CIO Greatest Hits: Endowments – Scott Wilson (WashU)

Our Summer Series kickoff is a twofer, Andy Golden, now retired after thirty years at Princeton University Investment Management Company, and Scott Wilson from Washington University-St. Louis. We packaged these two leading endowments to compare their investment styles. Scott comes from a direct investing background and has adopted a position-focused approach to diligence and co-investing, leading to a very different portfolio construction. It's perhaps the leading example of a new approach in the endowment world. Original air date: October 4, 2020 Learn More Follow Ted on Twitter at @tseides https://twitter.com/tseides?lang=en or LinkedIn https://www.linkedin.com/in/tedseides/ Subscribe to the mailing list https://capitalallocators.com/ Access Transcript with Premium Membership https://capitalallocators.com/signup Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com https://thepodcastconsultant.com/)

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:01Ted Seides?

  Capital Allocators is brought to you by AlphaSense. Every allocator sits at their desk for hours preparing the work around investment decisions, getting up to speed on a new theme, prepping for the next investment committee meeting, and tracking what changes across an entire portfolio. AlphaSense just launched something built to help. It's called SuperAnalyst, an always-on agent that works like a power user on your behalf. It draws on over 500 million premium sources, including broker research, expert transcripts, company filings, and earnings calls, and keeps working long after you've gone home for the day. Point SuperAnalyst at a theme, company, or market, and it learns the coverage universe

• 0:46Ted Seides?

  so you can easily turn new insights into the briefs, models, and memos you'd otherwise build by hand. It was designed to work like an extension of your team, so it remembers your projects, follows your templates and processes, and links every output to its source so you can see where each conclusion came from. The best way to judge its quality is to give it a whirl. Pick the research task on your desk before your next committee meeting and hand it to SuperAnalyst. Start a free trial at alphasense.com/capital and see what it has ready for you. Capital Allocators is also brought to you by RidgeLine, the investment management platform

• 1:29Ted Seides?

  built for firms who are rethinking how work gets done. You're at your desk looking at a line graph of your firm's growth. The line is moving sideways, linear growth, and you know exactly why. You're constrained by your operational bandwidth that's been the same for so long, it just feels like the cost of doing business. RidgeLine is built to change that line's trajectory, to be the inflection point that takes your growth from incremental to accelerated with the team you already have in place. RidgeLine is the only AI-native investment management platform that brings together the front, middle, and back office with one set of data and powerful AI agents that automate

• 2:12Ted Seides?

  away operational drudgery, so your talent can shift from managing old technology to materializing new ideas. RidgeLine helps asset and wealth managers understand and improve their firm's growth trajectory. To see how your firm compares to 16,000 of your peers, visit ridgeline.ai/trajectory. If you file Form ADV, your firm is already there. Then talk to RidgeLine about how you can do more with the team you already have. Capital Allocators is also brought to you by Juniper Square, the operations partner trusted by the leading private market GPs. One theme that keeps coming up on the show is GPs that build the strongest and most durable

• 2:57Ted Seides?

  relationships with LPs are the ones that have both strong returns and strong operations. AI raises the stakes on operations, and having Juniper Square as your operations partner helps ensure your data is organized, accurate, and accessible, so you can unlock operational alpha. That's why thousands of GPs trust Juniper Square. Learn more at junipersquare.com/capitalallocators.

• 3:32Ted Seides?

  Hello, I'm Ted Seides, and this is Capital Allocators. This show is an open exploration of the people and process behind capital allocation. Through conversations with leaders in the money game, we learn how these holders of the keys to the kingdom allocate their time and their capital. You can join our mailing list and access premium content at capitalallocators.com.

• 3:59Speaker 01

  All opinions expressed by TED and podcast guests are solely their own opinions and do not reflect the opinion of capital allocators or their firms. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of capital allocators or podcast guests may maintain positions in securities discussed on this podcast.

• 4:18Ted Seides?

  With eight years and over 500 podcasts under my belt, I'm often asked to recommend my favorite episode. But I can't really answer that question. I feel like I have 500 children and don't think I've disowned a single one. So when asked, I usually offer up a great recent episode to get a listener started. Finding the best episodes in a big library of content isn't easy, so we thought we'd help. Each summer going forward, we're going to share our best. Over seven weeks, we'll replay conversations curated from our favorites and yours, excluding those from the last 12 months. Our 2025 summer series focuses on CIOs.

• 5:03Ted Seides?

  We're blessed to have an incredible library of long shelf life content, and we just couldn't pick seven. Instead, we'll share a dozen gems canvassing every type of institutional asset owner. Our summer series kickoff is a twofer of Andy Golden, now retired after 30 years at Princeton University Investment Management Company, and Scott Wilson from Washington University St. Louis. We packaged these two leading endowment investment officers to compare their investment styles. Andy started his career at Yale with me and became one of the leaders of the endowment model for decades. His discussion of Printco's decision-making process is among the most referenced descriptions

• 5:48Ted Seides?

  of any podcast with a CIO we've had. Scott comes from a direct investing background and has adopted a position-focused approach to diligence and co-investing, leading to a very different portfolio construction. It's perhaps the leading example of a new approach in the endowment world.

• 6:07Speaker 02

  Before we get to the interview, a quick announcement. We've set new dates for our Capital Allocators University for investor relations and business development professionals. Those dates are December 3rd and 4th in New York City. Later in the year is just a better time of year for this gathering. It's post AGM season, travel starts to wind down, it's right before the holiday crunch time, and it's a great time for capital raisers to reflect on their previous year and plan for the year ahead. December 3rd and 4th in New York City. CAU for IRBD is a closed-door gathering for capital raisers to connect with peers, learn from allocators and other experts, and really share in best practices with each other. You can learn more at capitalallocators.com/university.

• 6:49Speaker 02

  Thanks so much for spreading the word about Capital Allocators University for investor relations and business development professionals.

• 6:56Ted Seides?

  Please enjoy my conversations with Andy Golden, all the way back to episode 13 in 2017, and Scott Wilson from 2020.

• 7:08Speaker 02

  Scott, thanks so much for joining me.

• 7:09Speaker 04

  Yeah, thanks for having me. It's great to be here.

• 7:12Ted Seides?

  I think we should go all the way back to your college experience. And before we get into any thoughts about investing, love to hear about your basketball experience at Cornell.

• 7:22Speaker 04

  Yeah, okay. I grew up in, maybe to start with, like, the very beginning. I grew up in small-town Alaska, and me and my younger brother were both big basketball fans. And I was an okay high school basketball player, like, good for the state of Alaska, which is kind of a small basketball state, though we did have some, some great players who went on to play, particularly at Duke. I was recruited by a small handful of schools and had a couple partial scholarship offers and some full scholarship offers, like junior colleges and stuff, but ultimately decided I was going to go to college for academics and, and not just basketball. But was recruited to play basketball at Cornell College and met some great people there, who have actually, quite a few of them went off into the financial world as well.

• 8:04Speaker 04

  But it was one of the original run-and-gun style, Will and Merrimount 1990s style. And, and the coach, I think, was very progressive at the time in terms of just understanding the power of this kind of three-for-two relationship. And we led the country all four years while I was there, and it was just a great experience all around. And we definitely had some success there. We won conference one year, but we were usually in the hunt for it. And if you're a shooter, I played point guard and shooting guard, mostly shooting guard while I was there. The point guard experiment was pretty unsuccessful from what I remember, but overall great experience.

• 8:37Ted Seides?

  At that age, did that different style of basketball sink in any deeper about kind of thinking differently?

• 8:44Speaker 04

  Yeah, it was certainly different at the time. And to be honest, it's a hard system to learn and it doesn't come naturally. You know, if I look at the way my high school and kind of AU basketball coach taught basketball was, you know, motion offense, work hard, get great shots, try and set yourself up for opportunity. Where here it was like, take that first initial shot, hopefully within six, eight seconds of taking possession of the ball and you're better off taking a quick three than particularly like the way we offensive would crash the offensive boards. You get a lot more of those kind of long rebounds on the offensive side than you do on the defensive side and kick it back out for another quick three. It was very different. And I think that the team approach certainly resonated

• 9:29Speaker 04

  in that every player had like specific responsibilities. We had designated shooters and some really great players while I was there, but a different style of basketball. And you've seen it become more of the norm at a lot of places now, I think, which is kind of interesting. And the coach became pretty famous for it and wrote some books on the system, as he calls it.

• 9:47Ted Seides?

  And did your thoughts at the time extend beyond basketball into, hey, thinking differently about this game you grew up thinking about one way could be extrapolated into other things?

• 9:59Speaker 04

  I'm not sure I was that forward thinking at the time. To be honest, I grew up in very small rural Alaska and didn't have any clue. I thought I wanted to be an engineer when I went to school. And that's obviously not the path I took, but I remember my first foray into the financial world wasn't until I was really a sophomore in college. And it was through the people I met at Grinnell that kind of opened my eyes to the financial world. Neither of my parents went to college and I really just had no idea of that whole, whether it was investment banking or asset management. I had no real concept at the time.

• 10:33Ted Seides?

  So how did you get started?

• 10:34Speaker 04

  I was fortunate, a really close friend of mine who was two years ahead of me that went off to be very successful in the financial world. He kind of took me under his wing, I guess, and he was dead set on going into investment banking and finance, even when I think he was a freshman in college and I had no idea what investment banking was. I was good at math and science. And so I thought I wanted to be an engineer. And if you grow up in small town Alaska, that's the guy who has the big house at the end of the street. And so that's what I thought I wanted to do. And my skill set was well suited for. And then the more I learned about investment banking and finance, the more interested I became. And I guess after my sophomore year, I got

• 11:17Speaker 04

  an internship at Payne Weber, basically a retail brokerage house that doesn't exist anymore. But learned quite a bit about finance and the stock market in general. And then the following summer, got a internship at a kind of a real asset management firm. And then when I was graduating from college, I was fortunate in that this was peak of the internet bubble and it was easier for kids from places like Grinnell to insert their foot into the recruiting process and interviewed at a bunch of the investment banks and consulting firms and ultimately ended up at First Boston Equity Research Group there. And that same friend, actually, the one who helped me get my foot in the door there as well.

• 11:58Ted Seides?

  And so what were those early experiences like on the street?

• 12:01Speaker 04

  Not having a traditional, like my undergrad major, I was a double major in math and economics. It was surprisingly less quantitative than I thought the investing world would be, but also just super interesting. I've been super fortunate to have like great people to work with and great mentors throughout my career. And those early experiences were just wonderful learning opportunities. When I first started at First Boston, Michael Mobison was an equity researcher, maybe he was product manager or something by the time I started there. But there was all kinds of interesting people to learn and you just had a huge, huge array of resources to. And when you're 20, 21 years old, you're just a sponge for that kind of

• 12:42Speaker 04

  stuff. So it was really a great experience. I mean, it's a lot of hours, like those analyst programs at the investment banks are. I don't think they're as bad as they used to be, but it's labor intensive and you see a lot of attrition throughout the ranks, like even over two, three years. I just really enjoyed it. It was a great experience.

• 13:00Ted Seides?

  What'd you either gravitate to or get placed in as the case may be?

• 13:04Speaker 04

  I was fortunate. There was a guy who was number one, I ranked research analyst and his name was Greg Capelli, just super smart, thoughtful guy. And I was earmarked to go into his group immediately. So I was just the junior person on the totem pole doing equity research, like basic financial models and basic due diligence on companies that we were either trying to take public, trying to raise money for, or just traditional equity research analysis.

• 13:32Ted Seides?

  And how did that progress over your years before you came over to this side of the business?

• 13:36Speaker 04

  I started at CSFB, had the opportunity to go to Merrill at the end of my two-year program to be a senior equity research analyst. So I moved out to Merrill and the tech group in San Francisco, I guess they called it the Global Growth Group, and was there during the whole implosion of the tech bubble and was fortunate enough to be at a stage in my career, I was given the choice, hey, you can go back to business school. I had a guarantee when I went over and they were going to potentially move me to New York and find a spot for me, but it was easy enough for me to go back to grad school. So I applied to a couple of different grad schools, but ultimately chose the financial mathematics program at University of Chicago and was going to go to school full-time and try and

• 14:17Speaker 04

  work part-time. But got an offer from Bank of America to be a quant in the strategy group there that was mostly focused on fixed income derivatives, some FX, some of the exotics. But I ended up going to school part-time and working full-time and that was kind of a great financial decision. But I worked there for just a, maybe it was a year and a half, 18 months before they shipped me off to the Tokyo office and landed in Tokyo as a junior trader on the derivatives desk and worked my way up. So I was running the fixed income, mostly like interest rate derivatives, swaps, swap options, cap spores in Tokyo and then got transferred to London during the financial crisis to.

• 15:01Speaker 04

  To take over the Euro Sterling and Swissy Books there. And then after the merger with B of A and Merrill, ultimately went back to Barclays in Japan before I got a call from Grinnell College to talk about coming to work for an endowment. So like very circuitous kind of random route. I mean, I guess there are links in the chain where you can point to where it was kind of logical at the time, but certainly didn't grow up in this kind of allocator world or even in asset management.

• 15:28Ted Seides?

  What was it like when you got that call?

• 15:30Speaker 04

  It was like, do you have the right number? I don't even know what you guys do. I was only conceptually aware of endowments because of Grinnell was kind of famous for being this little tiny college in the middle of Iowa that had a large endowment. And certainly knew people who worked in the investment office and that's how they got my number, but they wanted someone who had kind of international experience, experience in fixed income, experience in equities. And so my background kind of loosely fit there and obviously I tied this to Grinnell College as well. So, and the truth is my kids were starting school and we had started the kind of private school thing in Tokyo and my wife is originally from the Midwest. She's from small town Iowa, actually, and it just worked out for the family. And I thought the job was super interesting.

• 16:12Speaker 04

  Certainly the compensation scales are very different running a derivatives trading desk at an investment bank versus working at a smaller endowment. So that was kind of a big life decision and it just seemed like something, hey, this is super interesting. It's more meaningful and it ended up being a great decision in hindsight.

• 16:29Ted Seides?

  The Grinnell Endowment has a pretty interesting history and why don't you maybe talk a little bit about what drove the process over the years?

• 16:38Speaker 04

  It's probably most famous because of the connection with Buffett. Buffett hasn't been active since the late seventies, early eighties, but certainly was instrumental. And, and there's a famous investor, I think Money Magazine wrote him up as the most famous investor you'd never heard of, and that was Joe Rosenfield. And he had a huge role in the endowment from 1941 until 2000. And then David Clay, the CIO who hired me, he started in the eighties as well and worked with Joe and was really super instrumental in that portfolio over basically a 30 year period and super talented investor and just a wonderful human being. And I was so lucky to start there and

• 17:20Speaker 04

  work under David for that seven years I was there. He was just following more of that kind of Berkshire style investing than the traditional Yale model. David just was a really great investor. I think looked at the world in a very similar way to Joe did. And it was really good for me because I had no idea really what they did in Endowment when I first started. And I guess my role technically was Director of Public Investments and then quickly took over as managing privates and publics and then ultimately became the CIO in my fourth year there. But it was a great place to start and David was still a great mentor.

• 17:56Ted Seides?

  So you mentioned that Dave and Joe style is probably more Buffett like than Endowment model like. What did that mean? What was the philosophy of it when you showed up?

• 18:05Speaker 04

  It was definitely, hey, let's find great individual companies, great partners, and see if we can leverage those relationships to put concentrated exposure into individual positions that we can compound with over really long periods of time. So if you look at the biggest investments in Grinnell's history, it wasn't uncommon for them to have north of 10% of the portfolio in a single individual name. Particularly when Joe was there, they had a historical relationship with Buffett and Sequoia, the mutual fund. If Joe liked it and Warren liked it and Sequoia liked it, they could potentially own it in an internal portfolio in both places. So you'd end up with these large concentrated exposures, but produced just unbelievable returns over many,

• 18:49Speaker 04

  many decades. I think when, when Joe started, the Endowment was just a couple million dollars in 1940s and was over a billion dollars almost completely through capital gains over that timeframe. I think over that timeframe, they only took in $70 million in gifts. And turned 3 million into over a billion dollars.

• 19:07Ted Seides?

  So what did that portfolio look like?

• 19:09Speaker 04

  When I first got there, there was still legacy concentrated exposure to large cap domestic equities. And certainly the mandate from the board was the college had grown more dependent on the endowment and wanted to reduce overall volatility. So there was a mandate to diversify to some extent, while still kind of maintaining the core beliefs and tenants that had grown the endowment over that same time period.

• 19:31Ted Seides?

  And so when you say concentrated, was it 10 names or was it managers? Like, what was the setup?

• 19:37Speaker 04

  Yeah, it was more like 10 managers.

• 19:39Ted Seides?

  And predominantly US equities?

• 19:42Speaker 04

  Predominantly US large cap value investors.

• 19:44Ted Seides?

  And then what did it look like as seven years later, as you were getting ready to leave?

• 19:50Speaker 04

  It still looked, I think, pretty similar. Like, we had gone from, say, 10 managers who mattered to probably 15. And then we'd also done quite a few individual co-investments, either in public markets or private markets, that changed the risk profile of the portfolio quite substantially.

• 20:07Ted Seides?

  In this world where ostensibly all of your peers have completely different looking portfolios, global diversification, equities, credit, real assets, how did you think about sticking to effectively concentration in predominantly US equities?

• 20:27Speaker 04

  When we went from 10 to 15, the bulk of that came in from international partners, particularly in kind of emerging frontier markets. I like to think like here at WashU, we're completely opportunistic. We're more or less indifferent between domestic, international, public, private, where we can find interesting partners, interesting opportunities, interesting places to put capital, particularly when we think it reduces the risk profile of the overall portfolio. Like, we're always looking for something that we think is orthogonal or idiosyncratic to what we currently have in the portfolio. And that's where we like to kind of concentrate our exposures.

• 21:03Ted Seides?

  So yeah, let's turn over to WashU. What did the portfolio look like when you arrived a couple of years ago?

• 21:09Speaker 04

  It had a very traditional kind of endowment asset allocation. If you think top down, we haven't shifted the asset allocation too meaningfully. We've reduced exposure to the hedge funds. I think we've gone from 100 partners plus to 50 that matter or really 30 that matter. So we've concentrated our exposures and then we have a significant portion of the portfolio in individual securities and individual names.

• 21:35Ted Seides?

  How difficult was it for you stepping into a seat where there was a much more diversified group of managers to start winnowing it down?

• 21:43Speaker 04

  We certainly were not popular in certain circles for quite some time, probably still not. And those are tough decisions. Those partners didn't necessarily fit our portfolio. I mean, these are smart, thoughtful, well-intentioned, good people and often great investors. It's just it didn't fit what we were trying to do with the portfolio. And so we had to make a lot of tough decisions at the margins. I would say like we went through with the board and garnered internal support, but we put in redemptions for almost half the portfolio in the first several weeks. Now I was fortunate to have the portfolio for several months before I actually landed in the seat. So we spent a lot of time going over individual partners and individual names of who we're

• 22:28Speaker 04

  going to keep in the portfolio and who we weren't. At this point, I think we've probably turned over 70, 80% of the original pool, even more than 80% actually. So the vast majority of it's been turned over and those we've kept, we've added capital to and concentrated exposures, but for the most part, it's a very, very different looking portfolio than it was when I started three years ago.

• 22:53Ted Seides?

  What were the filters you used to start to winnow that down?

• 22:57Speaker 04

  There's some kind of very high level things. We tend to like smaller managers. We tend to like people who concentrate. We like people who have a long-term view. We typically stay away from systematic and macro. Generally, those are the things that we have a harder time getting over the hump. So we were able to eliminate quite a few of those relationships and those partners just right off the top. And then it became like, how do we re-underwrite this manager? Start with a blank slate. Is this somebody we would put in the portfolio? The answer was no, then we would look to terminate over time.

• 23:34Ted Seides?

  And what are your sort of favored criteria within, say, a manager you kept and a manager that was close, but you didn't?

• 23:40Speaker 04

  It's the same lens that we look through all managers. I mean, first and foremost, we're looking for people we think are great investors, people who are operating in an interesting opportunity set, people we think have an institutionalized, repeatable process. Ultimately, we evaluate them based on what we think the quality of their portfolio is. And we think about our portfolio on a bottoms up basis in that we own what our partners own in some fraction. So if they own 10 stocks and we're 10% of the fund, we think about our portfolio as these individual pieces. And then we have a fee and liquidity structure on top of that. And that portfolio has to make sense on a look through basis.

• 24:21Speaker 04

  So if you take our hedge fund portfolio three years ago, and I were to evaluate it on a look through basis, I'd say we own 2,000 names on the both sides of the market. And we have a fee structure that's one and a half and 20. Like, that's a portfolio construction problem, right? Because essentially, you're an index fund on both sides of the market with an expensive active management fee structure on top of it. And the fee structure is problematic in that it guarantees you always do worse than the average, right? So you're essentially in long correlation. If you have a hedge fund that's up 10% and a hedge fund that's down 10% on a gross basis, you're flat, right? But you paid them both 1 and 1/2% ish as a management fee.

• 25:03Speaker 04

  And then the one that was up 10%, you also paid a 15, 20% carry too. So on a gross basis, you're flat. But after you put on your fee structure, you've done horribly. And that's problematic in hedge funds in general. And I think You can look at it like industry wide returns. It struggles because the proliferation of just the number of hedge funds on a look through basis, that's kind of what the industry owns, right? They own both sides of the market. It's really tough with that fee structure to produce alpha.

• 25:30Ted Seides?

  At an aggregate level, it's easy to make the case that it never makes any sense, but you're not really dealing the aggregate level. You're dealing with the subset of managers that you inherited when you showed up and maybe a few that you liked from before. So how do you put together that kind of bearish macro perspective, say on long short, with bottom up manager by manager decisions?

• 25:54Speaker 04

  We're just hugely selective and I guess you have to be humble and intellectually honest about your ability to really choose the absolute best performing managers. There's a lot of large number problem in that, let's say 95% of the time, we can tell a really good manager from a really bad manager. But if only 1% of them are actually really good, then you still end up with five to one ratio of not so good managers with good managers. Right now, I'd say we only have four, what you call traditional hedge funds in the whole portfolio. And then we're also looking for places where we can leverage that relationship to make the overall portfolio better. So we're looking for people we can kind of use as either outsource research partners,

• 26:36Speaker 04

  places where we can add capital and we think they have a really interesting idea that again is kind of idiosyncratic to everything else we have in the portfolio. That's a really valuable relationship for us. And I would say the, we also understand the process. We understand their portfolio and we have the ability to assess when things are going poorly, whether it's a short term or long term problem. And I would say most of our partners, we've been able to produce significantly better returns than, than you would think, just looking at their headline numbers, because we have the conviction to kind of add capital when things aren't going that well and can rebalance when things are going well.

• 27:14Ted Seides?

  I'm curious, what have the dynamics on your team, on the investments office been when? As you said, it's hard winnowing it down. It's not fun. And you can imagine it being difficult to positively motivate the people on their team when they're making the phone calls saying, hey, we're taking money out of all these managers.

• 27:34Speaker 04

  It's easy enough for me to be the bad guy. So I'm happy having those calls. It doesn't have to be the team. But certainly there's like personal relationships that people on the team had with these people going back. Everybody on the team is a generalist, so nobody's kind of married to any one geography or asset class. And where we have people who have historical experience in privates or publics and tend to have more relationships there. But in general, we, we do things as a group and that makes it a little easier. Like we're trying to make all asset classes compete for capital. And that's a lot easier to do with a generalist model than it is when people are siloed into individual asset classes. And then it also gives us the ability to size things probably more. If you're thinking about the entire portfolio in context versus just my one little siloed

• 28:19Speaker 04

  asset class, I think the way you'd size positions is quite a bit different.

• 28:23Ted Seides?

  So what kind of impact did it have on the team?

• 28:26Speaker 04

  Overall, it's been really good. The team is different. We made changes to the team early on as well, but the team has done just phenomenally well. And I think it's really added a ton of value to the portfolio over the last couple of years. And the people who, who are still here, I think have really embraced this model of investing. It's a little bit of organized chaos at times running a generalist model with 10, 12 people on the investment staff. And oftentimes we have four people on a trip or five or six people, or even the whole team in a meeting where we probably only need five, but I think it's helped the portfolio over time.

• 29:00Ted Seides?

  How do you think about the generalist model in light of the concentration that you want in the portfolio? Where you could imagine the price of being wrong on something's a lot higher.

• 29:13Speaker 04

  Yeah, I would say that's definitely true, but also the benefit of being right is a lot higher. So if you're going to do something, do it in a size that will move the needle. And that's easier to do when you think about, you know, if you have say 5% of the portfolio in one individual relationship, one manager.

• 29:33Speaker 04

  That's huge concentration if it's 20% of your overall equity exposure. Right. You're kind of betting the house on it. That's your silo. Whereas depending on the underlying concentration, that may be perfectly reasonable for the portfolio as a whole.

• 29:47Ted Seides?

  How do you match this top down thinking and bottom up thinking if top down is traditional asset class or risk exposures and bottom up is the one-off selection of the managers in your portfolio?

• 29:59Speaker 04

  Our focus is really on the bottoms up. You know, if you look at even the way we think about diversification, like we're trying to concentrate our exposures in individual investments that we think have completely idiosyncratic outcomes over some period of time. Right? So if you look at the largest contributors to the portfolio over the last three years, you'd see like a Brazilian utility company, a Swedish supplier of medical products, an Indian biosimilars companies, a US based aerospace and telecom company. And there's no reason why we think those investments should have correlated outcomes over some investment time horizon. Now, in the short term, like if

• 30:40Speaker 04

  we go through a crisis like we did in March, where the cost of capital rises for all risk assets, we don't expect that portfolio to be immune, but we expect those investment outcomes to be completely independent over our investment time horizon. And that's a lot easier framework to find real diversification. Whereas if I step back and say, what are the diversification benefits for being in venture versus public equity versus private equity buyouts or real estate? Like, that's very difficult to quantify, particularly in times of severe market stress, where you really need diversification. And I think that's a better framework for us to evaluate real diversification benefits in the portfolio as opposed to this top down approach. Now, we use the top down approach, both presenting to the board and as a framework for thinking about

• 31:25Speaker 04

  how we guide our search. But, but really, we're looking for those idiosyncratic, completely independent outcome investments from a bottoms up basis. And that's how we, we like to concentrate the portfolio.

• 31:41Ted Seides?

  We're going to take a quick break in the action to tell you about Brookfield. Brookfield invests in the thing behind the thing behind the next big thing. Their focus across infrastructure, energy, real estate, private equity, and credit is helping to build the backbone of the global economy. Brookfield combines deep operational expertise with disciplined, long-term investing, uncovering value, and partnering alongside clients to shape tomorrow's economy today. Invest in the businesses that shape tomorrow. Learn how you can own what's next at Brookfield.com/own.

• 32:19Speaker 02

  This is not an offer to sell or investment advice. Investing involves risk, including the loss of capital.

• 32:24Ted Seides?

  And now, back to the show.

• 32:28Ted Seides?

  Think about exposures and drivers of return. It sounds like you're focused on the position level as opposed to, say, even a manager as a position.

• 32:38Speaker 04

  Yeah, and even our individual managers on our public and privates, we're generally thinking about them as individual exposures as opposed to like manager level. The returns aggregate through the partnership, but we think about the exposure on an individual investment level basis.

• 32:55Ted Seides?

  How is it different in the way that you do your due diligence on managers?

• 33:02Speaker 04

  At the highest level, we can look for all the things that all of our peers would have on their checklist. I think the way we evaluate them is really what we think based on the quality of the portfolio, and we'll use our own lens for that. So the quality of the individual investment ideas and the attractiveness, essentially, do we want to own what they own? And how does that fit in our overall portfolio? So like, there's lots of managers that we think are talented investors, have a good process, but for whatever reason, we don't think their underlying holdings fit our portfolio, or it's not something we're excited about, and we would probably pass on that. We're always trying to err, I guess, most of this job is saying, no, if you think of how many opportunities you look at before one actually makes it into the portfolio,

• 33:45Speaker 04

  it's probably closer to 0.1% than it is 1%.

• 33:49Ted Seides?

  When you're looking at a manager, are you focused on underwriting their positions more than their process to find the next position?

• 33:57Speaker 04

  We use that lens of underwriting their existing position. So it's really just like case studies of either what they currently own, what they have. And that's how we evaluate, like what caused you to make this investment? What was the process that led to this? Do you have a kind of unique differential view on the quality of the business or the industry? What is the real investment thesis? Is that empirically verifiable investment thesis? That's different than what we think the market or how the market is viewing that business? And that's the lens through which we look at their process. How did they think about valuation? How did they think about risk and return? How did they think about the industry? We spend our time focused on looking at those individual names.

• 34:37Ted Seides?

  How does that translate over into thinking about participating in the private markets?

• 34:42Speaker 04

  It's the exact same lens. You don't have the same, obviously, price discovery and transparency in private markets versus public markets. But oftentimes you have better access to financials and diligence materials and access to management teams.

• 34:57Ted Seides?

  So when you roll all that up today, what's the structure of the portfolio look like?

• 35:02Speaker 04

  I'd say like top down, it hasn't changed that much. If you think we're roughly a third public equities, which bounces around, we're probably a little bit overweighted in privates. That's probably 45% of the portfolio today, just because privates, particularly venture and growth equities, had such a big run. And then we have 5 to 10% of the portfolio in real assets type exposure, another 10% in hedge funds, and the balance would just be cash.

• 35:29Ted Seides?

  And how much do you try to do on the margin, sort of in addition to just what the managers are doing on your behalf?

• 35:36Speaker 04

  We focus most of our process internally on incremental research. We typically know what their thesis is, like how do we verify it? How can we use our networks or people within the university to help verify and re-underwrite the thesis?

• 35:51Speaker 04

  And it's a super time consuming way to invest, especially since you have to think you spend most of your time doing research on stuff that never makes it into the portfolio. And that can be a little disheartening at times, but ultimately, when something does make it into the portfolio, you understand it that much better. You have a much better understanding of the process and the partnership.

• 36:09Ted Seides?

  What opportunities are you particularly excited about today?

• 36:12Speaker 04

  Frontier markets is super interesting. I am emerging in frontier markets for us has been a big bright spot in the portfolio. If you look at the headline return numbers and emerging in frontier markets, significantly lagged developed markets, particularly the US over the last five years. For us, it's the opposite. We've been able to find really unique, interesting places to put capital in some of these markets. That has been a big differentiator for us in terms of performance. Again, it tends to be individual name, individual securities, but we have a ton of really high quality partners on the ground there. And it's been an interesting hunting ground for the last several years. And I think it's gotten better over time, not worse.

• 36:52Ted Seides?

  The particular region you're excited about?

• 36:54Speaker 04

  We spent quite a bit of time in Africa, Bangladesh, Russia's been really good for us. Africa is probably where we're spending more time. And again, it tends to be kind of one off, idiosyncratic opportunities, but it's been a really interesting place to invest.

• 37:09Ted Seides?

  What's an example of something that's worked well for you?

• 37:12Speaker 04

  Russia, we've made quite a bit of money in some of the more tech based companies that would trade at 20 times revenue in the US that are trading at five times earnings in Russia, growing a return on equity of 60% plus, growing at 30, 40% right through COVID. Super interesting companies that they're in Russia. So we're not going to bet the portfolio on Russia. And I know we have peers who basically said we would never invest in Russia. Like when we step back, our view is kind of look, all investing involves risk, right? If you're paying a hundred times revenue for a unproven business model in Silicon Valley, that's a risk. The question is like, are you being compensated for that risk? And we wouldn't.

• 37:54Speaker 04

  Have a massive portion of the portfolio, but we found opportunities that are compelling enough, even being in Russia, we think they're interesting and we've been well compensated for that. I'd say the same in places like Bangladesh, we spent time in Pakistan and all over the continent and Africa.

• 38:10Ted Seides?

  And what's that balance of you want to have a concentrated portfolio, so something's got to be big enough to move the needle, but then there's sort of known left tail risk so that you don't want it to be too big. How do you think about sizing?

• 38:23Speaker 04

  It's more of an art than a science. You size things based on how they fit in the overall portfolio and then whether or not you can underwrite the downside. And then again, we're always looking for things that we think add positive convexity to the portfolio, right? That have significant asymmetric risk and reward. As a general, I tell the team, look, if we're not willing to put 1% of the portfolio in it, then like that's not a lot of conviction. And for 1% for us is currently just over 100 million US dollars. So we don't always have that type of liquidity, right? Like the opportunity set isn't always that big, so things aren't always sized there. But again, if you're not willing to put 1% of the portfolio in it, and if you, let's say you do a disastrous job underwriting

• 39:06Speaker 04

  the downside and you lose half your money there, we can tolerate 50 basis points on the overall portfolio and hopefully make that up in other places, particularly if we think it's very, very idiosyncratic, right? We're looking for opportunities that aren't based purely on our macro view of the world. But for us to go above that again, we would have to have a significant view of downside and really be comfortable with the underwriting process.

• 39:31Ted Seides?

  So if you're willing to go to Russia, go to Pakistan, Bangladesh for investments, are there areas that you avoid?

• 39:39Speaker 04

  There's certainly certain markets that are tough that make Russia look like a very developed market, particularly across Africa. There are places that are just really difficult to invest. Whether that's property rights or contract enforceability, like there's lots of things that just make it a very, very tough place to invest, particularly in the type of size that we're hoping to do. So there's certain places that we just don't go hunting, but I'd say like very few places are completely off limits.

• 40:07Ted Seides?

  How does the process sort of work for your team in finding a new idea? So you can break it down, like where does the sourcing start?

• 40:15Speaker 04

  We try and spend a lot of time on the ground in the various markets that we're investing in, and it's really randomness and optionality. You never really know what the next interesting idea is going to come from, what it's going to look like, and which partner it's going to come from. So it's just basic blocking and tackling. I'd like to say we have a great funnel where we're looking at this really high level, interesting set of opportunities, and it boils down to a small group of investments that we end up making, but it's really random. And I think it's just hard work out there, knowing what our partners are doing, knowing what our partners are looking at, and trying to find interesting places to put capital.

• 40:53Ted Seides?

  If you think back to, you know, one of the more recent, maybe it's pre pandemic, but one of the more recent new commitments you made, walk me through the process of how you found it, where it came from, and what that due diligence was like.

• 41:08Speaker 04

  A recent one would be a co-investment in an additive manufacturing company that one of our Silicon Valley partners based out there, like at the last annual meeting, this was one of the companies that had presented, we thought it was a super interesting company, spun out of a really great institution on the East Coast, at least the intellectual property did. Our partner in California was one of the original seed investors of the company. Interesting software platform, interesting hardware platform, what we think is very unique, defensible IP. When we saw the CEO present at that annual meeting, I guess it was 2018, came back and said, look, this is a company we should start doing some work

• 41:50Speaker 04

  on just in case. So we spent probably six months just diligencing the company. We spent time talking to people in the industry, talking to potential customers, spent time with the management team, and just basically trying to position ourselves just in case they raise capital at some point, we could come in as a preferred provider of someone, hey, we've already done all our diligence, we're super interested in this. If we think the valuation makes sense, we'd love to be involved. And have a great relationship with that particular partner in California. And when they did come back to market with that round, we weren't able to get the full allocation that we would have liked, but we're able to put in a fairly sizable chunk of capital in what we think is a really interesting company for the next two decades.

• 42:33Ted Seides?

  That example brings up a whole host of questions in and around process. So the first is, how do you think about time allocation when you're spending all that time with a chunk of your team on one company?

• 42:44Speaker 04

  The truth is, if I think about the overall portfolio, if we find four or five companies like that a year, we've done our job, like four or five places and how much capital we have to reallocate every year, we hope you have a very long time horizon. And most of the time, we're allocating to our core partners and re-upping of funds. And we have lots of places we can put capital if we have excess capital. But finding these four or five differentiators of return, places where we have excess exposure and we think it's super interesting over a long period of time, like that's all we need. So the truth of it is that most of your time ends up being relatively unproductive just because you're looking at things that don't ever make it into the portfolio. But, but we have a big team and we have a lot of resources.

• 43:26Speaker 04

  And, you know, if we can produce a small amount of alpha compounded on a $10 billion portfolio over long periods of time, like that's definitely worth it.

• 43:34Ted Seides?

  How does that change the nature of the relationship you have with the manager, you know, in this private equity firm, who already has a position in the company and, you know, may want to put more in if it's doing well. And you're in some sense, their partner in some sense could be a competitor for a limited amount of capital investment.

• 43:53Speaker 04

  Well, I mean, we always say that they would obviously get their fill before we would get anything. So in this particular case, they were bringing us on instead of another outside partner. So they took their pro rata rights and we were able to come in on the back of that. And then like we'll set up an SPV and still pay them, like they'll manage the position for us and fee and carries. Typically, there's not a management fee associated with those, but we'll still pay them for all the help that they've done and manage the position over time. So we're rarely trading kind of on our own balance sheet. And we would never do that without expressed written consent from the partners. There are times we have gone directly on the cap table, but only because that's how we were asked to invest. But for the most part, we're setting these up as, as SPVs.

• 44:37Ted Seides?

  And how about the skill set of the people on your team where underwriting a company can be? Different skillset from diving in underwriting managers.

• 44:45Speaker 04

  Yeah, it's a very different skillset. It's a very different mindset, I would say. But that's taken a lot of time and effort to kind of bring the team to speed. It's a very different. I don't think someone who comes from a traditional allocator background and grew up in that world. It takes, I think, several years of learning and mentoring before they're comfortable with this kind of investment style.

• 45:08Ted Seides?

  Where have your people come from generally?

• 45:10Speaker 04

  It's fairly random, like people who come from traditional asset management industries, consulting backgrounds, I think are good. Private equity investment background is really good. And then we have people who were, one person on the team who was a PhD in physics and smart, curious, intellectually curious people. They enjoy investing this way. And if you step back like why it's interesting to work for an endowment. You have this pool of capital that's not too big, right? You're not a hundred billion dollar pension fund. So you can do interesting things that will move the needle. And you have an opportunity set that's pretty much any asset class, any geography within reason in the entire world. So that's a super interesting, very long time horizon, unlimited opportunity set.

• 45:54Speaker 04

  And you're only looking for a small handful of really great investments every year. That's a super interesting framework to start from. And certain people fit well within that framework and certain people don't. Cause as a team, we might be looking at again, a Brazilian utility company one day and a medical products company in Sweden, and they're both interesting investments, but it's a very different diligence and underwriting approach. And some people enjoy it, some people don't. And we've had great people, great investors who it just wasn't the right framework for them. And then when we can, we can hopefully be helpful to them to find someplace where they're going to excel.

• 46:29Ted Seides?

  And when you add it all up, how many positions would you say you have in the portfolio today? And how does that compare with a more typical endowment?

• 46:37Speaker 04

  We have more like a hundred positions that really drive performance. On a look through basis, if you looked at our top hundred positions, that's going to be probably a third of the portfolio and maybe even slightly more than that currently. Just because we've had such a big run in some of those names over the last 18 months, but. It's a manageable position for a team of 10, 12 investment professionals. We're typically looking for ways to concentrate that further, not less.

• 47:07Ted Seides?

  What have you learned the most from being in the seat the last bunch of years?

• 47:12Speaker 04

  Coming from a smaller endowment, realizing like how much the team matters. You can't be on every call. You can't be in every meeting. And being able to leverage the team and leverage resources, that's been a huge shift going from a $2 billion endowment to now $10 billion endowment. And then like governance, having a board that buys into the strategy that gives you the autonomy and flexibility to manage the portfolio, the way we manage it, I think has been just super important. And that governance thing, I think is maybe the most important thing that really is the north star for all endowments, that governance process drives so much. And the institution here has just been amazingly supportive.

• 47:54Ted Seides?

  What does the day to day look like or the week to week look like on your team?

• 47:58Speaker 04

  We try and organize it as much as we can, but we'll typically have one to two team calls per week. You know, typically Monday morning, what are we working on? What do we think is interesting? What's in the pipeline? What can we kill? And we'll include the entire team on that, including operations folks. And we try and integrate investment and operations as much as we can. That's mostly pipeline focused. And then what's interesting that's happening in our portfolio, like who's adding to what names? How are position sizes changing? What's performing? What's not performing? What are interesting hunting grounds, places to at least start your search? Right now it's very different just because there's no travel. I would have said I spent 30 to 50% of my time in any given week or month on the road,

• 48:43Speaker 04

  but that's not happening.

• 48:46Speaker 04

  And then from there, again, it's very random to like what kind of names or what geography, what we're spending our time on, it really depends on what's happening with our various partners in any given week. So it tends to be really random from one week to the other. And we organize the team so that nobody's over focused on one geography or one asset class. So you could have. Three calls in a day, looking at new investments or existing investments. And there'll be five people on each call, but none of those five people will overlap on any given call.

• 49:19Ted Seides?

  So much of the process of investing ties to trying to identify a competitive advantage or an edge. And I'm curious what you think yours is taking this approach?

• 49:32Speaker 04

  I step back and say, look, our top peers, these are smart, well-intentioned, thoughtful investors. Like, do we really have a sourcing edge? No. Do we have an underwriting edge? Probably not. If you look at what's really generated our returns, if you look at our performance this year and how we've done over the last three years, we'll end up towards the top of our peer group over that timeframe.

• 49:57Speaker 04

  It's our willingness and ability to go where our peers are not. I think like go to certainly geographies and take outside risk positions in assets where we think we have an underwriting advantage.

• 50:10Speaker 04

  And because these underlying investments tend to be uncorrelated, like again, we're looking for independent outcomes over our time horizon. I think it's reduced the overall risk in the portfolio while enhancing returns. But I'm not so sure there's a clearly definable edge, if I'm being intellectually honest. From a top-down perspective, we would have similar looking portfolios. But when you look at the underlying exposures is where our tracking error comes from.

• 50:36Ted Seides?

  And when you're looking at, you mentioned potentially an underwriting advantage. Is that compared to, say, endowment peers that are picking managers? Or is it compared to the managers doing the underlying security work?

• 50:49Speaker 04

  I always comparing ourselves to our peers, you know, other larger endowments. Certainly, we're not doing what the underlying partners are doing. I'd say what we're trying to recognize super interesting opportunities. We're not necessarily sourcing those on our own, although we're doing our own work. We're leveraging everything that our partners are doing. And hopefully we can find incremental ways to add value to that research process. So we, again, most of us come from non-traditional backgrounds. We have our own networks and own people and within industries and certainly people who are. Tied to the university that we can leverage.

• 51:22Ted Seides?

  How have you found those differential insights helping the process of just manager selection?

• 51:29Speaker 04

  Everything looks good on paper, right? Like you've never seen a pitch book, or whether it's someone's pitching you an individual investment, or it's a manager pitch book, like it always looks good on paper. And again, you know, it's peeling back the onion to understand where these positions come from, how are they sourced, like what was the underwriting process? What do we think of their framework around risk or valuation? And I think doing your own work on the underlying names gives you, you have your own opinion, all that stuff, and you can compare and contrast it with, with what your partner's doing. And that's a valuable framework that I'm not sure everybody does.

• 52:08Ted Seides?

  Where do you think you've tripped up the most?

• 52:10Speaker 04

  The list is long and undistinguished, is what I would say. Like, you know, we make mistakes all the time. And I would say, you know, certainly a big lesson over time is like, make sure you understand the bear case on every investment, whether it's a manager or underlying company.

• 52:28Speaker 04

  And overestimating your ability to, whether it's underwrite the downside, understand competitive dynamics within the industry. It's a super, super long list of like places where I think we've learned over time, both on the manager's side and individual selection side. I'd say our partners with managers is typically, if you look at what's ended more relationships, it's, we disagree with them on size of the opportunity set, or what the right size of AUM is, or their ability to find idiosyncratic ideas, or places where the manager has become more thematic investors than bottoms up, research-driven investors. We're always looking for idiosyncratic risks. So, most of the partners who are really thematic tend not to fit our portfolio, or the way

• 53:13Speaker 04

  we look at the world, but. Entry point is one thing and we've made all kinds of mistakes on exits. My old boss and through his training, he used to say, there's no good or bad trades. There's only good and bad exit and entry points. And there's some truth to that.

• 53:28Ted Seides?

  So if you look out five or 10 years at your portfolio, what do you think will evolve?

• 53:34Speaker 04

  I don't think we're going to do things much differently over the next five, 10 years. We certainly have like some positions, if you look at them over the last two, three years, have become outsized risk exposures in the book, just because of organically the positions have grown. And over the next five, 10 years, some of those positions could get really big if they continue on a similar trajectory. But I can't imagine we change our overall process significantly.

• 54:03Ted Seides?

  How do you think about taking this model and applying it in the venture capital area?

• 54:09Speaker 04

  Venture capital is tough, right? Just the nature of the industry.

• 54:15Speaker 04

  It's tough to underwrite. If you look at our partners and we have a great group of partners who have done extremely well for the portfolio, but we haven't had really much success in kind of the micro VC world. Like there's so many of these small micro VC funds. And again, these are a lot of smart, talented people who come from good places, but it's just really tough for us to underwrite and find unique differentiated thinkers in that area. And so we've just shied away from it. We typically, I guess we've concentrated our exposures and people that we think we can partner with very closely and we have ways to monetize the relationship outside of their ability just to pick really good early stage companies in that we can grow

• 54:56Speaker 04

  our exposure with them over time, either partnering in these co-investments or finding ways to add capital to what we think are the most interesting ideas.

• 55:04Ted Seides?

  So does that prevent you from investing with some of kind of the perceived best of breed that are always massively in excess demand?

• 55:13Speaker 04

  No, I mean, say we're still opportunistic, like there are certain partners who we think are just great investors and we have no ability to partner with them closely, but we still think it's a great investment and we're happy to take. Whatever capacity we can get in some of these underlying partners and just think that they have a great process, they have great pipeline, they've done tremendously well over long periods of time, and it's a group of just really talented investors. And whatever they're doing, we obviously would like a piece of it. But it's hard for us to scale up those relationships over time. There's just limited capacity.

• 55:46Ted Seides?

  With an increasingly concentrated portfolio, curious how you factor in some of these broader issues that are increasingly coming to light, like the sustainable investing lens and diversity and inclusion.

• 55:59Speaker 04

  We've obviously spent a decent amount of time on that. And I did when I was at Grinnell, that kind of ESG lens, I think it's a framework that plays in everything we do. We don't have a specific kind of ESG mandate, but we're always looking for partners. You know, I tell the team, we want somebody who has a similar moral compass. We want people who have a framework and has similar value systems that we do and understand the mission of the university. And, and nobody works in an endowment because they're trying to maximize their current compensation. If you can't buy into the mission, this isn't the right place to be. And I think that's something that pervades everything we do, whether it's hiring people on the team or finding new partners.

• 56:41Speaker 04

  And we obviously just recently went through this, over a third of our partners, either in the US or even more internationally, are managed by people of color or female heads. And that's not something that's a purely bottoms up driven outcome. And we don't positively or negatively screen for that. It's just, I think, an important framework for how we view the world.

• 57:06Ted Seides?

  All right, Scott, let's turn to a couple of closing questions. What's your favorite hobby or activity outside of work and family?

• 57:12Speaker 04

  I can't say I get to spend that much time outside of work and family, but I grew up in small town Alaska, and I love downhill skiing and fly fishing, which were just two activities that I grew up with. And, and obviously I love sharing those activities with my family, best of all.

• 57:27Ted Seides?

  What's your most important daily habit?

• 57:30Speaker 04

  I think just reading, being intellectually curious. I always want to know what's going on, not just with the portfolio, but in the world in general.

• 57:37Ted Seides?

  What's your biggest pet peeve?

• 57:39Speaker 04

  I've got a lot of these. Behavioral pet peeves, I guess, people who are just unproductive and lazy. I think working in an endowment, again, we have this. Huge, wide open space where we can invest in, within reason, anything we want, anywhere in the world. Like, if you can't find something to look at, something to do, you're probably not in the right seat. And then people who spend any time complaining or kind of whining about circumstances, like, I'm sure I inherited that from my father, but you're complaining about something and something's wrong, then fix it. If you can't, then there's no, no reason to complain about it if you can't fix it anyway. I guess maybe one other thing, I would say like firms that quote gross returns and not net returns, I think is another probably pet peeve that's shared with a lot of our peers.

• 58:25Ted Seides?

  What's the biggest mistake you've made?

• 58:27Speaker 04

  In terms of investment mistake, talking to a friend about this recently, I think when I graduated from college, I knew nothing about investing. I was a math and econ major, and I'm dumped down into junior seat in equity research. And I spent the first two years paying off student loans, right? I was sleeping on the floor, trying to save enough money so I could actually buy a stock or whatever, you know, put some skin in the game. And finally, I got a bonus, you know, in February, March of 2000, that I could invest. And I think the first thing I did was buy like a bunch of just disastrous tech names that I'd been following for the last two years. In hindsight, it was a cheap lesson, right? Because I didn't have that much money to lose. But, and I think certainly has been

• 59:09Speaker 04

  a positive influence for the last two decades. But that, in hindsight, was a really quick way to evaporate half my tiny capital base.

• 59:19Ted Seides?

  What teaching from your parents has most stayed with you?

• 59:22Speaker 04

  Work ethic. Like, you know, I mentioned neither of my parents went to college. My father worked in construction. My mom was a bookkeeper and did odd jobs when I was a kid. And they're both just super hardworking people. My father is just one of the most productive human beings. And he never went to college, but he's just a super intelligent person. And I'd say, now that he's been retired several years, he's still just amazing, hardworking, productive human being.

• 59:49Ted Seides?

  Scott, last one. What life lesson have you learned that you wish you knew a lot earlier in life?

• 59:54Speaker 04

  We talked about mindfulness training before. I think my big takeaway from that was to speak less, listen more.

• 1:00:02Speaker 04

  Something I wish I would have known when I was younger. I think the other thing too is intelligence is only one small factor in people being successful. Like when I was young, I thought that if you didn't have kind of a logical analytical framework, you'd have a hard time being successful. Whereas like people who are really good at driving consensus, communicating ideas, great salespeople, like all those things are just a huge facet of what makes you successful.

• 1:00:28Ted Seides?

  Scott, thanks so much for taking the time.

• 1:00:30Speaker 04

  Yeah, well, thanks for having me. I appreciate it, Ted.

• 1:00:32Ted Seides?

  Thanks for listening to the show. To learn more, hop on our website at capitalallocators.com where you can join our mailing list, access past shows, learn about our gatherings, and sign up for premium content, including podcast transcripts, my investment portfolio, and a lot more. Have a good one and see you next time.