Invest Like the Best with Patrick O'Shaughnessy
· Patrick O'Shaughnessy
[00:00:00] S0: I think a lot about leadership because ultimately, my main job is to back people with LP dollars, lots of them, that have been entrusted to me as a fiduciary, into companies led by these people that we're backing, that are usually pretty early in their company-building journey. So, mostly, you're largely backing the person and the team versus the mature business story. And pretty important that that person's a good leader. And I think one of the things I underestimated about great leaders that... Ravi Gupta is another person that I would list, and people that have really impacted me. At one point, I called everyone I knew. I was like, "Define good leader. I'm going to do a survey." And Ravi gave my favorite answer. He was like, "It's not hard. Like, a great leader is someone that other people want to follow." That's it. And everyone else had given much more ornate definitions, and Ravi's was my favorite. And what I've learned about what is shared in common amongst people that others want to follow, one of the big ones is that they are hyper-communicative with those people. And they're consistent, and they lead from the front. They take risk, they take arrows for the team, they communicate like crazy with the team. If something's changing, they overcommunicate it, you know? They're honest. Like, all these things add up to someone that people want to follow. And I think I was quite bad on that dimension for a long time, not because I was trying to be bad, just because I was so excitable. I am so excitable. Like, when I find something new and interesting, I just cannot get enough. But very often that means I'm billy-goating up ahead of the pack and forgetting that, oh wait, there are all these people that I want to do this with. I don't want to just do this alone. So, that's been a big lesson for me that has taken a while to learn, but yet another thing to credit Sam with.
· David Senra
[00:00:00] S1: Some of the best leaders, like when you see in company buildings, like history's greatest entrepreneurs, really think of them as, like, they're teachers, and then they understand the need to repeat, repeat, repeat. I always say repetition is persuasive. You gave me that great Catholic saying where it's like, "Repetition doesn't spoil the prayer." So, I think of, like, Jim Sinegal, founder of Costco. He has this great line in the book, this biography of his mentor, this guy named Sol Price, who basically influenced... He's, like, the most influential retailer of all time. Jim Sinegal was mentored by him, Sam Walton took more ideas from him than anybody, Bernie Marcus got the idea for doing Home Depot from Sol Price, Jeff Bezos took ideas from Sol Price. Like, it's just incredible how influential this guy was, and most people don't know who he is. And in that book, he says that if you're not spending 90% of your time teaching, you're not doing your job as the leader of the company. And what it is, is like, it means teaching what our philosophy is, what is our purpose, what we do, how we do it, why we're doing it, and you just repeat it over and over again. I just did this episode called "How Elon Works," which is, I think, the most downloaded episode of Founders ever. Like, it's just nuts. And what I was shocked by, you don't think of Elon as a... he's definitely a singular character. There's nobody else like him that I've found, living or dead. There's usually some kind of historical equivalent of anybody. I haven't found a historical equivalent of him. And you would think, "Oh, he's working on, like, seven different companies at a time, he can't possibly be like this." And he was mentioning, like, that algorithm, that four-part algorithm he had that he uses in all his companies. He's like, "I say it so much, I repeat it so much, that you'll be in a meeting, and my executives will be mouthing the words along with me. They know what I'm about to say." And I think that has to do with, like, overcommunication. It's like, "We are going to be on the same page. I'm not worried that you hear this for the 10th time, I'm worried that you're not understanding where we're going, or how we're going to do it." And so I think about that a ton. Like, repeat, repeat, repeat.
· Patrick O'Shaughnessy
[00:00:00] S0: Yeah, the joy of that sort of thing and that sort of leader, my favorite... you have all these great maxims. My favorite maxim, pretty much the only one we use in my business with my team, is "The reward for great work is more work." And I find that saying that maxim to the right person, like the kind of person I want to spend time with, their eyes go wide and they understand it immediately, that the reward for great work is not money, power, fame. It is the privilege to get to do more of this thing that I love doing. The problem with coming up with good terms for this stuff, we use this term "life's work," is that immediately everyone else just starts saying it, and it ceases to have any meaning, because, like, now every goddamn meeting I'm in is like, "I'm doing my life's work." And my experience is that almost nobody is doing their life's work. Even a lot of great founders, I would say, it's not their life's work. I love the fact that Thomas Jefferson, on his tombstone, has three things that describe his life, but one of them is not that he was the President of the United States. It was, you know, author of the Declaration of Independence, founder of the University of Virginia, not President. And I think that's so interesting. And so I think a lot about like, is this thing this person is doing going to be on their tombstone? And usually the answer is no. And the reason I like this concept of life's work so much, which I would define as a lifelong quest to build something for others that expresses who you are. All three parts are really important...
· David Senra
[00:00:00] S1: Say that one more time?
· Patrick O'Shaughnessy
[00:00:00] S0: A lifelong quest to build something for others that expresses who you are. And we have trained ourselves to see this in people. By the way, the best way to figure this out, my favorite question for founders is literally just give me two hours, tell me your whole life story up until the point you founded your company. We'll talk about your company later. Like, just tell me what got you to here. Back to best story wins. Originality, hardship, transformation. In the business context, it's, I want someone that's lived a very unique path. I find success in startups is the result of path dependency very often. Some unique set of lessons and experience led to you being the right person to do this thing. And then hardship, of course, you know, the harder the business is to build, the harder it will be to copy. I think that's really important. Transformation is about the customer. You know, if you build something crazy hard, the customer's life will get way better service. So, I think this powerful concept of life's work can be applied to ourselves, to make great investments. And it's really rare, but the leadership qualities of like, the reward for great work is more work. The reason I started talking about life's work and investing is these people come to realize you will not be rewarded with great work if you do not become a good leader. And a common pitfall that I certainly have fallen in before is, when there's someone really talented, they can do a lot themselves. They can get a lot done themselves. And I refer to this as, like, heroics. And that's always necessary. A founder always is the flame keeper of the spirit of the company. And I think founder-led companies are, of course, so much more interesting, preaching to the choir here, than professionally managed companies for the most part. But I do think that, like, becoming a great leader becomes the most important way to secure more right to do great work.
· David Senra, Patrick O'Shaughnessy
[00:00:00] S1: Is there anybody that you admire that was doing great work and then stopped? Whether they sold their company, they retired, whatever the case is? Is there anybody that you know that, like, you admire personally that stopped? [00:00:00] S0: There are tons of people I admire who change what they do a lot, or have changed what they do a lot, who stopped one thing and went to another thing. [00:00:00] S1: But they're doing something.