Invest Like the Best with Patrick O'Shaughnessy
· Alan Waxman
[00:00:00] S1: I think I told you this last time. We have everyone in our firm do a personal business plan. My personal business plan at the end of the year, I've done for 25-30 years. It takes me three weeks to do my personal business plan. And that's why I said to you last time, we spend all this time evaluating companies – do they have a business plan or not? And then most people – do you have a business plan for yourself? They don't have one. That's why we make everyone in our firm do personal business plans. But from that personal business plan I do at the end of the year, I get a lot of clarity just from reading, going back to stuff I wrote. What are my top five priorities of how I can drive the most impact to our firm, our investors? What is the absolute, complete clarity on what those five things are? And I have a box for each of those five things. So that's five boxes on each of those things. Then I have high priorities because again, those have a different cadence to them. Everything has a different cadence which is why I think you have to see everything together. The boxes on the page change every year. Just like our themes, every year, change. Everything has to change every year because it goes back to adapting, because the world's always changing so quickly. If you're not adapting yourself, then you're going to get lost in this world. So I'll have my five strategic priorities of my time. I'll have people I really want to focus on. Those could be internal, external. I also have on there my health because despite drinking this, I think about it, because I actually think I have to be healthy to be able to do my job.
· Patrick O'Shaughnessy, Alan Waxman
[00:00:00] S0: What would be an example of something that gets written down in health? [00:00:00] S1: I've got on there vitamin D. I'm very focused on vitamin D. I've got my left hip. I had an old soccer injury, so I'm focused on left hip mobility. [00:00:00] S0: But it's something you just see every day, and it's just this constant. [00:00:00] S1: I see it every day. Yeah, everything. There's different things. It's also the personal side, so I keep balance. It is an intention system, but it's also a return on time system and an ability to dynamically prioritize. You talk to younger people who are just coming up through the business. Even some older people still don't know how to prioritize their time. It's really hard to do because you literally could spend all your time on one thing. So how to manage your time and just being able to see that in your brain or in the matrix, that's kind of how I think about it. [00:00:00] S0: Another thing that, the last time we talked, really stuck in my head was – I just turned 40, and we were talking about the opportunity you had from age 40 to 50, which got me wondering about 20 to 30 and 30 to 40. If you think back on the major eras of building and managing a life's work and a career tied to specific ages, what have you learned?
· Alan Waxman
[00:00:00] S1: 20 to 30 for me was education. Learning just as much as I could. Asking as many dumb questions as possible. 20 to 30, you think you know stuff but if you haven't been through cycles or made a lot of mistakes and seen other people make mistakes and seen people make good decisions and good long-term decisions, short-term decisions, you don't really know anything when you're 20 to 30. 30 to 40, you're incredibly ambitious. You're still learning but you're trying to prove yourself. I started Sixth Street with my partners when I was 33 or 34, so I didn't know what I didn't know. I mean, I knew a lot but it's like, you're going through that but you haven't made enough mistakes yet to like refine everything. And you get to 40 or 50, and 40 or 50 is like, if you've spent time learning and continued to learn, you've made enough mistakes, you really know who you are at that point, know who you are as an investor and how you approach things, it's prime time. You get to 50 and then you're trying to really focus on being a mentor, developing the next generation and just trying to provide that voice in the room, not only in terms of investing but also leadership, management and really just trying to be a teacher to your team, but also a learner, because I still learn a lot from them. But 40 to 50, that's go time.
· Patrick O'Shaughnessy
[00:00:00] S0: In go time, one of the questions that I've been asking everybody – because I'm just selfishly curious about it at this age, feels like the right time to ask – is around the measurement of success. Kevin Kelly, one of the founders of Wired magazine has this amazing idea, which is like your success definition should be extremely bespoke to you. Traditional measures of success are traps, money, power, fame, et cetera. And I heard a founder recently say something like, he measures success through the degree of radical self-respect. Success means complete self-respect. And obviously that then means lots of other things. But I'm so curious how – if I'm going into prime time or something, I don't want to waste that. So the objective function of prime time needs to be success.
· Alan Waxman
[00:00:00] S1: That's good wisdom. Let's hit the mistake that people fall into, this whole idea of money, fame, fortune. Once you start to prioritize that, that's a cup that will never get filled. Keep trying to fill the cup and the cup keeps getting bigger and bigger. That cup never gets full. So I think that's one of the problems people make in our industry, is that they think the cup –people say, "Oh, it's easy for you to say where you are now." This is something my dad taught me when I was ten years old. So this is not new. It was never the thing. For me it's like, I just want to do great things, be excellent, and do it with great people that share my values, and do things the right way. That's on the business side, and I want to do all that in a way and be excellent. Not competing against anyone else, competing against ourselves. But do so in a way where I'm the best dad, the best husband and it's – getting one without the other, I just think you're going to be 80 years old, you're looking at your mirror and what was the purpose of life? There's no purpose. The purpose of life for me – and again, it's certainly not about the cup, that's definitely never been it. It's about all those relationships you form and those experiences you go through with people. When you're 80, 85 years old, you're looking back. Hopefully, I'm healthy because I looked at my sheet a lot of times. And it's those relationships and those experiences that I think drive to a fulfilled life. And obviously, it starts with your family, but I have a lot of Hawaiian friends – your hui. Hui is the term for your group, your posse. Having those experiences of climbing up the mountain together, and that's to me what it's all about. And if you are around the right people, you have the clarity of purpose, you have the right values, you have the right culture, and you're going up the mountain together, it's so fun. And you never have to question first principles. How you're going to do business, trying to do it the right way, and it's what we call clean living. But again, doing that at the expense of not spending time with your family, I think that would be pretty unfulfilling to me.
· Patrick O'Shaughnessy
[00:00:00] S0: Last time I got to ask you my traditional closing question, I had to come up with a new one this time. One of my favorite things from our first discussion, and you sent us the visual, which I loved – is the concept of facing the tiger. Maybe you can remind us what that means. I thought you were kidding in the conversation, but literally off the elevator is a giant tiger in your office, which is so funny. I like the principle a lot, but I'm also curious what it means to apply that principle for you and Sixth Street today in this fascinating dynamic environment.