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Reflections on Life, Investing, India at 75, and Keeping the Main Thing the Main Thing

One of the best books I have read on living a life of purpose is the one from the world-renowned innovation expert Clayton M. Christensen, who developed the theory of ‘disruptive innovation’, which has been called the most influential business idea of the early 21st century. In fact, Christensen introduced ‘disruption’ in his 1997 book The Innovator’s Dilemma, which was supposedly the only business book that Steve Jobs had on his bookshelf.

Anyways, the book I am talking about today is Christensen’s How Will You Measure Your Life?, the idea for which came up first in a 2010 speech he gave to Harvard Business School’s graduating class.

Drawing upon his business research, he offered a series of guidelines for finding meaning and happiness in life. He used examples from his own experiences to explain how high achievers can all too often fall into traps that lead to unhappiness.

The speech was memorable not only because it was deeply revealing but also because it came at a time of intense personal reflection. Christensen had just overcome the same type of cancer that had taken his father’s life.

As he struggled with the disease, he revealed that the question “How do you measure your life?” became more urgent and poignant, and he began to share his insights more widely with family, friends, and students.

The book tries to answer three key questions you must ask yourself –

  • How can I be sure that I’ll be happy in my career?
  • How can I be sure that my relationships with my spouse and my family become an enduring source of happiness?
  • How can I be sure I’ll stay out of jail?

As Christensen writes, “…though the last question sounds light-hearted, it’s not. Two of the 32 people in my Rhodes scholar class spent time in jail.”

Look around and you will find enough cases of “normal and respectable” people who did not answer this third question, and have spent their time in jail. Rajat Gupta, Ramalinga Raju, Bernard Madoff, and Jeff Skilling (Enron; one of Christensen’s classmates) are just a few of them.

I recommend you read the book, but here is an excerpt from the same that hits me hard every time I read it –

One of the most common versions of this mistake that high-potential young professionals make is believing that investments in life can be sequenced. The logic is, for example, “I can invest in my career during the early years when our children are small and parenting isn’t as critical. When our children are a bit older and begin to be interested in things that adults are interested in, then I can lift my foot off my career accelerator. That’s when I’ll focus on my family.” Guess what. By that time the game is already over. An investment in a child needs to have been made long before then, to provide him with the tools he needs to survive life’s challenges—even earlier than you might realize.

If you defer investing your time and energy until you see that you need to, chances are it will already be too late. But as you are getting your career off the ground, you will be tempted to do exactly that: assume you can defer investing in your personal relationships. You cannot. The only way to have those relationships bear fruit in your life is to invest long before you need them.

I genuinely believe that relationships with family and close friends are one of the greatest sources of happiness in life. It sounds simple, but like any important investment, these relationships need consistent attention and care. But there are two forces that will be constantly working against this happening. First, you’ll be routinely tempted to invest your resources elsewhere – in things that will provide you with a more immediate payoff. And second, your family and friends rarely shout the loudest to demand your attention. They love you and they want to support your career, too. That can add up to neglecting the people you care about most in the world.

The theory of good money, bad money explains that the clock of building a fulfilling relationship is ticking from the start. If you don’t nurture and develop those relationships, they won’t be there to support you if you find yourself traversing some of the more challenging stretches of life, or as one of the most important sources of happiness in your life.

If you haven’t read How Will You Measure Your Life? yet, you may want to do it soon.

Here’s his HBR article with the same title, that lead to the book.

I will be discussing Christensen’s book with Prime Members soon. If you haven’t checked out the membership yet, please do it now. I am offering a special discount on the membership till 15th August 2022.

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Manish Chokhani, Director, Enam Holdings, whom I had profiled in the first episode of The One Percent Show, recently spoke with CNBC on the state of Indian economy and financial markets, India’s journey over 75 years, rise of unicorns and digital revolution. Watch it. Coming from Manish, it’s as insightful as it can get.

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Howard Marks of Oaktree Capital was on a Goldman Sachs event a month back, where he talked about risk, uncertainty, and the importance of humility in investing.

One of the questions the host asked Marks was – “Why are you telling us all these things you know if we need to not know them for you to make money?”

Marks’ reply was illuminating –

Just knowing them is not enough. You also have to implement them. I think we do a superior job of implementing them. This is fun for me. And I’ve gotten such a great reward from sharing these things with people.

The people that I share these things with are not my competitors. They’re people. And I get these letters saying, you know, you made something complicated clear. Or I get letters that say you changed my life because I had a — there was a prominent economist from the ’70s who called me up a few years ago. He said, “You changed my life.” I said, “How?” He says, “I don’t think forecasts anymore. I tell people what I think is going on. And I tell them what I think the implications are.” That’s so gratifying.

I shared my complete notes from Marks’ conversation with Safal Niveshak’s Prime Members here.

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Michael Mauboussin recently reflected on his investing process in an interview with Frederik Gieschen. Here are a few wonderful snippets from the same –

Great investors do two things that most of us do not. They seek information or views that are different than their own and they update their beliefs when the evidence suggests they should. Neither task is easy.”

On common mistakes among analysts. “There was a letter from Seth Klarman at Baupost to his shareholders. He said, we aspire to the idea that if you lifted the roof off our organization and peered in and saw our investors operating, that they would be doing precisely what you thought they would be doing, given what we’ve said, we’re going to do. It’s this idea of congruence.”

What has he changed his mind on? “When you start to understand the fundamental components of complex adaptive systems, there’s no way to look at the stock market the same way again, personally.”

On being an effective teacher. “To be a great teacher, an effective teacher, it’s about being a great student, be a great learner yourself. And I think that comes through if you’re doing it well.”

Check out the interview here.

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Patrick O’Shaughnessy’s Invest Like the Best is one of my favourite podcasts. In the latest episode, Patrick hosted Ravi Gupta, who is a partner at Sequoia. Ravi quoted Stephen Covey – “The main thing is to keep the main thing the main thing.” In a question when Patrick asked him how he applied this idea while choosing an investment, Ravi replied –

I write at the top of my notebook, at the top of every meeting I take, “If you could only make one investment this year, would this be it? Would you tell your best friend that they should go work at this company and take options at the 409A price with their entire career? Would you do that? Do you want to be in the board of this company in the next 10 years?” There’s all these things that I think help on the, is this something that you’re going to look back on and not just feel good that you wrote a check? But that ultimately, you are doing something that has a chance to really make a difference. This is practically a way that I thought about it.

The other thing is, and I stole this from Pat Grady, who’s one of our partners, I literally have blocks on my calendar that are hours long, that are empty, that say, “Most important thing.” That is literally what they say. And the idea is, do the thing that is the most important right now. That might be reading something. That might be trying to meet with a founder who you think has a chance to be important. That might be working at a company that you already are invested in, that has a chance to be great, but it leaves room for you to decide that in the moment.

Access the full episode here.

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Before I end, here are a few quotes I reflected on in recent times –

Be as simple as you can be; you will be astonished to see how uncomplicated and happy your life can become. ~ Paramahansa Yogananda

Do not spoil what you have by desiring what you have not; remember that what you have was once among the things only hoped for. ~ Epicurus

We are drowning in information while starving for wisdom. The world henceforth will be run by synthesizers, people able to put together the right information at the right time, think critically about it, and make important choices wisely. ~ E. O. Wilson

I wish you happy Independence Day in advance.

Stay safe.

– Vishal

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