Optimizing Life and Finances with Jack Raines

Barry sits down with Jack Raines author of "Young Money". Jack dives into his unlikely journey into finance and venture capital. He discusses how his travels impacted the way he sees money and purpose for young people. He also reviews how to incorporate passion into your career and the impact it will have in your long-term finances. See omnystudio.com/listener https://omnystudio.com/listener for privacy information.

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

• 0:00Speaker 00

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• 1:15Barry Ritholtz?

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• 1:50Speaker 03

  Bloomberg Audio Studios. Podcasts, radio, news.

• 1:55Barry Ritholtz?

  This week on the podcast, my somewhat special guest, Jack Rains is a venture capitalist and author. I've been reading his Substack for a couple of years and always found it quite entertaining and interesting. His new book, Young Money: A Field Guide to Wealth and Purpose in Your Twenties, is really interesting and wise beyond its years. I wish I had access to a book like this 100 years ago when I was in my twenties. I thought this conversation was fascinating, and I think you will also. With no further ado, my interview of Jack Rains.

• 2:37Barry Ritholtz?

  Jack Rains, welcome to Bloomberg.

• 2:40Speaker 04

  I mean, extra special guest is way too kind, but.

• 2:42Barry Ritholtz?

  So my special guest, my.

• 2:44Speaker 04

  Normally special guest.

• 2:46Barry Ritholtz?

  I wouldn't want to call him like my young guest, my, you know, I painted myself into the corner with extra special guest. Once you go that way, you can never go back.

• 2:56Speaker 04

  I'll take it.

• 2:56Barry Ritholtz?

  Here's my special guest. Really, what's wrong with Jack? He's a special guest.

• 3:00Speaker 04

  He wears a cowboy hat.

• 3:01Barry Ritholtz?

  That's right. Well, we'll get into that in a little bit. So let's roll back so many years ago to when you're undergraduate studying finance and Spanish while playing football at Mercer. That was before you got your MBA from Columbia. Was there ever a career plan?

• 3:19Speaker 04

  Like, not really. It was just, I don't know, I feel like basically every white dude ends up studying finance unless they're dead set on going to like med school, law school, or like computer science. So it was study finance, and then I was set to graduate in two and a half years because we had to take summer classes with football. And I was like, I should double major. Finance and marketing is stupid. I don't like computer science. Let's pick up Spanish because it feels like that could be marginally useful living in the South. Spanish is very osi-osi right now, but it's like sufficient. But there was no real career path other than figure it out from there.

• 3:58Barry Ritholtz?

  That's intriguing. I'm cracking up because I have so many different ways to go with this. First gig at a school was corporate finance at UPS.

• 4:11Speaker 04

  Yep.

• 4:11Barry Ritholtz?

  Which you described as mostly moving a mouse around the screen and trying to look busy.

• 4:16Speaker 04

  Correct.

• 4:17Barry Ritholtz?

  Tell us about your experience in corporate finance.

• 4:21Speaker 04

  Yeah, I mean, to set the stage a little bit, I graduated in December 2019, which was probably the worst possible date to graduate, given that COVID started like three weeks after that. So I moved to Atlanta in January or February of 2020, start working for UPS. I'm in the office for three days. My computer isn't even fully online yet. And then we're told that we're going remote for one week and then one month, and then everybody had the same experience where a year and a half later, you're still remote. So I don't think it's great to be a 22-year-old who's never had a real job, who's then told you're going to work from home while you have like your Xbox and all of your friends are doing the same thing. And it was actually like a terrible environment to like start learning how to be a worker.

• 5:04Speaker 04

  And yeah, it was just Zoom calls, Excel sheets, like modeling out fuel cost projections and forecasts for UPS for like 2022.

• 5:15Speaker 04

  Yeah, I was honestly bored the whole time. And to build on top of that, I'd gotten into business school out of undergrad. So like Columbia, I went to business school at Columbia, and they have a deferred enrollment program where when you're a senior in college, you apply, and then you work a few years and go to business school. So I knew that I was going to go to grad school in like three years. COVID hit, I was super bored, working remote, just doing basically nothing. And it just kind of felt like I was in a work from home purgatory for about 18 months.

• 5:45Barry Ritholtz?

  So having that window where, hey, I know where I'm going to be 18 months from now in September of 2020 blank, what led you to say, I think I'm going to quit and just buy a one-way ticket to Barcelona and travel the world? Like, that's a giant leap, which not a lot of people have the nerve to make. What led to that decision?

• 6:11Speaker 04

  So like when I was a kid, I always loved to travel, and my grandparents would take me everywhere.

• 6:17Barry Ritholtz?

  Your grandma took you on a crazy trip, you describe in the book, to Savannah in Africa.

• 6:22Speaker 04

  Yeah, yeah. When I was 11, my grandma, Mama Ruth, she, I'm the oldest grandkid in the family, and she hit me with the idea that she wanted to take me on a trip, like anywhere in the world I wanted to go. I actually didn't know if she literally meant anywhere. I wanted to go somewhere crazy like Africa or Asia, and we lived in South Georgia. Initially, I pitched Costa Rica, and she said, you can, yeah, she said like, that's like a three-hour flight. And I was like, okay. Tanzania. I like, I thought the like, I had a big map in my room as a kid. I thought it'd be cool to go to the Ngoragoro Crater and see Mount Kilimanjaro and all this stuff. So she took me and we went, and we went on a two-week safari, and it was awesome. And then in college, I studied abroad in Spain one summer. I went to France one summer with my best friend from college.

• 7:06Speaker 04

  I did a service trip to Ecuador. Like, I always loved leaving the US. And it was kind of a thing in the back of my head where I knew at some point in my twenties, it would be really fun to do like a multi-month trip abroad with like no itinerary other than just see other stuff. And I was sitting there, it's like you have this, you're working remote for 18 months and you're bored. And then I, for better or worse, had a fortuitous run trading SPACs and SPAC warrants during the pandemic, which gave me enough, it gave me more money than I expected to have at 23 or 24. I was like, I mean, I don't, it wouldn't cost that much to just go hostel hop Europe and Latin America for a year.

• 7:46Barry Ritholtz?

  Yeah, I'm glad you brought that up. You're not a trust fund buddy, but baby, in any stretch of the imagination.

• 7:51Speaker 04

  No.

• 7:52Barry Ritholtz?

  You scrape together some money, you fly, coach, you staying in hostels, you have 10 roommates in these places.

• 7:59Speaker 04

  Eating like McDonald's or Euros or whatever every day. It was the best. I mean, I got food poisoning one time. It was fun. It was fun.

• 8:06Barry Ritholtz?

  More recently, you wrote a story about going to someone's wedding in, I think it was India. And a bunch of people got food poisoning. And it was hilarious.

• 8:16Speaker 04

  It feels a little bit like India right now in New York. It's like the air quality today as of recording is pretty similar to New Delhi.

• 8:23Barry Ritholtz?

  Those Canadian fires are amazing. You walk out, it smells like a barbecue. It's yellow.

• 8:27Speaker 04

  It's like we're microdosing New Delhi air right now. It's great. It's good stuff.

• 8:31Barry Ritholtz?

  Only without the E. coli that you described.

• 8:35Speaker 04

  Right.

• 8:36Barry Ritholtz?

  But let's, let's bring it back to your career. So, so you do this trip, you go through a couple of dozen countries, you meet people that you're still friendly with. It was really fascinating. And you get to business school. How do you adjust? How do you make that transition?

• 8:53Speaker 04

  Yeah, it was, it was interesting. Like I, in the back of my head, I kind of knew I had this start date moving to New York in August of 2022. So I eventually quit my previous job, first job out of college in August 21. I was kind of like, all right, let's spend a year and just have as much fun as physically possible, knowing that, that we're going to go to grad school, then we'll do our career in New York and yada, yada, yada. It was, it was funny because it was at first weird, like be, like I spent basically a full year out of the country, jumping around a lot. And then you're in New York and you have like a home base and you have a, business school is not a particularly strenuous thing, but you do have a set schedule where you have classes and stuff. I loved it though. I mean, I love, I love Columbia.

• 9:37Speaker 04

  Honestly, I love New York in general, best city in the world, particularly in your twenties. And it took a couple of months to really get in the flow of like living here, and then also like you're meeting hundreds of new people like that. But actually getting integrated, not hard. It felt like a perfect fit.

• 9:55Barry Ritholtz?

  Really, really interesting. So I'm curious, you learn a lot of things in both your office career or remote work from home career and business school. What did you learn about finance, money, time while you were traveling?

• 10:12Speaker 04

  I mean, the, the, the biggest thing that really jumped out was, it's something I write about a lot in the book. Like the, I call it the stage specificity of life, but by that, I mean that it's, it's pretty easy to conceptualize money. Like when you're taught from like in high school, how money compounds over time, if you invest it and it's, you know, you should be frugal and save up money. But what, what you miss is like, what's the optimal time to spend that money on different things? And the, the example that I give a lot is like, I was 24 and like sleeping in a bunk bed in a hostel with 12 roommates or whatever. And it was actually just a hilarious setup. Like it's just a bunch of nonsense.

• 10:51Speaker 04

  You have a French guy here and then like a Mexican girl here and it's like half the, a lot of the dorms are coed and it's like, it's like summer camp for like young adults. But then occasionally you meet somebody in their like early thirties, staying in the same hostel. And it's like, you can almost tell that they noticed they're like probably six or seven years too late to have done that type of trip. And like the, the biggest takeaway from traveling was like, if I really wanted to do this trip, this was the like, this was the right window to do this. Like I optimized like that phase of my life correctly for somebody who wanted to do that type of thing. And that's kind of what stuck with me the most after is not just being aware of what you want to get out of life, but like, what things have deadlines where like, if that window of opportunity closes,

• 11:36Speaker 04

  you're just not going to be able to maximize your like fulfillment or enjoyment or like utility from that experience. Like every, basically everything you do in life has a, an expiration date for when you would enjoy the most.

• 11:47Barry Ritholtz?

  You can, you can go cheap and cheerful in your twenties, maybe even early thirties, but not much past that.

• 11:53Speaker 04

  Correct.

• 11:53Barry Ritholtz?

  So, so you were also writing before the trip and during the trip. Tell us a little bit about your experience, what you discovered about yourself as you're writing and why you thought that might be a career path.

• 12:06Speaker 04

  So like hilariously, when I was doing the whole SPAC trading thing in 2020 and 2021, I had a burner Reddit account. Called Barmellos Anthony. It's a play on words on Carmelo Anthony and Xanax bars. It was my name in my college group. We, we all had edgy, like drug related, famous person combination names. I was writing so much stuff about like, oh, like Apollo changed the background header of their website from oil rigs to windmills. I think they're going to take an EV company public through a SPAC and then they announce a deal with Fisker Automotive three weeks later. It was like borderline conspiracy theory stuff, but a lot of it worked. Yeah. So I like, always liked just writing about like stuff I was seeing going on in markets.

• 12:50Speaker 04

  And then when I was, when I was traveling, I tried to get hired by the Morning Brew, um, the Hustle, a few different like kind of upstart ish media companies. Nobody would hire me for lack of like professional writing experience. So I just started writing, like I just launched a Substack and started writing a newsletter and it was like half investing in finance and half travel blog. Like detailing everything I was doing day to day, who I was meeting. And I just enjoyed it. Like it's writing something I've always found fun. I've always found it a bit cathartic, like putting your thoughts on paper. And it's a good, um, I don't know. I, I think it's like a good exercise for anybody to really like distill what you think about a thing is try to sit down and put pen on paper. So.

• 13:33Barry Ritholtz?

  Daniel Borstin, the librarian of Congress's famous quote, I write to figure out what I think.

• 13:38Speaker 04

  Yep.

• 13:39Barry Ritholtz?

  And besides that, at that hour, the bars were all closed.

• 13:42Speaker 04

  Yep.

• 13:42Barry Ritholtz?

  So you know, until you put it down, until you put pens to paper or fingers to keyboard, it's sort of nebulous and, and not distinct. Once you write it, there it is in black and white.

• 13:54Speaker 04

  Yeah. Yeah.

• 13:55Barry Ritholtz?

  So for, for sure. Um, so you, you come out of Columbia. What's the first gig you, you're doing while you're, while you're a new grad?

• 14:04Speaker 04

  So, so to step back a little bit, when I was still in business school, I kind of had this like, I think investing and financial markets are interesting. I really like writing. I had like monetized my newsletter fairly well, selling ads. And I was kind of trying to figure out which way I wanted to lean with it. And then I had some publishers who were like loosely interested in me maybe writing a book. So I wanted to leave the book writing door open and I interned for a venture capital fund called Red Point Ventures. Uh, my first year, helping them with like building up a newsletter and like editorial strategy and all that stuff. It was like, loved the team there. It was great. My takeaway from that was I should either like go do media

• 14:45Speaker 04

  or I should like push you get in like an investing seat somewhere, not split the middle and do like the marketing arm of an investment group. So going into my second year, um, Sam Rowe, you know, friend of the show. He was like contracted by Robinhood to help them with the hiring for, uh, they were building out a media subsidiary called Sherwood News. We grabbed coffee and he was like, I don't know what your plan is after business school. I think you'd be a good fit with what they're building here. And he started telling me about it and it checked a lot of boxes of like, on one hand, it was kind of an upstart new media thing with like, I would have a lot of autonomy. On the other hand, we were surrounded by the structure of like a big fintech company. So like media is a tough business these days. And like, there was a lot more stability there from like financial backing.

• 15:31Barry Ritholtz?

  Tell me about having a, a media outlet attached to a large fintech or data services company.

• 15:37Speaker 04

  The, the entire pitch was just trying to like basically make a new age Bloomberg, to tell you the truth.

• 15:42Barry Ritholtz?

  Did, did you guys get any hood, uh, stock?

• 15:45Speaker 04

  Yeah. Yeah. Yeah.

• 15:46Barry Ritholtz?

  So not terrible.

• 15:47Speaker 04

  Not terrible. I mean, the issue is I only worked there for a year. So it's not like I got that much, but like it, yeah, like I, I wish I would have, I wish I would have gotten more. And I wish I would have stayed longer had I gotten more is, um, the takeaway from that. But yeah, I ended up, I ended up joining them during my second year. I signed the book deal for that book the summer after I graduated. So about two years ago now. And then I was sitting there and I just like, everything was fine, but I realized after working in a like more structured media environment. I actually like, like, I like writing a blog. I like kind of free range, putting stuff on the internet. But like, I didn't like the actual, like, like call it nine to five employed version of like financial media.

• 16:27Speaker 04

  And my, like, it kind of clicked in my head that when I was at that point of investing thing versus like media, I actually probably should have gone investing track. But I was so hyper focused on like, I don't want to kill potential book deal momentum and this and that, that I took the other one. And I had like a total career panic, like two, almost two, almost two years ago, like fall of 24.

• 16:49Barry Ritholtz?

  And, and there is something to be said about the daily beast that must be fed when you're on a, a regular deadline like that.

• 16:56Speaker 04

  It's tough.

• 16:57Barry Ritholtz?

  Yeah, no, it's brutal. And it's why there's so much content that's so useless because hey, there are minutes and hours to fill and column inches and the infinite more of the internet. I mean, it just never stops. So that's why we have this fire hose. So, so you had done, um, Young Money as a Substack. You had done Sherwood for Robinhood. Uh, I'm kind of fascinated by an essay you did, how I lost a hundred and $50,000 in a day trading SPACs.

• 17:30Speaker 04

  Yep.

• 17:31Barry Ritholtz?

  Way back in, in 21. Uh, tell us about your ramp up in the SPAC world and then the blow up.

• 17:37Speaker 04

  Oh, it was, I mean, it was awesome. Like, like I, like I, I was, I don't know. If you would have checked my like pulse or stress levels at that point, they were through the roof, but like, it was crazy. So it's like, right when the pandemic hit, I thought I was like the next Michael Burry. I had like $10,000 in my checking account, threw it all in spy puts. They tripled because obviously the market was going to take. And I was like, yeah, I'm him. And then, you know, Bill Ackman, a week later was like crying on CNBC, say the world's going to hell. And I was like, S and P's going to like a thousand. Let's do it again. Let's buy more puts. You know, I actually, having not really been an adult during oh eight, I completely underestimated like the Fed and quantitative easing and how that could work.

• 18:21Barry Ritholtz?

  And how fast that turn is.

• 18:22Speaker 04

  Like I, my face got melted off. I shorted the actual bottom. And then I basically round tripped $10,000 to 30, back to 10. I had my tail tucked between my legs. I was like, I'm never trading a stock again.

• 18:33Barry Ritholtz?

  Did you, um, ever feel the need to reach over the wastepaper basket and throw up?

• 18:37Speaker 04

  No, but like, if it had been bigger numbers, maybe. So I'm like, I'm never going to trade stocks again. I put $6,000 and I opened like a Roth IRA, do my one contribution first year as a, you know, adult working. And I don't look at it for a month. And then in May, uh, my friend Jake, buddy from undergrad was like, do you know what a SPAC is? And I say, no. And he's like, well, if you buy this desert eagle SPAC, it'll turn into DraftKings stock in like two months. And I was like, this was like, like an IPO. And he's like, I don't know, dude. I just saw on the internet, if I buy this, you own DraftKings. And I was like, okay. I went down the rabbit hole and was looking at it and it's like.

• 19:14Barry Ritholtz?

  And it's at par. It's it's before it comes out. Was it trading at twenty five or did it trade up?

• 19:19Speaker 04

  It was trading, so the the the par on most SPACs is like ten dollars. It was trading at like twelve or thirteen.

• 19:26Barry Ritholtz?

  Oh, really?

• 19:27Speaker 04

  Maybe fifteen, but the warrants had like doubled or tripled, right? Because all the warrants have a strike price of eleven fifty. So then I had like traded options enough. I understood like strike prices, expiration dates, whatever. And the thing that jumped out was that warrants don't expire for five years and they have an eleven fifty strike price. So I was doing the math and I I watched DraftKings after the merger happened. It ran up to twenty. The warrants ran up to eight or nine dollars. You would have doubled on the stock. You would have made like nine X on the warrants if you'd bought them at a dollar, like at peak pandemic collapse. So I was like, okay.

• 19:59Barry Ritholtz?

  Hey, this is easy.

• 20:00Speaker 04

  Well, I was just like, SPACs obviously kind of seem like a bubble right now because there'd been like Nikolai Motors had announced a SPAC and there were a couple of others. And I was just like, I bet that this thing is gonna like, this is just gonna be a game for a little while. And if I can just pick SPAC warrants early, I bet I can make money. So Nikolai warrants are trading at three dollars. I bought six thousand dollars worth. I made like twelve grand a couple of weeks later. And then I just kept rinsing and repeating SPAC warrants. And like six months later, I got from six grand to a hundred fifty grand. And I was like, this is so easy. So then I.

• 20:31Barry Ritholtz?

  By the way, that that should immediately set bells off.

• 20:36Speaker 04

  I doubled down, though. It didn't set off any bells because then I was like, okay, it did set off one bell. I was like, warrants are risky. And if any of these deals collapses, the warrants go to zero. I should start buying the shares as close to NAV as possible. So I was in like a online Discord chat with a lot of other anonymous people. We built some web scrapers that would pull every SPAC SEC filing. So as soon as a filing hit the press, like trading halts when news comes out for SPAC, I would get a push notification, open up the deck, skim it. If it was electric vehicles, marijuana, outer space, sports betting, or renewable energy, I would go all in unless the unless the like valuation of the deal was just egregious, I would go all in.

• 21:19Speaker 04

  And I knew that the stock would probably pop like at least thirty or forty percent because they just did every time. So you get in an eleven, your max loss is probably like five percent on any trade. And you sell at fourteen or fifteen. So you're basically risking five percent to make forty percent.

• 21:34Barry Ritholtz?

  Asymmetrical risk reward. That's what you want.

• 21:36Speaker 04

  And I did that like seven times in a row. And then I went from one fifty to four hundred. And like I'd only risk on any given trade, like five percent of my portfolio. And they didn't all hit, but like enough did that it didn't matter. And my dad, obviously, I kept telling him what I was doing. And I hit like, it was February twenty twenty one. And he called me and he was like, you should probably just sell and just put it in like an index fund. And I was like, I can do this two more times. I'll have a million dollars at twenty four. I'm pretty sure I can get there. That that should have been the scream.

• 22:05Barry Ritholtz?

  There's the the bell ringing.

• 22:06Speaker 04

  That. And then when he and his brother were talking to me about potentially managing some of our family's money, you shouldn't have your twenty four year old kid. He just made six thousand percent trading SPACs, touching your grandparents like retirement money. I did not. Thankfully, I said, I don't feel comfortable doing that. I'm okay. I I was self aware enough to know that that would have been a bad idea. So getting to how I lose the money. At this point, way too many SPACs. Shaquille O'Neal has a SPAC. Paul Ryan has a SPAC. Like, everybody and their mother has a SPAC. And the bubble didn't pop. It just stopped bubbling because there there was kind of this pool of money that was chasing every hot SPAC. And then when there's like a hundred of them on the market, somebody announces a deal, the terms are getting worse and worse and the value.

• 22:46Barry Ritholtz?

  You're watching this decay in real time.

• 22:48Speaker 04

  Yeah. And it was like by April, May of that year, it's getting tougher. And like, a deal to get announced might jump ten percent. But you're just, I was like, I was addicted to the rush. So there was a buy now, pay later company called Catapult. Eighty percent of the revenue came from Wayfair, obviously a pandemic darling. And this is at the time when Square bought Afterpay for like thirty billion dollars, crazy price. A firm went public at like a thirty billion dollar valuation. And like these companies were growing slower than Catapult because Catapult was just a derivative of Wayfair, which is a pandemic darling. They were less profitable. And I was just like, Catapult's gonna have their earnings in August.

• 23:26Speaker 04

  They've had no sell side coverage. I just need like one analyst from like Morgan Stanley or whatever to to initiate like a buy. The stock's gonna double. I'm gonna buy a bunch of warrants at like a dollar fifty. They're gonna rip. And then this thing, I'm gonna make a million dollars on this trade. This thing had already gone public through a SPAC. Like, there was no floor. That deal was closed. It's just a normal company.

• 23:45Barry Ritholtz?

  So not your traditional SPAC trades that you've been doing before.

• 23:48Speaker 04

  It it had gone public through a SPAC and it's just like a normal company at this point. And I I just ate into it with like three hundred. I think I had like three hundred thirty thousand dollars at that point, just went all in. And it started like inching down and spiked back up, leading up to earnings. Like, I had four different times I could have gone out with like a ten percent loss. And I was just like, I was just pot committed. So like, this is gonna be the millionaire trade. They missed earnings so badly, the stock fell. I think the stock fell twenty percent before market opened on like August eleventh. And the warrants immediately got cut in half by like fifty percent.

• 24:21Barry Ritholtz?

  And that's a hundred and fifty grand.

• 24:22Speaker 04

  Yeah. And I'm just, I'm looking at it and I'm looking at the like level two trading data. And there's there's a big buy for like, like a hundred thousand warrants at a dollar or whatever. And then there's the floor collapses under and I was like, huh, I'm just gonna like, I'm just gonna sell to that entire bid and just eat it. And like, I'm getting out before like the whole thing gets rug pulled, which was the right move. Because I basically liquidated my position pre-market, went from like three hundred thousand dollars, like a hundred fifty or whatever. And I was just like, man, that sucks. Put it in the S and P and then just went to the gym and worked out for like real self loathing workout for like three hours.

• 24:59Barry Ritholtz?

  You know, that that sort of big whackage is a rite of passage of anybody that's ever worked on a trading desk. I don't care if you're at you're at Jane Street or if you're day trading from home. Those losses are just so seminal and so instructive and focus you on, hey, what's my risk management? What's my edge here? What am I really doing? Swinging for the fences? Am I really putting fifty or a hundred percent of my portfolio into one trade? That seems kind of like you you you could read that in a book, but until you've lived it, it's really challenging.

• 25:35Speaker 04

  The issue for me was like the the plan I had initially of like buy SPACs near NAV, sell when they pump, was like a good strategy. And if I'd stuck with that, even if it stopped working, it's like, okay.

• 25:46Barry Ritholtz?

  The downside is de minimis.

• 25:47Speaker 04

  We we made a bunch of money. This trade doesn't work. Just like park in the index fund until if you want. Yeah. And then like either come up with something new or just stop. The issue was I was so used to number going up. I was kind of willing to bet the house on doing it one more time. Then I I'm confident if I'd hit a million, I would have walked away. But that was just like a benchmark number.

• 26:05Barry Ritholtz?

  Oh, you should know that when you hit a million, you would not have walked away. Junkies don't say one more hit. And gamblers don't say, I just need this parlay to come in.

• 26:15Speaker 04

  Right.

• 26:15Barry Ritholtz?

  And then I'm good because you're always looking for the for the dopamine hit, for the adrenaline.

• 26:21Speaker 04

  I would have found something else to to speculate on. But I think I would have stopped trading SPACs had that happened.

• 26:26Barry Ritholtz?

  Coming up, we continue our conversation with Jack Rains discussing slow ventures and investing in creators. I'm Barry Ritholtz. You're listening to Masters in Business on Bloomberg Radio.

• 26:40Speaker 00

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• 27:13Speaker 01

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• 27:56Speaker 05

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• 28:24Speaker 06

  If you like YouTube, you'll love YouTube Premium. Hi, I'm Sean Evans from Hot Ones and I want to tell you about YouTube Premium. It has offline downloads, so you can watch without Wi-Fi. Background play, so you can lock your phone and it still plays, baby. Oh, and it is completely ad-free. Yes, I said it, ad-free. Try YouTube Premium for two months free at youtube.com/premium. Trial eligibility varies, terms apply, cancel anytime.

• 28:55Barry Ritholtz?

  I'm Barry Ritholtz, you're listening to Masters in Business on Bloomberg Radio. My somewhat special guest, is that how you want to be? Is that how you describe yourself?

• 29:05Speaker 04

  I'd say marginally special.

• 29:06Barry Ritholtz?

  My marginally special guest, Jack Rains, is here. He is an associate at the venture capital firm Slow Ventures and the author of the book, Young Money, which we'll get to in a few minutes. So I'm kind of fascinated how you pivoted into VC work. You joined Slow Ventures in San Francisco.

• 29:27Speaker 04

  Yep.

• 29:27Barry Ritholtz?

  From New York.

• 29:29Speaker 04

  Yep.

• 29:29Barry Ritholtz?

  Did you relocate to San Francisco and then come back to New York?

• 29:33Speaker 04

  Yep.

• 29:33Barry Ritholtz?

  So I kind of get the sense you're bi-coastal.

• 29:36Speaker 04

  I try to, I try to, I try to make it look bi-coastal occasionally on Twitter. No, I mean, the funny thing was they were hiring in New York and San Francisco and I applied for the New York job. I met with the partner in New York first and then the, one of the GPs in San Francisco, Sam Lessin, I got introduced to him by the guy in New York and we're on a Zoom call. He'd like just come from the gym, super sweaty and like disheveled looking and five minutes in.

• 30:01Barry Ritholtz?

  Are you allowed to say that? Is he okay with that?

• 30:03Speaker 04

  I think he would agree with it. Five minutes, five minutes into the call, he's like, what do you think of San Francisco? And I said, fentanyl and homeless people. And he was like, it's a crazy answer for somebody applying to a job in San Francisco. And I was just like, I didn't, like, I applied for the job in New York and he was just kind of like, well, I thought I was interviewing you for an SF seat and I was just like, he told me to like, take a beat and like, think about it. And I, I can't remember if I told him on the call or just texted him right after, but I was like, honestly dude, I mean, I want the job, so I didn't know this is what I was applying for, but if you hire me, I'll move to San Francisco. And he was like, have you ever visited? And I said, no, so.

• 30:41Barry Ritholtz?

  But I've been to 25 other countries and 50 other cities. I'm sure I can figure it out.

• 30:46Speaker 04

  Yeah. The only difference is San Francisco has so many more AI startup advertisements on the billboards and they have Waymos, which are awesome. But yeah, like I, I mean, I.

• 30:56Barry Ritholtz?

  And they are everywhere. We were just in San Francisco a few months ago.

• 30:59Speaker 04

  They're so sick.

• 31:00Barry Ritholtz?

  They, they're like yellow cabs in New York.

• 31:03Speaker 04

  Yeah, yeah, they're, they're incredible. I mean, the worst thing about New York is that we keep trying to like block Waymos. Let it happen. I'm, I'm so pro Waymo, I'm like Waymo's biggest fanboy. But yeah, like going back to fall 2024, I was in this real like kind of career panic. I want to get out of media and like, I was like, I should have gone down the investing route. And then, you know, it's like a step back and I had like, signed that book deal. I was like, okay, I'm going to have to write a book, I'm going to have to be able to market it. So that means I need to look at jobs where I can still have like bandwidth and flexibility to do so, which like eliminates a lot of investing-y stuff where there's compliance issues.

• 31:38Barry Ritholtz?

  No investment banking, no, no trading on a desk and no portfolio management or even CFA analysts where whatever you do is disclosable and, and requires approval and it's complex.

• 31:54Speaker 04

  But venture capital is like the biggest, like build your personal brand, like content helps you source deals. So I kind of honed in on, and I didn't have like an investment banking background. VC is more open to non-traditional investing backgrounds. It just kind of made sense and I had a decent network in that space from like Twitter and writing and all this stuff. So I just kind of started pounding the pavement, like reaching out to VCs I knew in my network that may or may not be hiring and Slow happened to be hiring and I messaged, hilariously, I messaged Yoni, the partner in New York on Blue Sky. That was back when everybody thought Twitter was going to die and Blue Sky was the thing.

• 32:27Barry Ritholtz?

  Blue Sky didn't take off, but it does feel like Twitter is kind of ground to a, a shell of what it used to be.

• 32:33Speaker 04

  I think it's starting to come back as of like a month ago.

• 32:35Barry Ritholtz?

  Oh, really?

• 32:36Speaker 04

  It feels like they changed the algorithm where you can like see your mutuals again. So people I actually care about. Yeah, literally last week, Nikita Beer tweeted, they tweaked the algo, so like you're seeing your mutual followers. And I was like, dude, that's what it should have been the whole time.

• 32:48Barry Ritholtz?

  Right.

• 32:49Speaker 04

  But anyway, I basically got hired from a Twitter DM and then a last second flight to San Francisco.

• 32:55Barry Ritholtz?

  Six weeks from application to starting in SF.

• 32:59Speaker 04

  Basically, yeah. Like I'm, I didn't know where to live. I went on the Facebook Marketplace, found some dude with an open room and just hopped on a FaceTime with him and I was just like, yeah, like I guess I'll just take the other half of your apartment. And then I moved there. That was, I just put my stuff in a suitcase and just flew out.

• 33:15Barry Ritholtz?

  So are you New York based today?

• 33:17Speaker 04

  I live in New York now. I moved back here a few months ago.

• 33:19Barry Ritholtz?

  All right. And, and how do you, how do you work that out if your core office is San Francisco?

• 33:25Speaker 04

  So we have an office in New York too, Flatiron, so 20th and 5th. It was one of those things where we were pretty async in San Francisco. Like we, we have an office in downtown SF. I was going in probably four days a week. So like some people were going in a lot. My boss lived in suburbs a little bit. He would come up sometimes, but I would like take the Caltrain down to like Hillsborough area and like go to his place, like work from his pool house with him. It was a funny setup. But it was like, we were async enough and I also knew that like long-term I was going to want to live in New York. I just pitched them on moving back and then flying out to San Francisco like every three weeks or so, and that's the setup I have now.

• 34:04Barry Ritholtz?

  New York has a pretty robust technology sector. I mean, we all think of, of San Francisco for AI, computer, mobile tech and Boston for healthcare tech. Where does New York land in that, in that list?

• 34:20Speaker 04

  It's, it's incre, I would, I would put New York as the like.

• 34:24Barry Ritholtz?

  Pretty fast rising, right?

• 34:25Speaker 04

  On, for like consumer tech, I would argue it's like number one or close to it.

• 34:29Barry Ritholtz?

  Well, you got a big Google office here, you got a big Microsoft office here, you got a giant Amazon office here.

• 34:34Speaker 04

  Well, and like Anthropic's opening like a 16,000 square foot, like they're opening a massive office in Hudson Square, like you're.

• 34:41Barry Ritholtz?

  There's some space there.

• 34:42Speaker 04

  A lot of like, a lot of, a lot of what keeps happening is like all these AI companies start there and then as they move into like bigger and bigger like enterprise, commercial business, they expand to the East Coast. And like, there's a lot of like sales teams on the East Coast and engineering talent on the West Coast. New York's also like a more social outgoing city where a lot of the like, like sales and go-to-market people would prefer to live here. San Francisco's more insular and it's like, there's just engineering talent from like Stanford, Berkeley, whatever, that aggregates around the Bay. So it's, it's honestly a big part of like engineers end up on the West Coast and then a lot of the salespeople end up on the East Coast. A lot of the customers are also on the East Coast.

• 35:20Barry Ritholtz?

  Really interesting. All right. So I got to start with a few quotes of yours and we'll, we'll plow through a lot of that. One of the things though, that, that you said, a quote of yours, junior investing jobs at VC megaphons are really just cold calling.

• 35:39Speaker 04

  Yeah.

• 35:40Barry Ritholtz?

  I, I don't think of VC in those terms. Explain, like are you really just smiling and dialing?

• 35:46Speaker 04

  Like a little bit, it's funny. Like, I don't know if you read Bill Gurley's new book, Running Out of Dreams. So he, he said something similar where venture capital is 90% sales and it really is like.

• 35:55Barry Ritholtz?

  But that's true about everything in finance. And I don't know about outside, but everything in this space is you're ultimately asking someone to trust you and give you their business.

• 36:06Speaker 04

  Yep, yep, yep. VC, especially at the big, I guess like Slow is a fairly small fund, right? Like we have like total teams, like 15 or 16 people, investment teams, like nine or 10 people. But like some of the bigger funds, like I have some buddies that have worked at the like, call it some combination of like the general catalyst type, A16Z type, whatever. It's just a machine or like inside is like this too, where like you are managing just like tens of billions of dollars or whatever. And there's so much coverage that it's, I was a little tongue-in-cheek saying that it's like cold calling, but it is very much like you need to be talking to like X number of people and there's like metric hurdles on like touchpoints and stuff.

• 36:49Speaker 04

  Like it's not that there's no discernment or anything like that, but it's a volume game.

• 36:54Barry Ritholtz?

  And they really do try and quantify it and, and turn it into.

• 36:59Speaker 04

  Yeah, it's like you, the, the name of the game is you don't want to miss anything that could be something, therefore like people should be pounding the pavement, making touchpoints with anybody who could be starting an early-stage tech company.

• 37:09Barry Ritholtz?

  Now Slow Ventures kind of famously avoids the trendy hot stuff. No robots, no AI foundation models. What are you looking at, at work? That's kind of interesting. What do you guys get to see that most people are overlooking?

• 37:26Speaker 04

  So it's funny, we actually, we actually just announced one that's like robot-y, doing like, like warehouses and fulfillment for e-commerce companies called Satronic. So we do occasionally touch, they don't make robots.

• 37:39Barry Ritholtz?

  You're not doing the human form robots.

• 37:40Speaker 04

  Right, right. We're not doing any of the stuff that gets clowned on Twitter because they can't fold clothes or do dishes right. I mean, it's, we're like broadly generalist, we've done everything from like, we've done, just to name some companies over the last 10 or 12 years, like Robinhood, Slack, Allbirds, before they pivoted to being an AI GPU company back when they sold footwear. I mean, we have like a hilarious one, Memelords Technology, where it's basically a software platform, it's like a, basically a marketing tool platform, but for creating memes. I mean, we'll, we'll do a little bit of everything. We've done crypto stuff, we've done, we have done some like vertical AI stuff. We just like making our calling card, we're not chasing the AI hype.

• 38:22Speaker 04

  The way that we broadly think about it is there's a lot of VC deals that are trades that are now marked up a lot, but like, do they have terminal value and would they get supported in public markets? You don't know. And a lot of early-stage investors that have played those and then sold when bigger funds come in at the multi-billion dollar valuations and made a lot of money. So like you could argue, we should have played that trading game. The, the bet that we're making is like, go for the stuff that's going to compound long-term value that could be like a standalone valuable entity.

• 38:53Barry Ritholtz?

  How does the? Sort of dearth of IPOs, although we're in the middle of a period where there are suddenly a spade of them coming out, and more and more companies choosing to stay private for longer. How does that figure into the VC calculus of, hey, we eventually want an exit and we can't rely on someone else, either from a bigger firm taking this over, or some M and A to give us an exit?

• 39:19Speaker 04

  It's interesting. I almost think you have to put VC in two buckets at this point, where you have like, we play at the really early stage, which also gives you like, a lot more opportunities for exits, whether you sell stakes to like, a later-stage, bigger growth, like a bigger growth investor, once they're in the unicorn status, or you have the acquisition or IPO. If you're getting in a company that's worth 20 or 30 million dollars, there's just like a lot of ways you can get paid on that, versus you have companies like, like Thrive is probably the most famous one, where they manage like, 50 billion dollars now, they own a massive slug of OpenAI, like, they take really big bets in companies that are like, it's worth 10 billion or 100 billion, we think it can be worth 100 billion or a trillion.

• 40:00Speaker 04

  So, for us, we have a lot more flexibility on exits, which is like, good, because we can be more nimble.

• 40:05Barry Ritholtz?

  You're primarily seed in A rounds, but you're not doing B rounds, or?

• 40:10Speaker 04

  We occasionally will with follow-on capital, but it's like, 95% seed in A, so that's like, that's our sweet spot. And then, so I think for funds like that, I think people, like, a lot of early-stage funds should get more creative, where can you exit into a big growth fund coming in at like, a $5 billion valuation from portfolio construction? Maybe you should. With the mega funds, it's like, okay, if you're gonna do that, you can't really index all of the like, 5 or 10 billion dollar unicorns, because a lot of those, those paper marks would never get support in the public markets. But, like, Thrive going really deep on OpenAI, or Spark Capital going really deep on Anthropic,

• 40:51Speaker 04

  those are gonna go out at potentially trillion dollar valuations, like, the math works, if you invest 40 billion dollars across a few big funds in something at like, a 200 billion dollar valuation, and you get a 4X or 5X, you're returning like, tens of billions of dollars, right? So, it's like, at the early stage, should probably be looking to sell into some, some of those later-stage companies coming in. At the later stage, it's like, stock picking, you're basically running, you have to run a concentrated book of like, there might be three or four private companies at any time, like SpaceX, OpenAI, Anthropic, that could go out at a multi-hundred billion dollar valuation. You have to be concentrated in those, otherwise, the math isn't gonna work. If you get those right, you can like, 2X, 3X a fund, if you don't, you won't.

• 41:34Barry Ritholtz?

  Really kinda interesting. You come out of the creator economy, Slow Ventures has been a player in that space. How does, how does your experience help you as a VC? And, and what does Slow Ventures see in that space that, you know, the traditional venture capitalists overlook?

• 41:55Speaker 04

  So to give like, a little more color on that, we have, we have a separate fund we raised a year ago, called our Creator Fund, where 64 million dollars, we invest directly in creators, meaning like, YouTubers, podcasters, could be newsletter writers. Our bet on that is that like, distribution compared to like, technical abilities is getting increasingly valuable, where, for two things, one, it's easier to build stuff, like software, because of AI coding assistance, two, the internet is so loud now, that having like, a cylinder of trust from your audience, gives you a massive selling advantage, because it's so much harder to get attention with like, paid ads and growth hacks and all this, that we, we have this, and like, Sam, my boss, was, kinda came up with this idea a

• 42:39Speaker 04

  few years ago, that like, he calls it, almost investing in cults, but people who have a true like, cult of personality, and are a subject matter expert in a particular theme or vertical, have a massive advantage on like, marketing and selling. So, we raised a fund where we literally invest in creators like, holding companies, where any businesses they build, like, off their platform, that leverage their brand and platform and all this stuff.

• 43:04Barry Ritholtz?

  These are 360 deals, covers everything that person does?

• 43:06Speaker 04

  Yeah, yeah.

• 43:07Barry Ritholtz?

  So it could be a podcast, could be Substack, could be all of those.

• 43:10Speaker 04

  Yeah, and like, we aren't really that interested in like, how money they make from like, ad revenue, or like, platform revenue, or whatever, it's more so, for example, the first deal we did was with this woodworking creator named Jonathan Katz Moses, and he has a, like, he has a massive YouTube channel, he's basically?

• 43:26Barry Ritholtz?

  I know that show, it is shockingly intriguing, watching this guy build stuff from scratch.

• 43:33Speaker 04

  Yeah, he's like-

• 43:34Barry Ritholtz?

  It's relaxing, too.

• 43:35Speaker 04

  Yeah, he's a super compelling guy, incredibly talented, and he's equally good as both a content creator and as an entrepreneur, like, he has a business that's like, making like, millions of dollars in revenue.

• 43:45Barry Ritholtz?

  So he builds various things and sells them, but also generates revenue from the YouTube channel?

• 43:53Speaker 04

  Right, and he, it's like, specifically has like, a tool line called KM Tools, and like, we invested money in like, his holding company, and that can go toward like, hiring people to help with like, the content development, editing, content creation, so we can, like, increase the velocity of putting out YouTube videos, also like, more people to help rolling out new products and a wider product suite of tools. So the bet is that like, you put money in that, and maybe like, the tool business really blows up, and then, a like, Black and Decker type of company acquires it, or maybe he launches like, another business vertical off his platform that we have exposure to. So it's, but his whole thing is like, woodworking, woodworkers, he'll go to like, a woodworking festival in Texas, people will come out, like, to come like, get him to like, sign their autographs, like, he, he just has a lot of clout in that space.

• 44:38Speaker 04

  So, finding people like that in different verticals, that we think have like, really compelling opportunities to scale big businesses through that vertical and that audience, is like, interesting, and historically, people have been very hesitant to back creators, or, they back like, one business, like, Mr. Beast has a bunch of different businesses. If you back Beast Burgers, didn't really work that well.

• 45:00Barry Ritholtz?

  Right.

• 45:01Speaker 04

  If you were backing Mr. Beast as a whole, like, Jimmy's entire empire is worth like, a billion dollars or whatever, so, you wanna be like, aligned, where if they wanna change their focus, like, our capital's still aligned with that, like, you don't think this, this experiment's working, move to this one.

• 45:15Barry Ritholtz?

  And, I think it's called CDC, if you haven't seen these computer-controlled woodworking lathes and carves, and, they're just astonishing to people, like, you think of carpentry as kinda old school, it is not.

• 45:30Speaker 04

  Yep.

• 45:31Barry Ritholtz?

  It's really fascinating. Coming up, we continue our conversation with Jack Rains, discussing his new book, Young Money, A Field Guide to Wealth and Purpose in Your 20s. I'm Barry Ritholtz, you're listening to Masters in Business on Bloomberg Radio.

• 45:49Speaker 01

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• 46:31Speaker 05

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• 46:58Speaker 06

  If you like YouTube, you'll love YouTube Premium. Hi, I'm Sean Evans from Hot Ones, and I wanna tell you about YouTube Premium. It has offline downloads, so you can watch without Wi-Fi. Background play, so you can lock your phone, and it still plays, baby. Oh, and it is completely ad-free. Yes, I said it, ad-free. Try YouTube Premium for two months free at youtube.com/premium. Trial eligibility varies, terms apply, cancel anytime.

• 47:32Speaker 07

  If you enjoy Bloomberg podcasts, you'll love listening to Bloomberg 991 FM in the DMV. Hi, this is Kaylee Lines. Here in the district, the story is always changing. From the White House and Capitol Hill to K Street, Wall Street and the Fed, Bloomberg 991 keeps you connected to the news that's driving decisions in the nation's capital and around the globe. Check us out at 991 FM or stream us anytime on the Bloomberg Business app. Bloomberg 991, the district's number one source for the news shaping our economy, our government and the world.

• 48:01Barry Ritholtz?

  I'm Barry Ritholtz. You're listening to Masters in Business on Bloomberg Radio. My pretty special guest, my kinda special guest.

• 48:11Speaker 04

  Somewhat special.

• 48:11Barry Ritholtz?

  Somewhat special guest. I'm gonna write that down. My somewhat special guest is Jack Rains. He is an associate at a venture capital firm and a author. I've been subscribed to his Substack, Young Money, for, I don't know, how many years has that been around?

• 48:27Speaker 04

  Four, five years.

• 48:29Barry Ritholtz?

  Let me know when you get to 30 and you'll be on to something.

• 48:31Speaker 04

  Yeah, yeah.

• 48:32Barry Ritholtz?

  But his new book, Young Money, A Field Guide to Wealth and Purpose in Your 20s. I was really taken by it. Not only was it a fun read, but I just, I not only laughed throughout because I just recognized, oh, I did that dumb thing. But it also is so wise beyond its years. It's hard to imagine that the guy who wrote this was 26, 27 when he wrote it.

• 49:01Speaker 04

  27, 28.

• 49:03Barry Ritholtz?

  27, 28.

• 49:04Speaker 04

  29 now.

• 49:05Barry Ritholtz?

  Last year of your 20s.

• 49:06Speaker 04

  Yeah.

• 49:06Barry Ritholtz?

  So I really found it a fun, enjoyable read about a space that I normally don't play in, Young Money, and there's so many things to talk about with this, starting with, quote, "I had considered the opportunity cost of how I was spending my time, and I adjusted my life accordingly." So you're giving the whole game away on page 13.

• 49:35Speaker 04

  Yep.

• 49:36Barry Ritholtz?

  You basically say, hey, time is finite and how and when you spend it is really important. Tell us a little bit about how you reached that insight back when you were in your early to mid 20s.

• 49:50Speaker 04

  Yep. So, I mean, we talked about the SPAC trading thing earlier, but like when I was 23, mainly 23 and a little bit 24, my life basically looked like this. It was, you roll out of bed, throw on some sweatpants, grab Chick-fil-A for breakfast, and then you're just like kinda responding to like Slack messages. You're on Zoom calls, spreadsheets, PowerPoints, and you're doing all of it from your bedroom. And it had been like that for well over a year. And then on the side, like you were over here like, you know, trading options before we jump on this. I had like my work laptop here and then I have my personal laptop here. It's like, huh, interesting. Like this SPAC just got announced. So I was, I was spending like, I was like basically fake working while just trading stocks all day. And then like in the evenings, I, you know,

• 50:33Speaker 04

  you have like your entire net worth and some speculative SPAC and you're, you can't even sleep straight. If futures tank, you think you might lose a hundred thousand dollars. And so I was almost in this like self-announced holding cell of like, I couldn't go anywhere really because of COVID and I was stuck at home. And then I was just watching screens all day. And thankfully I made some money from it, but I just became really aware around the time I was about to turn 24, that I had just spent the whole last year of my life not really doing anything, especially like, call it like personal relationships, whatever. I was probably a pretty terrible like boyfriend, friend, checked out son, grandson. Like I just wasn't like, I was not in control of how I was spending my time at all.

• 51:15Speaker 04

  I was kinda like a prisoner to like work and COVID and stock market.

• 51:21Barry Ritholtz?

  Which is kinda crazy because during the pandemic, you're no longer commuting, you're no longer on the same schedule. If, if any of us had a little more prescience, we really could have taken full control of our day.

• 51:36Speaker 04

  A hundred percent.

• 51:36Barry Ritholtz?

  Because nobody's looking over your shoulder at what you're doing. You could come and go as you want as long as you got your work done. Whenever, however, everybody was fine.

• 51:44Speaker 04

  Yep. Which is so, I mean, so the stock trading thing, I did, like that would not have been happening if I was in the office, probably, at least not as much.

• 51:52Barry Ritholtz?

  But what was fascinating as I was reading this, because I started out trading, is you nailed the phrase, you're a prisoner to the screen.

• 52:02Speaker 04

  Yep.

• 52:03Barry Ritholtz?

  You really can't leave your desktop. If you're on the desk, at least someone could watch a position for you. Hey, I gotta go leave for 10 minutes. Can you make sure this doesn't blow up on me? If it hits this, get me out. You could do that, but if you're doing this from your bedroom and you have a lot of positions on, you have no other bandwidth for anything else.

• 52:23Speaker 04

  It's just push notifications on for everything. You go to the gym, you're checking your phone every two minutes. It was just like a little bit nauseating.

• 52:30Barry Ritholtz?

  Right. And exhausting.

• 52:32Speaker 04

  Yeah. And like I honestly just felt pretty like mentally exhausted from the like always being on. And I just kind of had enough. And I also found my job pretty unfulfilling and I knew I was gonna leave it in a year. And it was just like, all of these things came to a head and I was like, okay, let's be really intentional here about like, how do I wanna spend? Like if I know I'm going to grad school in a year, like how do I actually wanna spend the next year? Is it keep going in the motions of the job that I know I'm gonna leave to go do something else? Is it like, like try to like trade back the money I just lost on that trade gone wrong? The thing I kinda wanted to do is like honestly just go have an adventure, having just been cooped up for a year and a half. And yeah, so that like, it was just like all of that came to a head and I was like, I should just,

• 53:18Speaker 04

  I mean, it's like the opening line of the book, just blow up my life and go do something crazy. And that's kinda what I did and I went to Barcelona.

• 53:25Barry Ritholtz?

  You hit the eject button. You, the concept of time comes up over and over throughout the book, both generally and specifically. One of the things you write about is defining decades differently and about the opportunity cost of your 20s. A lot of people who just buckle down and grind it out through their 20s. You say that for many people, that's a trap smart 20-somethings fall into. Discuss that.

• 53:55Speaker 04

  So I, and I think this is especially true in the like, call it hyper competitive, like New York, San Francisco, maybe like Chicago, DC areas where you're surrounded by very smart people who went to really good schools and they go into like, at least for like a early 20-something, high paying job. But you're also objectively pretty stupid. You don't know anything. You like, don't like know 22, especially guys.

• 54:19Barry Ritholtz?

  Objectively pretty stupid.

• 54:20Speaker 04

  Yeah. And, and.

• 54:22Barry Ritholtz?

  Tell me when I get to grow out of that.

• 54:24Speaker 04

  I don't know. I mean, you tell me. You're sitting there and it's like, okay, like what do I optimize for? And the obvious thing is money. And the like derivative of that is status, right? Where high paying jobs are typically higher status jobs. And I think it's, when you don't have anything else, it's like, like a North Star, you kind of go for like the like ambitious thing that will pay you well, that sounds impressive over and over again. And like, to be totally clear, there's nothing wrong with that. And that's also much better than like being a bum and not doing anything. But you almost, if you fall into that trap of like, having some expectation of what you should do without it actually being like your own original thought, like, oh, I want to go do this.

• 55:10Speaker 04

  You almost become, instead of being like the protagonist of your own life, you're just kinda like filling a preordained role. Like you're almost like an actor, right? Is how I think about it. And.

• 55:19Barry Ritholtz?

  In someone else's play.

• 55:20Speaker 04

  Right. And I think the thing, like, I think the implicit bet people are making when they do that is, I will like earn enough money and hit a level of stability where I can hit eject, which you can do, but you can't buy back the opportunities that you would have had in your 20s when you're in your like mid 30s.

• 55:41Barry Ritholtz?

  So another quote, "There's no saving time, there's no investing time, there is only spending time." And, and sentences like that is why I say this book is wise beyond its years. Because I know people who figure that out in their 50s, 60s, 70s, not in their 20s. So kudos to you for, for getting there. Tell us what, what led you to that conclusion? And, and how much did the pandemic lockdown accidentally lead to these insights?

• 56:17Speaker 04

  I think I became much more introspective, much younger, because like you just, I mean, I had roommates then. Like I just wasn't spending like that much time on a normal day to day. And like I'm a, I'm a very like sociable guy who like likes to hang out with people during the day. That gets removed and you're just in your head a lot and you become really reflective of like how you're spending your time, what you're motivated by. So it was just like this, again, I don't like, this book probably wouldn't have happened if COVID didn't happen because most of these like reflections were downstream of this whole just being like, kind of in like an isolated stage of life at a point where like you should really just be like in an office grinding.

• 56:59Speaker 04

  So I think that was a big part of it. Hilariously, I like, I mentioned like the second chapter of the book. I used to be terrified of flying and like, I'd fly all the time now. I don't care. But for some reason turbulence just like kicked my ass when I was younger. And I, I was on a flight to Colorado about a year into the pandemic for a ski trip. Plane was basically empty. It was awesome. We had a super, super turbulent takeoff and it was just bumpy from Atlanta, basically all the way to like Kansas City. And I was just sitting there thinking the whole time, we're totally gonna die. This thing's going down. We're gonna die. Like it's, I'm, I'm 23, it's over, I'm dead. And we obviously landed, I didn't die. But like, some, again, totally random, but just something about that put that thought back in my mind like,

• 57:44Speaker 04

  well, like at some point you are gonna die. And it's not like up until then I just thought I was gonna live forever. Like that's not stupid, but.

• 57:53Barry Ritholtz?

  You don't really think about that in your 20s. When most people are in their 20s, they're immortal. You're not thinking about, well, one day I'm gonna die.

• 58:01Speaker 04

  Yeah. And that became like a forcing function for like, okay, let's work backwards from, I finally got over the fear of flying, but it's like, all right, like we are, you know, we're on the clock and what do I wanna do with it? And so it was like a complete fluke from a turbulent flight, kind of forced a lot of introspection that had been bubbling under the surface for probably the prior year. I was like, all right, like I should be doing what I want with my time rather than just letting inertia kind of do its thing. And it was that like, call it like awareness and mortality that became like a forcing function for basically what I've done in the last four and a half years since then. Like be in control of your time. Don't, don't be a, don't be like a passive participant in your own life.

• 58:44Barry Ritholtz?

  The difference between money and time is that money is both infinite and fungible. Time is neither.

• 58:54Barry Ritholtz?

  This, this is a philosophical concept.

• 58:57Speaker 04

  I consider myself a bit of a philosopher.

• 58:59Barry Ritholtz?

  Okay, I, I'm with you, I'm there with you. What's your conclusion when you realize that money is both infinite and fungible?

• 59:09Speaker 04

  I think you like, need to be really aware of how much money it takes to get what you want out of life at various life stages. To your point earlier, you can kind of scrape by in your twenties, maybe early thirties and like, still enjoy yourself and the, the older you get, the more expensive it gets. Ideally, you're making more and more money over the course of your life as well. So like my conclusion on that is it's like counterintuitive financial advice, but like, young people shouldn't penny pinch so much if they have like fun, interesting stuff they want to spend the money on. The, the caveat to that is like, you should put yourself in a position where there are like, high income outcomes from that over time. But like, it's okay to be 25 and not be rich if it means like spending money on fun stuff with your friends, right?

• 59:52Barry Ritholtz?

  So you're not a fan of the FIRE movement, the early retirement movement?

• 59:58Speaker 04

  Not when it's taken to the extreme. I think that the core idea of like, having enough money saved up or like you control your own destiny is healthy and good and admirable. I think when you make the accumulation of capital to like, escape the labor force, as like an end goal, you just set yourself up to be bored. Um, and almost beyond that, when you like over optimize for FIRE and your whole thing is like, I want to opt out of work. You're probably going to hit that in your like early 40s when all of your peers are peak work. You're not going to be able to relate to anybody after a couple of years. Again, there's, there's a lot of, I think, when you take the FIRE movement too far, there's like social costs to that that are harder to see when you're looking at a spreadsheet.

• 1:00:39Speaker 04

  Um, but it's just like, and you have to forego so many things you would probably prefer to spend money on in your twenties and thirties to hit that. It's just not, I don't think you should like go into crazy debt and you should max out your 401K if you can and all this stuff, but like you just, you shouldn't pass up on life to accumulate cash to be able to opt out of another part of life, being work is kind of my take on it.

• 1:01:02Barry Ritholtz?

  No, that makes, makes a lot of sense. I love this quote. "Many of life's adventures are adventures only because you're 22 and broke and stupid, and you're surrounded by other broke, stupid 22-year-olds. This is a feature, not a flaw of being young. Lean into it."

• 1:01:20Speaker 04

  Yep.

• 1:01:21Barry Ritholtz?

  Tell us about how you, you saw that. Um, what is it about being 22 and broke and stupid that has to be embraced?

• 1:01:29Speaker 04

  So like, I, I mean, I spent that whole year of being, I guess I was technically 24, but I was with a lot of 22-year-olds who were like, this whole like hostel hopping thing is hilarious, right? Cause it's basically a bunch of kids like studying abroad. It's a bunch of people fresh out of college. It's a bunch of Europeans taking a gap year, a bunch of Americans fresh out of college. And then a bunch of like, 23 to 26-year-olds who worked for a couple of years and took a break. And you're all just like, in bunk beds. Everybody has a shared goal of like, I'm just trying to have cheap fun for a little while. And it makes every situation really, really funny. Like some guys like want to go from Sevilla, Spain to Paris and they're trying to game out like,

• 1:02:10Speaker 04

  it's $200 to fly, but if we take a train ticket and then sleep in a train station for six hours, we can get there for $12 and.

• 1:02:17Barry Ritholtz?

  And avoid a hotel room.

• 1:02:19Speaker 04

  Right, and avoid a hotel room and extend our European trip like eight more days, right? So, or you have like.

• 1:02:25Barry Ritholtz?

  And you did that, right? You went from Barcelona to, to where in Europe?

• 1:02:29Speaker 04

  I mean, I, I covered, I was there from August to December and then I went to Latin America a month later for a few months and back to Europe. And then that August to December thing, I think I went to like 19 different countries in four months. And it was just, there was no itinerary. I would just go somewhere and then I would meet some people and they would say, "Hey dude, we're going to Prague next. Do you want to come?" And I was like, "Sure." And I meet this guy in Prague, he's like, "Yo, I heard Budapest is great." I'm like, "All right." And then somebody's like, "We're going to Krakow, Poland next." I met a kid at a hostel in Krakow who pitched me on a startup in San Francisco a year ago. Like talking about weird, small world stuff, but it was just like, I went like pure optionality for a year and it was just like,

• 1:03:12Speaker 04

  anybody I meet interesting was doing something cool, I'm going to go with them. Like, "Oh, I heard Tromso, Norway. You can see the northern lights. Let's go dog sledding up there." And like, do that. So, um, the, the, the ability to just like cast a really wide net, because when like, cheap thrills are, like having to sleep on a train or like have a bunk bed with a stranger, it's just like, it's fine. Like when you're, when you're a kid, you just don't care. I, like, I'm still in my twenties now, but that would just sound awful. Like, I don't want to be in a, a room with like 12 strangers and worry about my stuff getting stolen. That sounds terrible, but.

• 1:03:44Barry Ritholtz?

  When you're 24, you got nothing to get stolen anyway, right?

• 1:03:47Speaker 04

  What are they going to take my backpack? I had a couple of XAR t-shirts and flip flops. Sick. Like I'll go play poker and win 20 bucks and go buy another one. It's fine. So, and there's versions that are playing with everything, right? Like I'm, I, I don't think everybody has to go backpack Europe, but like, you go to San Francisco and there's like 24-year-old startup founders that are sleeping in the office with a bunch of their buddies and they're having a blast. Like, they're in objectively like, horrid living conditions. They don't even notice because they're like 23 or 22 or whatever. Like you can, you can just really lean into like adverse living conditions and find them enjoyable, rather than like, they don't like take away from your life. They create really funny stories.

• 1:04:24Barry Ritholtz?

  Uh, uh, I'm always fascinated by the pursue your passion recommendation that so many people make. You say pursue your passion is terrible career advice.

• 1:04:36Speaker 04

  Yeah.

• 1:04:37Barry Ritholtz?

  Give us some color on that.

• 1:04:38Speaker 04

  So like.

• 1:04:39Barry Ritholtz?

  And, and you're giving this from someone who is pursuing their passion.

• 1:04:43Speaker 04

  So my, my like more specific take on that is you shouldn't bank your income on a thing you're passionate about. The example that I give is like, I love writing. It's a, it's a thing that like I've enjoyed. I'll do the rest of my life, whether it's books, blogs, like it's something I'll always incorporate. Um, my like initial job at a business school was columnist, podcaster, media guy, like an effectively a media startup. And I actually found it stressful where like every single day I had to like put something out. And then I also was sitting there thinking, this is draining the fun of like writing. Like I wasn't monetizing my blog. It was just a thing that I liked doing. And all of a sudden now, I don't have energy to work on that fun thing because I spend all that energy on the thing I'm paid to do.

• 1:05:24Speaker 04

  So, the issue with like chasing your passion is one, a lot of passions aren't that lucrative. Two, the second that your paycheck is dependent on you doing that thing over and over and over again, it can start feeling more like a chore than like fun. So the, the actual advice I have is like pursue stuff that you're pretty interested in, that can pay you, whether or not you're, like most jobs are boring for a lot of the time. So whether or not you're passionate about it, a thing that you're like, interested in and like have an inclination for and have some skills at, go do that for a career and then use that to like subsidize your ability to work on the fun stuff. Like I, you know, like writing, writing books and blogs is like a thing I want to do independent of the financial outcomes from it.

• 1:06:05Speaker 04

  I pivoted from media to venture capital because like I like the offshoot opportunities of investing in tech companies and that's just like a better world to be in for a career path.

• 1:06:17Barry Ritholtz?

  Last question before we get to our favorite questions that we ask all of our somewhat special guests.

• 1:06:23Speaker 04

  Somewhat special guests.

• 1:06:24Barry Ritholtz?

  How do I know I'm making the most of my time?

• 1:06:28Speaker 04

  So, the last chapter of the book is called, "Are you having fun yet?", which I think is like, I think fun is an underrated barometer that you're actually doing the right stuff with your life. Um, and it sounds silly at like first glance, but my take on it is, I think the definition of fun and what you find to be fun changes as you go through life's different stages where, when I was like 23 or 24, it was just doing dumb hostel hopping stuff and like getting drunk all the time or whatever. And it was great. Now I get drunk a lot less of the time. It's still slightly, a little bit more refined though. Um, but like, you know, once, once you get a little further in your career, like having real career success and making strides is like a, a source of like joy and personal achievement.

• 1:07:11Speaker 04

  When I was in college and playing football, like football objectively sucked, but like I, like playing college football really sucks. And anybody who's played it will tell you that, but it's like a.

• 1:07:21Barry Ritholtz?

  By the way, the description of the workout routines and the 6 a.m. wind sprints and, but, but when, you know, deep into the season, the coach tap, "Rains, get in there."

• 1:07:32Speaker 04

  Yeah, it's like, it's like incredibly like, like it's like, going from a walk on to be putting on scholarship and then like getting made team captain my senior year, like, that was a much cooler fulfilling moment than like anything I did before or after it. Like, I think it was because it was really, really hard, right? So.

• 1:07:48Barry Ritholtz?

  And a real sense of achievement.

• 1:07:50Speaker 04

  Yeah, like it was, it was a, it was a hard thing and I'd like executed on it. So, but it was fun. So my kind of definition of fun is if you like find joy in the suck, then you're probably doing the right thing. And like, that could be being like groggy and hungover like on a park bench in Spain, but you feel like you're living out an adventure. Or it could be like going after like a really ambitious career and like excelling at it. And it's, you know, I think a lot of people, as they get further in their careers, they keep chasing that ambition high off of that to the detriment of like their family or other parts of their life. I think a lot of young people like. Just start like, I, I, I think the biggest mistake you can make is like, keeping a prior version of you's like benchmark or idea of what they should be doing with their time and trying to like

• 1:08:35Speaker 04

  force apply that to a future version.

• 1:08:37Barry Ritholtz?

  You have to always evolve it over time.

• 1:08:39Speaker 04

  Trying to pull forward a future version too early in your life at the expense of the fun stuff you want to do now. And I think just having a very, very strong sense of like, what are the most important things right now that bring me fulfillment? And then going after those is the, the recipe to a good life.

• 1:08:55Barry Ritholtz?

  And the sequel to this, Find Joy in the Suck is a great.

• 1:09:00Speaker 04

  Could be.

• 1:09:00Barry Ritholtz?

  Title.

• 1:09:01Speaker 04

  Maybe I should call it middle aged money. Once I get into my like thirties and forties.

• 1:09:04Barry Ritholtz?

  You could do something every decade. You have a built in model, young money.

• 1:09:09Speaker 04

  Slightly older money.

• 1:09:10Barry Ritholtz?

  Right. Middle aged money, old man money. You got a whole run of things.

• 1:09:13Speaker 04

  Yeah.

• 1:09:13Barry Ritholtz?

  All right, let's jump to our favorite questions that I ask, um, even my somewhat special guests, starting with,

• 1:09:22Barry Ritholtz?

  you're, you're still young. Tell us about your mentors. Did anybody really help shape your career?

• 1:09:28Speaker 04

  Yeah. I mean, the, the early mentors would have been football coaches in high school and college, defensive line coach, Harold Brantley. He was the man. Like he, he was, he was actually the one who pushed me to the point that I could play in college in the first place. And then my college defensive line coach, Kenny Baker was like, I was, I came into college playing in a small private high school and thought I was the and then I got to college and just got wrecked for like a good year. And I was like really.

• 1:09:53Barry Ritholtz?

  Bigger, faster, stronger, or you just didn't know the game as well and didn't have the skills or some combination?

• 1:09:59Speaker 04

  Like, it, it was like, I, I just had to get better. It was like.

• 1:10:02Barry Ritholtz?

  Better shape, better skill.

• 1:10:04Speaker 04

  I need, I needed to get stronger and just be able to like react to the game on the field way faster. And I just wasn't, the, the processing speed and the just size weren't there yet.

• 1:10:12Barry Ritholtz?

  People don't realize that the quality of play at the college level, it, it's astounding, isn't it?

• 1:10:18Speaker 04

  We played, so we played Alabama, Little Mercy University. We played Alabama and Auburn in the same year.

• 1:10:23Barry Ritholtz?

  That's like a pro team.

• 1:10:24Speaker 04

  I like, you want to talk about seeing like, like, like.

• 1:10:27Barry Ritholtz?

  Monsters. Yeah.

• 1:10:29Speaker 04

  We almost beat Auburn. We were down seven in the fourth quarter, but Alabama, Jalen Hertz, Tua, Mac Jones, smoked us. They had Calvin Ridley, all pro receiver who briefly had a gambling problem, but he's back as their punt returner. Guess who started on the punt team was getting juke out of his shoes like 20 times because we punted so much, me. But defensive line coach Kenny Baker was like, he, I worked really hard and he gets how I did. And he was very encouraging and that like, keep the work ethic up and like you will develop, like you will catch up to the point that like, if you keep that work ethic, you'll be able to play. And he was right. By my third season, I was decent. And by my last season, I was objectively good. Like I was never going to be an all American, but I was like a starter and was like a very solid player.

• 1:11:15Speaker 04

  But I could have easily quit and transferred to Georgia and like, you know, done the fraternity thing at SEC school, which would have been short term more fun, but long term less fulfilling. So football coaches post, post school, it's funny, like especially with COVID, my early mentors were like kind of people I found through Twitter. Like I remember when I read the psychology of money, I thought it was like a very profound book and I just like, digested everything Morgan Housel published. And then a year after that, like, I remember when he followed me back on Twitter, I was flying from Sevilla, Spain to Manchester, England. I looked at my phone. I was like, oh, this is really cool. This is really cool. And then, uh, when I moved to New York, we like hung out in person at Club Funds office and like,

• 1:11:54Speaker 04

  like great guy. Um, but I would say like, as a somewhat career slash just aspirational, him and, uh, Tim Urban were like my two favorite bloggers from the kind of like.

• 1:12:07Barry Ritholtz?

  You referenced Tim Urban in, uh, the book, but I think you referenced a piece of his, and I was surprised you didn't reference the piece on optionality, the sort of chart with the black lines.

• 1:12:21Speaker 04

  Yeah. Everybody steals it on Twitter.

• 1:12:23Barry Ritholtz?

  I, I find that piece to be so interesting because, you know, one of the things about getting old is some of your optionality goes away because you don't have, hey, this is a 25 year project. Do I really have 25 years? Like, what am I going to be doing at age 90? All right. Maybe a 25 year project isn't the best thing for me.

• 1:12:45Speaker 04

  Yeah.

• 1:12:45Barry Ritholtz?

  Or at age 80, best thing for me to start. Um, but I, I, I laughed at a lot of your references because I, I'm familiar with, with many of them. They were really, really good. So, so you mentioned Morgan, any other post college mentors you want to bring up?

• 1:13:02Speaker 04

  Yeah. I mean, I like, I'd say my current boss, Sam Lessin, great guy. I mean, he's had a, he's had a very cool career, right? Like he like started a company in his twenties in Brooklyn, ends up getting acquired by Facebook, like had a successful career at Facebook. And then like co-founded the venture fund I work at now, right? And like, he's like, it's, it's funny. I feel like a lot of people in my bubble of like the late twenties have this like, is this what I want to do with my career? You kind of hit this inflection point of like, you should pick a thing that starts compounding and like, his take has always been like, you should just want to work with like really interesting, smart people you respect and like work on interesting problems. And that's a pretty good recipe for finding career fulfillment. And you know, if a couple of things go right, like financial success.

• 1:13:46Speaker 04

  But like, it's, I don't know. He, he's done like a few different things and now like has like objectively like, I like, if my lifestyle and like life is set up kind of like his in my forties, I'd be very cool with that. Like he crushes.

• 1:13:59Barry Ritholtz?

  So you mentioned, uh, Morgan's books. Um, tell us what you're reading now. What are, what are some of your favorites?

• 1:14:05Speaker 04

  So I, I just started reading this book called 1873. It's, I think it came out pretty.

• 1:14:09Barry Ritholtz?

  Ahmad?

• 1:14:10Speaker 04

  Yes.

• 1:14:11Barry Ritholtz?

  Who won the Pulitzer for, um, um, I forgot the name of the four central bankers that his first book was about.

• 1:14:21Speaker 04

  Yeah.

• 1:14:21Barry Ritholtz?

  That is literally at the top of my queue ready to go. How are you liking it?

• 1:14:25Speaker 04

  It's, I'm about halfway through and it's, it's like very good and interesting. I mean, the, the thing I've, I've done this from time to time. Like I hadn't read much over the last year while I was working on that.

• 1:14:34Barry Ritholtz?

  Yeah. It's a killer. Writing is a killer.

• 1:14:36Speaker 04

  Yeah. You, you, as someone who's written books, I had so underestimated, like I have much more respect for other authors after going through that.

• 1:14:44Barry Ritholtz?

  Not only can't you read books, you can't blog, you can't, it just sucks up so much.

• 1:14:48Speaker 04

  Yeah. Yeah. It's like all your free time goes to that. Um, but something I've always liked is, I've always been a big biography guy or like certain moments or events in history, because you can get the chat GPT, whatever. People can pull a story together in 300 pages of a thing is so fascinating. And with like 1873, like reading about the stock market speculation in the like Vienna, Austria stock market in the 1870s. And then you're just pattern matching that against like what I saw with retail investing in 2020, 2021. It's, you just see like human behavior playing out cyclically 150 years ago is just really, really interesting and like a, you know, totally different time and market and paradigm, but it's the exact same thing.

• 1:15:32Barry Ritholtz?

  Lords of Finance was his first book that won the, the Pulitzer. Um, I'm excited about that book. Any other books you want to mention?

• 1:15:39Speaker 04

  The Infinity Machine, the one about, um, the Deep Mind founders. It was by, um, Sebastian, Sebastian Mallaby, I think. Anyway, it's like, as far as AIs now the thing everybody cares about, he did a really good job of like, like how LLMs even became a thing in the first place. And how like this just group of like British researchers who've been holed up in London the whole time, kind of kickstarted this whole AI boom. And even though Sam Altman, Elon Musk, they aren't like main characters at all. You're getting these interesting anecdotes of how like OpenAI came together and how there was like a bit of a coup with an OpenAI and then Elon leaves. It, it just did a really good job of framing like the current moment in time and how we got here. But those are like, I read both of those or been reading both of those in the last month and a half. They're great.

• 1:16:25Barry Ritholtz?

  Interesting. What about streaming? What are you watching or, or listening to? Give us your favorite.

• 1:16:30Speaker 04

  Hilariously on the, like on the, on the podcast front, I don't have any shows I listen to regularly, but I will selectively, if there's like a guest that I find interesting for whatever reason, I've like, it's everything from tuning into like, like Josh and Michael on the Compound and Friends or, um, like Tim Ferriss's show or some of Scott Galloway's stuff. It's, I'm so much of a, I have people who I think are good interviewers. I don't care about half the people they talk to, but occasionally they'll have someone where I really want to hear that. Cause I think they'll pull out good questions. Um, like, I don't know, like Michael Lewis on Tim Ferriss, really good episode or it's, there's nothing I listen to specifically. Streaming, I did like that movie Obsession. I thought it was phenomenal.

• 1:17:14Speaker 04

  It was the one that like went mega viral out of indie film that went mega viral out of nowhere.

• 1:17:18Barry Ritholtz?

  In it?

• 1:17:20Barry Ritholtz?

  Who directed it?

• 1:17:21Speaker 04

  It was, it's what, it's the, um, I can't even think of the guy's name. He was, got his start on YouTube. He does a lot of short form comedy. But it like blew up and it was the one about the guy who like breaks the stick to make the girl like, he makes a wish that the girl falls in love with him. And then she goes full psycho. Anyway, it went like nuclear on Twitter, Instagram, Tik Tok, whatever. Pretty good horror film thriller. I liked it.

• 1:17:45Barry Ritholtz?

  Final two questions. What sort of advice would you give to a recent college grad interested in the career in either writing, content creation, or venture capital?

• 1:17:56Speaker 04

  So my, my take on all the career stuff for that is like, I think it's really, I think that one of the higher leverage things you can do is just start a blog and put your thoughts out there. Even if you have five people reading it, 50 people reading it. I think that especially with AI becoming more and more of a thing, it's easy to like, like resumes are becoming increasingly meaningless, both from like the odds of somebody actually looking at your job application when you send it in cold or very low and the ability to like lie or like, you can make a hundred different resumes and LLMs based on the job you're applying to now versus when I was like, when I was in college, you always tweak your cover letter or resume per job. And it's pretty tedious to do that when you're doing it by hand. You can make a million at once, right? So having some like, like.

• 1:18:43Speaker 04

  Proof of your thoughts on thing or you've articulated ideas online that show how you think, I think, carry a lot more, they've always been important, but like stand out a lot more now with AI. Or if you like, AI coding systems are really good, like anybody can access them to build stuff. So just having a portfolio of like written work or stuff you've built online that shows that you took interest and initiative in a thing and like put yourself out there, super useful. I mean, my, my take on career stuff in general is like, if you can go into investment banking or consulting right out of undergrad, it's still probably the right move, just from like getting trained on how to work hard. People who work at Goldman from 22 to 24 are typically more competent than other people.

• 1:19:24Speaker 04

  And for all my stuff about like, you should go take risk in your twenties, the caveat on that is like, you should have a couple of prestige snaps first. Like Columbia Business School was a prestige snap for me. I enjoyed it. I learned a lot. The main reason I went was like, I went to a somewhat no name undergrad. It's not like I worked at a marquee firm out of undergrad. Like you want to get a couple of like, I have like, somebody's de-risked me as an individual, then you go take the shots that you want to. So like, I, it's like, have a collection of like independent work and thoughts that like you can share, like in real time. And then I think it's important to get one or two prestige snaps before you go jump off and do your own thing.

• 1:20:06Barry Ritholtz?

  And yet in the book, you talk about what a, what a misfocus it is hyping on status and, and why that whole game is so challenging.

• 1:20:16Speaker 04

  So my, the status thing is so nuanced. I think that if you treat status as an end to itself, you're going to be incredibly disappointed. I think if you treat status as a thing that like you can acquire and leverage to actually do.

• 1:20:27Barry Ritholtz?

  A means to an end.

• 1:20:28Speaker 04

  Yes. Like if the trade is, I'm going to go to an incredibly competitive school and spend two to four years working in some version of like Goldman, Blackstone, McKinsey, whatever, and I can come out of that and do anything, that's very much worth it. But you don't want to be the person who like 10 or 15 years into their career, never really figured out their things or kept chasing status as like a vanity project.

• 1:20:51Barry Ritholtz?

  Makes, makes a lot of sense.

• 1:20:52Speaker 04

  It's like, I say status is diminishing returns, or like, once you have enough of it, it gets marginal after that.

• 1:20:59Barry Ritholtz?

  You're good. And our final question, what do you know about the world of investing today, might have been useful back when you were locked in your bedroom trading SPACs?

• 1:21:10Speaker 04

  I underestimated how much retail investing is like a permanent fixture in the market today. I think it compounds from like, and this is all like public market stuff, but like pod shops, trading quarter by quarter are like more and more of a thing. Passive investing is more and more of a thing. You could argue that true like, like price setters being like fundamental long, short funds or, and like long only mutual funds are less of a thing. So it's created this thing where you have like, a lot of like very short-term trading on like whatever alternative data, quarter by quarter data. And then you have a lot of passive stuff. And then a really big active group is like, retail investing is a thing. Like GameStop, I thought was a one-off fluke. It wasn't like open door,

• 1:21:52Speaker 04

  short squeeze out of nowhere. You're seeing like random companies will just pop off like 500%, which makes it like Dan Sundheim was on a podcast with the Collison Brothers, the Stripe founders a couple of months ago. He was talking about how they changed, like how they position their shorts now, D1 capital.

• 1:22:08Barry Ritholtz?

  Because of that.

• 1:22:09Speaker 04

  Because you just, you could be fundamentally right, but guess what? Fundamentals don't matter if the borrower hits through the roof and the stock like 8Xs and you get blown up, right? Like, like ask the, gave the Melvin Capital guy about fundamentals when his fund got blown up, right? Like at the, at the end of the day, the only thing that matters is making money. And I, I really thought a lot of that was a 2020, 2021 thing. And it was COVID and people were at home. We're seeing so much stuff with like random speculative like nuclear reactor, like a company Oclo went public through a SPAC. It was like a Sam Altman backed company. It was worth like $40 billion. I don't think they have a functional reactor yet. Like.

• 1:22:45Barry Ritholtz?

  Are you suggesting that sites like Reddit, Wall Street Bets still carry the influence they used to? Or has that attenuated and it's spread out to different areas?

• 1:22:55Speaker 04

  I would argue that they almost carry more weight because I think that like,

• 1:22:58Barry Ritholtz?

  Really?

• 1:22:59Speaker 04

  I think there's, this is pure speculation, but I think that they're now increasingly a thing that like, call it like institutional traders, quant funds, whatever, will like look at as a data source where if something spikes on one of these sites, they'll play the momentum and like, it makes these bubbles go even further than they used to. And everything happens so fast now because like the speed that information moves on the internet is just instantaneous, that like, a bubble that might take like months to build up and then collapse could happen within a week, both ways. So it's just like, the, the whole like internet spread of information faster and faster. It's all like derivatives, like retail investors getting in the market and then yapping about stuff online. That's just never going to stop.

• 1:23:39Barry Ritholtz?

  Right. And, and it's so funny because everything old is new again. Back in the day of the Yahoo message boards.

• 1:23:46Speaker 04

  It's like the late 90s. Yeah, yeah, yeah.

• 1:23:47Barry Ritholtz?

  Like I Omega and, and that sort of stuff. Nothing has changed. It's just how much faster.

• 1:23:54Speaker 04

  And it's like zero commissions now. It's like the, there's.

• 1:23:58Barry Ritholtz?

  And it's in your pocket. You don't have, oh, let me go home and call my broker, doesn't it?

• 1:24:01Speaker 04

  And now there's like, oh, we have prediction markets and sports betting on your phone. We have removed all friction from people putting money at risk to do stuff. And we've made.

• 1:24:10Barry Ritholtz?

  Regardless of how dumb or speculative it might be.

• 1:24:12Speaker 04

  And the speed at which you can communicate what you're doing is now also instantaneous and free. So you just have people constantly going risk on, on whatever, for whatever reason. And then everybody else knows it. That's just, that's only going to keep accelerating.

• 1:24:26Barry Ritholtz?

  Um, except, except it kind of sounds like a very late stage bull market.

• 1:24:31Speaker 04

  Could have said that in 21 and we were right. 22 was kind of a bear market, then AI happened. So it's like, I think that, I just think market cycles in general will keep happening faster and faster because it'll collapse, people get blown up and somebody starts running another thing. I just think it's going to get more and more violent.

• 1:24:48Barry Ritholtz?

  I, I have a pet thesis that the giant reset, the giant fiscal stimulus and crash and recovery in 2020 was like a reset and extended the bull market another five, 10 years. It's, but anyway, um, Jack, you were, you were more than a somewhat special guest.

• 1:25:08Speaker 04

  Thanks.

• 1:25:08Barry Ritholtz?

  This was really great. Thank you for being so generous with your time. We have been speaking with Jack Rains. He is the author of Young Money, A Field Guide to Wealth and Purpose in Your Twenties. If you enjoy this conversation, well, check out any of the 653 we've done over the previous 12 years. You can find those at iTunes, Spotify, YouTube, Bloomberg, or wherever you find your favorite podcasts. I would be remiss if I didn't thank the crack team that helps us put these conversations together each week. Alexis Noriega is my video producer. Sean Russo is my researcher. Anna Luke is my podcast producer. I'm Barry

• 1:25:53Barry Ritholtz?

  Ritholtz. You've been listening to Masters in Business on Bloomberg Radio.

• 1:26:05Speaker 08

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