Posture & Purpose With Dr. Michelle Carr Frank

Let's Talk About Financial Health with Johnathan Booth

• Chris Logan Media • Season 1 • Episode 11

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This episode of Posture & Purpose we sit down with Johnathan Booth with his Booth-Laird Capital Management and Booth-Laird Ventures.

Jonathan Booth, CFA, CPA/ABV: A Chartered Financial Analyst (CFA) and CPA who is also Accredited in Business Valuation, he has extensive experience in financial analysis and investment research. He earned the Elijah Watt Sells award for scoring one of the ten highest scores on the CPA exam globally in 2006.  He worked as auditor for Ernst & Young and KPMG, two of the world’s largest public accounting firms, before co-founding Booth-Laird Capital Management. He currently serves on the board of directors of private companies FlyGuys and US PBC as well as on the board of advisors for private companies Muddy Water Dredge Solutions and Skillcloud Consulting Group.

Booth-Laird Capital Management is a boutique investment firm founded in 2008 and based in Lafayette, Louisiana. We’re an experienced team that manages money for high-net-worth individuals through private investment funds we create and manage.  

Booth-Laird Ventures is a bespoke venture capital platform.  Current investments include FlyGuys, Muddy Water Dredge Solutions, Skillcloud HCM Solutions, and USPCB.

Our flagship fund is Booth-Laird Investment Partnership, LP (“the fund”).  When you invest with us, your money goes directly into that fund. Similar to a mutual fund, everyone’s money, including ours, is pooled together and invested into the stock market, focusing exclusively on great companies. We make every investment decision ourselves based on our decades of experience. We have a long history of successful investing.



SPEAKER_04:

Say you're teaching me, you're coming to me. Um, you mean that I want to invest in uh Pokemon cards. We're gonna have a hedge fund about Pokemon cards. If this certain group of individuals feel like there's a very um tremendous value in Pokemon cards, they can get together, put their money together, and invest in Pokemon cards.

SPEAKER_00:

Uh that'd be a terrible investment, but sure, if they wanted to do that. Welcome to Posture and Purpose, where both healing and community come together. Make sure to subscribe on Apple, Spotify, and YouTube. Let's get into this episode with Dr. Michelle Car Frank.

SPEAKER_04:

Welcome to Posture and Purpose. And my guest today is Mr. Jonathan Booth of Booth Laird Investments. He is the co-founder and managing partner of Booth Laird. So welcome, Mr. Booth.

SPEAKER_01:

Thank you for having me.

SPEAKER_04:

Well, I'm so happy to have you here today. And um I know your official title is a hedge fund manager.

SPEAKER_02:

Yes.

SPEAKER_04:

Tell us about that. Those who are listening that might not really know what a hedge fund is, how would you explain it in plain English and keep it simple for us? Say you're teaching me, you're coming to me. Um you mean that I want to invest in uh Pokemon cards. We're gonna have a hedge fund about Pokemon cards. If this certain group of individuals feel like there's a very um tremendous value in Pokemon cards, they can get together, put their money together, and invest in Pokemon cards?

SPEAKER_01:

Uh that'd be a terrible investment, but sure. If they wanted to do that.

SPEAKER_04:

But I'm trying to keep it simple.

SPEAKER_01:

You can get some beanie babies while you're at it. Exactly. Keep it simple. What's the new one? There's a new one now.

SPEAKER_04:

They're stealing them, the beanie baby things.

SPEAKER_01:

La boo-boo.

SPEAKER_04:

La boo-boo. You see, you knew about it?

SPEAKER_01:

I did. Well, yeah.

SPEAKER_04:

There you go.

SPEAKER_01:

None of those produce income, so they're worth nothing. I like to I want to spend a minute on Bitcoin because people get I get asked all the time, should I be investing into Bitcoin? What are your thoughts? It's purely speculation. I mean, it's practically a Ponti scheme. Imagine someone gave you a physical token and said, this is worth$100,000. It's like, well, why? Because someone just paid$50,000 for it. Um so why would I pay$100,000? Because someone else might pay$150,000. Well, why would they and no, it's just it's purely based on, well, someone might pay more for it down the road. It's pure speculative. And right, it's just like Dutch tulips in the 1700s. There have been so many bubbles throughout history where people just get fixated on some specific asset like that that has no intrinsic value whatsoever. It doesn't produce any income. It's not, I mean, you can use it as an exchange of good, but that doesn't mean it has true intrinsic value. So I tell people just avoid it. You know, it's okay if something takes off and you don't participate, uh, because eventually you're gonna run out of people to buy the Bitcoin. Eventually, people are gonna stop buying it. Whatever it is, the the beanie babies, it people stop buying it. It fell out of favor. It think of it that that way.

SPEAKER_02:

Yeah.

SPEAKER_01:

And what the wise man does in the beginning, the fool does in the end. And eventually someone's gonna be caught holding the bag and they're gonna have spent$200,000 on a Bitcoin that's now worth 10 cents.

SPEAKER_04:

I mean Or a bag of beanie babies.

SPEAKER_01:

Or yeah, essentially.

SPEAKER_04:

So what does a normal day in the life of a hedge fund manager look like? I know you hate that term, but what does a typical day look like for you?

SPEAKER_01:

Well, I don't hate the term so much, it's just it scares people. And so we run a private investment partnership rather than it's just an easier way to say hedge fund. But my day is just reading. It's a lot of reading. I get up and I read and I go to bed reading, and it's it's articles, it's interviews, it's uh because essentially I'm analyzing investment opportunities, and that just requires a ton of reading.

SPEAKER_04:

So reading about financial articles or businesses, uh, new businesses, um, businesses that can be acquired.

SPEAKER_01:

Right. It's everything. So if I'm analyzing a specific company, I'm reading their annual report, their financial statements, their quarterly earnings releases, their transcripts of transcripts of their earnings calls where management talks to the analyst about what's going on with the company. That's every quarter. I'm reading um interviews they may have done at some conference or on TV, and or I'm reading an article from a trade magazine about the industry. I mean, it's just think of think of it as an investigative journalist who has to write a report on a specific topic. That's effectively what I am for any specific investment. And then outside of that, I'll spend time reading articles basically on um just anything business related or tangent to it because I'm constantly having to connect dots. I love the phrase always be collecting dots because you'll always be connecting dots.

SPEAKER_04:

I like that.

SPEAKER_01:

And so our skill set, my particular skill set is pattern recognition. And part of that is seeing, okay, well, here's this piece of information, and here's this piece of information, and my brain can figure out how they're connected. And that's how you gain insights to make some good investments, or just as importantly, see what risks are coming down the road. So we have gotten out of investments in the past because I've seen I was tipped off to on something that my brain then carried through down whatever pathway to figure out this is how this leads to failure for this company. And I got out, and a couple times that those companies ended up going bankrupt. And we still made money on the investment because we got out in time.

SPEAKER_04:

How interesting that I'm seeing a correlation between that and chiropractic or health. Because if you see patterns with people, whether it be a genetic pattern or a lifestyle pattern, if you don't have healthy patterns and you don't follow those things through life like you should, the same thing will happen to you. And what's the end result? Unfortunately, an unhealthy or failure of health.

SPEAKER_02:

Right. Believe it.

SPEAKER_04:

Everything leads back to chiropractic with me though. It's just how I am. But I know you're very passionate about the financial world. What what ignited this passion in you to, you know, really go for it and go to school for this? And can you share with us the moment or maybe a story where you said, okay, this is this is my passion?

SPEAKER_01:

Well, it started super young. My uncle got me into investing when I was 11 years old. He would buy me stock in McDonald's and we'd go over earnings releases, and he would just instill that it wasn't just a piece of paper. You're buying a piece of a business. And so we would, if you're going to McDonald's, you own 0.001% of this company, but you own a piece of this business.

SPEAKER_04:

Did you want to go to McDonald's all the time?

SPEAKER_01:

I was raised on McDonald's. I mean, I had a st you had stock in it.

SPEAKER_04:

Why wouldn't you be? Exactly.

SPEAKER_01:

Yes, McDonald's was what I'm wanting to go to. I I love the restaurant. That's why he chose the stock, was because I loved McDonald's. And that was because he knew it would be something that would interest me.

SPEAKER_02:

Sure.

SPEAKER_01:

I tried to pass that down to my nieces and nephews. I would buy them stock in Disney. It did not have the same effect. They were not as interested as I was. But uh just so starting at age 11, it was years of buying McDonald's stock, family members buying me stock. By the time I was in high school, I was managing my own little tiny portfolio. And when I was 19, he took me to see Warren Buffett, the Berkshire Hathaway Annual Stockholders Meeting, which is held in Omaha every year, and that is called the Woodstock for Capitalists. So you you're sitting in this auditorium.

SPEAKER_04:

And how old were you?

SPEAKER_01:

19.

SPEAKER_04:

19. Most people don't know what a portfolio is at 19.

SPEAKER_01:

I was taught very young, but nine uh it took me at age 19 and nine and age 20, and I went again a couple years uh with my business partner. And you're sitting in this auditorium and you're listening to Charlie Munger and Warren Buffett, who've been partners, they were partners for 60 years before Munger passed away. They're just talking about everything life, business, and spewing information, spewing knowledge of their fields.

SPEAKER_04:

Right. So, what was that experience like for you?

SPEAKER_01:

I mean, 19-year-old little Jonathan is just in awe, just soaking all of this in. And I would say that's the moment. Because I remember sitting in that auditorium, looking at them on that stage and saying, that's what I want to do. And I was already in accounting, which is a pathway to investing. Typically you'd go finance, but I was already in accounting, and so I ended up getting my ma bachelor's in accounting and master's in accounting, but the whole time I continued investing on my own. And when I met my business partner working at uh KPMG, an accounting firm, within seven months we'd started our parent company. We just both clicked, we both had similar. Right. I think I was 24, he was 25.

SPEAKER_04:

Okay, and you guys met at school or in a firm setting.

SPEAKER_01:

He claims we knew each other at LSU. I don't remember him. So I don't know if that's true or not.

SPEAKER_04:

I hope he's not listening.

SPEAKER_01:

He knows this. We've talked about it.

SPEAKER_04:

Okay.

SPEAKER_01:

But we met uh when I went to interview with KPMG, they brought him on to the the interview dinner because he was good with people. And so I met that was the first time I met him, was it and I thought he was way older than me because he looks way older than I do.

SPEAKER_04:

Oh goodness. Okay. We might need to edit that part out. But good. So you built a a very strong working relationship at a young age, and I assume he is still your partner now.

SPEAKER_01:

Still my partner, 17 years and going.

SPEAKER_04:

Well, that that that speaks highly of your relationship that you built so many years ago. So what if you could explain some of the most common either misconceptions or misunderstandings about what you do? I know you said people think uh, you know, hedge funds mean uh oh gosh, uh large amounts of money, which it, you know, sure, sometimes it certainly is.

SPEAKER_02:

Right.

SPEAKER_04:

But if someone is either dabbling in finance or may possibly be in school for finance right now, what is something that you want them to hear today? What is something that you'd like them to learn?

SPEAKER_01:

That's a good question. Because there's so many different parts of finance. The the number one lesson, the number one thing I tell people is you have to invest your personality.

SPEAKER_03:

Really?

SPEAKER_01:

A dollar doesn't know how it's made, but there are so many ways to be successful in investing. And my way of investing it fits my personality. And it took me a good probably six years to learn that. So there are people, we're very concentrated. We're in less than 20 investments, and we're very comfortable with that. Someone else's personality that may not sit suit what what they're comfortable with. They may need to be in a hundred different investments, and they can still be successful that fits their personality. So, or they might be real estate. We're not real estate investors. Someone might be more far more comfortable in real estate than they are in stocks or in private companies versus public companies.

SPEAKER_04:

So find something that they are individually passionate about.

SPEAKER_01:

Try different things, bullets before cannonballs. So try, you know, a little bit or or even do a uh a mock portfolio. You don't have to actually put real dollars at it, but just start learning about different areas of investing and see what you gravitate to and what you feel the most comfortable in, and and uh that's where you have to focus your time.

SPEAKER_04:

Yeah, I've with me personally, if you're passionate about something, it will fall into place. Sure. Just don't give up, spend time with others, look to others that are are your idea of success and uh follow them, possibly. So speaking of different investments and uh decision making, how do you balance um just instinctual decisions um with driven um uh statistical like decisions?

SPEAKER_01:

So it all starts with the data. Uh we we always start with the data. But I've analyzed hundreds of companies, maybe over a thousand, dozens of different industries. So I have such a baseline now where I can see a pattern and instantly have some mental model that I can run it through.

SPEAKER_04:

Is it ever a gut decision? Is it everyone?

SPEAKER_01:

It's never a gut decision because it has to start with the data.

SPEAKER_04:

Okay. Okay.

SPEAKER_01:

But I will say because it gets very there's in intuition involved. There's certainly intuition. There's a business sense that you have to have. So you might call that a gut decision. But Warren Buffett said, I am a great investor because I'm a great businessman. And I'm a great businessman because I'm a great investor.

SPEAKER_04:

It starts there.

SPEAKER_01:

Now I don't want to call myself great, but I will say that uh having an innate ability with business really makes me a good investor and vice versa. And so many invest investors, finance people that I see, they don't have that business sense. And so I think that's a lot of times why you see a stock price drop or uh a company be out of favor. A lot of people investing or following that company, they don't understand the business part of it. They're so focused on there's a new threat of competition, there's a slow quarter, whatever it is, and they don't, they can't, they don't have the vision or the insight to think ahead five to ten years like we do. And so I guess you might call that a gut reaction or the gut instinct, but it's just understanding this is logically how this should play out based on my understanding of business, this industry, this company, uh, and honestly, that was a big part of what we brought to Fly Guys.

SPEAKER_04:

So well, my next question, other than saying you've certainly, you know, proven that you are quite good at what you do from certain gut decisions or data-driven decisions that you've made. I know you have some accolades with your education. Could you share that with us? I wanted to my audience to hear those as well.

SPEAKER_01:

Well, I did, so I passed the CPA exam and I scored one of the ten highest scores in the world on the exam the year that I took it in 2006. And so they give you an award. It's called the Elijah Watts Sales Award.

SPEAKER_04:

Elijah Watts Sales Award?

SPEAKER_01:

Elijah Watt Sales Award.

SPEAKER_04:

Okay.

SPEAKER_01:

Who was some individual decades ago that they named the award after. And it's given from the AI CPA and to the top ten. They they've changed it, but back then it was the top ten scores, period. I don't know how I did it. Uh I just studied really hard because I didn't want to fail and got the award.

SPEAKER_04:

So data driven, right? Data driven.

SPEAKER_01:

Uh yeah.

SPEAKER_04:

Very, you know, just well, that speaks very highly of you as well. So, which brings me to my next point. I wanted you to tell us, share with our audience what Fly Guys is. How did that come about? Where are we now? Um, anything you'd like to share, tell us about that experience.

SPEAKER_01:

So Fly Guys is a reality data capture company, and we use drones primarily to do that. But we have clients in many different industries who need the raw physical data of the physical world, and they use that for their software to produce some report, they're usually for whatever their client is, and I can give you some examples in a minute.

SPEAKER_02:

Yeah.

SPEAKER_01:

But we have 17,000 pilots in our network nationwide. So think of Uber. We only engage pilots as we need them for whatever the client needs. So theoretically, it's infinitely scalable, which is one of the things I love about the business. They're all independent contractors, they all own their own equipment. So we don't have to go hire a bunch of pilots, we don't have to hire a bunch of buy a bunch of equipment to expand business. We wait for the business to come first and then we go hire them. And I I love that.

SPEAKER_04:

Was that a gut decision?

SPEAKER_01:

Well, that was just how it was set up. I mean, and it makes sense. And that was part of the reason why we invested was the scalability. So when you're investing in a startup, you want to know how easy is it for this company to scale. Like if your business is uh I work in construction and I provide cranes. Okay, well, you have to go buy a crane to rent it out to expand, you have to spend another$500,000, a million dollars, however much it is, to buy a second crane. It's hard to scale without a ton of capital. Or else you just go super slow because you have to generate enough income to buy the second crane. But in a highly scalable business like ours, you don't have to continuously invest a ton of money up front to support revenue growth. And so that's the thing that we really loved about the attention. It really caught my attention. And also our founder at the time, Adam Zayer, who uh high-energy guy, and that's what brought me to it. He was a client of mine in my fund, still is, and he came to me, and I remember it was we met at CC's in Baton Rouge in January of 2018. I remember that like it was yesterday, because it was life-changing for all of us. And he said, I have this idea called Fly Guys, and it was pre-revenue, and he was just excited to tell me about it because my clients we love to talk about business. I'm a business junkie, they know they can always come to me and just like, hey, I've got this cool thing going. Right. And but we had never invested in any kind of startup at that point. But I liked him a lot. I really liked the opportunity, and so I said, Well, let's put together a little fund and and invest alongside you. And that was the start of our venture investing. He actually worked full-time, he oversaw the LNG facility build a big chunk of it in Cameron, and he was making a really good salary.

SPEAKER_04:

What is LNG?

SPEAKER_01:

LNG is the big uh liquefied natural gas facility that they built in outside of Lake Charles.

SPEAKER_04:

Interesting.

SPEAKER_01:

That's was a multi-billion dollar project. His piece of it that he oversaw was$800 million piece. He had 2,000 people under him. I mean, those this was a big deal. I made him quit that job to run Fly Guys full-time.

SPEAKER_04:

Oh, goodness.

SPEAKER_01:

If he wanted us to invest.

SPEAKER_04:

Oh.

SPEAKER_01:

And made them incorporate, form a board of directors. Just, you know, let's make a real business here. I'm still on the board of directors. I'm the only original board member still there. Um but it's it's pivoted and grown over time. One of the one of the things more interesting to bits is that Kevin O'Leary just became an investor.

SPEAKER_04:

Kevin O'Leary Leary from Shark Tank?

SPEAKER_01:

Yes.

SPEAKER_04:

The Kevin O'Leary? Mr.

SPEAKER_01:

Wonderful.

SPEAKER_04:

Mr. Wonderful, okay.

SPEAKER_01:

Who invested through something called the Wonder Fund really North Dakota.

SPEAKER_04:

How did that come about? Tell us about that experience.

SPEAKER_01:

So our CEO, Joe Style, he, our current CEO, who's exceptional, he knew Kevin from a previous investment. They were both invested in the same private company. Joe was on that board of directors. And so in January of this year, we were in the middle of a capital raise round, and Joe just sent Kevin the pitch deck. It was like six o'clock on a Tuesday night. He said, within one hour, Kevin responded and said, Let's meet. I'm very interested. As it turns out, Kevin had been looking for a drone company who also has heavy exposure to AI. And I'll go back, go into that in a minute. And so Joe went out to see Kevin the next week and he said it felt like they were pitching us, pitching me on of course they wanted to invest.

SPEAKER_04:

That's when you know you're doing something right.

SPEAKER_01:

Yes. And you know, he was he's been a great um Kevin has been great throughout this whole process of finalizing the investment. Joe and Kevin just had a sit-down interview just last week. And Kevin, that's gonna go on different social media, might go on TV. He's gonna do a lot to promote Fly Guys beyond just in dot his dollars, which were substantial. He's also gonna do a lot to promote Fly Guys through social media. Um, intimately involved.

SPEAKER_04:

It's not just my name's behind it.

SPEAKER_01:

Exactly, which is fantastic. That's only gonna help us get to the next level.

SPEAKER_04:

And that again, um very impressive, and that speaks highly of your experience. I know you say it's not so much about gut decisions, but I don't know. That that meeting sounds like um your gut was telling you something. So right.

SPEAKER_01:

And I I said I would go into some of what their things were, and I never did. Some of what Flyguys does, there's so many different use cases.

SPEAKER_04:

Yes, who are the some of the customers?

SPEAKER_01:

It's every everything under the sun. Every day it's a new use case. We have a client, we have multiple clients who need construction progress monitoring. So imagine your like Buckeys. Every new Bucky's being built going forward, we'll use Flyguys for construction progress monitoring. So they have headquarters wherever their headquarters is, the executive or management team, they can't be on site every day. They use us to fly over the project once a week, once every other week, and send them the data so that they can see that right. And so they can see, okay, well, this is progressing, you know, they know what to look for. And I mean that's one of the simpler things about that.

SPEAKER_04:

Yeah, I can imagine real estate also farming, uh, farming uses uh, you know, my goodness.

SPEAKER_01:

Agriculture is the biggest piece and the fastest growing piece. We have a client who uh and they're growing rapidly, they use us to fly over the so the client itself goes out and gets farmers as their client, and they tell the farmer, we can g generate a report to tell you throughout the growing season where you have too much water, where we have enough water, not enough, you need chemicals here, you have bugs, pests there, what have you.

SPEAKER_04:

Certainly makes for a big change in that industry.

SPEAKER_01:

And they but someone needs to actually capture the data that they then run through their report. So they use us. And so six times throughout the growing season, we go out there and and fly the fields, and it's getting bigger, and we st I think the first year was six hundred thousand acres, and then the next year was two or three million acres, and then there's a hundred and eighty million acres of this specific type of crop in the U.S. alone. There's eight hundred million acres of all farmland in the U.S. alone. They all could use this. Sure. And we're just in the beginning stages. I mean, that's that's gonna be huge. And then during the off-season, we have another client, the non-growing season, we have another client who uses us uh and we fly the field for them, and then they can tell the customer you where all your rocks are and that, you know, where they can go and perfect the field during the off-season to maximize their their growing during the growing season. And then we have another client who uses us uh to max to make it more efficient to spray weeds. So they can we can fly over the field and and um they use that data to show their client, here are your weeds, so they can be very efficient of just spraying where the weeds are. Otherwise, you're just spraying the whole thing.

SPEAKER_04:

And I can imagine maybe even security issues as well. I mean, that could also be uh a client for you if it's if not currently down the road for security purposes as well.

SPEAKER_01:

I'm constantly surprised by the use cases. And we might I mean I'm I'm a board member now, I get the monthly board calls, we might have one.

SPEAKER_04:

Might be me, who knows? Yeah. So could you share with us a market call you made, whether it be a right or wrong decision, but you did learn from it?

SPEAKER_01:

Well, I learned from every decision. We we document every decision that we make, and we go back and look later to see if it was right or wrong, and so we can it's constantly doing what's called a post-mortem analysis. Oh. But uh certainly no one's gonna have a perfect combating average unless you're just super cautious, in which case your return is gonna be very low. Or you're just in treasuries. I mean, you're not anything risky.

SPEAKER_04:

That's life.

SPEAKER_01:

That's life. Well, we all make risks and we're investing in high-quality companies, and we've come a very long way in identifying what is and is not a high-quality company. I the one that that uh sticks out to most right now as you're asking that question is Bed Bath and Beyond. So we invested in Bed Bath and Beyond in 20, I want to say around 2016, 2017, they had 25 years of uninterrupted sales growth. 25 years. Wow. Very strong balance sheet at the time, great margins. I mean, at the think 10 years ago, how popular Bed Bath and Beyond was. Amazon, of course, had been around a while and growing rapidly.

SPEAKER_02:

Sure.

SPEAKER_01:

And taking market share, but the business and Bed Bath Beyond was still continuing to do ex exceptionally well. The stock ran up after we invested, we were sitting in a very strong positive position. But the cracks started to show. They started taking on more and more debt to buy back stock to prop up their earnings per share growth. So they were starting to manipulate the numbers.

SPEAKER_04:

And things were changing.

SPEAKER_01:

And things were changing, and you started to see uh we started to notice that more cracks were showing that they were pivoting into areas where they hadn't done before, uh, things like that. So we that was one where we saw the writing on the wall, and we got out. And we we broke, we made money, not much, because it came back down by the time we sold, and now they're bankrupt. So the lesson we learned was primarily we avoid retail in general. We don't like being in an investment where the customer can easily switch to someone else. So that was the biggest thing was if your customers can walk away and there's no consequence to them, there's no switching costs, um, it's super easy to find an alternative, that's not a great place to be. How can you stick your money in that for years and be confident? So we want something that is mission critical. And so every every investment since then is a mission critical company. So, in other words, our investments, their customers need them, and to displace them would be very difficult. Fly guys is a great example. It would be very difficult for our customers to find an alternative to Fly Guys, and we're so embedded into many of their operations that even if they did, if someone existed, which does not, but if a competitor, true competitor existed of the same quality, removing us and plugging them in would take time. And that's the type of investment we focus on now where it just gives us so much more comfort that you is not they're not going to lose all their customers the next day.

SPEAKER_04:

Right. And uh for someone that would possibly just be getting started and they might have a little nest egg that they want to put some money into, what would be your very baseline advice for financial fitness for them moving forward? A a a young person, you know, early 20s, has you know got through college, got a fantastic position, and knows that um they're gonna be conservative with their money and they might have some money to s to put away and be smart with it. What would you tell them to do?

SPEAKER_01:

Okay, so it depends on their specific circumstance.

SPEAKER_04:

Very basic.

SPEAKER_01:

If they're with a company that has a 401k, match it. That's free money. Or whatever they match, maximize that, because that's free money. If you put in 3% and they match whatever you put in up to 3%, you immediately get 3% free money. That's 100% return on day one. You can't beat that. So do that. Beyond that, invest uh set up an IRA, a Roth IRA, if you're young, because a Roth IRA, you're paying taxes today. It's not pre-tax money. Um, but you are not paying taxes when you take it out. So your money can grow for the next 40 years, and you're not paying taxes on that growth.

SPEAKER_02:

And then it's yours.

SPEAKER_01:

So and you once you reach a certain income level, you can't do a Roth IRA. So do a Roth IRA, put as much money as you can while you can, while you can, and just put it into an index fund. Unless you know someone, like our minimum investment's pretty high. You know, generally someone fresh out of college isn't gonna be able to invest with us. Unless you know someone that you really trust to manage your money and invest for you, just stick it into an index fund. An SP 500. If you're young, I would do what's called a Russell 2000 index fund. So that's 2,000 of the smallest companies in the top 3,000. So the SP 500 is the 500 largest publicly traded companies. The Russell 2000 is or the smaller companies.

SPEAKER_04:

So it's doable for someone that is just getting started.

SPEAKER_01:

It's very doable and it's easy, and people just get so intimidated. Even now, I I encounter people very successful, doctors, what have you, they're in their 50s, 60s. Well, they're they're so intimidated about them.

SPEAKER_04:

And they could have been burned too. You know, that's they could have been burned, and that's very legitimate.

SPEAKER_01:

And there are a lot of bad players out there, a lot of people who with good intentions who just aren't very good, unfortunately. So that is tough. But if you just stick it into an index fund super early and just add to it all the every year, every month, whatever, and don't touch it for 40 years, I think you'll be very happy with the results.

SPEAKER_04:

And for someone who may be wanting to go um to get an education on finance or accounting, would you say most of your success has been about strategy, timing, or relationships?

SPEAKER_01:

That's a great question. You can't time the market. It's I would say that it's education. Because I've read everything. From an early age, I've read every investing book.

SPEAKER_04:

I just read now with podcasts. There's so many things to learn as well.

SPEAKER_01:

And what I'm find finding is more and more people are relying on AI. And their studies are showing that even just a few months of over-reliance on AI makes you worse at something. Because you're not you're not exercising those skills that you've been doing. They found this with doctors. I don't know if you saw this. So doctors that diagnose cancer who've been using AI, they took away the AI tools, and their success rate went down from before because they lost that that skill. It diminished.

SPEAKER_02:

Wow.

SPEAKER_01:

And more and more people in this world are going to rely on AI. They're not going to do the hard work of reading whatever it is themselves and doing the internal processing themselves.

SPEAKER_04:

Oh, I don't know about that.

SPEAKER_01:

My advice to a young person is you have a huge advantage if you just do the hard work and just read. Read it yourself. Don't rely on AI to summarize it and tell you what to get out of it.

SPEAKER_04:

Yes.

SPEAKER_01:

Figure that out on your own, and you will be. So much, especially down the road, five, ten years. I mean, you'll you'll be able to do that.

SPEAKER_04:

Yeah, one of my favorite quotes is Um It's funny, the harder I work, the luckier I get. Yeah. So there's nothing that compares to hard work. It will happen if you work hard at it, no matter what that field would be.

SPEAKER_01:

But I will say, sorry, I did want to backtrack on that one more because relationships are also very important.

unknown:

Yes.

SPEAKER_01:

You've got to treat everyone kindly.

SPEAKER_04:

With respect.

SPEAKER_01:

Yes. And this was uh this is one of my favorite stories. When I Kevin and I were working at KPMG, there was this guy, pretty awkward, uh, a little nerdy, which coming from me, that's that says a lot. And everyone picked on him. And it's just not my nature to do that. And I was like, this guy's just trying to fit in. It's hard enough as it is, the job that we had. So Kevin and I were just nice, just you know, decent people, just nice to the guy.

SPEAKER_04:

Well, that helps.

SPEAKER_01:

And he noticed. We didn't realize, but it really uh he noticed. And of course he washed out, he wasn't that great at what he was doing, but he washed out, ended up in construction. Went from public accounting to construction. And little did we know that over the next five, six years, he was our biggest fan, even though we really didn't have any contact with him.

SPEAKER_04:

But he was watching.

SPEAKER_01:

And fast forward to about 2014, he had a roommate named Adam Zare, and he told Adam, these are these really nice guys who are good at investing. And he introduced me to Adam.

SPEAKER_04:

That brought you to that meeting.

SPEAKER_01:

And then five years later, four years later, Adam and I met about Fly Guys.

SPEAKER_04:

Fly Guys, and now Kevin O'Leary is a part of that investment.

SPEAKER_01:

Right.

SPEAKER_04:

And there's there's no end in sight onward and upward.

SPEAKER_01:

Exactly. And all because I I was nice to someone 17 years ago.

SPEAKER_04:

Being a decent person and human usually pays off. Yes, I just with any field um out there. So I always like to ask all of my uh guests this last question. How do you maintain your posture while pursuing your purpose in life?

SPEAKER_01:

Well, it's not always easy. We follow what Warren Buffett calls the front page rule. Every decision that we make, everything that we do in life, we we act under the assumption that a knowledgeable journalist will write about it on the front page of the newspaper. And so if you live your life like that, then you never have to feel guilty or ashamed or or think that you're hiding something, because there's nothing to hide. And we always do what we feel is the right thing, even if you know it's to our detriment, but we feel it's the right thing for our client or for the investment, then we'll do it. And you know, it just makes it much easier to just go through life and and you know, our clients notice and that can apply to all. Our business partners notice, and certainly it applies to everything.

SPEAKER_04:

I think it's a great, a great answer. So thank you so much for being here. And until next time, sit up straight, stay happy, stay healthy, and stay adjusted.

SPEAKER_00:

Thanks for listening to the Posture and Purpose Podcast with Dr. Michelle Carr Frank. Make sure to subscribe on YouTube, Spotify, and Apple Podcasts. Until next time.