We Study Billionaires - The Investor’s Podcast Network - RWH025: Patient Capital W/ Samantha McLemore

Starting point is 00:00:00 You're listening to TIP. Hi there, welcome back to the richer, wiser, happier podcast. My guest today is a renowned investor named Samantha McElmore, who spent the last 20 years working with Bill Miller. As I'm sure you know, Bill is one of the most famous investors of our time, not least because he pulled off the unprecedented feat of beating the market for 15 years running. Bill first met Samantha back in 2001, during a visit. to his alma mater, Washington and Lee University, where she was an undergraduate student.

Starting point is 00:00:36 As luck would have it, I happened to be there on the day they met as I was traveling with Bill at the time and writing a profile of him for Fortune magazine. In any case, Bill hired Samantha right out of college and trained her to become an extremely accomplished analyst and portfolio manager. Over the last decade, they co-managed a top-performing mutual fund called Miller Opportunity Trust. Then, at the end of 2022, Bill retired after four decades in the investment business. Who did he anoint as his hand-picked successor? You guessed it, Samantha McElmore. She's now the sole manager of the fund they ran together. She's also the founder of her own investment firm, which is called Patient Capital Management. Bill is a major investor, both in her fund and her

Starting point is 00:01:25 investment firm. As you can imagine, it's no small feat to earn the confidence and backing of a legendary investor like Bill Miller. His trust in Samantha is a powerful testament to her analytical skills as a stock picker, her capacity to think independently and diverge from the crowd, and her ability to remain unusually calm and rational, even in the most tumultuous times. In this conversation, Samantha talks in depth about what she's learned from Bill in the last two decades, about how to outperform over the long run by exploiting periods of extreme uncertainty and fear when most investors either panic or become paralyzed. She discusses what she's learned from her meetings with Amazon's founder Jeff Bezos.

Starting point is 00:02:13 She talks about how she manages her time as a prominent investor who's also raising three young kids. And she also explains why she and Bill are so bullied. about Bitcoin, despite the fact that Warren Buffett has described it as rat poison squared. I hope you enjoy our conversation. Thanks so much for joining us. You're listening to The Richer, Wiser, Happier Podcast, where your host, William Green, interviews the world's greatest investors and explores how to win in markets and life. Hi, folks, I'm absolutely delighted to welcome today's guest, Samantha, Maclemore. Samantha, it's really lovely to see you. Thanks so much for joining us.

Starting point is 00:03:04 It's great to be here. Thank you so much for having me. I'm really excited for this. It's a real pleasure. And I feel a particular sense of delight in interviewing you today now that you're succeeding Bill Miller as the sole manager of the Opportunity Fund because I was actually present in Lexington, Virginia, on the day when you first met him, which I think must have been September 25th or September 26th, 2001. So this is right after 9-11. When Bill was going back to his alma mater, to give a talk. And I was writing a profile of him for fortune. And he was about 10 years into his streak of beating the market for 15 years, which is totally unprecedented. And so I was sort of trailing him and flying in on his Learjet so that we could spend a couple of days at his Armata and I could see him in action. And so I wanted to get your perspective on what happened that day, because I was present at the creation. I was there at the very start of your investment career. Yes, that's an amazing coincidence.

Starting point is 00:04:04 I didn't realize it was you. I remember a reporter being with him and a colleague being with him. And so, yeah, that's amazing. Well, I was in an investment club at school and, you know, in an investment class and my professor was a complete Bill Miller fan junkie. He really talked up. He's, you know, the streak and how this investor had beaten the market for 10 years in a row and no one else had ever accomplished that. So when Bill was arriving, we were all ready to meet this, what we thought of as a god of investing. And so, you know, I remember attending Bill gave a speech in the chapel.

Starting point is 00:04:41 And I remember attending that first. That was my first introduction to Bill. And I remember only probably following, I don't know, 50% if that, I'm maybe being generous. But I'm like, I know this sounds right. It's really smart. And then I met Bill at a lunch, which he had a lunch with the Investment Club. and he attended a presentation. I don't know if you remember all this.

Starting point is 00:05:03 If you were trailing him the whole time, I guess you wrote these things too. And I think at one of the Investment Club presentations, I asked Bill if I could send him a resume. I thought I was going to go into investment banking, but I was more interested in investments. And so I like to say I won the job lottery. I mean, it was the fall of 2001. The tech bubble was bursting. I've heard you tell the story about how Bill's calmly buying stocks. and my professor was very struck by that as well. At that time, I didn't know enough to know how

Starting point is 00:05:32 difficult it was to do that, to buy stocks when the world's falling apart of the stock is falling apart. And then, yeah, I joined him right out of undergrad at Lake Mason. And what were you even doing there at this Southern College in Lexington, Virginia? Because you had grown up in Vermont, right? It seems like an odd choice you have ended up at Washington Lee where Bill had been as well. It was a very odd choice. I didn't have the most sophisticated college selection process. I grew up in Vermont. I was, you know, so sick of freezing, walking from my car to the school parking lot, not being able to formulate words. I hated the cold. I knew I wanted a small liberal arts college, but I wanted to go south. And I thought, I want to be able to drive home in about a day. So that put me, you know, in the Virginia area. I got something in the mail from Washington and Lee. And so we visited it. I visited it with my mom.

Starting point is 00:06:28 She fell in love with it because it's such a beautiful campus. And I thought I was going to major in chemistry at the time. But my dad thought I should try to find a profession where I could actually make some money. So chemical engineering was better. And again, there weren't many schools that had both chemical engineering and chemistry. Not that I had a real interest in engineering, but I thought I could placate him a little. So I wound up at Washington and Lane. after the first semester of chemistry, I quickly realized that was not the path for me. And so then I looked

Starting point is 00:06:58 around and said, what am I going to do with myself? And they had a business school. I knew I was analytical and I thought, let me take some classes over in the business school. And I've heard you say before, I think, that you were from a relatively modest background. And so it was actually second nature for you to look for bargains, given that money was tight. Is that right? Was there some kind predisposition towards value investing because of your background? Yeah, we didn't grow up with much money. And so, you know, I started working when I was 12 every day. I babysat.

Starting point is 00:07:28 Every day after school, I would walk to a house and babysit for a couple of kids. And so I pretty much consistently worked from the time I was 12. I paid for, you know, a lot of my own clothes. So I was always having to think about how do you make money go far? How do you get good value? You know, I had car payments in college. So I think that was always, I don't know if it was nature or nurture, but it was, you know, just a fact of life. I guess my sister is not so much like that. So maybe there's some nature, you know, in there. But I always, you know, that was

Starting point is 00:08:02 just how my brain worked. And actually, when I met Bill, so I was in an investments class and we had to construct portfolios of securities. And one of the names in my portfolio was Eastman Kodak, which was down a lot, generating lots of cash. Bill and I talked about it, sort of bonded over it. It ended up being one of both of our biggest mistakes. So that was an interesting lesson. But this price and value, how much am I paying, how much am I getting? That was always a key part of how I thought about everything, you know, because of probably my background and how I was brought up.

Starting point is 00:08:40 And a lot of the stuff I learned from Bill afterwards were more learned on the. job. Do you think that was one of the reasons why you bonded with Bill that you came from a relatively modest background? Because Bill also, I remember talking to me about how he was the son of a taxi driver and he would, I remember him once saying to me, look, it was a treat when we went to Burger King for our birthday. That was like a big deal. And so for him buying stocks was kind of a way to make real money. I think he, I remember rightly from many years ago him telling me that he made money umpiring baseball games and then invested it and bought a car. and stuff. And it was like, this is the most amazing thing. I can make money without doing really

Starting point is 00:09:18 serious work. So do you think your background? That's his amazing story. He has the great story about learning about stocks because he was out mowing the lawn all day, sweating, like doing this hard labor. And then his dad's looking at, you know, the stock quotes in the newspaper and explaining to Bill what it was. And he's like, wait. So what does this mean? No, it means it went up a quarter. And Bill's like, what do you have to do to get it to go up a quarter? He's like, nothing. He's like, you mean you don't have to do any work? I just mowed a lot for two hours for a quarter. That's what I want to do. And he said it took them a lot longer to realize you can make money by not doing any work. But if you want to outperform, you have to do a lot more work.

Starting point is 00:09:53 And interestingly, I actually got introduced to stocks from my dad. I didn't have the immediate, you know, interest that Bill did. I was more like, okay, dad, yeah, whatever. Maybe I'll be interested in that. We had, I had some insurance proceeds from actually a dog bite. And again, we didn't have a lot of money. So this was my college fund. And my dad worked in construction. And so it was a big deal to him. How am I going to invest this appropriately? And this was in the late 90s.

Starting point is 00:10:19 So he asked me if I thought he should put it in the stock market. And I'm like, yeah, Dad, whatever you think? Like, I have no idea. You know, that's fine. I think he wanted my buy-in in case something happened to this. And it worked out quite well. I remember he bought Dell and it was the late 90s. So that mid-90s probably when he did that.

Starting point is 00:10:37 So that worked out very well. And then when I was in college, obviously the market. market peaked, you know, in the late 90s and then turned down. And I remember my dad saying, should we get out? And I was like, whatever you think, Dad, you know, so he sold it all. And he had great timing for me. And so that got me more interested to see, okay, wait, these markets go up, they go down. This is very interesting. So it was kind of intoxicating in a way to see that you could make money. You could get bitten and then take the money and actually make real money by being smart about this stuff. That must have kind of captured your imagination

Starting point is 00:11:10 in some way. Yeah, the whole concept, I mean, similar to Bill, the concept of making money with money is very striking if you come, you know, from humble means without much money, and you're used to working so many hours for what you make. And so you take note. You definitely take note. And I was very, you know, interested in learning more about that. And what do you think Bill soar in you? Because this is unusual, right? for someone to come up to a legendary money manager as an undergraduate. I think you're in the full semester of your senior year. And so you come out to him and you basically say, yeah, can I send you my resume?

Starting point is 00:11:52 And then you end up talking to him about Eastman Kodak and they're like, what would he have seen in you that made him think, yeah, this person could be really good. Well, it's really interesting because you hear so often and I hear people say, you know, and I was told you can't get a job on the by side right out of college. But I like to tell people, you know, don't listen to that, try. And so I think with Bill, he had attended, again, a number of lunch and presentation. I think in general, he was impressed with the quality of the work of all the students, not necessarily me, but just overall what we were doing there.

Starting point is 00:12:29 Obviously his firm was growing quickly at the time and he'd had some good experiences hiring young people right out of undergrad. He likes to joke, he used to like to joke about getting people young so he could imprint them like the baby bird when it rises out of the nest. The first thing it sees is its mother, right? And then it learned from that point on, this is who I'm attached to. And so I think a lot of people in the business like to train people young. So he just said, sure, send me, you know, Bill loves optionality.

Starting point is 00:12:58 So he said, sure, send me your resume. And so I sent it. And then I went and interviewed everyone on the team there on his team, you know, a lot of the analyst and CFO. So I did broad interviews with everyone. And I guess I got good reviews. They talked to my professor, the investments professor, who really talked me up. I thank him to this very day for that. And so, and I remember that there was actually, CMBC was profiling investment clubs. And I was one of our three speakers on that. Now, I'd already got an offer by them. So, but Bill told me they all tuned in and listened to, you know, that as well. So I don't know what it was.

Starting point is 00:13:38 I think they hadn't come across many candidates right out of undergrad who had had that, you know, experience in investing and an interest in investing. So something about that worked out well in my favor. And you were a magna cum laude student, right? And you were in business administration and accounting. So you were clearly smart. I guess you'd gone to his alma mater and that must be nice. And you were obviously kind of a really independent thinker as well, which is important to Bill.

Starting point is 00:14:06 Like if you were interested in something as ugly as Eastman Kodak, which everyone hated at the time, that must have been appealing to him as well. That's very true. I mean, I was magna cum laude. I won the accounting scholarship for, you know, one of the best student in the accounting degree. My investments professor, I think, told them that I got the highest score. So there were things that made him think I was smart and could do the job. But then, you know, I think Sir John Templeton talks about people either being. price and value or trend in momentum, he could clearly see that I was price and value. And Bill

Starting point is 00:14:41 and I are very similar in many ways, which is one of the reasons that we worked so well together. Psychologically, I think we're quite similar. So we hit it off. And I actually remember in the interviews, one of the analysts asked me what the worst thing about Bill was, which I was, you know, taking a back to have that question in an interview. I was like, what's the right answer to this? And I remember saying, and I had only met Bill very briefly, so I didn't know him at all well. And I said, well, maybe it's that, you know, he seems so serious and smart. I don't know if he jokes around at all. And then knowing Bill, you know, years later, you know, I think we were just discussing one of Bill's jokes.

Starting point is 00:15:20 So I completely got that wrong. He loves to joke around. But I think, you know, we're quite similar in many regards. And I remember in one of the interviews, this is how I knew I'd found my heart. home my culturally at Lake Mason with this group of people. I was in an interview with Bill and this woman, Jennifer Murphy, who's wonderful, and she's a great mentor. She was a CFO at the time. And she asked me, you know, I've been asked at all of these investment banking, what are your weaknesses? And I was trained to say, you know, I'm a perfectionist. You know, I like to get

Starting point is 00:15:55 everything perfect. And Jennifer said, do you have any siblings? And I said, yes, they have a younger sister. And she said, well, what would she say are your, you know, the worst things about your biggest faults? And I said, oh, that's easy. She tells me all the time, all of my faults. She thinks I'm bossy, controlling. I think I always know everything. And then I'm like thinking as I'm saying this, what are you doing? You're ruining your chances at this job. But Jennifer laughed and Bill laughed. And Jennifer said, that's exactly what my younger sister would say about me. And so I realized, you know, okay, these people actually do want to know who I am and, you know, accept me for that. And I think there were some similarities with both of them there, you know, that came out in the interview process.

Starting point is 00:16:38 That's great. I actually, I wanted to tell you about my perspective on what was happening that day, because I think you'll be able to reflect on what I observed, because you probably observed similar stuff over the last 20 years. So what happened with me, I flew in with Bill one afternoon, basically, I guess I'd been with him in the morning on the morning of September 25th. So this is two weeks after 9-11. And the markets had just been closed for several days because the world was just in a tailspin. Then the market opens. And it has basically the worst week since the Great Depression. And so I'm with Bill that morning in Baltimore and everything's kind of going to hell. The markets tumbling. And he's buying all of these things like Nextel, these kind of hot tech stocks,

Starting point is 00:17:24 well, previously hot tech stocks that have just been utterly killed. I mean, he was buying stocks that had fallen like 70, 80%, like really smelly stuff. Everyone's kind of in a panic. And then we get on his plane and we fly to your alma mater in Lexington, Virginia. So you can imagine for a young journalist, I mean, I must have been, I'm 54 now. So this is an opportunity for me to display my brilliant mathematical skills. Okay. So I'm, I'm, you know, I'm in my early 30s, and so I fly off with Bill. So I'm having great fun, right? And he has this beautiful Learjet that he bought partly because he owned a 110-pound Irish

Starting point is 00:17:57 Wolfhound that he liked to fly with. I don't think I ever met the wolfhound. And so we go back to his alma mater. And it's the first time he's been there, I guess, to give this kind of triumphant speech after 30 years to talk to the undergraduate. So you just got lucky that you were there at the time. And so he gives his speech. And we were standing outside the VIP house where, you know,

Starting point is 00:18:18 would have their A-list guest stay. And he can't get into the house. It's like this kind of comedy of errors. Like, the big guy has come back to his alma mater and no one has the key. And so he calls back to Baltimore. And I think Lisa Rapuano, who was a star analyst there, who you would have known and then became a hedge fund manager, picks up the phone. And she's like, Bill, there's stock that you bought this morning or, I think it was that morning or yesterday. It was the previous day that he'd bought like a million shares off, say, $27 million or something. He had four million shares. So it was like a hundred million dollar position has just announced that they're going to miss earnings massively. So Bill is like really annoyed. He's like,

Starting point is 00:18:58 oh my God, I can't believe, you know, like he was sort of annoyed at the company, I guess. And so then we go off and, you know, he has his dinners and speaking to students and like. And then the next morning, I guess he spoke to your investment club. And we come back to this sort of VIP house. And I only remember this because I was checking my notes again this morning to see what had happened. And the colleague of his who he was traveling with, who I think ran various institutional funds there, I think it was Kyle. Yeah, says to him, have you seen AES? And they both sort of look a little pale. And she says, it's down to 13. And so basically, it had halved. So it's not even breakfast. And I'm like, wait a second. So this guy, he's just lost 50 million.

Starting point is 00:19:44 dollars this morning. It's not even breakfast. And what was really interesting to me, and sorry for this long rambling story, but it's a rare moment to see a great value investor, sort of in the heat of the moment, like in one of the great market meltdowns of all time, he just gets really quiet and he says, okay, let me grab my phone here. And he says, I've got to find out where my cash is. And he starts kind of pacing around with this very quiet intensity. And he's calling the office and I'm, of course, having a blast. I'm just standing there next to him watching all of this and taking notes and feeling like, this is just heaven. Like the world's falling apart. And I'm like, what a great story. And he says, all right, let's buy two and a half million

Starting point is 00:20:22 shares today. Let's just get it done. And it was an extraordinary thing because, so you see this guy just investing instantly about, I guess probably $30 million or so more. And later he just said to me, look, it's people hate moments where bad news comes. They don't, they have this sort of behavioral tendency to overreact. So he said, it's highly probable that people are overreacting to news of this earnings shock. And over the next couple of weeks, basically he built his position to $500 million. And he sort of said to me, look, this could be the thing that makes all the difference over the next couple of years. This actually could be our big winner over the next couple of years. And so it's kind of amazing to watch this whole process of a guy seeing the market get killed,

Starting point is 00:21:07 seeing his stock get killed, getting really quiet, getting really focused, really intense, and doubling his bet, and sort of saying in the drive back to his plane, saying, we better do some really serious work here. So he was actually buying before he did the serious work, because there was a sort of belief that people were just going to overreact because of the behavioral bias that we have. So can you talk about how that's kind of emblematic of the way that you and Bill have operated over the last 20 years because so much of what you've done has actually been taking advantage of volatility in these moments where everyone else is kind of panicked. Those are precisely the moments where you guys have actually kind of made money.

Starting point is 00:21:51 That's a great story. I love that story and I love all the details and that you were there for it and listening to it now after, you know, working with Bill for over 20 years. There's so much that we could discuss about that. I think, you know, maybe just to start, I feel so fortunate. I did win the job lottery. You're right. They had tried to get Bill to come back for many, many, many years unsuccessfully. So I got super lucky.

Starting point is 00:22:17 And I think starting in July of 2002, which was right at the bottom of the market after the tech bubble burst. And so a lot of the initial work I did was on analyses on the market, some of it, analyses on the market about, you know, odds of making money. You'd had, you know, rolling, we were looking at rolling five-year returns and it had gone negative and it doesn't do that much. And when it does, your odds of, you know, future five-year returns are, you know, much more positive. And so there was a lot of work about that.

Starting point is 00:22:51 Interestingly, you mentioned AES and Nextel and some of these names. You know, we have a poster board of, I think it was Money Magazine. And there was a cover, you know, the profile that was done of Bill of his portfolio at that time, called the scariest portfolio ever. It was like shocking exclamation point. Something else outperforming question mark? And it said starring like Tyco AES, Nextel. And we tracked the returns of that portfolio relative to the market that was part of my job.

Starting point is 00:23:25 You know, we would update it monthly or quarterly. And dramatic. dramatic outperformance. And so this idea of fear and pessimism, you know, Buffett talks about this a lot. When those are high, it's a good odds that things can go right. And no one can predict the future of the world. I've heard Bill, he's been asked many, many times, what did you know about Amazon? What did you see in Amazon that others didn't see in the early days? And he's very clear, nothing, you know? I mean, there was a lot of analysis about the company and the business model and the working capital cycle, the free cash flow and Jeff Bezos, I analyze the fundamentals.

Starting point is 00:24:03 You don't know how the futures, you don't know anything about the future, you know, that other people don't know. But he thought it got really misprice. He added aggressively to it after the tech bubble burst. And so, you know, a lot of our work, I was fortunate to work with Michael Moveson, who wrote the book on expectations investing. And so it's those revisions to expectations that drive stock prices. So, you know, the great thing about value investing, is you're fishing in a favorable pond of low expectations. But those expectations have to be wrong. They have to be wrong for you to actually make money. But it's a good pond to be in. And so we try to find low expectations, fear and pessimism. It's exactly what you want in an

Starting point is 00:24:46 environment like this, where especially after the market suffered big losses, that's an advantage time to be investing if you can be long term. So yeah, that was definitely one of the lessons, you know, the bill always reinforced. And Amazon had been crushed at the time to an extent that very few people will remember because this was actually the core of my article about him for fortune. Because basically the stock had fallen from, I think, 90 to 6. And a lot of people were saying that it was going to go bankrupt and really smart people. I mean, these weren't idiots.

Starting point is 00:25:20 And so most of Bill's peers, I was talking to him about this the other day because we met in New York city a week or two ago. And we were recalling this because one of the people who'd been pillorying him at the time was at this, the meeting that we had. And this guy who's like, I won't embarrass him by saying his name, but he's a very brilliant kind of elder statesman of the investing world, was saying, this is going to go bust and you're not a value investor and why are you doing this? And Bill was sort of defending himself and was saying, look, well, it's like Fannie Mae in that its cost advantage is concealed. And so in the short term, it's losing lots of money,

Starting point is 00:25:57 but in the long term, you'll see that it has this cost advantage that's kind of concealed, at least by gap earnings. And so there was a kind of misperception there. And it seemed like that was always the essence of what Bill and you were doing was exploiting people's misperceptions, especially in times of real uncertainty when they would panic. Definitely. We're always looking for a variant perception.

Starting point is 00:26:18 And we believe the market is extremely difficult to be. It's pragmatically efficient. It's mostly right most of the time. And so there's not many areas where you can get an edge on the market. And informational inefficiencies, those are mostly competed, regulated away. It's very hard to get an informational edge. You can get an analytical edge. But again, in today's day and age, it's very, very difficult to do that.

Starting point is 00:26:44 It's hyper-competitive. So the area where we believe you can mostly get an edge is the behavior. The tendency of groups of people to act in similar ways to all the behavioral finance literature on loss aversion and recency bias. And when people have losses, they don't behave optimally. They're more likely to panic and sell. And those oftentimes create the best opportunities. And so if you can find, especially if you can find companies that you really like where there's any sort of panic going on, Those are our favorite sorts of opportunities, you know, over the long term.

Starting point is 00:27:21 I mean, at that time, I remember even when I wrote that article for Fortune, I basically said, look, if he's right about Amazon, this will turn out to be one of the greatest contrarian bets of all time, because it was so loosed. And he built this position where he bought 15% of the company. It wasn't just that it was contrarian. It was unbelievably bullsy. I mean, it was so aggressive. I see that again with his bets on Bitcoin these days and in his personal portfolio where he was saying to me a couple of weeks ago, he's like, yeah, it's basically it's the holy Trinity. It's Bitcoin, Amazon, and then I guess it was this security company clear that he invested in when it was still private. What do you make of just the sheer bullsiness of someone who was able to buy 15% of Amazon when it was most hated all the way down from 90 to 6? And then again, to have, you know, 90-something

Starting point is 00:28:14 to send to his portfolio in Bitcoin and Amazon at certain points and to use leverage. We have always joked that Bill has guts of steel. I have never met any other investor who can, I mean, many of the greatest investors can stomach much more than other people. That's, I think that's pretty common. But I have met no one who even comes close to Bill's level of what he can stomach and tolerate. And he just doesn't get perturbed by falling stock prices. If he believes in the company, if he believes in the business, he will change his mind based on evidence. He will update his view. But if he believes in the company, then he will buy more of the stock. And the funny thing about it is, we used to have this joke where internally,

Starting point is 00:29:01 once Bill reached the point, if things were going badly enough that Bill decided he didn't like a stock anymore, that was the best buy signal. If the company was going to survive, that was the best buy signal there was because no one else was left to sell. He's the last one to get to that point. And so he's made some amazing and great calls. The other thing I really admire about him, so, you know, his ability to stomach and just not get swayed and emotional, you know, in the markets is a huge benefit. I think Warren Buffett's when he talks about keys for, you know, being a good investor, emotional stability, a keen understanding of the behaviors of individuals and institutions and individual thinking. You know, there's no IQ in there. But emotional stability,

Starting point is 00:29:46 you know, again, Bill is as good as it gets, in my opinion, out there. And he's also, you know, just a very differentiated thinker. He's willing to look at things early and form his own conclusions based on the evidence. And so he did that on Amazon. He did that on Bitcoin. I mean, he was very early there. He loves to look at new things. He describes himself as intellectually promiscuous. So he He loves new things. He loves learning. And so all of those things, I think, are great assets when it comes to investing. I always got the sense that when the people he respected most disagreed with him, whether it was Buffett or Munger or Templeton or any of the great value investors, it actually made him more excited by an idea because he would think, I remember in those early days, I guess it

Starting point is 00:30:32 was after 9-11, he said to me, Buffett's not buying, Prince Al-Waleed's not buying, Templeton's not buying. He's like, when all of the great value investors aren't buying, that's a buy signal. And so likewise, I think almost with Bitcoin, when he hears Buffett and Munger talking about it as rat poison squared, it doesn't seem to put him off much as he admires them. What do you think the thinking is that? So I've seen Bill, you know, go both ways. So I really do think he listens to their arguments, his background in philosophy. He's going to listen to the merits of your arguments. When we did research for him, it was always based on the merits of what we were arguing and whether we could support it with evidence. So rat poison squared is not going to be convincing

Starting point is 00:31:17 to him. You know, it might be catchy and we might love to talk about it. It's interesting, but it's not evidence-based. And so Bill would say there, Buffett doesn't have any particular expertise when it comes to this sort of thing. He even swore off technology broadly for, you know, many, many years. And so if you look at the people who actually know something about this in the venture capital world, they're really excited by it. And Bill will read all the details of what's coming out. I mean, he's, again, a voracious consumer of information.

Starting point is 00:31:46 So I think, again, as I see it, again, if we kind of separate it into the expectations versus the fundamentals, you know, we want the expectations low and controversy and pessimism and fear and all of that's a good thing if it comes to expectations. And then we want the fundamentals to be good. But that's a different set of evidence and characteristics of what we're looking at and analyzing there. So, yeah, it's not going to deter him, you know, that other people don't agree with him. He will listen to what they think.

Starting point is 00:32:16 And he will change his mind if they're presenting good evidence. But they have to present good evidence, I think. Let's take a quick break and hear from today's sponsors. All right. I want you guys to imagine spending three days in Oslo at the height of the summer. You've got long days of daylight, incredible food, floating saunas on the Oslo Fjord, and every conversation you have is with people who are actually shaping the future. That's what the Oslo Freedom Forum is.

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Starting point is 00:36:26 slash WSB. All right, back to the show. You were kind of skeptical originally of Bitcoin and then sort of came around somewhat and put some of it in your patient capital fund and some of it personally? Or what happened in terms of your own trajectory with Bitcoin? And what would your argument be for owning it? You know, when Bill's asked, we're often asked, what are the main differences between us? So he would say, I have a much higher evidentiary threshold.

Starting point is 00:36:55 What do I need to see and analyze in order to believe something? And that's probably right. And so I kicked myself to this day that I didn't invest in Bitcoin when Bill did. And he made a ton of money. We had this big Bitcoin bull cycle. And so in 20, I guess it was at 2017 when it, you know, before I had gone from $300 a coin. And when it got to $3,000, I was telling Bill, you know, it was a big position in one of the funds he ran. I was like, Bill, you've got to cut this back.

Starting point is 00:37:27 You know, it's going to crash again. You're going to have losses in your portfolio. And at that time, the investment case was about it displacing currency and people tracking the number of transactions being utilized with Bitcoin. Again, I didn't see the evidence at that time that convinced me to believe in that bulk case. And then I was completely wrong on Bitcoin. So it went from 3,000 to 20,000.

Starting point is 00:37:54 And then it did crash, but back to 3,000. So if you had listened to me, you know, he would have been harmed because even riding through it, you know, it just went back to where I was advocating that he'd get out. And so, but it was something we were following. I think in 2020, that's when I put it in the fund that I run. And at that time, it had had a, you know, it had the cycle. It had crashed and started resuming its rise. The bull case had shifted from, you know, it was no longer about tracking transaction. and people were saying it's not great for that for a number of reasons, the cost to do that.

Starting point is 00:38:28 But they were saying, you know, and they were talking about it's digital gold. And that had been thrown around in earlier years. But again, there's only, you know, one goal. So the base rate of success there was very low. But interestingly, by 2020, Bill had been involved in this space for many, many years. So he was one of the experts. And he was on calls with institutions virtually every week who were interested in learning more about crypto and learning more about Bitcoin.

Starting point is 00:38:57 And so gold is basically just occupies a special psychological space in the investment universe because of a belief state that exists broadly among people. And so it seemed to be following that path. And then there were some academic research that suggested it actually did have, you know, quantitative characteristics, you know, that argued it could be a digital gold. And so, you know, I thought inflation was a risk. and it could be a good hedge for inflation if it occupied a similar digital gold place with free option value on the upside.

Starting point is 00:39:33 So yes, I think I'm oftentimes I want to do more of the detailed work. I think that was one of the ways Bill and I were very complimentary to each other, but his investing early was a big benefit. How much of the story of Bitcoin for Bill do you think is really just about the supply demand case, like that he just looks at it and he says, well, there's limited supply, the demand's growing, and there are so many millionaires in the world and they can't all get a coin, even if they wanted one. All these institutions want it. And so there's some sort of deeply agnostic part of Bill that doesn't really care whether it's a value or anything. It's just like, it's going to go up

Starting point is 00:40:12 because it's a sort of scarce resource with demand. No, entirely. That's entirely. I think it's two things. It's that. It's supply versus demand. and there's a fixed supply and that is the bull case. And so if you have growing and sustainably growing demand for a fixed supply thing, the price will go up. And then it's also just basic risk reward, expected values. What can I make if I'm right? And how does that compare to what I lose if I'm wrong?

Starting point is 00:40:42 And the upside, given those characteristics, if things work out well, is so extremely high. If it is digital gold, you can get values, you know, 300,000. And I think Kathy Woods out there with 500,000, those aren't crazy values if it continues to evolve in that way. So that's huge upside. And then the downside is, you know, to zero, 100%. That's the most you can lose if it completely disappears. And I think he would say, and I would agree, that at this point in its evolution, it's

Starting point is 00:41:12 very unlikely to completely go away. I think that's no longer like they could have, you know, significant losses. But I think those two elements are the bulk case, yes. I think that willingness to look for asymmetric bets with tremendous upside was always something that freaked out the rest of the value investing community, right? Because someone like Buffett really obviously loves certainty and avoiding risk. Like Munga's prepared to take more risk probably and bet on things like Alibaba. And then you have Bill who, I remember when he was defending himself when he was being attacked about Amazon back in 2001 when I was probably first interviewing

Starting point is 00:41:51 him about it. And he said, look, there's a pretty good chance that it's going to go to zero. This is when it was at about six. And he said, but if I'm right, and I think I probably am, but I may not be, if I'm right, I'm going to make 50 times my money. And there was a willingness to buy things where you could go to zero and be publicly humiliated if the upside was great enough. And that seems to be a consistent stream through a lot of your investments with Bill in kind of emerging, emerging companies, early stage companies that could be enormous winners. Can you talk about that? Because it's actually, it's a really unusual thing to see within the value investing community. You guys are sort of pioneers and outliers in being willing to take these big, these big, I mean, I think Lee Lou does

Starting point is 00:42:41 it as well. Lee Lou, I think, made enormous amounts of money on B.Y.D with almost like a venture capital style bet very early in its life. Yeah, no, I think that that's exactly right. And it's, it is similar to venture portfolios. And if you look at those portfolios, they do really well, but it's driven by a handful, a small number of, you know, huge winners that go up a ton. And the rest are losers. I think the risk is lower in the public markets. Well, maybe until recently when you had these really early stage companies come public. But I think this idea of what do we make it for right and what do we lose if we're wrong and the expected value there. And then at the portfolio level, you have to manage the risk and the exposure. But especially if you

Starting point is 00:43:25 have pessimism and these earlier stage companies, they're also, they can be more likely to be misunderstood. I mean, I've heard Buffett, you know, what he likes is, you know, I heard the three criteria like 15 times, you know, next 12 months earnings, 90% confidence the earnings will be higher in, you know, five years and 50% likelihood it can compound growth at 7% a year. The challenge is the market's pretty efficient at pricing things with those characteristics. And with rates so low, the prices are pretty high. Some of these earlier stage companies where the market, especially in an environment like today, where names are down, you know, 80, 90, 95 percent.

Starting point is 00:44:14 And the market just cares about, you know, the next week, month, you can find some gems, you know, businesses that could look entirely different in five years. And the market would meaningfully, you know, revise how it valued those companies from a money, loser to something that looks much different. And we're looking when we're doing analysis at reasons to believe that's the case in the fundamental. So we're not just taking shots and saying, so we want to believe the market's wrong. So we want that very perception.

Starting point is 00:44:48 But this idea that you can make a lot of money. And if you look at how managers deliver returns, oftentimes, it only takes a few big winners. And Bill, this is a less than Bill and part of very, very early on. to offset a lot of losers. So if you have a couple, one, two stocks that are up 10 times, one stock that's up 50 times, that pays for a lot of losers. And even Ben Graham, I think most of his returns came from Geico, Buffett the same thing. Again, that's time and a high quality business.

Starting point is 00:45:24 You can get those sort of returns if you have really low expectations on something the market, the market doesn't understand a business model where maybe you can't see, the market can't see or isn't looking out far enough to see what it might be, you know, over the long term. I remember Bill once saying to me many years ago, someone had done a study of his portfolio and said to him, yeah, if you took out AOL or you took out Dell, you would have trailed the market. And he's like, yeah, but I owned AOL and Dell. And he said, and that was intentional. He's like, I was looking for companies like that could go up 50 times. And so I'm curious, when you think about this portion of your portfolio, because it's only one bucket of your

Starting point is 00:46:03 portfolio, because you also have the old style, classic, smelly value stocks, and then some kind of steady compounders like the Amazon's and the Googles and the like. But when you're looking at these early stage things that could become huge, what are you looking for? What are the characteristics of the companies in this bucket that could become 50 baggers, 100 baggers? I mean, what we're always looking for is some reason to believe that market's current expectations aren't reflecting the fundamentals that we see in the business. I mean, that's similar across everything. And some reason to believe that these things could go up a lot.

Starting point is 00:46:40 So some of the things we look for with these companies, large total addressable market, so some competitive advantage within the market that they're operating. We want to believe that there's a compelling business model there. So there's a lot of companies that came public over the last few years where there were a lot of questions about the long-term business model. We want to do the work there. And so I would say, again, that the market doesn't understand something about the business and that we have an edge.

Starting point is 00:47:11 So I think those are the similarities. And then if we're right, obviously the upside is quite significant. So an example of this, I think, you know, now is, you know, there's a couple of examples, but one that we've owned for a little, a few years now is Farfetch. And this is a company that has a luxury goods marketplace. And they also have what they call platform services for luxury goods companies, which is basically they provide the tech backbone for luxury companies, kind of similar to AWS.

Starting point is 00:47:43 And then they own some luxury brands. It's losing money. It's one of these names that we bought it a few years ago after they did a deal for New Guards Group. and the market thought this is a terrible deal. And when we did the work, we thought it was a great deal. So there was something the market misunderstood in the short term. COVID hit.

Starting point is 00:48:02 So the stock initially traded down, but then the market realized this deal was good. And then it was benefited from all sorts of things going on with COVID and from additional deals, you know, they'd done in China. So the stock went from 10 to 75. So we cut back a lot then, but still held it because we still thought there was significant potential for the business over the long term. It's losing money in the short term. It's been hit by Russia, China, FX. So it's gone back to five. And so, you know, huge declines.

Starting point is 00:48:33 But we still see that sort of potential longer term for the business, despite the near-term headwinds. They are the only company building this sort of technology for the luxury industry. And they've made deals with a lot of companies in the space. Rishmont is the biggest one that will double their GMV, gross market. merchandise value as it comes on over the next few years. But this year, they're bringing on, you know, Farragamo, Neiman Marcus. So we can see a lot of positive things in the fundamentals that you can't see if you just look at the current income statement and cash flow statement.

Starting point is 00:49:07 But as we look at the implications for the business over the next few years, we think that the company is materially misunderstood and missed price. And so those are the sorts of things we're looking for when we analyze these companies. It seems like so many of these disruptive, innovative companies that Kathy Wood and the like were chasing after in the last few years that had incredible hype behind them, an incredible potential to be extraordinarily disruptive, got hugely overvalued. And there were people who were like, yeah, I can pay 50 times sales or 100 times sales. I think you mentioned in one interview, Snowflake at one point was 155 times revenues.

Starting point is 00:49:51 And it seemed to me that in some ways, people were learning the wrong lesson from Bill's success with Amazon and Nick Sleep's success, Nick and Zach's success with Amazon, which I'd written about in Richer Wiser Happier, where these really smart value investors like Nick, Zach, and Bill had kind of reinvented value investing by buying great businesses and holding them for a very long time. And so it had become kind of this new orthodoxy where people were saying, well, I'm kind of prepared to pay almost any price because these companies are making this land grab. And it's just as Amazon paid off because they made this enormous land grab. And Bezos was incredibly patient in deferring gratification and getting the rewards for investing in the business. People sort of thought,

Starting point is 00:50:40 well, maybe it's Amazon again. And so it feels like the pendulum kind of swung too far. And everyone in the value, or a lot of people in the value investing community got that new religion and then got kind of killed as a result. Can you talk about that kind of conflict between the tremendous potential of these companies and the benefits of understanding these different ways of investing, like, based on huge addressable market and the like, and also the dangers of becoming untethered from valuation? This is a great topic. It's one I'm really passionate about. I agree with you completely. And it's interesting on so many levels. That's my favorite sentence already. It's so rare, Samantha. No, sorry, carry on. You know, I really do think, you know,

Starting point is 00:51:28 if you look at Buffett's evolution, it was in the same vein from cigar butt investing to to high quality compounders with Geico, you know, Bill with Amazon, Nick's Sleep. Again, you know, one of my favorite things in this business is capital cycles, behavioral cycles. And so when I first got in, it was at the bottom of the tech bubble. And then energy global cyclicals had this huge move up driven by emerging China's growth. And that's what ended the streak for Bill, because he, you know, had never been a huge fan of those companies because they didn't earn above their cost of capital through the cycle. And so, you know, getting into 2005, 2006, that was the only group of companies, those sorts of companies that outperformed. And now more recently, you've seen

Starting point is 00:52:14 a cycle for growth. And it's reached the stage where, again, we are always very valuation sensitive. That's key across our whole portfolio. So we're doing the valuation work. We're not always right. We make plenty of mistakes on the work, but we're going to sell something if it exceeds our estimate of what it's worth. We're going to be patient and let our winners run. But, you know, we're going to track quite closely what do we think the business is worth. And we owned Peloton at the IPO and sold it, you know, during the bubble at greater than $100 because we couldn't make a valuation case. We're like, it's pricing in Apple type duration and level of growth. And so I think some people have taken the quality compounder argument, you know, so far that at least before this most recent bear market, they thought you could justify paying any price for a company.

Starting point is 00:53:11 But obviously, you cannot. You know, you can have a great company that's a poor investment if the price is too high. And that's especially true. I think the risk is even higher, you know, if interest rates are rising or even stable. You're not going to have that sort of tailwind. So I think, you know, in the growth space, you have a lot of great investors. Few of them are really sensitive about that valuation piece. And we always are and always have been. So I do think, you know, in the value space,

Starting point is 00:53:44 a lot of people have gotten into these sort of companies. I haven't seen any value investors do the snowflake thing. And that was, you know, a great example of a company that I have never heard a bad thing about the company. People love this company. They love the competitive advantage. But the valuation just got so high that everything had to go right. You know, extremely high expectation. Everything has to go right for the market for the company, for you to do well in those sort of situations. And if we have a decade more like the 70s, the risk is just much, much higher. I still think we see that around in many companies that are quite so dramatic. I've been thinking about this a lot recently because I spent a week

Starting point is 00:54:25 with Guy Speer in Switzerland recently and I interviewed him for the podcast, but also I help him with his annual report every year, partly just an excuse to spend a few days chatting with him. And this was one of the big sources of agony for him over the last couple of years is that all of these really smart value investor friends of his were telling him by things like, you know, Spotify, Netflix, Twylio, Salesforce. And these are people he really admires and likes, you know, Carvanna. And he would look at them and he'd get really excited when he was studying the business model. And then his heart would just sink when, you know, he would look at sort of Roku or something

Starting point is 00:55:02 and we'd just see how absurdly overvalued these things were. And I don't know, you guys always seem to have more patience with more tolerance for high valuation. But at the same time, you were also investing in these sort of ugly things like airlines and travel stocks and carnival cruise lines and the like or Norwegian cruise lines, things that people hate it. It's interesting that you have both of these buckets in your portfolio. Yeah, I think, you know, in terms of the high valuation stuff, Amazon would be the poster child for, you know, the name that we've owned for so long that has always looked expensive or maybe for a long time has looked expensive. But I think, again, our belief there is it's always been undervalued. It has such a huge total adjustable market, $5 trillion on the retail side. They invented and created AWS. It has, you know, one of the best management teams. We've, ever met, maybe the best in terms of their data discipline, evidence-based, financially sophisticated. I mean, you would be surprised how few companies can even understand that the proper metric to

Starting point is 00:56:13 engineer the business force, free cash flow per share. And this is a company that had it in its initial, you know, annual report. And so all these companies that claim to be the next Amazon of this, of that or the other, they don't actually behave like Amazon in many material ways around what they're optimizing for and their share dilution. So all the things that matter long term. And then what's difficult with these sort of companies is to separate out the investment from the cost structure with a company like Walmart as they were growing. You could analyze the store unit economics.

Starting point is 00:56:45 You could analyze the income statement. And then you could see that all of the investment in future growth was coming through the cash flow statement, new stores with companies like Amazon are more digital companies where it's R&D based or technology spend, you know, it's harder to understand what that looks like. So we spend a lot of time with that one or any names like this, trying to understand the long-term operating model and the value, what the valuation would look like over a longer-term time horizon. And so you're right, many of those companies, we owned at Netflix, you know, for many years, did very well, sold it too soon twice. But that was based on, again, our cell discipline around,

Starting point is 00:57:25 the valuation. So we are sensitive both on the buy side and the sell side. We don't just own all of these sort of names forever. I think the other compounders that we own, most of them look cheaper. So in an name like Alphabet is much cheaper even on the current earnings now. And the earlier stage companies, again, we'll look at money losing companies. A lot of people won't even do that. But we're doing a lot of analysis around can this business make money and what's the value over the next five or 10 years? To go back to this question of Amazon, one of the remarkable things, I guess, in your investment career is you've got to spend a fair amount of time with Jeff Bezos over the years, because Bill

Starting point is 00:58:05 would have these dinners with him fairly regularly. And I wonder if you could just talk about what that experience has been like, what you've learned from being so close to one of the great CEOs of our time. I've been very fortunate. I haven't got to attend as many of those dinners. I wish I'd gone every year. I would have been able to go every year. It took me many, many years to get a seat at that table.

Starting point is 00:58:27 But one of my first experiences in 2003, right after I joined, Bill had a big investment conference for all of our clients. And Jeff Bezos was the speaker, and he gave the washing machine talk where he talked about the internet being like the early days of electricity, where initially he compared it to this washing machine and it would hurt people and it would be outside and you have to go over there. And it was really clunky and it didn't work well. And then you got electrical outlets and things evolved.

Starting point is 00:58:57 And again, we were so early. And Bill believes that he kind of laid out the case for AWS at that meeting. And then I remember attending a meeting with Bill and Jeff where Jeff was soliciting advice about raising kids. And so at the time, I had no idea how special it was to have a seat at that table. But in hindsight, it's amazing. It's amazing that I was there. And then I have attended, you know, some of the dinners, you know, with Bill and Jeff and got to meet him.

Starting point is 00:59:28 And he is just, Warren Buffett calls him, you know, an authentic business genius. And so to learn from Jeff and hear about how he, and here Bill, you know, Chris Davis, asking Jeff Bezos questions about the business, you know, that's just an amazing opportunity to have some of the best investing minds and business minds. of one of the greatest companies in the history of the world. So I feel very fortunate for that experience. But I think that's also when we're doing work on companies, again, Bill for many years when meeting with Jeff would ask, okay, this is still a double-digit operating margin of business, right? The core retail business, but then they're investing.

Starting point is 01:00:14 And so just checking in on that, you know, that Jeff still believed that and what the evidence was for that, for that. I mean, that's similar to how we think about these companies. Again, as long as we believe a few key investment variables are true, you can withstand a lot of, you know, noise. And so I think to the point about Buffett, he talks about what doesn't change, what will be the same, what will people still be doing.

Starting point is 01:00:38 That's similar to what Jeff talks about. You know, people always focus on change and he says, what won't change is that people will still want low prices. You know, people always want low prices. So I think that that's an interesting and an important thing, you know, to think about. I was talking to Bill about Amazon a couple of weeks ago and he said he talked about how one of those meetings with Jeff Bezos was saying maybe this was around 2002 or something like that.

Starting point is 01:01:06 He said to Jeff, what are you spending your time on? And he was saying basically shoring up the balance sheet, I think. And then the next year he said to him, what are you spending your time on? He said the user experience, making sure the user experience. making sure the user experience is great. And Bill was like, Bill said how he kind of, he extrapolated from that the company had turned a corner and was going to kind of be great if he could focus not on survival, but on improving user experience. And I thought it was really interesting, just listening to Bill, as a sort of former military intelligence guy, because obviously that

Starting point is 01:01:38 was an important part of his early training, that he was able to take little bits of information in this kind of mosaic way and piece them together. And he said something similar about, I think it was Tupperware where he saw this company. I think it was Tupperware that it hadn't made money in so many years, suddenly said they were going to have a shareholder day where for the first time in years they were talked to shareholders. And he was like, we need to buy.

Starting point is 01:02:03 And I think he said, you were like, no, we need to do more work. And he's like, no, no, that's enough. We just buy. Because so he was seeing these little clues. Can you talk a bit about that? Because you must have seen that so many times where a little piece of information seen with the right kind of pattern recognition is absolutely critical. Absolutely.

Starting point is 01:02:25 And we would sometimes call it triangulation. So getting disparate pieces of information from different people or different sources that led you to the same conclusion would increase your conviction and belief state. And interestingly, I think Bill met with Jeff Bezos in 2012, I believe it was. And that was, we had owned Netflix. We'd sold it too early in 2008 when we thought streaming was a risk. And then they went on to dominate streaming. But in 2012, you know, they announced that they were going to separate the streaming

Starting point is 01:02:55 piece of the business from the DVD piece of the business. And the stock tanked. And I think it was 300 before that and went back to like, you know, 120 a share. I think it got down to 50, 60. And Bill had met with Jeff. And Jeff said, hey, do you know Netflix? and Bill's like, yeah, we've owned it. And he's like, we don't own it now.

Starting point is 01:03:15 He's like, well, do you have a sense of what it's worth? And Bill's like, well, our work's not current. And so he came back to us. And we were like, okay, if Jeff wants to know what that business is worth, we need to do the work on what that business is worth. So we started working on it. And then Bill attended another meeting with John Malone, where John, I think, said that he would be buying every share he could of Netflix

Starting point is 01:03:36 at those prices. And I think it rebounded back to like 90 by then. He said that he was restricted because some of his other holdings. And so, you know, Bill was like, this is basically all you need to know. You know, John Malone, one of the best investors in the history of the world, you know, would buy every share he can, you know, Jeff Bezos inquiring about, you know, what the company is worth. And so I think it's that classic sort of, you know, trying to triangulate different sources

Starting point is 01:04:04 of information to figure out. And then we did work and we realized that it was trading at a very low multiple of the U.S. earnings, but they were investing, again, all of this internationally, but those businesses were much earlier stage, but there was no reason to believe that they wouldn't evolve in a similar manner to, you know, the U.S. business. So you could buy the company at like five or ten times with the U.S. businesses earning. So for a company like that, given the stage, you know, where it was, it was an amazing opportunity. So we, you know, built up a big stake in Netflix at the time.

Starting point is 01:04:35 But it's that, again, are we doing our valuation work? What are other people that we respect, you know, seeing and saying? different sources, mosaic theory, you know, classic analyst, analytical stuff. Yes, so in a way in a world web, because of regulatory pressures, you can't get such an informational edge, the ability to see the information in a different context, to take information that's out there and see it in context and understand, recognize the patterns. That seems really key to your success over these years. Yeah, I think pattern recognition, you know, again, Bill would probably

Starting point is 01:05:10 tell you, I don't know if I agree with him on this, but he likes to say there's not many benefits of getting older, you know, in the business. I don't know if I agree with him because that pattern recognition piece and having these experiences, you learn so much the more you have them. And as Bill says, you know, there's not many people like him who are investing through the subsidies. Again, that's, that's an asset. And I think Charlie Munger has talked about how it is a big benefit to, you know, continue. There's not many things you get better and better as you get older and into your 90s like they are. But he said investing can be one. I think Bill's point is when you're younger, you can look at the world with fresh eyes. And there's a lot of benefits to that to not people

Starting point is 01:05:51 get stuck on their worldview. And it's very important not to do that in investing because things are changing all the time. It gets harder to do that as you get older. But the sort of pattern recognition piece, the fact that low prices, high fear and pessimism, you you know, leads to better investment opportunities. Again, it's why we think, you know, these behavioral advantages are so enduring. It's like I think of it like dieting, you know, or eating healthy. People don't not do that because they're not sure what to do. You know, they don't do that because it's hard to do.

Starting point is 01:06:25 It's hard to not eat the cookie. It's not like, you know, oh, I'm not sure if I should or not. No, it's like, you know you shouldn't, but it tastes great and you're going to eat the cookie, right? It's like selling things down a lot. I mean, you can actually. amendment yeah you can justify you can trick yourself in the markets a lot more it's hard to trick yourself to believing the cookies good for you but in investing you can make yourself believe oh there's all these problems there's all these bad things going on so i'm actually better off selling but at the end

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Starting point is 01:10:22 prospectus at fundrise.com slash income. This is a paid advertisement. All right. Back to the show. I wanted to go back to earlier in your career, because you really had this incredible trial by far, right? So initially you become a junior analyst at Lake Mason, where Bill was working at the time back in, I think, July 2002. So you're going through the sort of rubble after the dot-com bubble and after 9-11 and you guys buy like crazy and it works out. And then a few years later, I think, I think it must have been around July 2008, if I remember rightly, or maybe August 2008, you become, was it an associate portfolio manager on Opportunity Trust? In August of 2008, I became the assistant portfolio manager. Okay, so this is right before

Starting point is 01:11:08 Lehman Brothers blows up in September and the world basically goes into free fall and everything is collapsing. And Bill, for once in his career, having done brilliantly during these previous moments where there was tremendous disruption. Bill for once screws up totally, gets everything wrong, bets that the worst hit stocks are going to rebound the best, and they continue to get killed all these things like countrywide financial and Merrill. It was just, it was a sort of nightmare. So Opportunity Trust was down, I think, 65% in 2008, and Value Trust down 55%. And I was reading a quarterly report of yours where you wrote investment. managers must face the prospect of underperforming at some point, this reality nearly drove me

Starting point is 01:11:55 out of the business. My experience managing money in the financial crisis drove home the point that no matter how brilliant and hardworking you are, you will eventually underperform in this business. And I really wanted to talk to you about that experience of going through the kind of the pain of short-term failure and getting stuff wrong and what it was like for you and how, you know, that's fascinating to me that you said that the prospect of understanding. underperforming actually nearly drove you out of the business and you started looking for other professions that you should maybe be exploring. Tell me about this existential crisis in the early career of Samantha McElmore. So I had joined Bill. Again, he was a hero, a God, having done

Starting point is 01:12:36 things, no one else did. I had such respect for him. He was completely dedicated to the job, you know, spent all his time doing it. No one could read more voraciously, have more knowledge, you know, have had more success. And then we go through this terrible period. I mean, you know, it could hardly have been worse. And then I had my first child shortly thereafter too, which completely changes your priorities. So at that point, I was thinking. And then as I learned more also, I thought, wow, if you look around, all the best investors

Starting point is 01:13:09 have periods of underperformance. And as a professional investor, my job is to outperform and deliver value to my clients. So at the time, I thought, if I underperform, I'm failing. I'm failing at my job. And so this is the job where even if you're successful, even if you're at the top of your game, you're destined to fail for periods of time. And you're going to have to work really, really, really hard because, you know, it's super competitive.

Starting point is 01:13:35 There is super intelligent, smart, capable, the most capable people you'll find in the world are drawn to this profession. And I thought, you know, I had a new baby. And I thought, is this what I want to sign up for? Is working really hard, you know, taking time away from this beautiful baby to fail? And so I was like, when you frame it that way, that doesn't sound so appealing. So I did. I looked around at other things and said, is there something else, you know, something else that would be better for me?

Starting point is 01:14:06 I didn't find anything else that I loved as much as this job. I hadn't yet, you know, I know you have talked and written and done interviews on stoicism. And I hadn't yet come across many of those learnings and Buddhism and these more spiritual principles on a different way to view the challenges. And so ultimately I concluded though, I couldn't find anything else. Like I love this work. I love learning about companies. I love doing valuation work.

Starting point is 01:14:36 I think I'm well suited to it. I think I am emotionally stable and I can tolerate losses. I can buy things down. That doesn't bother me. does bother me to, you know, underperform significantly. But I think there's a lot of value that we can deliver by educating people, by helping them make better, you know, decisions and choices. I also think the way the markets of, and I stopped equating short-term underperformance with failure also. I think we're playing a long game. And if we can deliver long-term outperformance for people,

Starting point is 01:15:09 that's the objective. Again, you know, no one else has outperformed 15 consecutive years. That's an unreasonable expectation. Bill would tell you that, you know, that was an accident of the calendar if you measured it, you know, January to January, February to February, it didn't happen any other time. So, you know, that's not the right metric. And then, you know, some of these, you know, more philosophies around stoicism and how to confront challenges and how to benefit from them and how to kind of be more stable and look, you know, we create all of our suffering more internally. I think finding some of that material and understanding that better was super helpful. And then we try to educate our investors as well in terms of what we're doing.

Starting point is 01:15:51 And we can have short-term periods of significant underperformance, you know, because we're playing a long game. And we hope to make that up over rolling three to five-year time horizons. That's our time horizon. And so that's the period over which we're assessing ourselves. And so I think I got comfort with it in many ways. But yeah, there was a period where I was not quite sure this was, you know, the correct place for me. Did Bill ever try to persuade you? No, no, stick with it.

Starting point is 01:16:21 Because I remember like about 100 people lost their jobs, right? I mean, it was mayhem and it was torture for him because, I mean, I remember him saying, we had a meeting. I think the first time I met you in person was I came to Baltimore and I met with you and Bill and Bill four, Bill's son. And he was talking about how painful that period was. And he was saying, you know, look, the most painful thing was we wasn't losing my own money, even though he lost a fortune of his own money and had to sell his yacht, which is tragic,

Starting point is 01:16:49 which I gather was the biggest yacht in the country at the time. But he had to lay off more than 100 people and lost masses of client money. I think it was torture. In terms of your experience of watching him go through that and him trying to persuade you to stay in it, what was going on there behind the scenes? Well, no, that, I mean, that was exactly the experience, again, of all of the pain. of the layoffs and it impacting people's, you know, again, I have never seen Bill. I can lose my own money just fine.

Starting point is 01:17:18 Like, I am totally fine with that. I have no problem with that. I know what I'm doing. I know over long-term periods, times it'll come back. So it was all the other stuff, organizationally, you know, clients, all the stress around it, the press, obviously, and what happened and how Bill was covered there. It was so public. You know, a lot of people when they face these, you know, personal terms.

Starting point is 01:17:40 There's much more private, not if you're an investor that's well known. It's very public. So, yeah, all of that was why I was reconsidering it. I think Bill is great about, you know, he wants people to make their own decisions. He wouldn't want to unduly influence. I mean, if I ever considered doing other things, he would take, he told me he thought it was a mistake. And, you know, he's been very complimentary if he thinks I'm well suited to this line

Starting point is 01:18:08 of business, he never, I mean, he will be open about the challenges. And, you know, I remember in March of 2020 when COVID was causing the markets to crash and Bill and I are both reading, like, stoicism and emailing each other, you know, the quotes and like dealing with it together. So it's been great to have, you know, him to go through these things with. And I learned tools to adjust and adapt to it. But I think early, so that was pretty early in my career. And so Bill had always said, I'm going to make an expensive proposition for you to decide to do anything else. And so I considered going back to get my MBA. And he was like, that would be really dumb. He's like, you're going to learn far more here. That's a really stupid thing. You're going to go

Starting point is 01:18:53 pay a lot of money to go do that. So there were certain things he had very strong opinions on. And any specific example that I would talk to him, he would say, like, you're much better. have a lot of good reasons why I was much better off staying here. I think he never tried to change my perception. I mean, the challenges were what they were. You can see the magnitude of the challenges. So he didn't try to persuade me that it wasn't a very challenging business that you had to be entirely committed to. But he did help me, you know, find, you know, tools to deal with that, you know, like the stoicism and the different readings and those sort of things. Can you talk more about how you use stoicism? Because I saw, I saw you,

Starting point is 01:19:34 You quoted in one of your letters, a beautiful quote from Marcus Aurelius that I used in my book as well. Maybe when I was writing about Bill in the epilogue where he talked about being like a rock and the waves are kind of crashing over you, but you remain still within it all. Can you talk about how some of these teachings have helped you? Yes. So that is my very favorite quote. I love that. I love that image of stillness in the storm and then the storm calms around you.

Starting point is 01:20:01 So I think, you know, like I said, reading it when things get challenging, I, you know, I took up meditation. I love meditation, learning about breathing techniques. So actually doing things to compensate or offset and manage and mitigate, you know, A, it helps you focus more. But it also calms you down and improves your decision making and what can be a very stressful environment. So, I mean, if you have any good stoicism, you know, recommendations, I cannot claim to be an expert there at all. I mean, I got turned onto stoicism by Bill all those years ago, I think, back in about 2001, 2002, that sort of thing. And so I read things like Marcus Aurelius' Meditations, which I've read multiple times, which I think is an extraordinary book because he was so in the thick of everything. I think you've written about this that he went through a plague.

Starting point is 01:20:54 he went through, you know, obviously being a military leader and all of the political machinations. I think he had sickness as well, right? So he was in the trenches dealing with pain and insecurity. And, right, so he's great. Epictetus was great as well. And Seneca, so Seneca's letters are great. So, you know, and then Bill got me to read thoughts of a philosophical fighter pilot by Admiral's, Vice Admiral Stockdale, which I thought, I'm sure you've read, right? That was extraordinary where he was tortured for years. That's really good. And so, I mean, basically this guy, Vice Admiral Stockdale, is shot down over Vietnam.

Starting point is 01:21:32 And as he's being ejected from his plane, knowing that he's going to be captured and tortured, he whispers to himself something like, I'm leaving the world of engineering or something like that and entering the world of Epictetus. Because he knew he was going to get tortured, like Epic Titus, who was a slave, was tortured. And he was in solitary confinement for years, and he writes about being tortured and how he dealt with it. And one of the things he would say over and over was, I think, he had this mantra where as he was going in to get tortured, because he knew he was going to break while he was being tortured. He would just say to himself over and over again, no fear, no shame. And so he knew that he couldn't really control his behavior, but he could control his mindset. And so he was drawing on the Stoics like Epictetus and saying, well, so I can control his behavior. on the stoics like Epictetus and saying, well, so I can control my internal sense of honor.

Starting point is 01:22:23 And so one of the things that he did, because he was very senior, they said to him, you can go home. And he was like, no, I'm staying. And so he refused to take early release, even though he was getting tortured. So it was an astonishing thing. But he felt like he needed to keep his own sense of honor because he was so broken by the fact that, you know, the shame that came with confessions while being tortured. So that was a book that Bill got me to read.

Starting point is 01:22:49 And I still think it's kind of a remarkable book because it's one of those things where it's like a modern age stoic going through hell. Yeah, that's amazing. I'm going to have to read that one. That's the sort of stuff I love. And I love that piece of the story where he kept repeating it to himself. Because I know, I think you've had conversations with a number of people. And I know there's a number of a lot of people like to talk to Bill about, do you feel the fear?

Starting point is 01:23:14 Do you actually feel it or do you not feel it? And our investors wired differently, you know, the great value investors, are they wired differently? And at one point, you know, people were considering conducting an MRI study, which I think would be super interesting. And so, you know, again, I don't know what the answer is. As I said, Bill has guts of steel. So I know he feels a lot less than most people. But it's not that there's zero feelings because like I said, when things get really extreme, again, doing things like reading stoic passages, is like we would be reading them and sharing them with each other. Again, I can only remember doing that in March 2020.

Starting point is 01:23:49 So that was like an extreme time or, you know, meditating or for me doing things that keep me focused on things that I think will help me do the rational thing. So in this period after this, you know, sell off, A, you know, I've grown up in an environment of optimists. And so Bill, you know, people like to joke or he jokes that he has two modes, bullish or very bullish. And his partner, Ernie Keeney, who started the value trust with him and came into work almost every day until he was like 92. He was amazing. He was an amazing man and he was so optimistic. And he would sit at our investment meetings and he would tell us about all the wonderful things

Starting point is 01:24:32 going on in the world. So last year, as the market's crashing, I felt there was a vacuum of this sort of perspective. And so, you know, just that's when we started looking at, okay, the market's down a lot. We've entered bear market territory back to, you know, kind of what I learned when I first started. What does that imply for markets going forward from here? You know, our returns higher, are you more likely to make money? And that data was highly supportive of yes. You know, you actually are. If you buy now after the market's had a 25% decline, you know, the average one-year return is It's much higher than average. It's like 18% versus 12% over the whole data period.

Starting point is 01:25:10 And you're 97% likely to make money, at least given the data set that we looked at. So doing those sorts of things when it gets ugly, when it gets harder, when you might be more at risk of making a poor decision and getting scared by the environment, I think is helpful in sharing that knowledge and data with people, you know, repeating things to yourself about returns or, you know, no fear. I think those sort of practices are really important for the vast majority of people and everyone can benefit from that. I mean, I know Ray Dalio has talked a lot about meditation and the benefit he's had from that.

Starting point is 01:25:47 What kind of meditation do you do? Transcendental meditation. Oh, really? That's interesting. And you find that very helpful. I find it really helpful. You know, I, again, I do it once a day. It's hard to find the time to do it twice a day.

Starting point is 01:26:01 You're supposed to do it twice a day. And I heard Seinfeld say during his time, you know, working and creating the show, he did it once a day. And when he stopped, he started doing it twice a day and he found that so much more helpful. So I, you know, I'd be better off if I did it more, but I find it extremely helpful. I had a podcast episode with Daniel Goldman who co-wrote a book called Alter Traits. It's an extraordinary book on what meditation does to your brain. and Dan said, the best meditation is the meditation that you'll do. And I thought that was really helpful.

Starting point is 01:26:35 It's like, it's really easy to feel guilty and be like, I'm not doing enough. I'm not doing it right. And he said it is dose dependent. Like I asked him a year or so ago, like, how much are you meditating now since you wrote that book? And he wouldn't tell me, which I assume means he's spending hours a day. But he said after studying what it does to the brain, he's like, yeah, I do a lot. You know, and this is after 50 years.

Starting point is 01:26:56 But I thought that was really helpful actually just to say, look, the best meditation is the meditation you'll do. And so, I mean, 20 minutes a day seems amazing to me. That's fantastic. Yes, no, you're right. I should have a better perspective on that and any amount is helpful. I love that episode of yours. I thought it was a fabulous episode in it.

Starting point is 01:27:15 And you had someone else on with him, right? Sookni Rinpoche came on. I did one just with Dan Goldman and one with Dan and Sokney Rimshay, who's an extraordinary Tibetan Buddhist. And I was reading something of Sokne's yesterday. I mean, I read a lot of his stuff. And he was telling a story about his father, Tuku Uri and Rimpichai, who was very extraordinary, his great sage and meditation master. And Tuku Uri and Rimpsche, Rimshay means precious ones.

Starting point is 01:27:40 So it's sort of like a big deal of reincarnated Lama. And he talked about the greater quality that you should get to this state where there's no fear, there's no hope, everything is fine. So he was in incredible pain during some surgery. and he was like total suffering, total bliss. And it was all equal. That's amazing. Yeah.

Starting point is 01:28:05 That's my life goal right there is to reach, you know, so far from that state, but that always amazes me stories like that. I think that's one of the things that's fascinating to me when I study both Buddhism and Stoicism and also Kabbalah, which is the other thing I study a lot, where you can see it's all about trying to gain control of your inner landscape. And so the discovery that by doing things like meditation or how you talk to yourself or mantras and the like or how you breathe, that you can actually gain some control of your inner landscape so that the stuff that's swirling outside doesn't mess you up quite so much.

Starting point is 01:28:43 That's an incredibly valuable discovery, I think. Yeah, I agree. I do all of that mantras. And, you know, I meditate for 20 minutes a day, but I'll do breathing for a minute or something later in the day. So I think those things are so powerful and, you know, can be so helpful. And the other, one of my other favorite episodes and people that you've written about Arnold Vandenberg and his story. Yeah. Amazing. I mean, and he had some great recommendations for books that I, you know, that I picked up The Power of Now and one of the back pain books about really willing,

Starting point is 01:29:23 like the story about how he, you know, grew up. up and ended up in the orphanage, right? And was in really bad physical shape and then sort of willed himself to get better and compete at climbing ropes and that sort of thing. Yeah, and he would, you can tell him. Yeah, he hypnotized himself. And he would, he was so full of rage and anger and bitternessness after the Holocaust where he'd been in a concentration camp, sorry, his parents had been in a concentration camp and he'd been in an orphanage while they were in concentration camp. So he'd been hidden in this orphanage. And then he gets, out and he could barely walk. I mean, he would crawl because he was so malnourished. And so his early

Starting point is 01:30:02 life was just kind of a disaster. And then he gets divorced. His wife leaves him for someone else. He barely graduated from high school, didn't make it to college. And so his transformation through gaining control of his mind is such an extraordinary thing. And one of the things that I always remember is he would, he was so aware of how much rage he had and he would just walk around saying, no, I'm a loving person over and over again. And you see him now. And he's so, such a lovely bloke. And so, so yeah, I mean, he transformed himself partly through hypnosis, partly through having an extraordinary therapist. And partly he got incredibly lucky with his second wife, who is just like one of the world's loveliest humans. And so I, you know, but that made me

Starting point is 01:30:43 think, well, so if, if Arnold could gain control over his inner landscape, he could turn himself around, given what a bad hand he was dealt, then the rest of us stand a much better chance. But he was obsessive. He was fanatical in doing it. And so I think some of it is just the persistency. So I think stuff that you're doing where you're doing the meditation every day, there's a kind of, and the breathing and the mantras and like, there's something cumulative about it. Yeah, no, I think so. I agree. I was so struck by his story because of how extreme it was and how extreme, you know, what he accomplished on the other side and his belief states about, about, you know, we only, yourself to do certain things and the power of that. I mean, there couldn't be a better story

Starting point is 01:31:32 to share with my kids about, you know, they mostly don't want to listen to me when I share stories like this with them, but, you know, about how to transform your life, really, through your mind. And we just understand so little about it, but I think it's powerful. And so obviously, that has a lot of applicability to investing. Yeah, totally, because you've got to somehow sit in the middle of uncertainty and failure and disappointment and somehow deal with it and stay calm within the maelstrom? I was just going to say, I think one of, you look at, again, many of the best investors, one of my favorite stories is, where things to remember is, you know, Buffett, obviously,

Starting point is 01:32:12 an amazing, you know, accomplished career. And he wrote, I mean, he fulfills such a special role for the world, I think, but he wrote in October of 2008, buy American I am. And I think that was in the New York Times, his piece on buying America. And he wrote about, you know, be fearful when others are greedy and greedy when others are fearful and how the best time to buy is, you know, during horrible periods. And he talked about the depression and the wars and, you know, the buying opportunities there. And years later at an event, I'm not sure if it was a Berkshire meeting.

Starting point is 01:32:48 but someone asked him, how did you know that that was the right time to buy? And he said, you know, I don't know time. I know price. And if you look actually, so that was October of 2008, the market was down like 25 to 30 percent more to the bottom in March. So in the short term, it looked and felt like, although I'm not sure Buffett cared, a terrible mistake. I just, you know, if you were to buy then, then you had this 20 to 30 percent loss over, you know, know, less than six months. But if you could even hold for a year, I think his one-year return was like 24 percent. And then he compounded over two, three, five. He was very clear in that piece that

Starting point is 01:33:29 he had no idea in the short term what the market went to. But he compounded over even if you could even have a one-year time horizon, it bounced back and you made more on the other side. And over, you know, two, three, five, ten years, you compounded well above long-term, you know, market rates. And so I, you know, in this sort of environment, again, we keep talking about that because the market's down and if you buy it, could go to new lows. No one knows what's going to happen or where it's ultimately going to bottom. But the amazing thing to me is you don't even have to be that long term, you know, when we're down this much, you know, the odds that you're going to go down a lot more, you know, could it go down 30% more?

Starting point is 01:34:05 Could that be I think unlikely from here. But, you know, again, 90 plus 5% plus over one year. It'll be up a lot more than average. I mean, it's amazing to me that people don't talk about. that more. They focus all on the next recession and the macro, you know, all this other stuff. I was reading a lot of your writing both for the Opportunity Trust and also for Patient Capital, the firm that you launched in 2020, which I guess is going to, has its own fund, but also is taking over the management of Miller Value Partners, the firm where you were working with Bill for all those years. And this emphasis on having a long time horizon seems like such a recurring theme in such an important aspect of your success. And it's no accident that the firm itself is

Starting point is 01:34:51 called patient capital. I was struck by a couple of things that you said. There's one thing where you said that the market only rises a little more than half of days and 63% of months, but it gains in 73% of years. And then you said on a rolling basis, it's up in 89% of five-year periods, 93% of 10-year periods, and 100% of 20-year periods since 1927. And I thought that was a very striking statistic. Can you talk about that sense of, because Bill is often accused of being permanently bullish, and he's always like, well, yeah, but the market goes up 70, you know, more than 70% of the years. It's smart.

Starting point is 01:35:29 Can you talk about this sense of how, as you extend your time horizon, the risk of loss sort of diminishes? Yeah, I think, I remember learning those stats. And it was one of those transformative events for me as I thought about investing. Because, you know, half of days, if you're going to invest for a day, I mean, no one will tell you should put it in the equity market. It's a gamble. It's a coin toss, you know. You could make money. You could lose money.

Starting point is 01:35:57 Who knows? But the stats on, you know, 20-year period or even 10-year periods, you know, 100% of 20-year periods, when do you get 100% odds? I mean, not saying perspective would be. But historically, I mean, even the worst of periods in America, you, you know, made money and 10-year periods. And again, you look at even over five-year periods. So it's just, it's so crucial. And I think we talk a lot about time, not timing. Again, the whole world, the media is so focused on timing and giving you data that no one can predict the future.

Starting point is 01:36:33 No one knows what's going to happen with recession and inflate. Like, no one knows. And so all that talk is noise. And actually what you do know is that when the market's down and when you're long term, you know, the historical evidence is overwhelmingly in favor of very strong long term returns. And so I think one, we want to make sure that our investors understand. I just think it's so powerful for anyone, any individual investor to understand, you know, if you just put it away and you buy more at lower prices,

Starting point is 01:37:05 so a systematic investment program or, you know, even better, do the Buffett, thing have cash on evidence isn't as clear that it that you should keep any cash on the sidelines. Like oftentimes the numbers don't work out. But if you systematically invest over time and put anything more you can, you know, in markets that are down. That's so powerful. And what I love and what we've written about are these stories about individual people like I think this guy named Ronald Dahl from Vermont. And that's why I can remember this one better, but a janitor who, you know, became a multi-millionaire just by saving, consistently investing in blue chip companies.

Starting point is 01:37:42 Again, he passed away. His family had no idea that he had all these millions stashed away and he gave it to charity. And he didn't do that because he was really sophisticated in his knowledge. He did it because he had long, long periods of time. The power of compounding is just so important in markets. I try to teach my kids now who are 11, 9, try to teach the 4-year-old. But, you know, this principal, my son was, you know, we're going to Disney World next week. And we heard about this VIP program, which is egregiously expensive.

Starting point is 01:38:15 And so we were looking up the price. And he was like, Mom, do it. You know, that sounds amazing. Do it. And I was like, you know, it's at the high end $7,000. I was like, do you know, okay, you have, you know, 60 years to retirement. So we went through the math of if I put this in your account now, $7,000. And you compounded at 10% a year, which is long term market returns. What would that be worth in 60 years?

Starting point is 01:38:38 It was like $2.1 million. And he was like, you know, assounded. And he was like, well, can you put it in my account? No. I'm not putting it. That's smooth. But I'm not going to do that. But just this power of compounding.

Starting point is 01:38:51 It's just so important. And finding signal in the markets and abstracting away from noise is such an essential concept. And it's so difficult to do. So things like those data sets about longer term return, I think help you do that when when people are so focused on the near-term downside over the next month, three months, you know, the macro stuff that no one has any idea about. I totally agree. And then at the same time, you had that sort of impassing caveat where you said,

Starting point is 01:39:22 in America. And I was looking the other day at Guy Spears returns because I just finished editing his annual report. And he was comparing his returns to various benchmarks. And when you look at, you know, he's, the fund has been going for 25 years now. So it's kind of interesting to see the different benchmarks. When you look at the Futsi 100, which is kind of relevant because a lot of his investors like his dad live in England, it's gone nowhere basically in 25 years.

Starting point is 01:39:50 And that's kind of extraordinary. And that makes me think, yeah, this is all true and you want to diversify internationally because you don't want to be the one who's living in Cuba when the market gets closed down or in Ukraine when the market gets closed down and have all of your money. in your home market because you assume it's going to be okay. And so given that none of us knows what's going to happen in the future, it seems to me it's smart to be optimistic about the future and to know that good times follow bad, which is one of the great lessons of your career and bills, but at the same time to hedge against

Starting point is 01:40:25 the possibility that you're in a country that goes nowhere for 25 years. Oh, yeah. That's definitely, you know, those sort of returns statistics, as you said, are not true for every country. And so the risk for word profiles, you know, very different. Again, when Buffett writes about this, he talks about Buy Americans specifically, you know, that was his piece. Now I am, and he's talked about the golden goose being here and all the things that have made America in particular so special. I mean, I think diversification makes a lot of sense and can help a lot, you know, in terms of international, global sort of diversification, and especially some of those

Starting point is 01:40:58 markets now are down a lot more. So I bet they're, you know, quite attractive too. But the risk profiles, I think, differ across, you know, different places. What do you do with your personal portfolio? Are you as wild and aggressive as Bill with his holy trinity of three investments and margin? Or are you a little more conservative? I'm mostly invested in our funds and I have a handful of stocks and a little bit of Bitcoin. I don't do the same leverage thing that Bill does. I also don't have access to the same margin rates that Bill has historically had access to. And I just, one of my things is, you know, I just don't want to ever deal with being a forced seller. So I have a little bit of margin,

Starting point is 01:41:43 which I put on in this market in particular, you know, with higher yielding stuff that could, you know, more than pay the rate. So, and then the securities I own outside are mostly older legacy things and their names that we own, you know, in the funds, too. So names like Amazon or one main financial or far fetch or some of the banks, those sort of things. You mentioned your three children. So, they're between 12 and 4, 4, 9, and 11. Okay. I'm just wondering, like, how you handle the intensity of parenting, family life.

Starting point is 01:42:19 I know you mentioned before we started talking that your husband is a teacher in a nearby school. So obviously, you know, you're not doing all of this alone. But still, it's incredibly difficult, given how intense the work is. and how super competitive. How do you just manage in practical terms to juggle this stuff? Well, I am fortunate to have a lot of help at home. So my husband, the teacher, you know, next year, all three will be at the same school where he is. That's a huge health. I'm super, you know, fortunate. I have more help at home. So I feel very fortunate to have that sort of help. But it still is challenging because they are my most important priority. And so I want to make time and

Starting point is 01:43:02 space for them. And so I am pretty maniacal about my time and trying to only spend my time on the most important things and trying to say no to everything else. And fortunately, I'm, I don't know if this is fortunate, but I'm pretty introverted. And so I don't have a need for, you know, a big social calendar. I am just fine spending zero time on that. You know, I do spend some time doing some charitable stuff. I have a great team, you know, at the office and spend very little time on anything organizational. So it's really, you know, I try to spend most of my time, you know, during the day on investment stuff. And then we'll have a family dinner together. We try to do that every night. I travel sometimes so we can't do that every night. But that's our, you know,

Starting point is 01:43:50 time to be together. And really now with remote work, it makes things, you know, so much more efficient. And so I can meet with a lot of companies on Zoom and have to travel a lot less to do that, which is a huge benefit. And so I can sneak out to a game once in a while, though my kids tell me I don't attend enough of their stuff. So it's always, you know, I don't have this answer, you know, this totally figured out. It's like I'm either missing something here or missing something there. But that's the sort of, you know, I think Jeff Bezos says it's, he doesn't like the word

Starting point is 01:44:28 balance, it's more about harmony. So again, can I, can I just make everything sort of work harmoniously and fulfill all my obligations? That's sort of, I'm like, if everyone's a little bit upset that I'm not doing it, I'm probably balancing it, you know, pretty well. Tony Robbins once, I don't think he said this to me. I think he said it to Peter Diamandis, who then said it to me, that Tony says it's not about work-life balance, it's about work-play integration. I thought that's a really interesting insight that you can't, you'd never really get work-life balance, but it is possible to have some degree of work-play integration where you, I don't know, this has always eluded me. And I'm very, I'm very struck when I see a lot of the great investors at the sacrifices they've had to make.

Starting point is 01:45:15 And I remember Jean-Marie Eveyard telling me once, saying that he felt like he'd neglected his daughters a bit. And he said, yeah, I asked him if, if you had been a less neglectful father, would you returns have been as good? And he said, I don't know. I really don't know. I thought those are very interesting admission. I think that's part of what I struggled with because I, you know, I knew I never wanted to make that mistake. As soon as I had a child, I was, you know, changed and I had such love for this thing. And I wanted to be with her all the time at the beginning. And so that's, that's part of what and what led me to have those questions at the beginning. And Bill had always said, you know, about Peter Lynch, that he had left the business.

Starting point is 01:46:00 And again, this is where I feel so fortunate to be doing this now. He said, you can only be in two modes, overdrive or stop. And then I remember hearing the story about how Peter never took a vacation. His entire career, he took one vacation and when he went away, the markets were crashing. He was on the phone. I think he had to fly. I think he was overseas. He had to fly back to the office.

Starting point is 01:46:21 He never took another one. And so that's amazing. I probably wouldn't have been. been able to do this if I wouldn't have wanted to make that choice if I had done this, you know, 20 or 30 years ago when those were the options. I mean, now we have Bloomberg on phones. So again, I'm a phone addict. My kids will tell you I'm on it all the time. I, you know, we try to put it down at dinner and not pick it up so we have spaces where it's not. But I can be on top of what's going on in the markets and still, you know, duck out for something.

Starting point is 01:46:54 And then if I know if emergency is going on or, you know, the tools we have today, I think make that integration, which is actually something I was horrible at earlier in my career. And it didn't really matter, you know, then as much as it would matter now, I would have had to figure that out of like a work life. And I was in the office all the time when I was younger. And so I, before I had a family, I was fine. That was like my preferred lifestyle. And then when I had kids, everything changed. And so it became much more important to figure out how do I integrate this? how do I stay on top of all my responsibilities?

Starting point is 01:47:27 I mean, I am very fortunate. I try to make all of my home responsibilities. I can't do this completely, but I try revolving around my children and not a lot of the home things. And again, not everyone can do that and has that privilege. I understand that. But I feel very, very fortunate to have a very good situation with that. You've mentioned before that I think less than 10% of all fund managers. so women. And I know that as you were coming into the job, you were reading books on leadership

Starting point is 01:47:57 by people like Ray Dalio. And you'd mentioned a book by Colin Powell, I think, is autobiography. So you were sort of studying leadership. And I'm wondering what you've thought about the type of leader you want to be and as you assume the leadership position in the firm. And, you know, what kind of leader you want to be in order to be a role model to other women and to your own children? Yeah, that's a great question. And I would say that's a working process. I think I'm a slow learner. I like a lot of time. It's the evidentiary threshold thing again that Bill says. I like to really study things, spend a lot of time, get a lot of data. So I was very explicit about reading about that. And really before,

Starting point is 01:48:39 you know, before that, I didn't have any organizational responsibility. So it was all investing. And that suited me just perfectly. You know, I like to sit at my computer and buy view on myself and read and do research and build models. And so it's a whole new challenge and one that I find very exciting, but that I had to, you know, figure out. I knew I was not like Bill. And so I oftentimes compare myself to Bill. And this was an area where we were, we are not alike. And so I had to find, you know, my own voice.

Starting point is 01:49:10 And I know that I'm very passionate about women and women having, you know, equal opportunities and women having the confidence. You know, I think some of the stats of women are that, you know, at least in investing, they just don't have the confidence that men have. And actually, that can help their results in performance because they don't trade as much. But I think they're just as well suited to invest if they so choose and may have many benefits. So I think helping them understand it in that educational aspect, I'm passionate about that. We're building up the team and capabilities. I think that'll be an important part of the approach.

Starting point is 01:49:47 I mean, more broadly, just helping people invest better and hopefully being a voice that can help people make better decisions as we go forward will be important in patients' future. In terms of leadership, I think, you know, as I've read about these service leaders, that resonates with me well in terms of the sort of leaders who want to help their people accomplish their objectives. You know, one of the things I loved about working with Bill and we worked so well together is I always love the feeling of helping this, you know, great master accomplish these great things and growing on my own as a part of that. But, you know, I realize I find a lot of fulfillment in that. So you don't just have to do that to people you report too. You can also do

Starting point is 01:50:33 that to people who work for you. And so the big challenge that I'm still working through is making sure you have the right time and space and, you know, efficiently, how do you most efficiently do that and figure out the scale and leverage to do that. So that's what I think about, you know, if I'm really inspired by helping people, I've learned about myself. So if it's help, you know, that also abstracts away from it. It's not just about the numbers, although what I love about this business is at the end of the day, it is about the numbers.

Starting point is 01:51:01 So you can either do it or not. You need a long time horizon to assess that. But you can help people, you know, in many other ways to make good investment decisions. I think you do great work there. You know, that's, you know, I find your work so inspired. So I think you're helping people do that. And I would like to do that as well. I asked Bill a couple of weeks ago how you were different from him. And one thing he mentioned that I thought was really interesting was he said that, look, I could look at eight people's portfolios and I'd be

Starting point is 01:51:28 able to tell you who they belong to. And so he said there are certain things about your portfolio that are distinctive. And one of the things that he said is that you like to invest in companies run by women. And one of the reasons for that is that they tend to be underestimated. And I was saying to that to my wife this morning. And I was like, it's so true. And she's like, yeah, absolutely. I mean, can you talk a bit about that? I thought it was such an interesting observation. Men suffer from so much overconfidence in so many ways. I mean, these are absurd generalizations, but also there's something to them, I think. You know, it's so funny. I, you know, that you asked Bill that, I wouldn't have guessed that he would have said that. I haven't had that conversation with him.

Starting point is 01:52:08 So it's really interesting. So there's a number of different things here. One, yes, I think it's completely true. And Bill's explicitly talked about it. I think, you know, women are underestimated. And some of my favorite stuff, again, I don't know the veracity of this, but I've heard this stat where, you know, it was at some woman's conference I was listening to. And they said, if you ask a woman or a group of women, how much do you need to know about a topic to raise your hand and say, yeah, I know about that? I'm, you know, I'm expert at that. Or even I'm well equipped to answer that. They said it's like 90%. They need to have covered the whole landscape and know a lot about it. And with men, it's more like 30%. They're like, have I read a few things,

Starting point is 01:52:47 have I ever been exposed to this? Oh yeah, I know something about it. Again, I don't know if that's true. I have not found this study. But, you know, you can see some areas in life, like with my two kids, they were asking me about Santa Claus Real and my daughter, who's older. She was like, I don't know. I mean, on this, this, I don't think you guys really, you know, know what I like. And so my son was just like, he's not. And I'm like, how do you know? And he's like, I just know, he's not. He was entirely confident of his, he did not have more information.

Starting point is 01:53:17 He wasn't. But again, that's an anecdote. But it's a fun one. He has a low evidentiary threshold. Yeah. So I do think it's true. But, you know, I don't, it's not a search strategy. I don't go searching for women's CEOs.

Starting point is 01:53:33 Again, they make up a greater percentage of the portfolio. And I do agree that I think, they're underestimated or maybe expectations are low. But I also think that's the value of diversity. And Bill was really early on the values of diversity on the team is that women just happen to, you know, we're different in some ways. And the stuff that I look at, I end up finding things, you know, more things that are run by women. And so, or what they say resonates with me in a different way. And then I do more work on the stock and the company. So it is, you know, I do think we overrepresent on women's CEOs relative to the market overall. I did look into that.

Starting point is 01:54:12 And maybe I should make it a search strategy. I haven't done that so far. I think it just is the value of diversity and people from different backgrounds that have different characteristics, you know, have a different life and they find different things. It's interesting. It sounds like a weird digression, but I was just thinking back to my interview with Fred Martin on the podcast. And this isn't something that came up in the podcast itself, but it came up in my research before it, where he had said to me years ago that when he's looking to hire someone, he finds serious underdogs. And he had hired these people who were really hungry. They tended to be minorities, foreigners, who come from poor backgrounds and were really smart and really driven. And I think in general, finding people who underrepresented in some way and are hungry and overlooked, it's powerful in every area, whether it's powerful in every area, whether it's,

Starting point is 01:55:05 hiring or investing. Definitely. And I think the other interesting thing is, you know, Danny Kahneman's done work on confidence and how confidence is the key thing that convinces people of things. And, you know, there's a lot of good data and evidence on men having more confidence, overconfidence, you know, the data that I've seen is trading and, you know, overconfidence is it relates to that. So that's where we do have better data.

Starting point is 01:55:32 But I think that confidence really helps you sell yourself. And I know plenty of women who undersell themselves. And, you know, one of my friends who works at a big company and, you know, she does PowerPoints all the time. And she was applying for this other job and it asked her to rate how she would rate herself on PowerPoints. And she gave herself like a mediocre grade. And her boss came into her and said, what are you doing? You do PowerPoints every day. Like, no one does them more than you.

Starting point is 01:56:01 Like, what do you more do you expect to know? Go change that and rate yourself higher. And so, and I've heard, you know, some people in the asset allocation world talk about this as it relates to investors and advise women to present themselves differently in a more confident manner. Again, you know, I'm not sure I agree that that's the optimal solution to that problem. But I do think that, again, if there is some difference there, my guess would be most women who make it to the CEO level are on the most confident end of the spectrum of women.

Starting point is 01:56:33 But if there is some lower confidence, lower presentation that leads into how they're being perceived by the world and lowers those expectations, again, low expectations, I think are always helpful when it comes to investing. You also shared a really interesting thing on Twitter some time ago. There was an article from the New York Times, I think, where they were writing about a study that Fidelity had done of something like 5 million or so customer accounts between like 2,000. 11 and 2020. So it's quite a significant study. And they found that their female customers earned, I think, 0.4 percentage points a year more than their male customers on average. That's really striking.

Starting point is 01:57:17 And what's going on there that women do seem to have better judgment? There is broad. Again, all of the data I've seen on that sort of thing is similar. And it's that women do a little better because they trade less. Again, they just trade less. So men trade more. They're more confident. They think, you know, and they must be doing the wrong.

Starting point is 01:57:37 So if something's down, they sell it, they buy something out, you know, they do. They're obviously trading in a way that, but there's a lot of good evidence that doing less helps returns. You know, there's costs to doing that. So again, I think I love that data on the returns, but I think it relates to that, you know, overconfidence piece. Yeah. It's humbling for us, man.

Starting point is 01:57:59 I definitely feel like I suffer from overconfidence a lot of the time. I'm proof of the Dunning Kruger effect. So I wanted to just ask you one last question, because I'm aware that I'm exhausting your patients and you have better time management skills than I do, so you probably have to go somewhere. I wanted to ask you, when you look back on your investing career and think of all the stuff that you've learned from working with Bill or from your own experience of dealing with all of these tumultuous periods and how they've ended up turning out right in the end, are there lessons that you've drawn that you've tried to pass on to your three kids because they apply

Starting point is 01:58:34 not just in investing, but are really important life lessons that you can carry from your investment career into life, that are sort of important things for young kids to internalize? You know, there are so many overlaps. I think, A, just the power of time and more of the stuff that we talked about on stoicism and the power of the mind. You know, for my daughter's specifically, the confidence stuff. Again, my four-year-old is too young, but my 11-year-old, I try to teach her that sort of stuff. But I think I shared with them, you know, some of the story about Arnold and his history. And it was just so striking that you can go through such horrible times and then, you know, will yourself to be better.

Starting point is 01:59:23 I think it was really transformative to my kids. my son last year, you know, had a ruptured appendix. And then he had all these complications, abscesses. And it was really jarring for him to, you know, and it made him much more fearful, I think, about his health. And so, you know, we talked a lot about mantras and, you know, repeating things and the power and how your body can heal itself. And he's really probably internalized the most of the power that the mind can have. I mean, I'm always trying to come home and share with them little lessons that I learn, you know, in the day. And I think one of the things, I mean, there's so many things we could go on forever. But one of the first lessons Bill taught was,

Starting point is 02:00:06 A, to go directly to the source if, you know, if you get information. And that was, you know, in 2002, 2003. Today, misinformation is, you know, an even greater thing. And for my kids who were growing up in an age of the internet and social media and the amount of it out there, I'm constantly telling them to look for credible sources, go directly to the source, look for information in different areas that can confirm your understanding of something. Again, this triangulate view. I think that's so important in today's day and age. So, you know, I talk about that a lot to be based on the evidence and inform your view

Starting point is 02:00:44 before having a position on something. Again, the power of the mind and mantras and how powerful that can be. I've taught them little tools that they'll use from time to time. So, yeah, I think there's a lot of things that you learn as you're in this line of work that can be helpful far more broadly. What would be a typical tool that you taught them, like a little, like a mantra or something? Well, we do mantra. So, you know, my son after that, my body can heal my body was like his mantra.

Starting point is 02:01:17 Oh, lovely. And he would say in a funny way. And if he starts, like he says it. And it really helped him. And it helped him believe. And he had this complication where, again, he was at risk for another surgery and it's not clear that it's entirely healed. So he continued to tell himself that.

Starting point is 02:01:33 And, you know, I think it's helped him. And then I don't know if you've heard of this neuroemotional technique. So there's a practitioner, you know, that I see locally who's pretty advanced in this neuroemotional technique. And I love her. And I love this technique. And but you, the body can tell. you know, she can tell by doing different things on the body like moving your fingers,

Starting point is 02:01:56 if it weakens to certain things. You know, you have these neural networks in the brain. If you have an emotional belief state that's not helping you, it's a way of trying to figure out, A, what is that belief state? And then, you know, through some breathing and feeling and kind of going into that feeling, working through it and letting it pass through you. And so it's much better when it's done by a practitioner. But you can, you know, do it a little bit on yourself. And so, you know, at least I, I've tried that and I've taught my kids to do that. And I think it's quite helpful, you know, for them. So if they're feeling scared, my, you know, if they're feeling scared, mom, I'm feeling scared. I think someone's going to break in my room at night.

Starting point is 02:02:38 And, you know, everything I tell them, oh, that's not going to happen. Here's all the reason, you know, all the rational reasons why that that's not moving to them. But if they, you know, you kind of put your hand on your forehead and hold your wrist and you close your eyes and you go into that feeling and you just stay there until the feeling passes and then you take a couple of deep breaths and then you can, you know, test and see if you're so weakening to that thought. And so it's just a technique to use in the moment when you're having points of stress or worry or concern to really feel those and allow them, you know, allow yourself to work through them, which I think is a super helpful tool. I think they've both found, you know, again,

Starting point is 02:03:21 I haven't done it with my youngest. It's a little trickier with her. But my older kids, I think, have found it quite helpful. I find that, you know, quite helpful as well. And some people have likened the technique more broadly. My practitioner has likened it, you know, you can go to a therapy session and you can talk for an hour about what's bothering you or try to get to that and then work through it that way. This is a really efficient way to let the body diagnose it.

Starting point is 02:03:44 Or if you know something, you can go directly to it that way too. And then it takes, you know, again, a few minutes, you know, to clear. it and maybe you need to do a few rounds of this, but it's a highly efficient way to process some of that stuff. And is there a good resource for people if they want to go to a website or a book or anything like that for them to learn more about this? There is a website. There's a neuroemotional technique website and it has practitioners.

Starting point is 02:04:12 So you can search your local area for it has both information and practitioners. I don't know if there's a good book more on more broadly on. I'm sure there is. I haven't, you know, read one, but there's a lot of good information on the website. I don't know if it's, and we'll include that in the show notes for the episode. I don't know if it's relevant. It sounds related, but there's a lovely book by, co-written by Kristen Neff, who's a great psychologist at the University of Texas, I think, in Austin. And she's a Buddhist meditation practitioner, but also a psychologist and an academic who's an expert on the brain and the like. And she wrote a, co-wrote a great book called the Self-compassion workbook. And there's something

Starting point is 02:04:54 really interesting in there where she talks about different ways of soothing yourself by, you know, touching your hands, touching your face, things like that. And I remember her saying, there's one point where she's talking about some technique and she says, this works for about 50% of people. It was really interesting that, you know, for some people putting, you know, rubbing their arm is going to help them. And for some people putting their hand on their face is going to help them. But it was really interesting to me that the way you talk to yourself, the way you put your hand on your face or whatever would have huge benefits. And she's just looked really deeply into the scientific arguments for self-compassion

Starting point is 02:05:31 rather than beating yourself up, which is the approved technique of kids who go to English boarding schools. Yes. You know, I was raised in a Catholic school. So I am well versed in that. And so, you know, those of us who are in that environment, it takes us many years to to work out of it, I think. That's interesting. I haven't heard about that, but there's a lot of these interesting modalities. I've read about tapping and I know, you know, a number of smart health

Starting point is 02:05:55 practitioners have said some benefit to like tapping on different parts of your faith while repeating some of these mantras and how powerful it is. It's an interesting, I love stats so that it works for 50 percent. I'd love to have more of that on these different things in terms of, but I think most of them are pretty evidence-based that I've seen in terms of, you know, good data to support that, again, And working through a lot of these things can be more, they're far more physical than I would have expected when I started learning about this stuff. Just, I think that's what's great when you study people like Dan Goldman, who has a PhD in psychology from Harvard and is an expert on the neuroscience of meditation or Kristen Neff, who's not only a serious meditator, but also an

Starting point is 02:06:38 expert on the science of self-compassion. And so you look at this stuff and you're like, this isn't just ancient wisdom that's been tested for 2,000 years, which is pretty good. But it's actually, you know, now they're able to show that these things work, which I think is interesting. So it gives you kind of hope that within the maelstrom of investing and life and parenting and all of these things, you can gain more control over your state of mind, your equanimity. So it's hopeful, but it also gives you a sense of how important it is that if you want to have a full and happy and truly abundant life. It's not just about getting amazing returns. You actually kind of want to have peace of mind. I think that's one of the things I've most admired about Bill over all these years

Starting point is 02:07:19 is that when I was younger, I thought, God, he's just got the most beautiful mind. He's got this really thrilling intellect. And it kind of bould me over. I would always be very excited after I finished an interview with him. I would come away sort of on an intellectual and emotional high. And increasingly, when I look back, I'm more and more admiring of the fact that he showed such resilience and sort of sense of honor and good humor when he had, but when he had things kicked out of him and then managed to come back from it. That seems to me such an extraordinary thing. And when you wrote a thank you letter to Bill that I read recently, you know, you talked about the power of resilience and perseverance and the importance of positivity and a great sense

Starting point is 02:08:00 of humor. And so it's interesting. There were really personal qualities that we admire. You weren't mentioning just his brilliance. It was like his character and his ethics. resilience. So that seems central to me, really. I agree 100% with that. I mean, I agree that he's brilliant and you can talk to him and one person described it as, you know, usually with people, it's like peeling an onion and once you get past a layer, but like him, it's like more and more and more. And so it was a great privilege to work with him. But when I think about, you know, you mentioned being really wealthy or peace of mind, I would choose peace of mind all day. You know, there's plenty of evidence of people who can be happy if you have that and satisfied and fulfilled if you can

Starting point is 02:08:44 achieve that. And there's plenty of evidence that there's a lot of people extremely wealthy who have none of that and who are miserable. So I think the markets are a great, you know, venue for working through, helping you work through a lot of stuff to get to that. That's why I just, I find the mixture and overlap of these things so interesting. And, you know, I'm so fortunate, to spend my time on it. But yeah, when you look at Bill and his history, I mean, you know, the fact that he had that resilience, that he did it magnanimously. And, you know, I've never, you know, I've never heard Bill throw anyone under the bus, say anything negative about any, anyone else. He fully owns any decision that he makes to a, you know, to the complete degree.

Starting point is 02:09:34 you know, again, I think those are the things. And he works on himself. He reads these things. He tries to improve all the time. And I think that's another interesting topic, you know, just improvement in getting better and how that never stops that potential and the plasticity of the brain. And, you know, Bill reading stoicism in a COVID crisis, but then also being the voice of reason that goes on CNBC, you know, days from the lows to tell people like, this is one of the five best buying opportunities of, you know, my investment career. And it takes a lot of gall when the stocks are falling out of bed to say that. And I was at an event with Bill last fall, a charitable event, and he's been gracious enough to speak at it. Every year, I'm on the board

Starting point is 02:10:23 of the group that puts it together, raises money for educational institutions. And afterwards, you know, this woman said, I want to go out and buy stocks. And she'd been to the event every year. She was involved with one of the, you know, the educational institutions. She's like, I've never done that before. She's in her 50s. So I was like, what made you want to do that? And she was like, Bill, because Bill had said, you know, the markets are down a lot. And I think you can basically, you know, throw a dart and make money from where we are now. You just pick any stock. And so he has a way of communicating with people in a way that really resonates. And he can, He can do it at any level, any level, you know, where you are, he can communicate with you.

Starting point is 02:11:05 You can be at the highest level of academia, PhD, and whatever topic. And he can talk to you about your field and research going on. And he can talk to the average person in a way that makes it compelling for them to make the right decisions. And I find that just amazing. Yeah, it's a beautiful thing. He's a remarkable man. And you definitely hit the jackpot going to be a mentee and sidekick of his.

Starting point is 02:11:29 I'm really thrilled for you that you're taking over the reins. And it's a huge compliment to you that someone as brilliant as Bill trusts you, wants to give you his money to invest the money that's not invested in Bitcoin already. He does have money in our funds, you know? He didn't include that in his trifectar, right? Yeah, absolutely. And also stake in your firm. So, no, it's an entrusting you with the fund that he's worked on for more than 20 years.

Starting point is 02:11:57 So, no, it's a huge vote of confidence in your, talents and it's going to be really fun to watch your next chapter. And so I thank you so much for joining us today. And I'm excited to see what happens and how it works out. And I'm placing my bets on you. I have great confidence that it'll be a great new chapter. Thanks, William. This has been fun. Thank you so much for your time. All right, folks, thanks a lot for listening to this conversation with Samantha McElmore. I hope you enjoyed it as much as I did. As you may remember, Samantha mentioned that she was deeply affected by a previous interview on this podcast with a remarkable investor named Arnold Vandenberg.

Starting point is 02:12:35 If you'd like to listen to that interview, I've included a link to it in the show notes for today's episode. You may also want to check out the conversation that I had last year with Samantha's mentor, Bill Miller, where he explained why he's made an enormous bet on Bitcoin, which he first bought at around $200 per coin. Again, I'll include the link in the show notes for today's episode, along with various other resources that I hope you might find helpful. I'll be back very soon with some more terrific guests, including Jason Karp, a superb investor whom I profiled in the epilogue of my book, Richer Wiser Happier. My interview with Jason is one of the most valuable and candid conversations I've ever had with an investor, so please do keep an eye out for it.

Starting point is 02:13:20 If you haven't subscribed to the podcast already, it's probably worth doing so that you won't miss it. I'm then heading to Omaha in early May for Berkshathaway's annual meeting, so I hope to see a lot of you there. In the meantime, feel free to follow me on Twitter at William Green 72, and as ever, do let me know how you're enjoying the podcast. It's always a pleasure to hear from you. But now, take good care and stay well. Thank you for listening to TIP. Make sure to subscribe to we study billionaires by the Investors Podcast Network. Every Wednesday, we teach you about Bitcoin, and every Saturday we study billionaires and the financial markets.

Starting point is 02:14:01 To access our show notes, transcripts or courses, go to theinvestorspodcast.com. This show is for entertainment purposes only. Before making any decision consult a professional, this show is copyrighted by the Investors Podcast Network. Written permission must be granted before syndication or or rebroadcasting.

We Study Billionaires - The Investor’s Podcast Network - RWH025: Patient Capital W/ Samantha McLemore

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