Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
Be careful there. You know, I'm always amazed at how many huge decisions I've screwed up, and still things worked out.

[/ QUOTE ]

anyone who ever tries to do anything great has these. they are just a part of the story. and i doubt things just "worked out". it sounds like you decided you weren't just going to give up, so you just kept busting your ass until you forced things to work out. it's pretty awesome.

Re: How did you do it? Financial Success Thread
 

DC,

"The greatest lesson of my life is never look backwards. If you dwell on the mistakes of the past it will drive you crazy. Focus on what you can do in the here and now to make the future better. I'm the poster child for not dwelling on bad mistakes cause I've made a ton of them."

Wow, your catalog of mistakes looks a LOT like mine. I'll post some of them in this thread soon.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]

The best advice I can offer is to really take stock of what makes you happy. For me, it's not money. I'm sure I could have gone into business or law or another well-compensated field and made tons more money than I did. But I did just fine.

[/ QUOTE ]

This is so true. I think the key to being happy is to learn to be content with what you have, rather than lusting after what you don't.

Re: How did you do it? Financial Success Thread
 

Mid 80s

Druing my first year at Cambridge, video-games started getting big. A kid in the year below me at high school had written a game on a home computer that he sold for 10,000 quid - big money for a school-kid back then. I knew I was as smart as him so I had a go myself. I made around 50,000 before I finished my degree 2 years later.

I moved back to my home town and tried to continue to do the same. It didn't work out so well. The industry had become much more focused on licenses rather than simple game ideas. After a year I took a job with a games publisher in Manchester. To be honest, I had found working by myself fairly issolating and welcomed being in an office.

Early 90s

I had always wanted to come the US. Manchester was a cool place in the 80s but the weather... well it ain't California. Also I was in a rut where I was. I think there was a slight pay cut, but I could have cared less. As things worked out, it was a great move financially. My new boss got contracts to develop games for publishers. He received royalties based upon how well the games sold and he actually paid his developers a cut. This was a completely different culture to the UK industry, where programmers were treated like mushrooms.

The first game I wrote for him I eventually made four times my salary. It worked out better for my boss. I think he made around $1m off just that one project. After two years I was ready to strike out on my own. It would have been sooner, but it took a while before we realized how much money we could make and I didn't want to leave in the middle of a project.

94-03

I set up a development company with a couple of people from work. We figured we'd just do a couple of projects at $1m a piece and be set for life. Wrong!

I had a fairly naive idea that because what we were developing sold to the public without our name on the box, that we didn't have to worry too much about sales or presentation. The games industry is fairly close-knit and I thought I had a good enough reputation with the publishers I had dealt with, that something would just land in our laps. I ended up getting a deal with a start-up publisher. The game we made for them got great reviews, but they weren't really able to promote it properly.

After that project, it seemed as if everybody wanted to work with us. I wanted a shot at working on something that could make us $m's, but we ended up getting strung along with a lot of "Hollywood noes" ie "maybes". I blame myself for not being more decisive and giving publishers a deadline to come up with a deal, before taking something less glamorous. Again I was fairly naive.

I had lunch with my former boss. He had let his early success go to his head a bit and over-expanded. He had made some good hires early, but the talent had been diluted by people leaving to set up on their own and the later hires weren't as good. The company ended up closing. After a break, he set himself up as an agent signing deals for other developers.

It was an ideal role for him. He was always pretty crap at running development, but he was a born salesman. To be honest, when I worked for him, I hadn't really appreciated how much of a role that played in his success. I thought he had just got lucky hiring me! After doing it myself and while not exactly failing, I ended up with a lot more respect for him. He landed a great deal for us within 3 months and after a year we had sold a stake in our company to a major publisher.

We grew to around 40 employees eventually. I would have been happy to keep it smaller, but video-games just kept getting bigger. 40 people was definitely on the small side for a viable team by the time I left. My decision to retire was partly because I didn't really enjoy managing people as much as I used to enjoy developing games and partly because it was bloody hard work - though maybe if I had been better at management it would have been easier.




Looking back, I don't know that I have been that sucessful financially. I retired before 40, but - and I don't want to brag but this is true - I was bloody smart when I was a kid. I believe I would have done better if I had gone into the financial markets. However, I can relate to what Taylor was saying about enjoying Cardrunners more than grinding out a living playing high stakes. I think trading bonds would have been dull compared to developing video-games and while running a business wasn't always easy for me, I think I grew as a person.

Also, I would have made money faster if I had been smarter about running the business. I was always good at manipulating numbers and symbols, which is partly why I ended up programming, but I didn't really appreciate how much selling and management was going to be involved, as opposed to just being good at development. I got better at both with time, but I'm sure other people take to it more quickly than I did.

I guess if there's one key thing I learnt about running a business, it is that you should work out what you are good at and hire or partner with the best poeple you can to do what you are weaker at. I'm sure I read that somewhere before I started, but some things you have to experience before you really know how true they are. If you asked me on leaving college, I would have been fairly dismissive of people without my skill-set. Not so now. If anything it's the other way around. Talented programmers are 10 a penny, but show me a good salesman...

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
The greatest lesson of my life is never look backwards. If you dwell on the mistakes of the past it will drive you crazy. Focus on what you can do in the here and now to make the future better. I'm the poster child for not dwelling on bad mistakes cause I've made a ton of them.

[/ QUOTE ]

Great story.

That quote right there is truly worth it's weight in gold.

Re: How did you do it? Financial Success Thread
 

i'm interested in ElDiablo's and lapoker's stories. i unfortuanatly have nothing worthy of this thread.

Re: How did you do it? Financial Success Thread
 

pj,

awesome story, made me feel good reading it [img]/images/graemlins/wink.gif[/img]

Re: How did you do it? Financial Success Thread
 

Great thread. Great stories. Really appreciative that people included their failures as well.

I have been dealt some awesome opportunities in my life, and so far each one has been followed by some catastrophic stupidity that kept the opportunity from developing to fruition. So hearing the bad along with the good is inspiring. Thank You.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
i'm interested in ElDiablo's and lapoker's stories. i unfortuanatly have nothing worthy of this thread.

[/ QUOTE ]

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
but i hope op just made a mistake and meant for his displeasure to apply only when he is buying something? b/c i love having someone on commission working/selling FOR me - it's awesome.

[/ QUOTE ]My objection is that you (as buyer or seller) are making the commission-recipient a partner in the transaction without him providing capital or assuming any risk. Finding yourself in this kind of deal is prima facie evidence of an inefficient market (if not an outright cartel).

There are exceptions, notably when the salesperson's role and discretion are narrowly defined; e.g., a waitress making modest wage plus tips is a commission scheme that works for everyone.

But often, the buyer's and seller's interests are aligned more closely to each other than either of them are to the guy on commission. So if they can figure out a way to transact without that guy, they both win.

Re: How did you do it? Financial Success Thread
 

Bump. I'd especially be interested in hearing experiences from anyone that has worked in tech startups.

Re: How did you do it? Financial Success Thread
 

i have had financial success, but am now working on creating a story.

James

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]

But often, the buyer's and seller's interests are aligned more closely to each other than either of them are to the guy on commission. So if they can figure out a way to transact without that guy, they both win.

[/ QUOTE ]

I would have agreed with you before I saw what a really good salesperson could do. A great salesman finds ways to make transactions take place that wouldn't have happened without him. Often these transactions can yield positive outcomes for both parties.

Re: How did you do it? Financial Success Thread
 

I posted my story so far in BBV two weeks ago here: http://forumserver.twoplustwo.com/showfl...=0#Post10038653
It's all about my poker career, as I'm 18 and have just started college part time (I'm going to go full time next year). However, I did start up a school snack store in high school (I went to a really small private Quaker school with only ~40 students) that was successful, but didn't net me nearly as much money as poker has. Since I wrote this, I'm consistently playing 2/4 NLHE and had my best day ever three days ago (~$4300!). CardRunners helped me improve and re-evaluate my game IMMENSELY. Thank you!

BBV Cliffnotes:
Brag: Finally reached $10K from poker
Beat: Took me about 180K hands
Variance: Started with 90 cents. Fun graphs below.


Even when I was a kid, as young as 8, I had been totally fascinated by gambling. I really liked video games (still do), and I got a gambling game called Vegas Stakes for my Super Nintendo. I thought it was awesome, and I thought being a professional gambler would've been the coolest thing in the world. I never really played poker until I was 13 or so with my friends for $5 or less at a time.

A year and twelve days ago, I got $.90 for free on a small site call All In Poker for some really crappy promotion they had. I was seventeen years old and still in high school (I graduated a year early because that's how I roll). The lowest limits on that site were $.05/$.10 Limit, so I only had a 9BB bankroll, but that was enough for me to gogogogogogogogo.

Well, I obviously didn't go broke. I was already a 2+2 member, and was soaking up all the information I could about this game. I read a guide on how to build a bankroll, and that 300BBs is a solid start. So I decided that I was going to build up to $30 then move onto PokerStars, which I heard was rake-free in the lowest limits (I believe they originally only raked the limits of Limit $.50/$1 and above, but when I joined, the highest limit that was rake-free was $.05/$.10). The reason I waited until I reached $30, a 300BB bankroll, was because that was the minimum amount required to cashout from the small site I was playing at, which I believe was a part of the Prima network. I remember when I reached $5, a person joined my table and bought in for $700. He claimed that poker had no skill, and to prove his point he didn't do anything but raise the entire time he played. I tripled my bankroll through him for a cool $15.

So I eventually I built up to $30, moved to PokerStars, and just grinded all the way up to $100. I think I only played one table at that time, so progress was a bit slow. I moved to $.10/$.20 when my bankroll reached $80 because I didn't think the rake made it worth it. After that, I moved around a lot of sites just looking for free bonuses that were easy to clear. A site called empirebacker.com gave me $50 on some Prima site for signing up, and that was a very easy bonus to clear. Then the owner of that site came up with another site, freepokerquiz.com, that gave other bonuses for taking poker quizzes every day and getting $10 here and there. I won one of their special monthly quizzes for a free iPod when my bankroll had reached $300 (playing $.25/$.50 and $.50/$1 on Titan Poker at the time). That was a nice gift.

In addition to low stakes Limit, I'd occasionally dabble in Sit-N-Gos, and I still do play them, but they're not really my thing. I usually play them as a way to relieve tilt. The freepokerquiz.com bonuses on Titan Poker were really nice for my bankroll, so I stayed there for a while. Unfortunately, Titan Poker didn't save hand histories to the hard drive at the time, so that part of my poker career is missing in my Poker Tracker database.

I've always been a very frugal money spender, and that shows in my bankroll management skills. I'm a total nit with my bankroll. I eventually moved to the Cryptologic network when my bankroll reached $450 or so, because of bonuses+rakeback, which I heard was excellent for bankroll building. I believe I was playing $.35/$.70 at the time, and started to experience some variance that was practically non-existent at the levels below that. Up to this point, I was kind of afraid of NL (which, ironically, was the only game I had ever played live with my friends), but I started to dabble in the $.10/$.25 games. It was at this time I played three donkaments and cashed in all three. The first two were about 50 people, and I think I came in 3rd and 5th. The buy-ins were really low, so it wasn't too much money, but the third one was about a $25 buy-in with nearly 200 people, and I came in second for a $1000 prize. I remember at the time I only played donkaments that had enough overlay to completely make up for juice. Boy am I a nit.

After the $1000 boost, I decided to actually spend some of my hard-earned money on one of the 1600x1200 monitors I had heard about that were oh-so-perfect for playing poker with. I'm a computer guy, so I did a lot of research on which was the best one, and finally decided on the Dell 2007FP (there was originally some kind of color banding problem with 2007FPs, but by the time I was looking for a monitor, this had been fixed). I waited for it to go on sale and I spent $425 on it. It was quite a nice upgrade from the 1024x768 CRT that was 5+ years old that I had been using. I still consider it one of the best investments I've ever made.

So after the monitor, my bankroll was about $1100. I suddenly had the urge to play heads-up NL. It's what I usually played with my friends, and I thought I was pretty good. I crushed the heads-up $.25/$.50 NL games on the Cryptologic network for about 15PTBB/100. While doing that, I decided I wanted to really learn NLHE, since I had heard that it was much more profitable than LHE (did I mention that the entire time I had played 6-max games, because FR sucks?). I did beat the $.25/$.50 and $.5/$1 NL, but it was very swingy. I was committed to playing a thousand hands a day, almost everyday, four-tabling. Overall I think my winrate was about 4PTBB/100. I built up my bankroll up to $2500, but had a $1000 downswing at one point when I tried moving back to $3/$6 and $5/$10 Limit which totally destroyed my confidence. I did pull out of it though.

I had heard of Party Poker having the softest games, but I had stayed away from it because I didn't think it was worth giving up rakeback for softer games. Someone posted that Party rakeback was actually possible, but it was that very week that I had planned to switch over when a certain bastard named Bill Frist helped get the UIGEA passed. Interpoker (the Crypto site I played on) took about two months to send me my check, but fortunately I had kept half my bankroll, which was about $5500 total in Neteller just in case.

I had already set up rakeback accounts at Ultimate Bet and Full Tilt Poker. I tried UB first because the rakeback was higher and the bonus was about the same. I didn't like the interface at all, so I quickly withdrew my money and moved (along with nearly every other 2+2er) to FTP. Between October and December I really had trouble beating the games (I was regularly playing $.50/$1 NL). During that period, I pretty much broke even even AFTER bonuses and rakeback. I had (have) a weakness for donkaments, and am probably $2K in the hole lifetime from those damn $150+$13 and $69+$6 Guaranteed donkaments. Fortunately I've learned proper donkament bankroll management (I thought 30 buy-ins was overrolled [img]/images/graemlins/tongue.gif[/img]), and now I don't play any higher than $24+$2, even though I'm way overrolled for that.

Around the middle of December, I really didn't feel like I was beating the games, and the $1000 I had initially deposited into FTP had winded down to about $400 when it had been up as high as $2400. I didn't totally quit, but I barely played at all in the second half of December, January and the first half of February. Also, my PT database had kind of gone wacko, and I had to start a new one. You can see in the new one's graph that in the beginning, I didn't make any money. In fact, I was about $2500 in the hole lifetime at $1/$2 NL. I think that game is where the money starts messing with my head. Most people say they become somewhat weak-tight when they move up. I became the opposite; a reckless loose-aggressive style that resulted in me making bad bluffs in pot after pot.

After my hiatus, I thought that if I was to one day become a real professional player like aba20/sbrugby/Brian Townsend (one of my idols), then I had to get off my ass and start working on my game. Unfortunately, I had (and still have) $3800 stuck in Neteller, so the only money I had to work with is the $400 or so I still had on FTP. I decided to start from the basics at $.05/$.10 NL and work my way up when I felt ready. This was in the middle of February, and I moved up pretty quickly from $.05/$.10 to $.10/$.25 to $.15/$.30 (I think I play well deepstacked, or at least I run hot [img]/images/graemlins/smile.gif[/img]) to $.25/$.50 (not too much), to $.50/$1 with $.40/$.80, and, as of today, $1/$2. I bought a CardRunners subscription at the end of March, as I've heard that they've vastly helped many players' games. Since then, I've been playing, I think, extremely well, and running super hot. I'm up about $1350 (plus $250 for last month's rakeback [img]/images/graemlins/smile.gif[/img]) in the past three days alone, playing $.40/$.80, $.50/$1, and $1/$2. I still stick to my 1000 hands a day schedule, and I hope to be disciplined enough to continue to do so. I also usually play between four and six tables. Anymore than that and my concentration and game just go way down.

As promised, here are my graphs. Database #2 follow directly after database #1.
Database #1, dollars:
http://img153.imageshack.us/img153/8365/90dollarfj3.jpg

Database #1, nicer graph in BBs
http://img154.imageshack.us/img154/9414/90bbzn5.jpg

Database #2, dollars (sexy upswing, isn't it?)
http://img90.imageshack.us/img90/675...ddollarsf6.jpg

Database #2, BBs
http://img206.imageshack.us/img206/3941/grindbbkp8.jpg

Re: How did you do it? Financial Success Thread
 

there have been some great stories in this thread...i really admire those that have had to take big risks to get to where they are...i feel like my career progression and financial success have been more "safe"...

Electrical Engineering and Finance majors from Ivy League School-> trading derivatives on sell-side->running a desk at a big hedge fund start up...

My path is not worthy of a long email, but some of the takeaways seem to be...

1. Hard work is imperative in success, but I really believe luck plays a big role...i ended up with a trading internship my junior year in college...i heard one of the guys at tennis practice say that Salomon Brothers Sales + Trading was on campus interviewing today...ran over after practice sweaty/unshaven/in practice garb and caught the interviewer as she was walking out the door...quickly told her about my background and asked if she would interview me...she said she would give me 15 min and take the next train...we talked about college basketball for 15 min, and she gave me the callback which lead to my internship...lots of blind luck here that led me to a career path that probably would not have taken place otherwise...

2. Happiness in personal life always makes it easier to be successful in career...i've felt very good about friendships/relationships/wife/kids during my working career and really feel like it greatly increased my opportunity set of success at work...

3. If you do things just for the money, you aren't going to last...you always hear people say that they would put up with XXX if that meant they could make YYY a year...that sentiment rarely lasts, and it becomes very difficult to "grind out" that paycheck...i understand that many americans feel like they are grinding out their careers...but i am talking about people that have had some financial success...if they have some financial freedom, they are probably not going to last grinding it out...find a career that really does interest you as that will eventually be what drives your success

4.Don't burn bridges because you never know when those people will come back to affect you...i'll be the first to say that it feels good to give someone an F U after they have treated you poorly...but in a lot of lines of work, the upper echelon is a tight-nit group and someone always knows someone else...bite your tongue and leave bridges in tact as they will help you down the road...

5. Make sure morals/ethics are high on your priority list...there are plenty of people who are talented enough to make a good living and retire early if they just keep their head down...but one little mistake blows them up...i am not talking about major ethical breaches, but more those things that everyone recognizes as gray, and justifies with "everyone else is doing it so it must be ok"...those gray lines can be career busters, and even if they arent, they still give a glimpse of character...

6. While it may play a big role, don't let your financial success be your defining personality characteristic...those that let their financial success define them never seem truly happy...

Keep the stories coming.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]


Shortly after that, I gambled and argued to the firm that we should take a case on contingency for a small client who had gotten screwed by Lockheed. The firm agreed. Two years later, a federal district judge granted summary judgment against us on all counts. Two years after that, largely based on my brief and my depositions, the 9th Circuit reversed and remanded for trial. Two of my partners and I tried the case; we won $64.5 million. Largely on the strength of that case, I made the second partnership cut, which was huge -- from $350K up to about $1MM/year.

[/ QUOTE ]

I had to read this three times, because I thought i was going to call you out on it. Since you are a respected poster (myself included in that respect) I'd like to hear just a little more detail about the small client that got screwed and the lawfirm that made >$20MM on it. In general I side with Shakespeare, but perhaps more facts can persuade me otherwise.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
In general I side with Shakespeare...

[/ QUOTE ]
This old chestnut again. You side with Dick in Henry VI. Google it.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
[ QUOTE ]


Shortly after that, I gambled and argued to the firm that we should take a case on contingency for a small client who had gotten screwed by Lockheed. The firm agreed. Two years later, a federal district judge granted summary judgment against us on all counts. Two years after that, largely based on my brief and my depositions, the 9th Circuit reversed and remanded for trial. Two of my partners and I tried the case; we won $64.5 million. Largely on the strength of that case, I made the second partnership cut, which was huge -- from $350K up to about $1MM/year.

[/ QUOTE ]

I had to read this three times, because I thought i was going to call you out on it. Since you are a respected poster (myself included in that respect) I'd like to hear just a little more detail about the small client that got screwed and the lawfirm that made >$20MM on it. In general I side with Shakespeare, but perhaps more facts can persuade me otherwise.

[/ QUOTE ]

Sure. A couple of points right off the bat: the law firm didn't make anywhere close to $20MM on it; we were on a variable contingency, and I think the final number was a bit over $7MM. The case is Cable & Computer Technology v. Lockheed; here's a link to one of the Ninth Circuit opinions that does a passable job of describing the factual setting: http://caselaw.lp.findlaw.com/cgi-bi...mp;no=9955004.

Basically, one Lockheed division (Sanders) agreed to team with CCT to submit a bid to Boeing to upgrade mission control computers on the B1-B with CCT as prime contractor. Although no written contract was signed, that division of Lockheed sent four guys out to CCT to work up the bid package. Unbeknownst to CCT, Lockheed met internally with another division (Owego) and disclosed CCT's bidding prices to Owego. Two days before the bid was due, Sanders called CCT and backed out of the agreement to submit a bid, giving no explanation. Owego won it. In discovery, we found an email from the meeting saying something semantically similar to this: "CCT's bid prices were disclosed. They are so confidential that I am not writing them down."

When we filed the case, CCT would have taken a much much lower number. Lockheed played hardball the entire way, deposing each of CCT's four principals for a total of 25 days and leaning hard on their own employees to buy off on their outside counsel's arguments. One of Lockheed's employees, as the opinion notes, sent in an affidavit that the court discusses. He was indeed let go.

I've spent about 90% of my career as a defense lawyer and so appreciate your sentiments. There's a good bit of stupidity in that particular business; I've been considering firing up an EDF post on the asbestosis/silicosis class action rackets that have been going on for years.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
In general I side with Shakespeare, but perhaps more facts can persuade me otherwise.

[/ QUOTE ]He was saying the exact opposite of what you think he was saying.

Re: How did you do it? Financial Success Thread
 

Thanks Howard.

Everytime I have an interaction with my fine lawyer friends I usually vomit in my mouth a little. The utterly absurd "lottery mentality" that most Americans have these days with regard to any type of liability is sickening-- some times sh*t just happens and that's life.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
Thanks Howard.

Everytime I have an interaction with my fine lawyer friends I usually vomit in my mouth a little. The utterly absurd "lottery mentality" that most Americans have these days with regard to any type of liability is sickening-- some times sh*t just happens and that's life.

[/ QUOTE ]

I generally agree with that principle, and it likewise seems to me that America has lost some sight of that.

Re: How did you do it? Financial Success Thread
 

If I don't win the lottery someone else will. The problem is with the legislature, not the American people.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
If I don't win the lottery someone else will. The problem is with the legislature, not the American people.

[/ QUOTE ]

I call [censored]. If you order coffee at Micky D's, you should expect that its going to be served hot. If you smoke, you should expect to have a higher cancer risk. If you have a bad medical outcome it might be your disease that killed you, not your doctor. If you are at a department store and slip on the floor, its not necessarily wal-mart's fault.

The same mentality that demands social security and medicare entitlements is what drives the lawsuit industry. Its a huge detriment to our society and it starts with the individual who thinks everything that happens is someone else's fault.

Re: How did you do it? Financial Success Thread
 

reno (and others),

Let's end this hijack. Feel free to start a thread on liability lawsuits and related issues.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
Wow, your catalog of mistakes looks a LOT like mine. I'll post some of them in this thread soon.

[/ QUOTE ]

El D,

Here's a good way to get this thread back on track [img]/images/graemlins/wink.gif[/img]

Re: How did you do it? Financial Success Thread
 

I wasn't gonna post, but what the heck, its almost halftime at the Warriors game.

I will try to tie it all together with some advice at the end.

In a nutshell, I made sure I excelled at everything that was important...grades, extracurriculars, relationships with potential referral sources early on (this was not Machiavellian...I cultivated these naturally).

So, top of high school class, not that far from a 4.0 at a West Coast Ivy (got into Harvard ugrad, did not go, was the start of a habit of avoiding the biggest brand names and the safest routes except for bschool--i couldnt help it), entrepreneurial summer job my sophomore year selling advertisements on freely distributed phone book covers, led to a great $2600 per month (all the money in the world as far as I was concerned in 1988) gig at a litigation consulting firm (very competitive and learned a lot about the professional environment and computers and programming, etc).

Graduated early (parents went bankrupt my senior year and I was so focused on business by that point that I wanted to get it start it - I see in retrospect that this sounds lame, but its how I felt at the time).

Conventional wisdom - NYC for an I Banking job. My solution - NYC sucks. I don't like big orgs and slowly working my way up. I found a couple year old investment bank in SF that focused on entrepreneurial firms. Perfect. A start up focusing on startups. Two small problems... (1) 1990 was a terrible year in the markets and very little happened (other than some of you finally getting off of your pacifiers). (2) The founder was an a-hole and there was significant turnover and I hated many of the professionals. In addition, I banking is great training but an absolutely horrible career.

Next...got lucky and good...my third cousin in law (how is that for removed) introduced me to a top 15 or so venture cpaital firm who was looking for their first ever associate...this was before VC was on anyone's screen. I had an interview from the junior partner (only 5 guys in the firm) on the West Coast. Passed that. Senior partner calls and says "I am on Cape Cod (I am in SF...) and would be happy to interview tomorrow at my vacation house here if you would like to come out...but we won't pay for it." This was like 4pm SF time. I catch a redeye on my own expense (I am 21 years old, online poker does not exist, this seems like a lot of $). I stay overnight...most notable aspect of the interview is that it happens on a 20 mile bike ride that I am not in shape to take...my average answer sounds like "I...heave, heave...and intersted in venture capital...heave, heave...because, etc". My family lives in Massachusetts and he is family oriented...I make the mistake of calling my parents when he is around and he invites them up to the Cape for dinner...and they accept. INteresting all around. Got the job. Best thing that could have ever happened to me. Salary - $30k. No layers between me and the partners, no other associates. Participate in most partnership meetings and have the balls/naivete to speak up often with me opinions (must have been comical to them). Got an incredibly important exposure to (1) broad swath of industries at (2) high levels, i.e. ceo's pitching to raise money - paved a path for me in later life as a generalist and a person who grills CEOs for a living, comfortably.

During second year pointed out to VC firm that they had a public stock portfolio they had suckered their LP into giving them that was going totally unmanaged. Told them it was malpractice (literally) and offered to assist (they knew I had a longstanding interest in stocks). They were too uninterested/lazy to do it, so told me to do it myself. It was $7m (that was not bad back then). I ask "how will I be paid for this". They say "if you make money for us, you will make money, trust us". These are very distinguished, top of the line smart, rich, guys. I accept. I spend halftime my second year going up 50% in the fund (no fault of my own...it was lucky, I had no idea what I was doing. I am not a modest person, this is just how it was). I also source and complete 2 VC investments (very difficult for someone my age and lack of experience) through sheer drive and willpower. Both are successful - 5x and 3x (pretty good back then, before the bubble).

I apply only to HBS, because its the only place I wanna go. If I dont get in, I will stay. I get in. My 50% year generates $750k for the partnership (forgetting the VC deals). Comp comes up. They give me $15k. I say WTF? They say "we don't like to pay for unrealized gains (I had a couple large gains I had not taken; this perspective is about not wanting a large public position in an illiquid copmany that then tanks and the supposedly successful VC investment never actually liquidates". I say, ok, you have a telephone? I can fix that immediately.

lesson: having trustworthy partners who share your compensation philosophy is crucial in the investment busienss. They screwed me, and I don't think they even realized it.

HBS. I expected to return to the VC firm (they kept me on as a consultant during HBS to help defer my expenses). They offered me $60k when I was graduating. I was pissed because they had offered someone a couple years earlier without my now 4 years of history with them, etc. the same amount. I asked for $65k. They pulled the offer (they thought I was ungrateful i think)! I cried. Literally. In a meeting. Well, I hope they did not notice, I tried as hard as I could not to let it happen, but my eyes were
watering for sure. That said, I had great concern because they were asking me to specialize in an industry (that was clearly where VC was going) and I had no freaking clue. I was 25 years old and I had never worked for an actual company in an actual industry and I was terrified about picking a speciality I knew nothing about. I felt very much an outsider when I was an associate (there was no one my age in the industry at that time...no one at all)..and the feeling lingered. So that was that. Very traumatic.

I had a very long standing interest in stocks - had invested in them since I was 10 years old...read the Investors Biz Daily at summer camp,etc. (no family background in this, i was just very intersted, it is just a personality thing). I read books and newspapers about the finance world all the time...and I had noticed the emergence of hedge funds. At the time they were really a sideshow at business school. Everyone else was focused on IBanking and Consulting - it was all about Goldman and McKinsey. I literally never even interviewed for those jobs. I wanted something unusual, different, where I could make an immediate impact and be measured by that impact. One of the reasons I was willing to blow the VC deal was that I did not like the 5 year partner track they were talking about. I had delivered and if I continued to deliver I wanted to be paid.

A firm my classmates and I had never heard of came to interview on campus. The 31 year old interviewer had made $11m the previous year. Whaaaat? OK, sign me up. Incredibly competitive process for two slots, and I got it. beauty of it was that it was in Santa Monica, and I drove a moped to work in jeans. Sweeeet. Small problem. I realized within a month that 'there was no there there'. The firm had been up 170% in 1993 and it turns out they were just leveraged trading nuts. Add to that that pretty much everyone except the top guy was a total moron that had ridden his coattails and that being smart and pedigreed was a negative...I started looking for a job immediately.

Through lots of networking (I wont go into it, but lets say that some positive impressions that I had made on some people at HBS when I was interviewing ended up being crucial) I was introduced to a young guy out of Fidelity starting a hedge fund. We met, we hit it off, and after 9 mos of looking I moved to SF and was there day 1 for investing.

Helped build a firm from $75m and 7 people to almost $5B and 70 people...I had a hand in hiring almost everyone and in the important invesmtent decisions. Worked like crazy and though about little else during this decade. Moved my "number" a few times along the way but was clearly there by 2003. During 2004, combo of growing disagreement with the founder over the way the firm was run and the fact that my daughter was diagnosed with a serious disease led me to give notice and quit at yearend.

Have not earned a single external dollar since.


Lessons? Hmmmm...
1) While there are outliers, careers are continual processes of closing off options in my opinion. I did everything in my power to leave all options open to me for as long as possible. This is my main argument with online poker...it starts to close off options

2) If you want the big payoff, you usually need to take a big risk. If you are talented and "hirable" enough, you can afford to take that risk because if it fails you can move on. I am totally convinced that if my second firm did not work, a later one would have.

3) This is key...identify a growing industry and become an expert in it. This is the easiest way to success. You can even be mediocre and successful if you manaage to figure this out (for example cellular in the late 80s/early 90s, internet in the late 90s, hedge funds in the mid 90s)

4) Don't kiss ass. Don't be a yes man. Most of my success I attribute to a willingness to tell the boss he was wrong.

5) Develop your own ideas. Conventional wisdom is often wrong. If you are bright, you will discover where you differ from conventional wisdom and exploit it

6) Be an asskicker...that redeye flight might not translate in this post, but it was a very aggressive move on my part and the key to my getting that job. Careers are often like pyramids...you need the base to get to the top. That was my base.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
While there are outliers, careers are continual processes of closing off options in my opinion. I did everything in my power to leave all options open to me for as long as possible. This is my main argument with online poker...it starts to close off options

[/ QUOTE ]

Bingo. This hits the nail right on the head, along with your described-but-not-quite-stated premise that all too many guys runing VCs are greedy pigs. I had exactly two fights with clients in fifteen years of law practice and both were with VC principals. Both were utter dicks who had zero shame about lying through their teeth.

There are some good guys in that universe but sheesh, 15 is "taking care of you" on a 750 gain in liquid securities? That's an effing joke. I would have shipped the 15 back with a hearty FU, no lie.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]


There are some good guys in that universe but sheesh, 15 is "taking care of you" on a 750 gain in liquid securities? That's an effing joke. I would have shipped the 15 back with a hearty FU, no lie.

[/ QUOTE ]

Seriously. Does stuff like this happen a lot? That is, if I ever find myself in position to make a company a lot of money and I am low-level, should I get some kind of written agreement stating how much of what I make them goes to me? Or is that asking too much?

What do you guys think a standard number for them to have returned Scorpion Man on the 750 would be? I would think... uhh... 100?

Cool story Scorpion Man, thanks for sharing.

Re: How did you do it? Financial Success Thread
 

Nothing too exciting - had a late start at med school, got a good ER job after residency, and am maxing out my pension each year. 11 yrs out, pretty much debt free and about 550k put away. Bout six more years and I'm done.

The easiest way to financial success is just saving as much as you can every year, putting it in an index mutual and leaving it alone. It's not sexy or exciting. It just works.

MM MD

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
[ QUOTE ]
There are some good guys in that universe but sheesh, 15 is "taking care of you" on a 750 gain in liquid securities? That's an effing joke. I would have shipped the 15 back with a hearty FU, no lie.

[/ QUOTE ]

Seriously. Does stuff like this happen a lot? That is, if I ever find myself in position to make a company a lot of money and I am low-level, should I get some kind of written agreement stating how much of what I make them goes to me? Or is that asking too much?

[/ QUOTE ]

In a small environment like that, asking for a written agreement makes you look like a nit, which is a bad outcome too. Basically, sometimes you just get screwed.

[ QUOTE ]
What do you guys think a standard number for them to have returned Scorpion Man on the 750 would be? I would think... uhh... 100?

[/ QUOTE ]

I would have made an argument for 20% of the realized gain and been entirely satisfied with 10%. Had I been on the other side from OP, I probably would have offered 50 and let myself get talked up to 75.

And yes: good story, SM.

Re: How did you do it? Financial Success Thread
 

Yes, it was a good story SM, but just a few thoughts – maybe the post left things out that are assumed by those in the industry. For those of us not in the know:


[ QUOTE ]
Salary - $30k.

[/ QUOTE ]

[ QUOTE ]
It was $7m … I spend halftime my second year going up 50% in the fund (no fault of my own...it was lucky, I had no idea what I was doing. I am not a modest person, this is just how it was).

[/ QUOTE ]


[ QUOTE ]
My 50% year generates $750k for the partnership

[/ QUOTE ]



[ QUOTE ]
They give me $15k.

[/ QUOTE ]

[ QUOTE ]
They screwed me, and I don't think they even realized it.

[/ QUOTE ]



[ QUOTE ]
(they kept me on as a consultant during HBS to help defer my expenses).

[/ QUOTE ]


[ QUOTE ]
They screwed me, and I don't think they even realized it.

[/ QUOTE ]


From Howard Treesong: I would have made an argument for 20% of the realized gain and been entirely satisfied with 10%. Had I been on the other side from OP, I probably would have offered 50 and let myself get talked up to 75.


I know this is probably how big business works. But, if we take a step back and look at this - how is this any different than the union worker wanting more money when “he” makes the big corporation so much money?

How much would be fair for the OP to pay the company had he lost $750k.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]

The easiest way to financial success is just saving as much as you can every year, putting it in an index mutual and leaving it alone. It's not sexy or exciting. It just works.

MM MD

[/ QUOTE ]

This is what they taught us in college and I always disagreed with it. This is the easiest way to living a comfortable life when you are retired.

I think young people should be more concerned with busting their asses to do something your peers are not than simply saying "i'll put 20% of my pay into an index fund and then 40 years later I'll be able to afford to retire."

Maybe I'm just weird, but the thought of waiting 40 years to retire/become wealthy just doesn't appeal to me. I think Scorpion Man's post was very representative of what it takes for success; someone smart who is both willing to work harder and take more (calculated) risks than everyone else. I really enjoyed reading that post.

One other thing it got me thinking about is you can't just blindly follow the trends. I can't tell you how many people I know tell me "I plan on making a little money and then getting into real estate because that's where the money is." Yeah, you could still make a lot of money if you are really good at it but the market is filled with millions trying to do the same. Find a new market that is just getting started (BEFORE it is getting hot) and learn everything there is to know about it if you really want to give yourself a chance for financial riches.

tc

Re: How did you do it? Financial Success Thread
 

Putting money into an index fund doesn't somehow lock it in, though. The power of a compounding investment early in life pays dividends later when you will find business ventures. Having an extra 100k because you were smart at age 21 is invaluable.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
Putting money into an index fund doesn't somehow lock it in, though. The power of a compounding investment early in life pays dividends later when you will find business ventures. Having an extra 100k because you were smart at age 21 is invaluable.

[/ QUOTE ]

seriously though, is there anyone that doesn't know this? anyone that is smart enough to make 6 figures when they are 20 years old has invariably been told to stick it in an index fund. this to me doesn't take a ton of brains and is pretty standard. being smart is taking that X dollars you made and putting it in something that is going to make you abnormal returns over time, the index fund simply seems like a safe bet to me.

i agree, having an extra 100k because you chose to put your money in an index fund rather than leaving it in your checking account is great. i guess i am hoping that in 30 years that extra 100k will be insignificant compared to the money i have made by working harder and taking more risks than everyone else along the way.

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]

From Howard Treesong: I would have made an argument for 20% of the realized gain and been entirely satisfied with 10%. Had I been on the other side from OP, I probably would have offered 50 and let myself get talked up to 75.


I know this is probably how big business works. But, if we take a step back and look at this - how is this any different than the union worker wanting more money when “he” makes the big corporation so much money?

How much would be fair for the OP to pay the company had he lost $750k.

[/ QUOTE ]

So just to be clear, I made the fund over $3.5m, in addition to making them look good. I did this 100% on my own. The firm gets 20% of that...call it $750k. I did not have a high salary. It was a tiny little firm in terms of # of employees, and all the other guys were pretty rich. I showed a tremendous amount of initiative to get this done. Most importantly, I specifically sat down with 2 of the top partners before I agreed to accept this role and asked about the compensation arrangement. This is money very directly generated by me...it's more akin to sales or some other performance based job than working on an assembly line. But what it really comes down to is this-- had they said "tough [censored], you should just be glad for the experience (which would have been worth it)" then I would not have much problem with it (some, but not much). They gave me the old hard stare in the eye, we are men of our workds, "trust me, if we make money, you will make money".

That bonus was a trivial amount, even back in 1990.

BUT -- it was wholly irrelevant, it had no effect on my life other than to teach me that key lesson. That ultimately was a wildly valuable lesson because it taught me what to focus on when I ultimately ended up in a spot where the money mattered.

The other interesting takeaway is that if you were married to one of these guys and he came home and you said "honey, did you screw SM today"? He would have said or course not we were very generous. It is an important lesson that fairness is in the eyes of the beholder, that unspoken understandings can be wildly different on the two sides, and that he who has the gold gets to decide what is fair and usually feels he is totally justified in that decision. If you disagree, you are just a greedy malcontent.

Happily, my hedge fund experience was very different than this and I have no complaints.

Re: How did you do it? Financial Success Thread
 

All,

OK, I'll take a shot.

Interned as an engineer in college, realized that I didn't want to do that. Considered i-banking and consulting. I-banking didn't sound like much fun to me (my friends were working 100-plus hours), plus I've always had a thing for "building/creating" stuff, which didn't seem to come into play much in banking, so consulting seemed the natural course for someone with no clue what to do.

Got a job making something like $45k total w/ bonus (1993). Did that for a year. Was 100% staffed at billing rates of $150+/hr. Hmmmmm... Also hated having people above me in the company that were idiots.

I quit and got a consulting job making about $70/hr. Did that for a year, then realized I didn't like it all that much more. Had some money saved up at this point.

'95 now. Started a web development tool software company with a couple of friends. Didn't have any clue what we were doing, really, no idea about market/competitive analysis. Moved to Bay Area. Burned most of my money on this, didn't really go anywhere, but was great experience and met tons of people in the startup and finance worlds.

Did some more consulting to make a few bucks (now making $100/hr) and came up with some enterprise software ideas that seemed good. Again, devoted all the money I had to getting this company going. I had worked on large natural gas trading systems in consulting and developed some related stuff for the web. Sold a couple of $50k+ customers while still bootstrapped, then raised some venture money.

Grew this company for the next few years, raising and spending a ton of money (total VC money raised in the ~$50M range). Biggest mistake throughout this process was hiring various execs simply based on the fact that they "had experience" and not firing the ones who didn't perform quickly enough. It's really great to bring on top-notch performers with great experience. But it can be devastating to bring on people who have just slowly moved up the corporate ladder over 15-20 years of uninspired performance. Their resumes often look great, but their ability to perform in a super-competitve world sucks. Anyway, at the point where we had raised ~15M, had revenues of a few million, and staff of about 150, we were offered $300M+ for the company. Investors vetoed the deal, looking forward to a big IPO. This was late '99, my share of that deal would have turned out to be worth about $50M when the lockup expired and I could sell.

Instead, we pushed forward to an IPO, but in early 2000 the whole tech sector crashed, so instead of doing that I spent the next year firing about two-thirds of the company and getting to profitability. We did that and sold the company for a fraction of the earlier offered price. I had a few bucks in my pocket, not enough to retire, but enough to not worry about work for a few years and not be stressed about the next thing.

I took a couple years off, travelling and helping other friends with startups, doing a little investing from time to time. A few of these startups ended up putting a few more bucks in my pocket.

Then decided to start another software company. All the initial R&D was bootstrapped by me and my business partner. Once we started having some sales, we raised a small amount of seed money from a group of friends to ramp up staffing and marketing, but have so far passed up all offers of professional outside investment, instead trying to scale this via revenues. In a year or two, this will either look like a genius move or an idiotic one, we'll see.

I could have gone down multiple paths that would have made me a ton more money (after my last company I had numerous offers to work at VC firms making a ton of money or joining high-flying startups as CEO or senior management), but I've pretty much focused just on being my own boss and keeping as much control as possible on what I do on a day-to-day basis. This has involved me at multiple times putting just about everything I have into the next business idea (and in the early attempts, putting on sizable credit card debt as well) rather than put the money into more conservative investments. But the way I figure it, there's always a way to make money and always time to go get a high-paying job working for someone else. I have no regrets sacrificing those types of opportunities numerous times and I can't overemphasize the value of actually doing stuff - fundrasiing, selling, managing people, delivering product, negotiating deals, whatever. That type of experience is not only valuable, but also really fun and fulfilling to accomplish.

I plan to stay in this field, working with my current company and a few others I'm involved with, for a few more years. Then I think the most likely next thing for me is starting a small boutique investment bank with a couple of guys I've worked with on various projects for 10+ years.

Re: How did you do it? Financial Success Thread
 

Yes first to respond to ED's post!

Anyways, couple of things I'm curious about.

-Consulting really seems to be the norm for my peers nowadays still that have no idea what they want to do besides knowing that accounting and ibanxking aren't for them. Has been a consultant been a big part of your success so far?
-You stated you have no regrets, but does that mean you wouldn't go back and change anything at all? Seems like I'd be pretty bummed about the investors' decision to veto the sell. Could you have done anything differently then? Would you? Also, the hiring personnel part of the story seems fairly interesting. From all your business-related posts it seems as if you work with a close-knitted but a moderate size team. I assume this was from that experience? Have you considered much harder for someone to be a part of your company since?
-T-shirt company still in the works?

I really enjoyed reading everyone's stories. There are Ivy grads to dropouts. The stories certainly serve as great motivation to not study as much for my midterm in 3 hours.

Re: How did you do it? Financial Success Thread
 

El Diablo,
at what point were you playing in the big ub games? How did you fare in these games? Your story is interesting.

Re: How did you do it? Financial Success Thread
 

Cool story El D.

Keep em coming guys! [img]/images/graemlins/smile.gif[/img]

Re: How did you do it? Financial Success Thread
 

[ QUOTE ]
While there are outliers, careers are continual processes of closing off options in my opinion. I did everything in my power to leave all options open to me for as long as possible. This is my main argument with online poker...it starts to close off options

[/ QUOTE ]

I feel like this is so important, but it is difficult to convey to my friends both inside the poker world and outside of it. There is the obvious chance that the floor will drop out from under all these young grinders, and they are going to have no idea what to do when the endless stream of money dries up and they are stuck with no job, no degree, and a skewed sense of money's worth. Besides, the money is so much more rewarding if you are living a balanced life, and playing poker all the time leads to intellectual and social atrophy.

Edit: I shouldn't generalize like this because most of the highest stakes players are probably tough and smart enough to adapt to whatever life throws at them, but guys that drop out to play midstakes for 80-100k/yr would likely falter I think (if poker crashed completely).

Double Edit: While I'm still a teenager and not really financially successful for the long term, I have done well at poker, and I think most of the things that have been said here can apply to that as well. Integrity, persistence, self-confidence, and ability to take risks (and fail) can never be stressed enough. Unfortunately, these are traits that all must be garnered from experience rather than reading an Internet post (and I say that because, while I know all of these are necessary, I have not really attained any of them to the degree that I desire).