“So much has been done, exclaimed the soul of Frankenstein – more, far more, will I achieve; treading in the steps already marked, I will pioneer a new way, explore unknown powers, and unfold to the worlds the deepest mysteries of creation.”   -- Mary Shelly, Frankenstein, 1818

So I’m back in the bar, still reeling from my conversation last week with The Earth.  And who walks but Dr. Victor Frankenstein!  (No, not the Boris Karloff Frankenstein – that was the monster.  Victor is the guy who created him; he looks kinda like Gene Wilder. 

“Wow,” I say, “Dr. Frankenstein – what a surprise!  There’s been something I’ve always wanted to ask you.  Can I buy you a beer?”

“Well young man, that’s very kind, but if you don’t mind, I’d prefer a nice Claret.”  

“Um, Claret? That’s like wine, right? OK.  Johnny,” I say to the bartender, “can I get another beer here, and do you have a red wine for my friend?”

“Now Doc,” I say, “my question, what exactly does it mean to be "human?  I mean, we like to think that being human is to be kind, thoughtful, unselfish.  That our intellect and compassion separate us from the animals.  Make us, you know, the superior beings that we are.  But I figure you’d know, since, well, you know what I mean – you ‘made’ a human – sort of?”  

Frankenstein pauses, looking thoughtfully into his wine.   “That is a very difficult question, young man, but if you have time, I’ll start with your brain.  You see, while we understand that the brain is not just a blob of slimy gray stuff – that is has parts like the occipital lobe, the frontal lobe, the Cerebral Cortex and more – we really don’t understand how it works.”

“What?  How could that be?”  Me, incredulous.  “I mean, Elon Musk says we’re already building machines that are smarter than us!  How can that be if we don’t even understand how our brains work?”

“We can talk about Elon Musk another time, but we really don’t understand much about anything.  As far as the brain goes, Dr. Jeff Lichtman of Harvard, a leader in neurology, at the start of each semester asks his student this question:  ‘If everything you need to know about the brain is a mile, how far have we walked in this mile?’” 

“I don’t know – but since we’re building technology right now that connects the brain and thought waves and that kind’a stuff to computers, we must’a passed that mile a long time ago!”

Frankenstein scoffs.  “Well, according to Dr. Lichtman, the answer is about 3 inches.  You ask me ‘what is human,’ but all we really know is that everything we think we know is wrong.”

“But how can that be?  I mean, we’ve built rocket ships!  We’ve been to the moon!  We’ve invented The Magic Eight Ball – and socks-with-toes!”

“My point is that the conventional wisdom is always wrong.  Given enough time, all things that we believe as fact and truth today are proven to be wrong.   We don’t even understand time – though the majority of physicists today acknowledge that time is not linear; that the past and the future are concepts adopted by humans…Well, anyway, that’s a topic for another blog.  You get my point – we really don’t know much, about anything.  Back to being human – and the brain.  There is a part of the brain – call it primitive, or reptilian – it’s in the brain stem and cerebellum.  And since you’re a Silicon Valley guy, think of it as the software that helps you survive – programed for sleep, pain, hunger, conserving energy, ‘fight or flight’ – all the basic functions required to live – and to propagate the species.  Which is the bottom line for any species, right?  Procreation.”

“OK, sure.  I’ve heard about the ‘reptilian brain’ – but that brain’s bad, right?  If we only had a reptilian brain, we’d be like, well, you know – reptiles.  And we couldn’t even “like” on Facebook!  So what’s the rest of the story?”

“Funny you should ask.  Charles Darwin and I were discussing that a couple of decades ago.  He was telling me about how the human brain has evolved – how those other parts of the brain started to ‘think’ and to ‘reason.’  But that wasn’t very long ago – a few million years ago – give or take.”

“Millions-of-years?  That’s forever!”

“Ha!  Not at all.”  Shaking his head.   “You need to read your other blog.  The Earth is almost 5 billion years old.  A million years is a blink of the eye in Earth time.  And in fact we homo sapiens were just one of a whole bunch of new experimental of candidates for a new model for the species.  The others died out – extinct - hit the big evolutionary dead end.”  

“Wow, good thing we made it!”

“Made it?”  Frankenstein laughs.  “Like I said, we still know nothing.  Home sapiens are most likely just another evolutionary dead end.  Consider that single and simple goal for a species - survival - and every that species on the planet proceeds down a path in which it is constantly evolves and hopefully adapts through mutation to a changing environment in order to survive.   As I said, we humans are a relatively "new" species.  Compared to dinosaurs, for example, we're still the new kids on the block.  We haven't the evolutionary chops that support all of this ‘human’ arrogance and superiority we developed of the millennia.    Cockroaches, for example – they should swagger.  Cockroaches have made it for 300M years so far, and appear to be in no danger of extinction.  If we look at the enlightened vs the primitive man, our evolutionary case is even flimsier.   What we consider human civilization is a scant thousands-of-years old project.  So for the first six millions of years or so humankind seemed to go pretty well.   Sure, life was tough, small tribes fought against other small tribes in the quest for survival (food, bigger caves…) and with the other animals on both sides of the food chain.  But ‘man’ was simply a part of the environment, not a changer of the environment. 

Human population grew during those millions-of-years, but very gradually, and in concert with the rest of the species with which humans evolved.  Homo sapiens survived, and all was good.   Then civilization happened, and caves grew to cities, and things started getting recorded and science happened and eventually the Kardashians were born.  All the enlightened stuff we describe as being ‘human.’   Yet what if all of this is simply an aberration, an evolutionary dead end, that has a run for several millennium and then simply fades from the planet?  Just another fad – like disco?  Because the evolution of all the things we consider ‘human’ are in fact not consistent with the single and simple goal for a species: survival.   And I'm not referring to war and our success in creating better weapons to more effectively kill each other.  No – think about all or our ‘great’ accomplishments - advancements in medicine, industrialization, and smart toilets.   Things that have greatly increased the span of life of humans.  

But as a result, the human population, which grew only very moderately and sustainably for the first 6M years, exploded over the past couple of centuries.  Human population growth (and it's curtailment) became and remains a topic of great social concern for the enlightened mind.  And yet it is the advancement of all the things we call human that have caused humans to start thinking about our own extinction.  The increasing life span, for example, and the prospect of curing all diseases, is certainly within reach of medical science within a century or two.  Humans that can live for centuries?  That would cause a massive threat to the continuation - the survival - of the species.  And that's only one of the issues that we as enlightened humans and all of our progress have to face.”

“So, you’re telling me we’re killing ourselves – in the name of humanity?”

“Well, yes, of course we are – have you been to San Francisco recently?  But that’s not my point.   I can see you’re a bit slow, so I’ll say it again: as humans, we really know nothing.  We have no concept of where we are in the universe.  We know and understand as much about the universe as an ant in an ant colony can understand its place in New York City.  Yet we pretend to understand how the Earth warms and cools.  And we try to build machines that think and reason – while we don’t even know how our own brains work.”

“So what’s the point, doc?”

“The point is, I happen to know something about fiddling with life, and you know how that turned out.  Kids still have nightmares about my little project.  So I’m telling you, knock it off with the machine-brain thing.”

“So progress is bad?”

“Dammit, kid, you are dense.  No, progress isn’t bad, but aim it in the right direction.  Here you are, trying to connect computers and brains, and you no more idea where you’re going than I did when I hooked my little monster up to an electrode and a lightning bolt.  Look around, kid – have you noticed that in the past year, let alone the past 30 centuries, we still haven’t progressed all far from the cave?  We’re still using our reptilian brain – we’re still afraid of anyone who isn’t just like us, who doesn’t believe what we believe, or doesn’t look just like us.  Have you been to Minneapolis – or St. Louis?   How about we figure ourselves out before we try to create a new one from scratch.”

“Look, I could talk the next decade about human fear and being tribal and the fact that our DNA is wired basically the same it was six-million years ago – and that doesn’t mean it’s wired for compassion and understanding.  But you can learn!  Thanks for the wine – but I really have to run.  I’ve left Igor with a couple of abnormal brains – reminding me that you guys should worry about finding a real leader rather than the two clowns in that abysmal presidential debate last week.” 

Forget about saving the planet – let’s save ourselves.  It’s relative.

So I’m at the bar and who walks in but The Earth.  That’s right – but he’s not “Mother,” he’s a guy.  He sits down next to me.  I say, “Hey, it’s not everyday I get to talk to the earth in person.  Let me buy you a drink.”

“Thanks,” says Earth, “but I hope this isn’t you’re way of ‘saving’ me.  You know, you humans can be really annoying.  You’ve been around – what – a million years or so?”

“Well, yeah, but what’s the point?”

“Look,” says Earth, taking a sip of the Manhattan I just bought him, “with all due respect, I’m pretty capable of taking care of myself.  Do you have any idea how long four-and-a-half billion years is?  Yet me put it in perspective for you.  If I was a year old, your time on my planet – and I’m talking about the first time one of you guys got off your knees and walked out of a cave – it’s less than a second.  Microseconds.   You know, I hate to burst your bubble, since you bought me a drink and all, but you humans are pretty insignificant.”

“Insignificant?  What the Hell?   Human ingenuity has no bounds – I mean, come on – we invented the Internet!  And burgers with no meat!”

“Yeah, funny.  Now the dinosaurs – they were significant.  Of course, nothing like cockroaches.  They’ve made it for over 300 million years – and they’re still thriving.”

“Dinosaurs?  They’re extinct – they didn’t even survive.”

“Look kid, let’s go back to this time thing, of which your species apparently just cannot comprehend.  Those dinosaurs, who you write off as insignificant, were, in fact, walking around on me for over 165 million years.   Do you realize the time between the extinction of the Stegosaurus and the first Tyrannosaurus was longer than the time between the last Tyrannosaurus and the first Man?  Those dinosaurs – they were grand.  They’d still be here today if that damn asteroid 65 millions years ago didn’t smash into what you guys Mexico today.  But they never thought about saving me.  See – the scale of time, and distance - the universe – it’s just way to far out of your comprehension of relativity.  For example, you co-exist with ant colonies, right?  But do you think ants can grasp and understand the scope and scale of human existence?  And do you think ants worry about “saving the humans?” 

“Yeah, but Earth, come on – all this fossil fuel we’re burning – come on man, we’re killin’ ya!”

“Killin me.”  Scoffs.  “Not only don’t you get time.  You’ve got no concept of the force and power I have.  Power to restore – or destroy.”

“Destroy?”

“Yeah, of course.  Little while ago – I guess around the year 450 as you measure time, I let loose a little volcano in my lower hemisphere.  Well, actually, I blew up a mountain – but I’ve got a lot of them, you know?  Anyway, you wanna talk climate change?  That was pretty awesome.  Winter for about three years.  A nanosecond for me – but long enough to kill about half of your puny species.  And the effects on my climate lasted for over an entire human life span.  Hard to grow crops with no Sun, you know?  But I’m always warming and cooling – humans are here because I’ve been pretty calm for the last several million years.   Because, you see, your existence here is pretty fragile.  Man, you should have seen me a couple billion years ago!  I was really cranky then, and wiped out all life and started over again.  You call it ‘The Great Oxidation Event.’  Kinda funny – like it was an Ultimate Fighting match.”

“So you’re saying you’ll do that – the volcano thing - again?”

“I’m not threatening you kid – just sayin’ that I’ve got powers far beyond your comprehension.   You guys have been lucky so far – but then again, you’ve only been around for less-than-a-relative-second, like I said.  I’ve got volcanoes and earthquakes and storms on a scale that humans have never seen.  And then there all other kinds of threats that even I don’t control – like those pesky asteroids, and radiation, right?  Humans?  You are so arrogant.   You’re no more than fleas arguing over who owns the dog.  But trust me – you don’t have to worry about asteroids.  You’re petty squabbling between your tribes will kill you all off well before the 165 million years the dinosaurs made it.  I hate to tell you kid, but in the big picture of my existence, you guys look to me just like another failed species.  The Dodo bird comes to mind.”

“You’re sayin’ humans don’t worry you – what does?

“Ha!  The Sun, man.”

“The Sun?” 

“Sure, the Sun.  We all die.  One day the Sun burns out, and I get sucked into the black hole it leaves.  I’m finished.  Basta.  And so are you – but, long, long, before that happens.  What I’m saying kid is this: Stop worrying about me – I’m fine.  And I’ll still be fine long after humans are no longer here.  Clean up your own act – stop the nonsense between your own races – it’s so silly.  Your time here is borrowed – and short.  Like I said, your existence is very fragile.  It’s all about priorities, kid.  You have bigger issues to worry about than me.  I wish I could say you humans could give the dinosaurs a run.  But I’m not betting on it – you haven’t even been able to get rid of cockroaches.  Gotta run – thanks for the drink.”

A couple of centuries later, the lessons of John Paul Jones still apply….

“It seems to be a law of nature, inflexible and inexorable, that those who do not risk cannot win,” said the so-called father of the US Navy, John Paul Jones.  And you may wonder what John Paul Jones has to do during a twenty-first century pandemic, but being an old Navy guy, I can’t help myself.  And I do like the simple logic of the military, where life can be pretty binary: “Yes sir or No sir,” (or the occasional, “I’ll find out, sir.”)  And I think businesses would benefit from less posturing, less ambiguity, and more decisiveness:  yes, no, or “I don’t know – but I’ll find out.”

But back to Admiral Jones (whose bones, incidentally, rest in Annapolis in a crypt below the US Naval Academy chapel).  As a young Midshipman, I was taken by Jones’ practical advice on risk versus reward.  And while my life in general has had a lot to do with taking risks, unlike the Navy, the consequences of taking risks in business typically don’t include life or death.  Today, we can only imagine the terror of the crew of Jones’ newly minted USS Ranger, facing the more heavily armed and better trained ships and warriors of the British Empire: “Well, kids, in order to beat these guys, I’m gonna try some risky stuff.  And I hope I’m right, but if I’m not, we’re all probably gonna die.”  And the history buffs reading this may recall that when things weren’t going so well for Jones in that battle, his ship and crew alike shattered and bleeding, the commander of the British frigate asked Jones if he was ready to surrender.  To which Jones responded with the immortal – and certainly ballsy - words, “Surrender?  I have not yet begun to fight!”

For me, risk is what makes life interesting.  And yet in my career, I’ve encountered so many who consider risk a four-letter word.  People who are afraid to put their name by a decision that may turn out poorly.  Who, instead of a simple yes or no, would vote “present.”  Or would take extraordinary steps not to have to make a controversial decision that involves risk: “While I tend to agree with you, I think we have to study this issue in greater detail.” Theodore Roosevelt had some words for them: They are “Those cold, timid souls who know neither victory nor defeat.”

If your reading this on Wisdom’s website, you’re probably a risk taker.   And Wisdom Warrior I, our current fund and barely a year old, certainly hasn’t won yet.  But nobody’s died, either.  Our portfolio CEOs have risked a lot.  Most have left the safety and security of a steady and substantial paycheck to venture into their own visions.  And now, in a recession that places challenges unfamiliar in the past decade of unprecedented economic expansion, they risk far greater uncertainties related to pandemics and civil discourse.   Many have had to reduce staff or make dramatic changes to their business models and plans.   And I’m proud that despite the difficulties, where others have panicked - CEOs and investors alike - our teams have handled the current crisis’s with a bit of that of that John Paul Jones bravado:  “What – a virus?  Is this the best you can do?”  Meanwhile, at Wisdom, we’ve amped up our activity, accelerating the pace of new investments during a recession which, based on historical data, has produced superior venture capital returns.

A year from now when we’re looking back at 2020, we’ll reflect on all the new risks we’ve taken between now and then.  There will be some wins, but losses as well, for loss is inherent with risk.   But we hope more of the former than the latter.  Because in the end, it’s all about risk: risk taken with as much information as possible within the allotted time.

I’ll close with another naval hero, Captain James Lawrence.  Lawrence may not be a household name, but I’m sure you’re familiar with his dying words, “Fight her till she sinks, and don’t give up the ship.”  So while I can’t promise you which risks we’ll win and which we’ll lose, I can assure you that we won’t give up on our teams.

Thank God it’s Monday!

We closed an investment yesterday.  A big one.  One that we’ve been working on for a long time.  The cycle of a deal usually follows the same path: peaks of high expectations followed by valleys of deep despair – the days when you fall asleep exhausted, knowing you’ll be wide awake at 2AM playing back the nuances and trying to figure out if you’ve still got a chance in hell or the deal is dead. It’s a rollercoaster in an endless loop: exhilaration, frustration, panic. Repeat.  Until it stops – on either the peak or in the trough.

People ask me why I’m still working. It’s certainly not for the money. It’s for Friday.  The thrill of the deal, of accomplishment.  That feeling of elation when the efforts of a team working for months on a common goal are realized.  I don’t believe you get that same satisfaction doing anything in retirement.  Not a great golf score.  Not even a hole-in-one.   A bigger fish?  And sitting on a board?  No way.  I’ve sat on both sides of that table; the directors are disconnected from the daily ebb-and-flow, the give-and-take, the subtleties and depths.   If you’re not the operator, whether it’s a corporation or a fund, it’s simply not your skin.  What about grandkids? Sure, I love my seven little granddaughters but it’s the same reward system: when I see them now, it’s because I make it a priority.   So if retirement means seeing them more, I suspect they’d soon be saying, “Mom, is grandpa ever going home?”

I’ll say, “Man, I’m so glad it’s Friday. Been a brutal week.”  And I’ll often hear, “But Gary, if you were retired, every day is the weekend.”  But it’s not – then every day is the same.  Work is good because there is anticipation: a Friday is still better than a Monday.  But Thank God I Still Have Mondays. And Saturdays still rock.  Days without meetings and obligations are only special if there are still days with meetings and obligations for comparison. I think it is good to keep working on goals, goals that involve a lot of people (as opposed to “putting.”)  Cycles that include getting excited about down time.  Cycles that include a lot of pressure. And yes, stress.  Stress is underrated.  I think when we’ve succeeded in removing the stress from our lives, we die.  Probably why I’m not one of those “life coaches.”

I had a wise boss once tell me, “Enjoy this day – the deal will never look as good as the day on which it’s signed.”  I’m not sure I believed him when he told me that, but 30 years later, I know from experience he was right.  Now that the agreement is signed, more work, more frustration, and certainly some disappointment lies ahead.  But also enough satisfaction – a brass ring or two – to keep us going.  To keep us working.

There’s a phrase popular in the Middle Ages: Momento mori.  (Remember you will die); symbolized by the skull often found in paintings – especially still lives – of the period.  So stay relevant.  Work.  Stress out.  And enjoy these precious days.

But know the difference between what’s in and out of your control

When my kids were growing up, I used to tell them that life was pretty simple. Contrary to what they might learn in libraries full of self-help and personal advice books. “You can live by two simple rules,” I’d tell them:

Rule 1:  Don’t sweat the small stuff.

Rule 2:  It’s all small stuff.

And the corollary that can (and should) be applied to most any situation requiring a decision: “What’s the worst thing that could happen if…?”

To me, life is all about setting priorities, realizing the difference between things you can and cannot control, and having fun. Not sweating the small stuff is not an excuse for being lazy, sloppy or not taking responsibility. Rather, it is simply the realization that 99% of the things we worry about (the things that keep us up at night) are probably not going to kill us.  It’s about priority, understanding who and what in your life really do matter (hint: probably not all 876 Facebook or Instagram “friends”) and staying focused on whatever that might be. Catching Pokémon may feel like the most important event in your life today, but chances are, in a year from now, it won’t have significantly contributed to your personal or career growth. Ditto for how many “likes” you get on your latest Facebook or Instagram post, or re-tweets of your last tweet.  And if you’re stressing over the recent rash of increased COVID-19 cases in parts of the US, well, that’s hardly small stuff, but unless you’re over 70 and in a nursing home, you’re probably not going to change the situation by worrying about it.  But you can take control of the situation and just stay home if you’re worried.  Considering the limited capacity we all have as individuals, most of what we deal with on a daily basis is small stuff.

But my point is not to pile on in the already overcrowded field of telling people how to live their
lives. Rather, as CEOs, we should be concerned with building great brands. And building great brands and great companies is achieved by doing a million little things right.  Wait, what? Now I’m confused…I mean, here’s the don’t sweat the small stuff guy saying we need to focus on details…a million of them?!  Could I have been wrong? Would I have to call kids and tell them to start sweating the details after all?  Perish the thought!

So now I’m on a flight to Boston and having made a note to think about big and small stuff for the next six hours, my thoughts have returned to my dilemma.  I started thinking about the flight crew, and the Pakistani airliner that crashed last month.  I thought about the landing gear on this plane, and the guy responsible for making sure that the hydraulics work consistently.   Now, that may be “small stuff.” In a little detail, one of the million things that could go wrong on this Boeing 737 (and not a new one, by the way).  And it occurred to me that for him (and me, and the other 250+ people onboard this plane), ensuring that the hydraulics work is not small stuff.  Nor are the electronics to power the flight deck, the fuel injectors that make sure the jet engines are getting enough to drink, etc.  It goes back to priorities.  I don’t want any of those guys worrying about Pokémon (at least not now) and I do want them sweating the details of their job.  In this case, lives are at stake.

Sure, for most of us, no one is going to die if we don’t write a follow-up to our champion on a new account that just closed.  Or if we don’t deliver the best possible support to a customer in need of our help.  Similarly, no one will die if we make an error in our financial statements, or don’t thoroughly test our code, resulting in a bug.  There are millions of things that could go wrong and each of us has our own set of details. The small stuff, perhaps, that may be details but are critically important.  Even if no one is going to die if we fail, there sure will be a lot of disappointment from our shareholders, customers, partners and even our employees.  This is an awesome responsibility, and should be treated with an awesome level of respect.

In short, it’s OK not to sweat the small stuff.  Just make sure you know the difference.

It’s not about trying to time the market – but trying to understand the herd we call humans

On March 22, I posted a blog, “Buy When There’s Blood in the Streets,” with the message: follow the money in a crisis, and then act on it.  Which usually results in action contrary to what the herd is doing. Because it is the herd that feeds the cowboys.

The point of the blog was not to question the dubious COVID-19 lockdown, but rather to assess the economic situation and take the appropriate financial actions and risks.  In the case of COVID, quoting from that blog, “…both history and data tell me that the Coronavirus offers a very convenient means for a global sell-off, resetting a very tired, decade-old bull market.  The bulls were pretty sure there’s be a lot more downside than opportunity for more growth, but what is the catalyst for the sell off…?” Well, here it is: the S&P 500 average over the past six months:

The low point on this chart (2,192) was Monday, March 23rd, the first trading day following that blog and, as the chart shows, in the midst of a precipitous and literally unprecedented sell-off.  Yesterday, June 5th, the S&P (as shown above) closed at 3,194, a gain of just over 1,000 points, or up 46% from the low.  In other words, anyone who put $10,000 in the market on March 23rd would have gained over $4,000 to date in less than just over two months (or $40,000 on $100,000…).

Now, at the time I wrote the blog, I had a number of people comment, “I agree with you, but not yet,” which means that they 1) really don’t agree, or 2) just didn’t get the point.  That is, buying when there is “blood in the streets” should make you physically ill – being a contrarian is hard – it goes against every instinct of being human, being part of the tribe.  The real fear with Coronavirus was not getting infected, but rather having a view that the rest of the crowd believed to be “stupid.”  For countless millennia, our DNA has been programmed to be included in the tribe, and since the first humans started gathering in groups, our worst nightmare has been ex-communication.

So, in understanding the herd, there is one maxim I’ve always held: the conventional wisdom is always wrong – given enough time.  Figuring out the timing is always a challenge, but whether it’s a flat earth or even Newtonian physics, time and more experience will prove the old dictums inaccurate. 

To wrap this up, I said on March 23rd that unlike the herd, Wisdom was open for business.  In fact, in the ten weeks since, we’ve increased our Assets Under Management by a whopping 50% by investing in new companies as well as adding additional funds to existing investments.

On to the next crisis, and the herd has already changed direction and is stampeding again (don’t let social distancing ruin a good protest). 

We’d all get a lot more business done if we stopped talking and did more listening……

It will come as no surprise to anyone that in my current line of work - even in the fantasy land of Covid-19 - I spend a lot of time with entrepreneurs – those whose companies are currently in the Wisdom portfolio – but more often those who’d like to be.  And as a public company CEO, I spent a lot of time talking to investors: those who held my stock, and those who I wished would buy our stock.  In fact, I’m sure I spent a lot more time doing this than the average CEO.  But I needed to spend a lot more time than the average CEO.   Our shareholders weren’t happy with the company, and they certainly had no reason to be happy with me – the new CEO who, as a long time board member, I already had blood on my hands. 

Before I showed up, our investors had suffered through eight long years of revenue decline and cash burn without seeing a profit.  We had activists wanting to replace the entire board.  Our stockholders were tired, and frustrated – and did I say angry?  So my task was to try to convince them that we had a strategy, and that we believed we were an undervalued asset that could grow - profitably.  At the onset, it wasn’t a pleasant task.  But we had a decent story to tell, and gradually the mood softened.  The mood moved from “burn this bozo at the stake” to “OK, let’s give him a chance to see if he crashes and burns without our help.”

But I’m off on a tangent – my point was to talk about an investor I had the pleasure of meeting in New York in those stressful days.  Of the hundreds of fund managers and analysts and investors I’ve talked to over the years, he was special.   An old school investor.   A native New Yorker was making money on Wall Street while I was still in high school.  He ran his own fund, no staff, no analysts.  Did the heavy lifting himself.  The kind of guy who marks a friend (and a deal) with a firm handshake – not with a “like” on Facebook.  (It’s already hard to remember actual handshakes, right?)  I’m pretty sure gentlemen like this don’t have a lot of time for Facebook – or any “social media.”

I was told going into this meeting to expect only 30 minutes – but not to be surprised if I only get 10.  Which would mean he wasn’t impressed with the story.  Or me.  But frankly, I’m sure that he understands you can get a lot done in 30 minutes – as long as time isn’t wasted on pleasantries and inane small talk: “How ya’ doing.”  “Fine, how are you?”  “Yeah, good, me too.” 

When did you get into New York…” Blah, blah, blah.  So none of that, and after that firm handshake while looking me straight in the eye (don’t you hate it when a guy is looking at his shoes when shaking hands?), it was all business:

“How many shares outstanding?”

“Is that fully diluted?”

“How much cash?”

“Any debt?”

“Tell me why I should invest in your company?”

I don’t mean to imply he was rude.  To the contrary – he is a true gentleman.   He was simply direct.   But respectful, courteous, and attentive.  Not distracted.  Not glancing at his cell phone, or stealing peaks at a computer screen.  I had all his attention.  100%.  He understands the power of listening, not talking.  Especially not talking about himself.  He wasn’t there to impress me.  His only objective was to see if we might be an opportunity for him to make some money.  And opportunity in which he could add value – helping the company – while helping himself.  He asked good questions – the right questions.  So I kept talking, and he kept listening.  

I was inspired.  Here’s a man older than I am (that’s rare these days) with all the energy and passion of a 20-year old.  A man who has earned the respect of Wall Street, but keeps a modest office without the usual trappings and, as I mentioned, no staff.  A man of humility.  Of honor.  And integrity.

And it occurred to me how many more deals would get done – how much time would be saved – if we were all this direct and efficient in our business.  If we all said what we really thought – no agenda, no politics, no hedging.  No empty promises made with no intent to honor.   As I often tell people, “Look, you don’t have to protect my feelings.  A simple ‘no’ works just fine.”

So 45 minutes later I walked out of his office with an agreement to meet again in a couple weeks – and a promise that he’d make an introduction to the CEO of a company in his portfolio he thought might make a good partner for us.  A promise he had fulfilled within an hour of the end of our meeting.  

Did he invest?  Well, yes, and he became a real (not Facebook) friend.  But that wasn’t the point: I’m a better man for simply having met him.

This too will pass.

Time. Our worst enemy, or our most cherished friend?It’s Sunday morning; I’m supposed to be on a flight to Boston for a board meeting. But of course these are the days of COVID-19, and I’m not going anywhere.  Nor is anyone else.  Not that there isn’t work to do – thanks to technology most of us can work remotely, and there’s plenty of it to do.  As an investor, and typically a contrarian investor, these times of crisis are typically great times to invest.

But today, instead of preparing for that board meeting, I put down the iPhone and MacBook and looked out to see a glorious California spring day. And from this vantage point, looking out across the hills to the San Francisco Bay, the world looks the same – no masks, gloves, or scared people backing away from each other in the local grocery store to insure the proper “social distance” is maintained.  Just trees and fields and bright skies – and a lot more birds than I remember.

This – C19 – will pass.  Our species is resilient.  We have about one-million years give of take of DNA that has evolved.  We’ve been hardened by famine and drought and plague for millennia before we had advanced far enough as a species to record all of the terrifying challenges we endured.  And then we did start chronicling the pestilence that stalked our ancestors, it’s a pretty bleak story.

The Plague of Justinian in the 6th Century, perhaps the first recorded occurrence of the Bubonic plague, is thought to have killed between 30 – 50M.  Skip ahead to the 14thcentury, and The Black Death – this time the Bubonic plague for sure – claimed two-thirds of the population of the Western World – perhaps as many as 200M. A half a dozen or so subsequent pandemics before the 20thcentury claimed many millions more, and the infamous Spanish Flu late in the second decade of last century is thought to have killed 50M across the globe.  And yet here we are.  Resilient.

With each passing disease, the human herd has adapted; new anti-bodies have developed, eventually new immunities to the latest threat.  And for all but about the last one-hundred years or so of a million, there were no drugs or drug companies to aid in the battle.  Just time, truly the great healer.

With more springs behind me than ahead, I guess I think more about time these days than I did when I was chasing girls in foreign ports, and even later, when I was chasing product problems as a young IBM engineer. I’m less likely to squander time these days. I’m more sensitive to those whom I really care about in my life. It’s a short list. And I’m also keenly aware of what matters to me – and the importance of prioritizing. The heady days of changing the world are far behind me. Even as a young man of the 60’s, the lofty ideals of those days were blunted by the hard edge of reality, for while my peers were growing their hair and waving banners of peace and love and free dope, I was training to be a Naval Officer. Vietnam was raging, and it wasn’t a popular time to be in uniform. But Time is a healer of broken bodies and of damaged nations.

So all thoughts of fleeting springs aside, I’m back to the realities of time and priorities. No, COVID-19 is not the end of civilization.  In fact, in the spectrum of pandemics, it hardly shows up on the screen.   And while in the middle of this crisis, it’s easy to imagine that “Corona will change everything; our lives will never be the same.”  It won’t, and they will – eventually.  Time. I’m a mercenary – I’m not ashamed to admit it. But those who put their faith and money behind me are too. They expect a return on their investment, and they expect me to deliver it to them. And maybe what we are doing here at Wisdom is not as noble as saving the whales, but providing capital to US military veterans with great business ideas is not a bad way to spend one’s remaining time.  Because whether you’re saving a whale, delivering software that helps industries design and visual new products, or software that helps hospitals deal with C19, running a brewery, or just closing a sale, it’s important to be remember that time is on your side. 

Times of crisis are always breeding grounds for opportunity, and Covad-19 is epic

I’ve lived through a lot of disasters in my life: the assassination of a president, Watergate, bell bottom jeans, Jimmy Carter, the crash of 1987, 9/11… And all these times of turmoil, fear, and doubt had two things in common: we’re still here, and each created opportunities for those that looked beyond the short term hysteria and saw not only a future, but the chance to build from the chaos a better future.  

The current pandemic is no exception.  On whichever side of the argument you fall – whether it is necessary to trade off the global economic health of the planet to “flatten the curve – or worried that the current one-size-fits-all-stop-the-planet cure to C19 is worse than the disease – it doesn’t matter.  This pandemic will have lasting impact. The world a year from now will be a much different place than it was three months ago, like it or not. There’s an old saying on Wall Street: “Don’t fight the tape (referring to the old stock ticker tape), translated to, “the trend is your friend.”  And the trend right now, right or wrong, is that remnants – a probably spinnaker-sized remnants – of today’s “social distancing” will be around for a long time. Maybe permanently. The airlines will need to find new ways of sanitization, making passengers comfortable about flying again. Restaurants will not longer serve food in traditional ways, any and all large venues will struggle to balance safety and contagion fears with practicality and entertainment.  And governments at all levels will likely leverage the new powers they’ve assumed in deciding what is essential and what is not, whether in business or our personal lives. If that sounds like Hell, I agree. But that certainly appears to be the trend.

If you are reading this blog, it is highly likely that creativity and innovation are currencies in which you trade.  And just as most businesses have suffered since Corona-mania struck in March, others have flourished. For example, as video conferencing, always a viable option, has become essentially mandatory, Zoom has seen its market cap nearly double has while the S&P has plunged.   In my line of work, I have the opportunity to work with a lot of entrepreneurs, and virtually all are feeling the impact of C19: the scarcity of new capital, mandated shutdowns of public venues, difficultly in reaching new customers, and so on. But many – the majority – are looking at this journey through Hell as an opportunity.  Perhaps the opportunity is simply using the downtime to reflect on the strategy, making course adjustments to accommodate a new reality. Others have quickly adapted, and are making changes and course corrections:

• Boston-based Oana Manolache, CEO/founder of Introvoke (www.introvoke.com), was gaining traction streaming live events, primarily for entrepreneurs and venture capitalists.  When Corona hit and live events literally ended. Undeterred, Introvoke quickly adapted, accelerating the release of solutions such as virtual events capability, digital ticketing platform and multiple conference tools integration, in addition to their well established live streaming in-person events solutions.  COVID19 forced organizations to think more about how to integrate technology in all aspects of business, including the connection with their customers, which has massively fueled Introvoke’s growth. Introvoke registered the highest monthly users in April since its launch in 2019, fast new customer adoption from organizations of all sizes and non-profits looking to go virtual, and high awareness as a technology brand to be considered for remote working. Introvoke is built for now and for the future.

• Noteworth (www.noteworth.com), founded by CEO Justin Williams in Hoboken, NJ, found that his software platform could help hospitals process and manage Covid-19 patients rapidly and efficiently, and is struggling to 

• keep up with accelerating demand.  

• Canvas GFX (www.canfasgfx.com), a Canadian company led by CEO Patricia Hume that facilitates visualization of complex objects with precision and clarity – and also collaboration.  While Canvas is typically used in industrial applications – Boeing, Caterpillar, NASA, Raytheon, 3M among their customer base – they found that the versatility of the Canvas suite can also help the pharmaceutical industry design the complex drugs, vaccines, and tests that will be in demand to help prevent of mitigate the next pandemic.

And of course I could go on.  Point is, while the majority of the populations are cowering in fear, thousands of entrepreneurs, engineers, scientists, and business leaders across the globe are running into the storm – not away from it – looking for the gems hidden in this wreckage.  In the words of Winston Churchill, “Never let a good crisis go to waste.” And don’t return from Hell without bringing back some wisdom.

The only bad deals are the deals not done

It’s been almost 150 years since William Seward, then U.S. Secretary of State to President Andrew Johnson, barely convinced a skeptical U.S. Congress – by a single vote – to buy Alaska from Russia. For $7M. About two cents an acre. While a pittance today in comparison to the staggering $4+ trillion budget of the federal government today, $7M was a lot of money back in 1867, accounting for almost 2% of the total federal spend that year. And as such, the deal was widely criticized by the media: “Stewart’s Folly” or “Stewart’s Ice Box,” and “Johnson’s polar bear garden.” By 1898 with the discovery of gold in Alaska, there weren’t many critics left for what was arguably the greatest land deal in history, or certainly since Thomas Jefferson doubled the size of the U.S. with the Louisiana Purchase. At a minimum, I suspect that during the Cold War, it would have been pretty uncomfortable having the Soviet’s hanging out a few miles away from Pike’s Fish Market in Seattle.

But this isn’t The History Channel. We’re a venture capital fund, this is not about geography, but business. It’s about the deal – the art of the deal. And my point is that in my career, the only bad deals I’ve done were the deals that didn’t get done. Every deal, every sale, carries some amount of risk, and generally the bigger the deal, the bigger the risk. Every new contract includes assumptions, and every time we depend on an assumption, we are taking a chance. These assumptions may include legal issues, usage considerations, certainly financial factors, and much more. And there will always be lawyers, auditors, security professionals, and experts of all kinds who will find lots of reasons not to do a deal. And more commonly, there are almost always those who will want to try and find ways to squeeze every last penny out of a new customer to maximize financial return, even at the expense of delaying the close.

I remember, painfully, a customer engagement several years ago. I was still a “young” CEO at one of my first start-ups, and we were dealing with a much larger company as a potential customer. This was a big deal for us, a very big deal, one that would have been transformative for our fledging business.

The problem, as it often is, was the price: this prospect was demanding pricing much lower than what we were offering our current customers. There was no shortage of people inside the company telling me that we’d be crazy to do this deal, that the price they were asking would never cover our expenses, that the deal would be “unprofitable.” Assumptions.

So I got on a plane and went to see their CEO. One-on-one. No entourage. He was an older guy, a tough guy. A curmudgeon. Rumor was that he once was invited to a white tie gala hosted by the Queen – and got into a fistfight. Anyway, by the end of that meeting, we shook hands on the deal at a price that was a bit higher than the one he’d originally demanded, but not by much. I came back, happy, and turned it over to the sales team to wrap it up, to make our agreement formal via the contract. Well, you already know how this story ends.

In my naiveté, I just assumed that the deal would get done. But the “committees” got involved, and corner cases got covered, and contingencies were inserted, and asses were covered; so by the time the contract was constructed, it looked nothing like the deal that we sealed with a handshake. And the customer, the CEO, was pissed. And he should have been. He had shaken hands on the deal, and the contract that came back looked nothing like the simple agreement he thought he thought he’d sealed. And I was wrong; it was my fault. I allowed “sensibility” to get in front of the deal, which of course never closed. And I’ve never forgotten that painful lesson. But I promised I’d never let it happen again. And it hasn’t.

I’ve done hundreds – thousands? – of deals since then. And sure, some turned out better than others, and some were absolutely terrifying. But as bad as any of those deals may have looked, when I’ve asked myself this simple question, “Honestly, if you had it to do over again, would you still do this deal?” my answer has always been, “yes.” The moral of this story: trust your instinct. Any deal done is better than the one lost. Remember that time kills all deals.  Just do it.

“What is steel compared to the hand that wields it?”

I’m a voracious reader, but not a big fan of business books.  I won’t belabor this – but how many times in a career do you need some pompous ass telling you to “always hire people smarter than you” to realize that that makes the CEO the stupidest person in the company?  Well, perhaps I can think of a few that may resemble that remark, but I don’t think shareholders like t to subscribe to that theory.  Alternatively, there’s a Bruce Springsteen line in No Surrender: “We learned more from a three minute record than we ever did in school.”  My one exception – Dilbert  - if that is considered a business book.  Because I’m all in for the wisdom of Scott Adams.

So let’s get back to the title – Conan the Barbarian.  I refer to the 1982 Dino De Laurentiis film starring Arnold Schwarzenegger.  So how can an Austrian-born actor (and former California Governator) playing a comic book heathen from the days before “the oceans drank Atlantis…” shed any light on a the trials of a 21st century CEO?  Well,  “Let me tell you of the days of high adventure!” 

First, Conan (the barbarian, not late night TV host) had laser focus (even if he had no idea what a laser was).  Since some of you (remarkably) may not Conan’s story, in a nutshell:  As a young boy Conan’s nomadic tribe is invaded by the evil snake-worshiping sorcerer, ThulsaDoom (James Earl Jones), killing his parents and all of their buddies, and kidnapping Conan and the other children to be sold into slavery.  Poor Conan gets chained to a spoke on this big wheel, providing the human power to run agrindstone out in the middle of East-Overshoe, Eurasia.  

Now, when Conan starts his labor, there are a few dozen other unfortunates chained to the spokes alongside him.  Fast forward ten years or so.  Apparently everyone else has perished but Conan.  And he’s still grinding away.  Except he’s really ripped now.  Ten years of manual labor will do that (if it doesn’t kill you).  Maybe this is why they started calling work “the grind.”  Anyway, that’s a lot of focus, and I’m sure he crushed a lot of grain.  But he had focus: revenge.  Survive and find the murderer of his parents.  If some business book-author asked Conan, “What kept him awake at 2AM, other than the wheel?” he’d likely have said, “revenge.”  No distractions.  No whales to save, no SOX seminars to attend.  Focus: a good thing for a CEO: maybe not chained to a wheel, and perhaps not looking for revenge.  But focus: growing revenue and getting the company profitable.

Eventually, Conan is discovered by a guy whose CV reads “gladiator manager.” But  the “off-Broadway” version; not the Coliseum.  Conan rises to gory stardom: “In time, his victories could not easily be counted.”  So he is taken east, and, living with a Genghis Khan-like clan, gets to study advanced swordsmanship and poetry.  So he gets even more formidable.  And smarter.  Now, while the revenge motive is still driving him, Conan now learns another dimension that is important to his ultimate success.  While fighting for his life in the gladiator pits:

He did not care any more... life and death... the same. Only that the crowd would be there to greet him with howls of lust and fury. He began to realize his sense of worth... he mattered.

“He Mattered…He began to realize his sense of worth.”  A sense of worth – a way of measurement.  For Conan, it was being greeted with “howls of lust and fury.”  Today, that sounds like an earnings call.  Seriously, the sense of worth is an important factor for a CEO.  We can find in in KPIs – the key measurements upon which our business can plot our progress.  Including the stock price, a report card that may not mean much on a day-to-day basis, but certainly will reflect those howls of lust and fury over the long run.

As CEOs, we face adversary frequently.  Adversary wears many faces.  It can be competition.  Or law suits.  Adversary comes in the form of shareholder activists.  Cranky VCs.  And deals lost, or accounts churned out.  That we face adversary is a given.  Handling adversary with strength and courage and humor is a lesson we can learn from Conan.  Let’s start when Conan is plotting to break into one of Thula Doom’s outpost, where he meets a fellow thief, Valeria, soon to be his lover. 

Valeria:  Do you know what horror lies beyond that wall?

Conan:   No.

Valeria:  Then you go first.

Later, Conan and crew are captured and brought beforeKing Osric.  Surely, Conan and his two companions will in the best case be thrown into the dungeon.  And the King is duly pissed:  “What daring!  What outrageousness!  What insolence!  What arrogance!”  And Conan hangs his head, knowing that important lesson: “Don’t do the crime if you can’t do the time.”  But the King softens.  And smiles.  “I salute you.”   For only Conan, a barbarian, a common thief, had the courage to stand up to the evil Thulsa Doom – to face his adversary directly and courageously.  And of course, who can argue with the simple business axiom of “Crush your enemies.  See them driven before you.  And hear the lamentations of the women.”  Oh well, as I mentioned, it was a different era.

I could go on, but I’ll close with a subtle message implicit in Schwarzenegger’s performance:  “Don’t talk – act.” Now, the cynic would say that Arnold’s accent at the time was still so strong, and his talents so fledgling, that too much dialog was a risk.  But whatever the reason in the movie, the best leaders don’t do a lot of talking.  They don’t have to tell you how great they are.  We can see it in the way the have single-minded purpose, and measurements, and are not afraid to face adversity.  We can all learn from those simple truths.

So I’m not going to say that Conan the Barbarian is my favorite movie, but…

Yeah, actually I am.  “Let us take the world by the throat and make it give us what we desire.”

And follow the money.  Every good crisis has an underlying economic justification.

We are living through a strange time – unprecedented even – for never has war, pestilence or prognosticated apocalypse had such a dramatic and loosely coordinated global effort to shut the world down.  So while about 99% of news and peoples focus and fears are about Coronavirus, is it warranted?

Or is Coronavirus just the current head fake that allows financial markets to reset and return to the business of making money?

I’m not a conspiracy theorist.  Not that conspiracies don’t exist and haven’t been tried – its just that conspiracies – especially global – are too hard to pull off.  Too many moving parts (and moving people).  But I am a believer in economic and financial models, and I am a student of history and data.  And both history and data tell me that the Coronavirus offered a very convenient means for a global sell off, resetting a very tired, decade-old bull market.  The bulls were pretty sure there’d be a lot more downside than opportunity for more growth, but what is the catalyst for the sell off, and how do I know when that is so I can get out?

Before talking about the current financial crisis, just a bit of recent history.

• 1987: a drop in the Dow of nearly 23% - biggest single drop in history.  What preceded that?  A five-year bull market.  What caused the drop?  A series of actions taken in Washington (some anti-business legislation, a Treasury-backed devaluation of the dollar, etc.) caused the initial drop, which led to panic as the press fueled the hysteria and more selling led to more losses.

• After a recovery that took a couple of years, the market ran hot through the 90s, and then got the double whammy of the Internet bubble burst and 9/11.

• And 2008, when bank failures spawned by sub-prime mortgage loans resulted in the crash that ended the post-9/11 bull run.

All very different circumstances, but all with common elements:

 • A long period of economic prosperity preceding them, as measured in the value of the Dow 30 and other indices.  To points where there is ample evidence that continued gains would not materialize.

• A external trigger that caused a radical, not gradual, decline.  One can argue whether these catalysts were “natural” or manufactured; it doesn’t matter – the key is recognizing the signals and acting.

• The reaction from pundits and experts for each:  “This time it is different.  The world will never be the same.”  Which of course scares people from re-investing.

• And finally and most importantly, in each of these times of turmoil and fear, and lost of people ignored the conventional wisdom and bought when the rest of the world was selling.  Because if you follow the masses, you are the mass, and the masses aren’t billionaires.

So is Coronavirus just a convenient excuse to divert attention, crash the markets, and provide buying opportunities for the Smart Money?  Well, that’s another blog, but if you compare the facts of Coronavirus to the impact of the drastic actions being taken on the economy, I’d place my money on this being a “manufactured” crisis.  Take some facts, get the attention of a not-to-well-educated media, and sit back and watch the panic.  In the early days of the virus, some may have anticipated the potential impacts on the markets, and wisely sold.  Others, like the four US senators who sold prior to the announcements of broad government actions to shut down the economy, had inside information.  

But that doesn’t matter now; now is the time to buy – there is enough blood on the streets.  And no, it won’t be different this time, either.  It’s how the world works – buy low, sell high.  The world will not end, and the smart money will get richer.

At Wisdom, we’re open for business.

As company leaders, one of our biggest challenges is identifying the sales talent we need. Finding people who have the competencies, passion, and commitment required to do the job is getting so much tougher. Many sales leaders are pouring resources into all aspects of the recruiting cycle, with limited results. Part of the problem arises when recruiting efforts are limited to popular talent pools or traditional hiring criteria such as prior sales or industry experience. This traditional sourcing approach limits both the quality and quantity of available sales talent and increases overall sourcing timelines and costs.

A few months ago, I was fortunate enough to meet David Hester the CEO of Service 2 Software. He has built an amazing non-profit business which gives active duty service members the ability to spend their last five months in a technology sales intensive transition program. He leverages the Department of Defense SkillBridge program which provides an invaluable chance for service men and women to work and learn in civilian career areas. SkillBridge provides an opportunity to access and leverage the world’s most highly trained and motivated workforce. Service members participating in SkillBridge receive their military compensation and benefits, and Service 2 Software provides the training and work experience.  

"With more than 200,000 U.S. service members returning to civilian life each year, the task of facilitating their transition deserves our focus and best effort."

At Canvas GFX, we worked with David to identify the right individuals to meet our needs. We found  amazing talent in Tom, Jacob, and Aubrey, who are working side by side with us to help drive sales and improve customer satisfaction. They bring their military training and discipline coupled with the passion and commitment needed to make a difference, and they are. Sales are growing, are customers are happy and everyone is winning. 

On Veteran’s Day, I want to acknowledge the great work that David and his team are doing, thank Tom, Jacob and Aubrey for being part of Canvas and send a special thank you to all our Veterans. It is time for us to give back!