The Best One Yet - 📈 What Shaq taught us about Investing: Buy What You Know

Starting point is 00:00:00 Yetis, Nick and Jack here from the T-Boy Studio. We're on vacation still, so we are testing out our new series and giving you a sneak peek all week long. This is a soft launch, so let us know what you think in the comments. Because this fall, we're going to do a hard launch on YouTube, but right now your feedback's gift, drop it in the comments. All right, let's hit episode two of, cha-ching. Let's go. Why did Shaquille O'Neal sprung out of a Best Buy to install a doorbell in his home? Oh, and what does that have to do with investing?

Starting point is 00:00:26 Everything. Because one day the world's biggest basketball star needed a security security camera. He bought a ring doorbell at Best Buy and screwed it in himself. Ah, but here's the key. Shack was so impressed by that ring doorbell. He tracked down the founder of Ring at a convention just to invest in his startup. What Shack just did there, it's a famous financial philosophy, and it's how you should start your investing journey too. Yes, it is. And it's why he's now worth $500 million, making more money off the court than on it. Because Bestie's the first step in investing is this, buy what you know. That strategy not only is embraced by Shack, but also by the portfolio manager of the world's

Starting point is 00:01:00 most successful mutual fund. But buy what you know does not mean you should buy Starbucks stock because you customize Vente double-digit latties every day. So we'll break down the difference in this video. Because this is the best chichingya, where we reveal the money secrets of the world's most famous stars. And today, it's what Shaq taught us about how to start investing. Jack, time to slip into some 22-sized sneaks. Four-time NBA champ, three-time NBA Finals MVP, one gold medal, and 28,596 points. Oh, and yeah, the size 22 shoes for the 15-inch long foot. The only thing Shaq hasn't done is drain three free throws in a row. Trust us, he'd agree on that one.

Starting point is 00:01:38 But Shaquille O'Neal is also the NBA's Renaissance man. True. Because he's a DJ, a licensed cop and a collector of rare Japanese coyfish. Dude got snubbed by the Oscars for his Roland Kazan, by the way. I want to point that out. But most of all, he may be the NBA's best investor. That's right, because Shaq collected $292 million in NBA salary over his basketball career and made big money as a TNT commentator and celebrity endorser too.

Starting point is 00:02:02 But his stock investments have been prolific. Talk to me, Jack. And Shaq's number one investing rule before he writes a check is that he must be a customer. Right. He doesn't turn to others for hot stock tips. He creates his own stock picks based on what he tries out and becomes obsessed with. And it's not just that ring doorbell we mentioned a couple minutes ago. Which became a huge gain for Shaq when Amazon bought ring for a billion dollars.

Starting point is 00:02:22 How about Beatbox, the viral boxed wine that we called the drink of the summer back in 2024? When Shaq was DJing sets as his alter ego DJ Diesel, he noticed Beatbox was sold out everywhere he played. And if those Music Fest fans were the early adopters, then he wanted to get in early too. So he reached out to Mark Cuban, who invested on Shark Tank, and Mark's endorsement sealed the deal. Shaq became their biggest celebrity investor.

Starting point is 00:02:45 And when Beatbox sold to Anheuser Bush in 2026, but it's not just private companies and startups. Shack has made some moves on publicly traded stocks that you could invest into, like Papa Johns. Bring us back to Shaq in college. Back in college, Shaq's number one food source was Papa John's Excel pizza with extra pepperoni. He was protein maxing before maxing was maxing, Jack.

Starting point is 00:03:06 Same through his 20s and 30s. Shack was pounding Papa John's delivery at hotels when he was on the road with the magic battling the Rockets. He got to carve all over the playoffs, man. So in 2017, when controversy forced the Papa himself, founder and CEO John Schnattered step down, Shaq stepped up. He proactively reached out to Papa John's management to invest in the company. He bought a 30% stake and nine Atlanta stores.

Starting point is 00:03:29 He also joined the board and filled the void as the face of Papa Johns. And then he turned his freshman year go-to order into a marketable product to turn the chain around. Ah, behold, the chakaroni limited time pie. If you buy it, if you own it, if you dream about it when you're not consuming it, then you have an information advantage about this product. And besties, that is your starting point for how to invest. It's not the whole investing story, but it is your starting point. Now, Jack, pause the pod.

Starting point is 00:03:56 We know what you're thinking out there. But Shaq, he's a celebrity with a massive following. So, of course, he turned his investments into highly lucrative $8.5 million pizza endorsement deals. It's true that Shaq has access to special and private investments that we don't. But the fundamentals of his strategy can apply to all of us. And we can nimbly purchase any stock on any brokerage app. Shaq, since he bought such big stakes, had to sign deals with lawyers and sign contracts. True, Jack, but time out over here.

Starting point is 00:04:23 Not only does Shaq preach that philosophy. does one of the biggest brains on Wall Street. Whistle sound, mid-episode trivia. Okay, what we got? What fast food chain does Shaq own 155 locations? I want to say Shake Shack. I know it's not Papa John's. The only one's nine Papa Johns.

Starting point is 00:04:40 It's five guys. Shack was an early investor in the burger chain and owned 10% of all their locations. So if you like those extra flies that get dumped into the bag so it's overflowing, classic five guys. You can thank this 7-foot-1, 325-pound center from Newark, New Jersey,

Starting point is 00:04:55 who himself is basically five guys. Peter Lynch. It says he's six foot online, but you know this guy's 5.10. A white guy, Wharton, MBA who wears a beige suit, your dad's tie, and nerd alert glasses in every picture of him online. He's the opposite of Shaquille O'Neal. He's not a Los Angeles Laker. He's a Brooks brother's boomer. But we'd argue Peter Lynch is also the Shaquille O'Neal finance. Because his record of fund returns would posterize Warren Buffett. Oh, what does sprinkle on more context from 1977 to 1990? Peter, Rand Fidelity's famous Magellan Fund, a legendary mutual fund with a better track record than

Starting point is 00:05:32 the 90s. During his 13-year run, Peter Lynch beat the S&P 500 11 times. Wow. His annual return was 29.2% on average. Okay, so Jack, a thousand bucks invested in 1977 was $28,000 by 1990 under Peter Lynch. That is 28x return for people who invested with him from the beginning. And that unreal performance caused millions to buy into his fund, betting their retirement on this stock picks, and he rewarded them with consistent, better than market returns. But what really makes Peter Lynch, like Shaq, is his shared investing philosophy that he calls invest in what you know. Invest in what you know.

Starting point is 00:06:09 He describes it as using your specialized knowledge in an area of interest to create a starting list of stocks that you could invest in, but then you have to analyze and study that list to determine which are actually good things to put money into it. Yeah, so for like example, 1971. Lynch's wife comes home from the supermarket with a pair of legs pantyhose and she tells them, hey, these are better than what the department store sold. So Lynch looked up the parent company, which was Haynes, did some research and then pulled the trigger. And Haynes becomes his fund's biggest position. Nick, an oil worker knows more about the oil industry than we would. And a Chipotle manager would know more about the restaurant

Starting point is 00:06:43 industry than an oil worker was. Both of them have a knowledge advantage that should be their starting point for investing or not investing in those industries. And it's the same for you, besties. Like, even if you don't work in fashion, you may shop at The Gap a lot, right, Jack? Are you looking at me? I'm looking at you. And you may have recently noticed, you know, more people in the stores, longer lines for the fitting room. And, oh, wait, are they sold out of denim hoodies again? Or maybe you notice the opposite. Fewer people are in the gap because they've wandered down the hall to T.J. Max. Those signals, in your experience, they aren't a reason to spontaneously drop $5,000 on Gap or TJX stock, but they are the right signals to start researching the Gap or TJX stock.

Starting point is 00:07:23 as potential investments because you know more than others do about that. Just like how Shaq wasn't a doorbell expert or a pizza stand, but his interest, curiosity, and experience with them opened the door to analyzing the companies further. Which in his case did lead to big investments. And even bigger exits. So as basketball Shaq and Wall Street's Peter Lynch have taught us, investing in what you know is how you start.

Starting point is 00:07:45 Here's how to put that philosophy to work off the court and in the market. First, we got the receipts. Like, literally. Like, please take out your receipts. your credit card activity from the last 12 months and then upload it to AI. And then, Jack, what should you ask? Ask AI, what do I spend more on than the average American consumer? I'm sorry, 12 visits to Sweet Green last month?

Starting point is 00:08:03 Seven orders from Petco and monthly subscriptions from Chile. Jack, you bought how much Roblox, Roblox? Those are your starting points of businesses and industries to begin research because your spending patterns are potential investing advantages. Find the patterns like a coach. Which leads to our second tip. Watch the post-game press conference. That's the quarterly earnings call.

Starting point is 00:08:22 Yep. NBA players are required to talk to reporters. Well, public company CEOs are required to talk to Wall Street. But unlike a player, companies legally cannot lie. So they got to tell you the good... Revenue's up, all-time high profits, higher foot traffic from customers. And they have to tell you the bad. We're closing 12 stores and suspending our dividend because the product we launched was a dud.

Starting point is 00:08:41 So here's how you get them. Google the company's name and the words earnings call transcript. You'll be able to read the entire conversation the CEO had with stock analysts about their recent performance. Or you can listen on your next one. walk. You see, the company share audio of the call on their investor relations page. Executives will share how the company is doing, and Wall Street analysts will grill them with the tough questions. We also peruse financial reports and presentations that you can also find on the investor relations page, which is required on every public company's website.

Starting point is 00:09:09 There are so many tactics for how to research a stock opportunity from technical analysis to fundamental analysis to vibe analysis on social media, and we're going to share all of them with you on future episodes of this show. But in the meantime, Jack, what's the takeaway for all our buddies who are fans of Shaq. Passion doesn't guarantee profits. Now, Eddie, we've been focusing on Shaq's slam dunks here, but there have been some airballs, and we can learn from those too. FDX, the $32 billion crypto startup that turned out to be a fraud. Oh, boy. Shaq was sued for being a spokesperson, ultimately paying victims in his settlement. Although months before he did the deal with FTC, he did tell CNBC, I don't understand it, so I'll probably stay away. So he violated his own

Starting point is 00:09:49 investing rule. You're right. And he admitted that. That's why the investment failed. He invested in something he didn't know. But Jack, there's also anti-ants, the mall pretzel brand that you can smell from the parking lot. As you know, Shack is a carboloading king of the pretzel-wrapped hot dog. But despite investing in 17 locations, he eventually sold off those anti-ans for a loss. As Shack put it, owe the numbers. Just because you're a fan doesn't mean it's a smart financial investment. So Yeties, to invest in what you know isn't a guaranteed win, but it is how you get on the court.

Starting point is 00:10:18 And you can't get the W unless you're playing the game. So that's the first page of Wall Street's a playbook. Invest in what you know. It's why Shaq is worth $500 million and is making more money off the court than on. While binging on pepperoni pizzas and installing home doorbells. Now, subscribe to this channel for more celebrity money wins that are totally doable for you.

The Best One Yet - 📈 What Shaq taught us about Investing: Buy What You Know

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