the future consequences of their efforts might be they just went out and did whatever there was to be done Teddy Roosevelt has this famous quote that he took from his
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dad as his life model it's called get action there's people in the book their like life motto is make action they're at the very beginning of an industry so they're going to have to learn by doing that's another Telltale sign that you might be in an industry where has
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essentially unlimited opportunity the second is the opportunity has to be open to or the third I guess the opportunity has to be open to small teams without a lot of money and so when they're drilling right now in fact you know what
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let me pull this up real quick this is one of my favorite lines ever I think uh I did another podcast and read another book around a similar time period in fact some of the characters in that uh in this book or in that book it's called The Big Rich it's one of my favorite
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books I've ever read but was fascinating is there's a line in the book that I never forgot and I use it as a metaphor all the time and they said the trouble with this business is that everybody expects to find oil on the surface if it
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was near the top it wouldn't be any trick to it you've got to drill deep for oil and my interpretation of that or how I apply it to my own life is like there's an essentially an inexhaustible supply of people that want to get the most for doing the least and there's a
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lot more competition for things that are easy and so in my own life I want to get the most by doing the most and so what's fascinating is that that quote was about the oil business you know maybe 20 or 30 years uh in the future from where we are
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in this book but at this time it was very possible for a young Wildcatter and that's why the book is called wild CS essentially just like these little startup oil companies to go out raise some money and then try to drill Wells over time that ability becomes cost
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prohibitive and the only people that were able to drill Wells are these giant oil companies like we see today so at the point at this time you could buy at this time you could try to drill a well the oil or the gas that you're looking
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for might be 5,000 ft underground right so it would cost you it would cost a wild cater about $20,000 to drill and in Oklahoma and Texas at the time that there's a ton of oil at five only 5,000 feet underneath the ground and so that was the advantage that Monty had right
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but it says 20 years later everything near the top right is gone so now you have to go 30,000 ft underground to get the same amount of uh oil or gas out of there and that's going to cost you go the cost goes from $20,000 to $750,000 if I did the math correct that
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is 37 times more costs 37 times more investment required to do similar work so if you're looking for Fields with Limitless opportunity how they look in the very early days is they that opportunity has to be open to small teams without a lot of money and
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eventually as that opportunity is exploited it'll usually just be open to people with a lot more resources and you'll see the cost of doing the same things drastically Skyrocket so something that's been on my mind for the last few months since I reread uh the
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new version of poor Charlie Domo uh that stra press uh just republished uh the episode's 329 if you want to listen to it was uh Charlie has this thing that he talks about a lot which is this model of Surfing um and he uses it to when he's
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trying to examine like okay well why was Sam Walton so successful why was Les Schwab so Su successful there's a bunch of factors and one of them he says like they had to Surf some kind of wave and so as I was reading this book I was like
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okay well what wave I was looking for the wave I was like okay well what wave did Monty Surf and I'm going to read this this is fascinating like why this was available to basically at this at this time in history and at this specific place the fact that he was
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lucky enough to be born in America because America is the only country in the world in which the the mineral rights underneath the ground right in which you're these Wildcats need to buy or to lease are privately owned everywhere else a state or a crown will
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hold the title and so it says in America mineral rights must be purchased from thousands of individual land owners the big companies very naturally preferred to make their deals with a single Chic or a tyrant or whatever of the country for the wealth of an entire nation
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instead of around with countless farmers in order to be to put together a field and this is the punch line right here the wildcat's competitive individual way of working was compatible with the private ownership of the land okay so the fact for the fact that
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America's the only country in the world where such rights are privately owned is the main wave and then the second thing is the fact that let's say he buys you know 100 thou 100 uh excuse me a th000 Acres there might be 50 60 two 200
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different Farmers or uh land owners that he has to go and negotiate with and so a larger oil company was like I'm not going to do that I'll just go and see if like let me go let me go to the gulf or let me go to Russia because if I can sell that one person or if I can
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convince that one person I get access to essentially Sovereign level assets and then there's a second thing that Charlie uh Munger said about surfing um that I think well one is useful to you and I but also as you heard Monty in the opening and there
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have a bunch other highlights I I'll most likely read to you where he was anti- diversification remember they're like you ask him about cattle or real estate he's like we're oil men uh his future Generations are you know diversifying in all kind of assets and
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he was very against that although it was good for him not to diversify but you could argue that it was beneficial for his descendants to because the oil business vastly changes in his lifetime but this is what Munger said about it um
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let me pull that up again it's from Port Charlie Zac in fact I found my Note too that I'm going to read to so he says there's huge advantages for the early birds so this is Charlie Munger talking about surfing obviously applicable to
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way more um people and industries than money and oil there are huge advantages for the O the early birds when you're an early bird there's a model that I call surfing when a surfer gets up and catches the wave and just stays there he can go for a long long time but if he
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gets off the wave he becomes mired in the shallows but people get long runs when they're right on the edge of the wave whether it's Microsoft or Intel or all kinds of people surfing is very powerful and then I'm looking at the note uh that I left
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myself when I read that um when I read that in portch omac it says Charlie surfing model one thing I learned from having dinner with Charlie was the importance of getting into a great business and staying in it there's a tendency in human nature to mess up a
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good thing because of an inability to sit still so Monty understood that and was only interested in the oil business for his entire life let's go back to this idea of what is Limitless opportunity look like Limitless opportunity usually found
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environments with little to no regulation at the time the money starts there's almost non-existent uh regulation by the third generation it's becoming increasingly difficult so this is the difference between what manty had which is essentially little to no
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regulation and what the third generation is having to deal with there was an increasing number of bureaucratic considerations governing everything from the distance a well can be from an old Indian burial ground to the number of portable toilets that must surround a
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rig site these regulations continue to increase as government agencies proliferated I want to continue with 84 year-old Monty monre before you go to his early life which is actually absolutely incredible and it's really again uh main part of the book is the
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fact that this guy's Shadow is over his entire family all these oil dynasties are controlled by you know this one what do they call them uh prickly individual I'll get there in one second but one of the reasons that they their Shadow Loom so large is because they
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never exit he's doing oil deals until he dies way past he's decades past the need uh to work for money and so he's his not only did are every his entire family working in the business that he started but his physical presence is still there
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and so it says these grandfathers so they're you know these Patriarchs of these family dynasties in Texas rarely abandon the towns where they raise their families and they don't Venture forth into senior citizen uh senior citizen communities in Florida or Arizona they
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live where they've always lived and their daily Pres keeps their Legends alive the Mystique of Grandfather Heroes exists partly because the grandfathers play a special in between role in this land of men that are impossibly hard all over Texas the
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story is the same my daddy was a tough old bull but when he told me it was time to quit law school and come to work for him I did it even though it was the hardest thing in the world for me and even though he told me I'd have to run
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him out of business before I could get my share that's funny because that's happening in Texas also I don't think it's exclusive to Texas when when I got to this the not left myself was oh this this could be this quote could be from Ted Turner as you and I learned in
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episode 327 on Ted Turner's autobiography you know he he tried to Rebel his dad had started that company it was very successful one of the largest I think it was the most successful billboard company in in in the Southeast and you know he took off
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running but eventually exactly what they said you know he called him he's like you just Now's the Time you have to come and even though Ted wasn't sure he's like you know I'm going to go do this back to this book this this is also something that I've noticed that the
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entrepreneurs that you and I study are way more similar to each other than uh you and I are to maybe like the general population or the population that are not entrepreneurial uh traveling through oil country one becomes aware of a similarity among the tales told of
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grandfathers who first subdued the land and claimed its riches like Mythic Heroes the men of the first generation began to seem interchangeable after a while like figures cut from the same rough magnificent fabric they call them prick
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they had they said they possessed prickly individuality that's a great line they were they possessed prickly individuality all the stories seem to be about the same prickly individual I I said this over and over it's like the same personality type that
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reappears over and over again throughout history different Industries different parts of the world different times basically the same shape same shape more description of them these are they are giants they are successful Predators acute and astute Tamers of the untamable
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and Defenders of vast treasure that is a description of Monty mon creef another thing where the second and third generation they start to love luxury they're spending they're they're making it rain they're balling out of control
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they're spending a ton of the family money mon was not interested in that he lives in the same house that he lived in for his entire life old Wildcats attitudes seem to be much like those of the original Cattlemen who preferred their familiar Ranch homesteads to the
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palatial quarters that their heirs built in town the allegiance is not to pleasure or luxury but to comfort one by sweat and handed down with an understanding of the duties that entailed upon them what drove money was achievement not money knowing that if I
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chase achievement the money comes with it but it's also about being able to live up to your own ideals and so at this point in the story man's obviously very very wealthy so he winds up knowing a bunch of presidents and this was a
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very fascinating uh insight into him man monrie is quick to tell the visitor he got pictures in his office with like Richard Nixon and Lyon Johnson and all these other people right this is very fascinating Monty monrie is quick to tell the visitor that Nixon was a weak
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man destroyed by his own aest he speaks of lynon Johnson as a compassionate man but greedy like Nixon and much prouder than he such judgments are not political but personal they are moral sentences passed upon men who were not large enough to live up to their
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offices but at the same time he still respects them because for this reason but to whom a measure of respect is nonetheless owed simply because they won and held those offices they exhibit personal pantheons across which fall the shadows of men who shaped American
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Destiny I so I need to explain that a little further So it's talking about this first generation of Frontier settlers which is what what uh Monty monrie was right they have a sense of Honor even for those who have disgraced themselves because even when a great man
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falls from Grace there are actions they did before that help shapee America's destiny okay so then the book goes into his early life I think this is the way I think I can essentially tell the entire story in just two sentences and so this
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is not a direct quote from Monty monrie but this is my interpretation if we were able to talk to him this is what he would say my dad got to Texas in a covered wagon I made hundreds of millions of dollars in my lifetime and so when Monty is a young man he serves
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in he goes to Europe to fight in World War I while he's doing that he actually becomes friends with the son of an Oklahoma oil family and so after the war when Monte gets back to America he decides to head for Oklahoma and he
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starts working for his friends families oil company and so his first job in the oil industry he has this job called a landman so it says he worked first as a landman as many future Independents often did landman landmen do not buy land rather they lease the right to
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produce minerals upon it from the land's owner so this is what I mentioned earlier how a lot of larger uh companies oil companies like I'm not doing that I have to go you know in negotiate individually with 50 people 25 people 200 people I just rather go straight to
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the ruler of the country so this is how it works rather they lease the right to produce minerals upon it from the land's owner who takes a share a lease which is what he's negotiating right gives the operator access to that tract of land
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for five or 10 years if oil is found before the lease expires the operator may continue to produce it for as long as that well lasts if not the mineral right rights revert back to the landholder who then may sell them to the next bidder but if
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the land proves productive the lease the person that's doing the leasing pays a royalty to the landowner right uh which is a share of his profits before costs so share of his Revenue before cost rather the share is usually 1/8 and this is this is fascinating the share is
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usually 1/8 and it is called a royalty because it was once paid to the crown so after a few years Monty decides to strike out his own he wants to work for himself and he's going to go from Oklahoma to West Texas now a huge part of this early industry is like well
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where are they getting the money from and so there's two interesting sources for funding here one is the oil industry at this point is completely dependent on the railroad industry remember this for later because there's this huge dispute
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between two separate oil companies and wait till you hear the name of the Le of the actual governing body it's it's not named after oil let me just put it let me just tell you that so the earliest some of the earliest American oril
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Finance years were actually easterners right these are very far away from the frontier in Oklahoma and Texas they're actually easterners who controlled the railroad lines and then the second source which was uniquely Texan is before oil came to Texas they were their
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massive industry was uh a lot of the the richest families were actually cattle ranchers uh so there's this guy named papy Wagner for example he was Texas's first billionaire he obviously made his money in cattle ranching and then he
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takes that money and then uh actually founds a bank and then he would fund a bunch it's kind of like Angel Investing if you really think about what's going on here it's a billionaire he's like okay I'm willing to go ahead and issue and invest these in these speculative
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like oil startups is the way to think about this and he does it through Fort Worth National Bank which he founded and so one of the main things that jumps out is like okay well why would you do that you have a good job like why would you
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quit you move States and this is this idea where it's like he had unbelievable self-confidence I don't even know if that's the right word this a lot of these early Wildcats they they were default optimistic by far but they also believed that they were born lucky
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this is not a joke so he says monim mon Cree believed that he had a gift a special talent for finding oil he believed that he had been born lucky when asked why he set himself up as an independent oilman he said I had always had it in my mind to better myself and
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to better himself has always been his quest in life and and so these wild cats raise money they start start drilling holes Monty's first 29 his first 29 Wells all come up empty so at the beginning of his career remember he still thinks he's born lucky
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he was destined to it I have a gift this is the way he's talking about have a gift for finding oil imagine believing that right quitting your job moving States raising money first 29 times they're all Duds they start calling him dry hole Monty that was the situation
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right before he hits one of the largest uh oil discoveries ever there is actually let me read this to you there's a great line I think about all the time in the book the fish that ate the whale which is about Sam Murray and it talked
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about this essentially he goes and and accumulates assets when he does not have the money to do so because he believed if he did not get those assets his business in the future wouldn't work out anyways there is some some degree of for some reason when when I got to the
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section of the book I was thinking about this line This paragraph that's in the fish that ate the whale so let me read that paragraph to you first and then we'll get into this incredible discovery that Moni is a young Moni monrie his son
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is I think 11 years old when this is about to happen but this is the line from the fish the whale there are times when certain cards sit unclaimed in the common pile when certain properties become available that will never be available again a good businessman feels
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these moments like a fall in the barometric pressure a great businessman man is dumb enough to act on them even when he cannot afford to and so when a real estate Trader by the name of ba Skipper comes and asks Monty if he wants
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to buy these leases this is what happens So ba Skipper was trying to unload the leases that he held on 4,000 Acres these 4,000 Acres just happen to be near Dad Joiner as well so Dad Joiner is this guy that's sold out to this other guy named
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HL hunt HL Hunt is in that book I referenced earlier which is the big Rich Dad Joiner site is the foundation of the HL hunt family Dynasty should have went to Dad Joiner but he sold out I think that's a huge important thing to remember so ba Skipper comes and he's
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like well I got 4,000 Acres he's under Financial pressure they're kind of near Joiner as well do you want them no Geological Survey had been made in the land but the acreage was cheap because Skipper hadn't paid off his leases he
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had taken them on an open draft from the bank instead hoping to get rid of them fast and turn a profit by doing so so there's a bunch of these people where they'll they'll get a lease and essentially they just want to sell paper they have no issue they're not wild
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catters are like oh we got these let's say I paid you know I'm making up the number I paid a th for them I will give you my rights for you know 5x they're like short-term you short-term Traders I guess is the way to think about them very different than what uh Mani was
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interested in doing them uh man mon creef thought it was possible that this site may be sitting on top of the Northeast running Trend and on impulse meaning that it's close to the Dad Joiner Discovery and an Impulse he bought the leases and he bought the
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leases even though he didn't have the money so what does he do they they do this over and over again they take on Partners uh to to save himself money he went partners with a B man named JT frell who worked down the hall from him monrie and frell didn't have enough
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money to permit them to expand their Holdings and undertake the expense of drilling at the same time so they did what Independents have always done and then sold off pieces of their Enterprise They gave up some of their interest to
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Getty uh that's Getty oil so think about what just happened there ba Skipper comes to Monty with a with an opportunity money's like okay I'm going to take another flyer i' I've trilled 29 uh Duds I don't have money for this what I got to do I got to walk down the hall
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knock on some doors and see who wants to go in on this deal with me so now we're 50-50 Partners we're like all right we got the leases we we ain't got no money to to drill what are we going to do here we'll go to a bigger Oil Company say hey
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give us somebody to drill and if it works out we'll obviously give you some of uh you know the interest in a good well and then I love his Relentless optimism here because the first well that he drills gushed forth 18,000 barrels of oil a day and then his
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response was was hilarious right because it's like it's like to be delusionally optimistic you just go from one setback to another setback without any loss of enthusiasm which I love and it says like so you know has all these struggle for years doesn't have the money winds up
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figuring out how how to do it the first well they drill on this other thing so this would be what his 30th attempt uh the first well is 18,000 barrels a day and then it says this further convinced him that the good Lord must be looking
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out for him in other words that he was born Lucky Now what's fascinating is how fast his fortunes changed so it says Monty and his partner held on to their leases until the end of 1931 if I'm not mistaken they actually hid it I can't find the exact year I'm pretty sure they
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hit it that same year I think they held on to it for a year maybe two it was not long the point whether it's a year or two years something like that it's not a very long time but the value obviously increases dramatically and so it says
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they watched their worth increase many times over finally they sold out to a larger oil company for $2.5 million that'd be the equivalent of you know something like 50 million today a few years later uh the company that bought it for 2 and a half million sold it for
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37 million to Standard Oil and so a bunch of other people like were like oh you you know you sold too early or whatever the case is but again this is going to be the foundation of a which present day is a multi-billion dollar family fortune so a lot of other
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Wildcats are like oh you sold too early but I loved what monim mon cre said here he says uh in the oil business there's no what if there's only what happened and another interesting thing is one he's sold so now he doesn't have to worry about any money he's going to keep
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he's going to be in the same business uh for the rest of his life and he's going to keep having a lot of success in that business but also be what was fascinating is because uh his wealth was was based off like this tangible resource he was able to survive and
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thrive in the Great Depression so it says unlike the oligarchs in New York Rich Texans were not necessarily forced into diminished circumstances by the depression Texas fortunes had been built upon the Bounty of the Earth this is
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their words and the memory of this Advantage during a time of crisis has made many Texans mistrustful of paper fortunes ever since mistrustful of paper fortunes ever since remember that sentence uh for later on when his grandson is you know essentially
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peacocking like look what I did on this deal he's drilling oil for Israel uh on like disputed land between Israel and Egypt in the 1970s and we'll get to there later but his his his uh grandfather wasn't buying it he's like until the money is in the bank it you
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know what it reminded me of something that Sam zel said I think it was an autobiography where you know somebody had said to him during the do the original dotcom boom in the late 90s it's like Sam you know it took you 40 years or something like that to be a
32:26
billionaire uh what do you think of this guy that you know started his company 18 months ago and he's a billionaire you know this like 97 or 98 and he goes tell me when he has the money in the bank and I'm pretty sure if I remember the the
32:37
story correctly that the that was always just a paper fortune it wind up uh booming and then busting and then I think going bankrupt so before I move on I want to go over some of the characteristics of these early Wildcats because I'm
32:49
choosing to focus on monum M creef there was a lot of other characters in there HL hunt Sid Richardson merchon in fact what brought this book to my attention is I've been doing research I want to do a podcast on Richard rainwater very influential uh investor and Company
33:05
Builder and yet there's surprisingly as influential as this person was uh there's there's no biography on them and so I found uh this podcast and it's called rain makers podcast I'll leave a link down below uh turns out R who runs the rain makers podcast has been uh
33:21
listening to Founders for a while and I sent him a message and he gave me all of his research he's that recommend listening to that podcast because the level of research that went into it it's incredible I've been trying to find stuff on Rich R all the time and R just
33:34
came up with an like his sources were just way better than mine and I uh one of his sources was this book and so I immediately ordered all the books on that list and I started reading this like this actually incredible um and so my interest in this was I was like okay
33:46
I want to learn more about because Richard rainwater how he got his start was that there's an oil man who winds up becoming I think the richest person in the United States for a certain time he's more like a gambler though his name
33:56
is S Richardson uh he passes away his fortune goes to he didn't have any children his fortune goes to his NE nephew it is the bass family and then the bass family hires Richard rainwater and so the podcast I'm telling you about talks about how Richard I think turned
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50 million of the bass's money into 5 billion but Sid Richardson just like Monty M creef they were big belief in luck in fact uh Sid's Credo says that uh he' he'd always been uh his Credo had always been that he'd rather be lucky
34:23
than smart because a lot of smart guys go hungry uh another trait that they had was they were not afraid of debt this is not advice by the way because there's a lot of people that did the exact same thing they did but did not survive and
34:36
so Sid Richardson's uh his partner was his guy named merchon who's also fascinating he's in the Big Rich highly recommend I'm going to leave links for this book but I'd also go back and listen to episode 150 oh no it's not 150 is it I don't know why I'm guessing I
34:48
can just look it up uh it is episode 149 150 Sam Walton so 149 I'd listen to episode but also read the book The Big Rich is excellent I'm going to wind up rereading it and doing another podcast on it in the future because I thought that the book was uh fantastic but so
35:03
Clint meron's in there as well they were one-time Partners uh with Sid Richardson and you might find this interesting Clint meron's son it was actually the founder of the Dallas Cowboys but so what they have uh in common they believe
35:15
in luck they have an absence of fear of disgrace as we just saw like they're failing over and over again they just keep getting back up and going at it uh as we just saw with Monty he was 0 and 29 and he was still going at it and 30 was you know changed his his life and
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really not only changed his life but changed the trajectory of many generations of his family uh they're also not scared of of having tons of debt there's a great uh there's a great exchange between Sid Richardson in this and Clint merchon in the book and Sid
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tells Clint I must be the richest one between us because I owe more money than you you do they've got paper of mine floating all the way to London Sid believed that this is crazy Sid had an attitude that uh there was no innate shamefulness in going broke or in
35:58
borrowing as long as there was a reason for it they all were delusional optimists they believe that optimism was the personal quality that nurtures luck they hated timidity they said you cannot you simply an oil Man simply could not
36:11
afford to be timid and then they did not feel uh the need to apologize uh for the occasional big losses they believe that if you were not having big losses that means you weren't trying enough and in many cases they operated in legal like
36:26
gray areas uh they built concrete bunkers around Wells and hired armed guards to defend their Turf from government inspectors they smuggled oil across state borders they operated unregistered refineries in Backwoods they processed crude in excess of what
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each operator was allowed this is later in the oil industry uh it says chaos and they believed in chaos and Defiance and they refused to be controlled they were not afraid of risk they said the risk is always there and then Clint merchon has
36:53
a great saying he says uh so the risk is always there and as Clint merchon was fond of saying after the first 100 million what the hell and so what he's talking about there is like after $100 million you got have a hundred at this point you got have 100 million or a
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billion the difference in your lifestyle is negligible so you should be going like you should be building businesses going for risk uh in Clint's case he was he would spread money all around he would own oil companies railroads cattle
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ranching obviously his son uh eventually uh started the Dallas Cowboys but really this is the I guess the punchline for this entire section they were motivated to found found dynasties to which their sons and their sons Sons could succeed this is more about their mindset West
37:35
Texas where all these these guys are operating was settled by optimism by pure booster Spirit by the willingness to go on faith and instinct to believe that hard work in the taking of high risk must inevitably bring reward only something as stubborn and unreasoning
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remember this is not like an intellectual thing in many cases they're being irrational and people around them are telling them they are only something as stubborn as unre and unreasoning as faith could have inspired men and women
37:58
to settle and remain upon this harsh unyielding land these Texas Wildcats were optimists without equal they had to be this was very fascinating uh so keep in mind Clint uh or not Clint uh Monty gets in the business right after World
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War I so we're talking late 19 19s right in the years before and after the first world war the US Bureau of Mines had begun issuing a series of pessimistic surveys they estimated these are the quote unquote experts saying you're wasting your time here why because we
38:25
estimate that 40% of America's petroleum reserves had already been exhausted that is insane that is an insane statement this is over a 100 years ago right so a 100 years later than this report by these experts was issued right over 100
38:39
years later there's more petroleum produced in America there's hundreds of thousands of barrels a day in the 1920s so at that time and let me let me be clear what I'm saying here in the 1920s or 19s when this this report is issued it's like hey we've already we're
38:54
estimating that you guys have already tapped 40% of America's petroleum reserves we're already producing hundreds of thousands of barrels a day right it can't like we're going to run out a 100 years later we're producing tens of millions of barrels a day this
39:08
is why I keep bringing up this like irrational optimism and the belief and luck that they have because EV like the industry report is like nope we're 40% of the way through uh and the report concluded right that the domestic Oil Business was not far from
39:23
dead West Texas oilman refused to take these reports at their word and it was a good thing they did because when they start drilling all of these findings that's going to happen over the next 10 20 years right it was the greatest Frontier Gold Rush of all time and they
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they make a great point in the book that this these discoveries in Texas in you know 20s 30s 40s uh were 10 times the size of the Gold Strike that brought the 49ers to Northern California in the 1800s and I think there's some needed
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context around this right like why could you have this default optimism and it goes back to this this theme that I was thinking about I was just reading this book it's like okay let's let's study this not to like try to start an oil company but I'm really curious like
40:10
where is their opportunity Without Limits today and can we derive insights into like what those opportunities look like and what to look for and part of this was that these are there's a actually a dual theme here it's like these are poor men Mon Mon creef when he
40:27
was was doing this was not a rich man when his grandson or his son tried to do that they are rich men and so I think the benefit that like a Clint merchon or SID Richardson or Monty mon creef had is the fact that really they really they could speak as growth as an
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inevitability because there's nowhere to go but up they had begun their lives and a lot of these Wildcats they begun their lives in HS and had nowhere to go and so they were willing to sleep in tents they would p in some cases they would TCH
40:56
they would pitch a tent right next to a a a Derek right and they're out in the open they describe this environment as ungoverned backlands with a climate that was predictable only in its violence so you got either freezing there's storms
41:10
there's mud then there's heat and the only thing pushing them through is one they're broke and two they're very optimistic such harshness put to the test the willingness of people to put aside all thoughts of present comfort and pleasure and live exclusively upon
41:23
hopes for the future this same Stern ability to ignore their present circumstances and live upon their hopes as one descendant of a wild catter said my granddaddy was born in a hole in the ground you can't start life much lower than that and so I mentioned the surprising
41:41
role that railroads uh played in the not only the growth of the oil business but also the regulation of it so says uh growth meant railroads some West Texas Fields had to be shut down after they were discovered because so it means they
41:55
struck oil because there was no no means for hauling barrels of crude out of there to the refineries and if the discovery was big enough they would actually be able to influence rail railroads to lay tracks so it says they
42:09
became a bonanza for railroad schemers as much as for Wildcats so that was that's at the stage it was very interesting that uh you know the there's a kind of like symbiotic relationship between independent oil Wildcats like Monty and these larger companies like
42:24
they're kind of doing deals with each other their fields are next to each other they they become partners for a little bit then they break up uh if an independent yui is is going to eventually sell out he's going to sell out to a major so this was fascinating
42:36
this was really surprising and I think it speaks to the influence that that Railways or railroads had on the uh early American oil industry so Independents like Monty McRee they're they usually are rarely willing to jeopardize their relationship with major
42:50
companies by taking them before regulatory boards manim mon creef had to do this because he feels that he thought that humble was decreasing the value of his oil fields because they were draining essentially like let's say he was on the outskirts they own the middle
43:07
they were draining things that were not in the middle and so if an independent wanted to file suit against the major he would go through the regulatory board of the oil industry at the time which was called The Railroad Commission that was
43:21
surprising again it's not the oil board oil regulations the Railroad Commission and in this case this wind up making him over $100 million the Railroad Commission ordered humble to compensate him for his Fields they were forced to pay him $100 million along with
43:36
percentages and residuals on th on those percentages and so it said it was a victory for his dynasty and a means for its perpetuation and there's just a great line in the book about this you know because you think you're nuts for you know essentially suing a potential
43:50
partner in the future you're nuts for doing all you know all the the behavior that the Wildcats are doing uh seem nuts at the time and it says being crazy is something that Majors just don't understand and being crazy in having imagination is actually a huge asset for
44:05
The Independents this this stat blew my mind independent Wildcats find 80% of the oil and gas in America despite the fact that most of the mineral leases they acquire have been rejected by the big companies and so when the book ends
44:22
Monty is in his 80s and he's still at it and I think this is a good description of why monim mon creef grew up amid the harshness of a developing Frontier land and made hundreds of millions of dollars over the course of his 80 odd years he
44:34
had realized his Ambitions in a town that he helped to settle and shape and make grow he had been able to trace his shadow leave his Mark upon an empty land and set a standard for those who were to follow he created a dynasty for monim Mon creef and for men of this Pioneer
44:50
generation achievement not refinement is the measure of all things and that is where I'll leave it for the full story highly recommend reading the book if you buy the book using a link in your show notes or available at finders podcast.com you'll be supporting the
45:05
podcast at the same time there's only a few limited copies of this so in case you can't get this I will also leave a link below uh to read the Big Rich which tells a lot of uh similar stories and it's an excellent book that is 338 books
45:20
down 1,000 AO and I'll talk to you again soon okay just a few quick things in fact a few quick new things uh before you go first one was asked for and requested uh for many many months Founders now officially has merch if you go to shop. Founders podcast.com or you
45:38
can just go to Founders podcast.com and click on merch uh a few months ago I did a live show in New York City with my friend Patrick asany from the invest like the best podcast and we sold for the first time ever like Founders merch
45:52
like sweatshirts hats people seem to love it I've been wearing that I have I actually took like four of them for myself and I've been wearing them for the past few months they are super super comfortable uh I would definitely order the sweatshirt the hat that we have on
46:06
there right now I'm actually going to replace soon with a hat that's because the founders logo on the hat is Big some people like it I personally like it if it's a little smaller but if you happen to like the bigger logo get the Hat soon
46:18
because eventually they'll be replaced with the hat with the smaller uh logo so if you want to buy some Founders merch go to shop. Founders podcast.com or go to Founders podcast.com and click on merch and you can do that the second new
46:30
thing and this one is incredibly important me and Patrick are looking for partners if you are building products if your company is building a product that makes somebody else's business better so B2B and you would be interested in becoming partners with me and Patrick
46:44
ashany from invest like the best email Partnerships Founders podcast.com that is Partnerships with ANS Partnerships Founders podcast.com tell us about the company You're Building obviously any important links that we need to know and
46:58
why you think we would be good partners so we're able to obviously help with distribution we're looking for partners that we can actually partner with and then help advertise across both of our podcasts we can also bring capital and then access to Talent as well and one of
47:13
the reasons this came uh this this idea came to mind is because I keep having this experience where whether I'm touring a company because I've been invited to or I'm giving a speech or I meet somebody uh through like a a friend of a friend that listens to the podcast
47:27
I keep coming across these unbelievably talented and formidable uh Founders that listen to Founders and in some cases have been listening like I I just met one last week he's incredible and he's like yeah I've listened to 200 episodes
47:41
and so it's very apparent to me that I'm doing something wrong because these supremely talented people there's no mechanism for which for them to like reveal themselves to me and that's important to the podcast because supremely talented people usually build
47:53
supremely impressive products products that can make your business business better and I would like to use the podcast to essentially highlight founder-led companies from Founders that listen to Founders that would benefit other listeners of Founders and so
48:07
Patrick and I don't know what shape this is going to take yet all we know is we have access to a lot of resources we have very unique assets no one else probably on the planet has and if you're you think you're a right fit just email
48:18
Partnerships Founders podcast.com there'll be more details in the future I just want to put out put that out there for now so if you're building something and you would want to partner with Patrick and I email Partnerships Founders podcast.com and I think you'd
48:33
be surprised about all the kind of unexpected benefits that could happen so this this actually just happened um because I've told you about this company vesto uh vas and Victor it's vest.com and I partnered with them for a while I knew the founder
48:48
uh two of my close founder friends were both using vesto to get higher Returns on their business's idle cash and so I was like oh this I knew Ben I'd spent a bunch of time with him went out to dinner with him a bunch of times and then I had two people I trust were and
49:02
they were both in very opposite uh situations one was I had raised a bunch of venture capital and so he had a long Runway and he was using vesto to lengthen his Runway and the other one had this giant bootstrap business with a
49:13
bunch of companies and he was using it to get a higher rate of return than his bank was offering him and so there's a bunch of people that heard about vesto uh from the ads I was doing on the podcast but what was fascinating and this is an unexpect expected benefit
49:28
they actually pulled a product out of vesto that didn't exist and now exists because of that and this is also the benefit of founder-led calls uh sales calls if you can do that in your company because Ben Ben was taking all the calls
49:41
right explaining getting to know who the prospects were explaining the business explaining why the business exists you know he built the the from it from the ground up so he's the person in the best possible position to uh explain to explain its value to potential customers
49:55
but he was having a bunch of these conversations and what was fascinating is people didn't know that didn't even know each other were asking for the same thing because like yeah I have excess cash and I would like a higher return obviously now the interest rates are
50:07
higher but there's this other problem uh that I really want to find a solution for and a lot of people have uh in many cases multiple bank accounts spread across multiple banks in some cases multiple countries and in some cases multiple currencies and multiple
50:22
entities and the only solution they could find and this is what they were asking Ben to build for them was hey I have to hire somebody right they're paying somebody every morning or every day to log into all their accounts in some cases there was like 10 to 30
50:35
different accounts uh reconcile all the balances and in some cases convert the currencies just to figure out how much cash is all my businesses have right at this exact moment and so as a result of Founders in the founder community in the
50:49
founders podcast Community this product now exists if you have this problem you can go to vest.com vest everybody says I slur my words I know I don't pronounce things correctly so it's Vias and Victor and obviously I will leave the links in the show notes
51:02
and the links for everything I talked to uh talk about is at Founders podcast.com but if you want to see all of your company's Financial accounts in one view uh vesto this this version of vesto will connect and control all of your Global business accounts from One dashboard and
51:16
then if you choose to they can automatically also help you earn higher rates on your business's idle cash and then when you go to vesto and schedule demo you actually talk to Ben so just make sure that you tell them that David from Founders sent you so uh two more
51:29
quick things I want to talk to you about Founders notes Founders notes uh is the best way the single best way uh first I think it's it's the world's greatest the world's greatest notebook for Founders but it's also the best way to support
51:41
the podcast I think last week uh the Napoleon episode really honed in on the value proposition from just reading and rereading uh all the the not all of my notes and highlights so what Founders notes is is for what is this now six years since
51:59
2018 uh I've been cataloging all of the notes and all the highlights I've been putting in this app called readwise which allows me to search by book search by keyword uh constantly review my highlights there's this thing called the Highlights feed which I think is
52:12
incredible which is essentially a random generated it's like a Smart Twitter feed but instead of reading The Psychotic delusions of these crazy people that are that hang out on social media all day you're reading notes and highlights from
52:24
History's Greatest Founders and so so I went to the team of rewise was like hey uh people have been asking for a long time to have access to my notes and highlights is there any way we can build a product together where we can we can essentially mirror what I see so when
52:36
you subscribe when you go to Founders notes that's founders with an S Founders notes.com and you subscribe to this when you invest in a subscription you see exactly you see a direct mirror you see exactly what I see this is something
52:48
that I use every day this is a product that I could not make the podcast without it is literally embedded in my workflow so if you had already had access to Founders notes you would have already seen the highlights for the for the Wildcats the book that we just went
53:02
over because I'm updating it nearly every single day and the reason I thought that there was a lot of there was a couple things that people emailed me that really resonate from last week is uh one I talked about the fact that it's only for people that are running
53:15
already successful companies right if you're not already running successful company though the people running a successful company uh are going to get the most value out of Founders notes because they already have a mechanism in
53:26
which to trans that knowledge it's in the notebook into profit right and if you're not listen to the podcast I said like Founders notes does not have a free trial because the podcast is the free trial so if you're not already running a
53:40
successful company it doesn't make any sense for you to to invest in the subscription just go and listen to the 337 episodes whenever you want as much as you want and then use those ideas to build a successful company then this is this is in addition to but for people
53:54
that are already running a su a successful company then it's it's a no-brainer you can invest in a year subscription right at the end of a year first of all there's already you know I don't know something like 20,000 highlights uh in there I think the team
54:06
of rewi just sent me my stats page um I think they said there's 24,000 highlights um but I'd have to go back and double check that but anyways my point being is like the you if you would sign up today in the next year I'm going to add another you know 50 something
54:22
books and you know probably four or 5,000 highlights so the product literally gets better every day and then you can decide at the end of the year did you get value at it or not but I think I think it's a no-brainer to to try for at least a year and the reason I
54:35
say that I heard from a lot of people that that uh the Napoleon uh episode resonated with them and they realized helped them realize the value of you know not just listening to the podcast but really going deep on this and reading and re rereading over and over
54:48
again because that's that's mine's own words he said read over and over again he didn't say read once listen to one episode and then keep it moveing no he said read over and over again the the campaigns of Alexander Hannibal Caesar
55:01
uh Frederick the great make them your models this is the only way to become a great General to master secrets of the Art of War with your own genius enlightened by this study I truly believe that if you subscribe to Founders notes and you read it every day
55:13
keep it open your browser what I would do is pick a new book every morning right and just read the highlights you can see my notes too uh search whatever comes to mind uh use the highlights feed which is that is a really cool thing if
55:26
you can build the habit of just scrolling the highlights feed take 10 this is what you should do take 10 minutes out of your social media scrolling right just take 10 minutes out of whatever how much time you're using and use that to read the highlights feed
55:38
for 10 minutes a day it's impossible that you're not going to get valuable information to makes your business better if you do that 10 minutes a day for the year it's just impossible and that it's not even including the crazy thing that I've been testing and I might
55:50
just release it soon I uh it's the essentially a Founders GPT that I can't call it that there's got to be a different name so I got to figure out what I'm call it it's like chat GPT instead of being trained on the entire Internet it's trained on all my notes
56:03
and highlights and then now all my transcripts um and it's just it if you've ever heard you hear it on the podcast but if you've ever heard me speak in in person two it's this thing where some are being interviewed on a podcast I don't know what that other
56:17
person is going to ask me but everything that I hear is filtered through all the reading and research and the constant rereading my highlights so like oh that reminds me of this and that reminds me of that you'll hear me do this over and
56:25
over again the founders GPT version does that and I'm like it it now is making connections that I didn't even think about and I'm like oo this is interesting now here's the problem just like with any kind of these like new you know chat models you know 80% of it's
56:40
amazing and then some of it's like that's not you just made that up so we got to figure out what to do with that but that's super exciting so uh this idea where it's like Napoleon said multiple times in his maxims the importance of this you know he says it's
56:54
it's profitable to study the campaigns of the great Masters I don't know about you if you're reading notes and highlights from biographies of History greatest entrepreneurs what is that that is this you're studying the campaigns of
57:05
the great Masters Napoleon saying that's profitable to do so uh he says that all great captains have been diligent students of History you and I talk about this every week that's one of the main reoccurring themes in this this in the history of Entrepreneurship that comes
57:19
up in these biographies over and over again and then Napoleon says experience must be supplemented by study no man's personal experience can be so inclusive as to Warrant his disregarding the experience of others experience must be
57:31
supplemented by study during the day you know you're busy working on your company you're building your Empire when you're not doing that I think listening to Founders reading these biographies investing in subscription to Founders notes that's professional research you
57:43
are supplementing you're you're supplementing your own experience by study so if you have not yet signed up for it highly recommend you do you go to Founders notes.com after you sign up you'll receive an email in that email it goes into detail that welcome email make
57:59
sure you you read it it goes into exact detail how I use this on a daily basis and even this morning I was going and rereading highlights because one of my favorite books that I've ever read was uh this it's called hard drive it's it's
58:13
episode 290 it's a it's a biography of Bill Gates but what I love about it is like it's the first like 35 years of his life because it ends at the Microsoft IPO and I was rereading the highlights because he young Bill Gates had there's
58:28
this line it has like this monomaniacal quality and essentially what I'm just brainwashing myself to make sure that I don't lose my focus and so I was reading uh through the highlights and I was also thinking about this idea uh that I'm thinking about my own business the
58:41
importance of like uncapped Limitless opportunity and his decision to insist on a royalty agreement between him and IBM so all these weird things that you know I maybe had forgotten or hadn't thought about in a while I'm rereading and then I get to this part it was like
58:54
oh he consumed biographies uh to understand how the great figures of History thought and like oh there it is again except he was doing that you know 30 years ago no probably longer than that 40 years ago but this idea it's like oh this constant
59:11
rereading and rereading and studying of the great people that came before us and I I really do because I can tell you with my whole heart like I made the product I use the product every day it's it would be impossible for me to endorse uh another product in the world
59:26
to a greater degree other than you know listening to the podcast so I I truly believe it's valuable if you want to try it out for a year go to Founders uh Founders notes.com as always thank you very much for listening and I'll talk to you again soon