My Worst Investment Ever Podcast Andrew Stotz

BIO: AcreTrader’s CEO, Carter Malloy, grew up in an Arkansas farming family and has had a lifelong passion for agriculture and investing. Before founding AcreTrader, he spent five years as part of the founding team of a successful global equity investment firm.
STORY: Carter was super impressed by a healthcare software company whose stock was really expensive, and the valuation was crazy high. Carter decided to short the company’s stock. However, he lost most of his money because the stock almost doubled on him.
LEARNING: Valuation is not a reason to invest. Don’t bet against really good management teams.
 
“Valuation should inform your position size. However, look at it across a large spectrum of metrics and measurements to help you determine whether you have a thesis or not.”Carter Malloy 
Guest profileAcreTrader’s CEO, Carter Malloy, grew up in an Arkansas farming family and has had a lifelong passion for agriculture and investing. Before founding AcreTrader, he spent five years as part of the founding team of a successful global equity investment firm.
Before joining in 2013, Carter was a Managing Director with Stephens Inc., a large private investment bank, where he was an equity research analyst.
At AcreTrader, Carter has successfully raised over $60 million in Series B funding and grown from 20 employees to 120 employees across the company’s two business divisions, which include AcreTrader, the farmland investing platform, and Acres, a land research platform.
Worst investment everAs an equity investor, Carter would generally chase okay businesses valued as great ones. One particular company, a healthcare software business, caught Carter’s attention. He had a thesis around the macro developments—both cyclical and secular headwinds—that this company faced. He realized there were these real pressures on that business that the rest of Wall Street and the investment world was seeing. The stock was really expensive, and the valuation was crazy high.
Carter started digging into the company. He met with the company CEO, and this guy was unbelievably impressive. Carter dug deeper into the company culture and the people who worked there, concluding that this was a well-run business. Carter decided to invest in the company. However, he lost most of the principal because the stock almost halved on him.
Lessons learnedValuation is an essential part of your research. It can support an investment decision but is not a reason to invest.Don’t bet against excellent management teams because they can absolutely—and often do—determine the outcome.Valuation should inform your position size.
Andrew’s takeawaysValuation will be a tool if you don’t have any other fundamental things driving your investment decision.
Actionable adviceDon’t invest in single securities. Instead, invest in ETFs.
Carter’s recommendationsIf you want to be a good investor, understand what CFAs read and then take the Kaplan Schweser CFA Level One course.
No.1 goal for the next 12 monthsCarter’s goal for the next 12 months is to spend more time with his children.
Parting words 
“This has been fantastic. I sincerely appreciate you.”Carter...

In this episode of Investment Strategy Made Simple (ISMS), Andrew and Larry discuss two chapters of Larry’s book Investment Mistakes Even Smart Investors Make and How to Avoid Them. In this fourth episode, they talk about mistake number 7: Do you confuse skill and luck? And mistake number 8: Do you avoid passive investing because you sense a loss of control?
LEARNING: When gauging a fund manager’s performance, consider risk-adjusted performance. If you’re a passive investor and use a systematic strategy, you’re 100% in control.
 
“You have to accept that you can only control what you can control; you can’t control the unpredictable things that happen.”Larry Swedroe 
In today’s episode, Andrew continues his discussion with Larry Swedroe, head of financial and economic research at Buckingham Wealth Partners. You can learn more about Larry’s Worst Investment Ever story on Ep645: Beware of Idiosyncratic Risks.
Larry deeply understands the world of academic research and investing, especially risk. Today Andrew and Larry discuss a chapter of Larry’s book Investment Mistakes Even Smart Investors Make and How to Avoid Them. In this fifth series, they talk about mistake number seven: Do you confuse skill and luck? And mistake number eight: Do you avoid passive investing because you sense a loss of control?
Missed out on previous mistakes? Check them out:
ISMS 8: Larry Swedroe – Are You Overconfident in Your Skills?ISMS 17: Larry Swedroe – Do You Project Recent Trends Indefinitely Into the Future?ISMS 20: Larry Swedroe – Do You Extrapolate From Small Samples and Trust Your Intuition?ISMS 23: Larry Swedroe – Do You Allow Yourself to Be Influenced by Your Ego and Herd Mentality?
Mistake number 7: Do you confuse skill and luck?According to Larry, investors don’t know statistics well enough to differentiate skill from luck. To understand if an outperformer is outperforming because of skill and not luck, look at risk-adjusted performance. So, for example, over the very long term, value stocks have outperformed growth stocks, and small stocks have outperformed large stocks. So somebody who outperforms simply because they owned lots of small and value stocks more than the market isn’t outperforming on a properly adjusted basis. Other factors than size and value, such as momentum, profitability, or quality, can also drive the return. Larry recommends Portfolio Visualizer, a tool that shows how much exposure an active fund has to those factors. It also reveals the alpha or the remaining performance that cannot be explained.
The second thing you need to consider is whether the fund’s assets are growing. If they’ve

BIO: Gisela Hausmann graduated with a master’s degree in film & mass media from the University of Vienna. She’s one of a dying breed of adventurers – she digs in and researches topics of interest from the ground up, then tells things as she sees them.
STORY: Gisela joins the podcast again, discussing her new book Winning @ Amazon. Today she shares advice on how employees can allocate their creativity in a way that’s appreciated. She also talks about why employees need to start thinking outside the box and focus on problem-solving and innovation instead of feeling sorry for themselves and staying stuck where they’re not appreciated.
LEARNING: Encourage and appreciate your employees’ creativity.
 
“Appreciated creativity creates more creativity.”Gisela Hausmann 
Guest profileGisela Hausmann graduated with a master’s degree in film & mass media from the University of Vienna, the oldest university in the German-speaking world.
She is one of a dying breed of adventurers – she digs in and researches topics of interest from the ground up, then tells things as she sees them.
An author of two dozen books, her work has been featured in regional, national, and international publications, including GeekWire, Inc, Success (print magazine), Entrepreneur, and Bloomberg’s podcast ‘Decrypted.’ She is also the winner of the 2016 Sparky Award “Best Subject Line.”
Born to be an adventurer, she hiked in the Himalayas and the Gobi Desert, crossed Russia on the Trans-Siberian Railway twice, and meditated in the Dalai Lama’s private room at the Potala Palace in Lhasa, Tibet.
Her motto is: “Don’t wait. The time will never be just right.” – Napoleon Hill
Encourage employee creativity
Gisela Hausmann first appeared on the podcast in episode 539, where she narrated how Amazon implemented suggestions she’d made in her book Inside Amazon: My Story. Gisela is back with a new book Winning @ Amazon. Today she shares advice on how employees can allocate their creativity in a way that’s appreciated. She also talks about why employees need to start thinking outside the box and focus on problem-solving and innovation instead of feeling sorry for themselves and staying stuck where they’re not appreciated.
According to Gisela, companies consistently ignore the input from clever, hardworking, dedicated people and—seemingly—perceive them as “irrelevant little cogwheels in a big machine.” Senior management is often threatened by subordinates who seem more innovative than them, and it’s no wonder they ignore their creative suggestions. This has led to employees choosing to keep suggestions to themselves, and this is killing most organizations, especially the big ones.
Gisela advises organizations that want to encourage employee creativity to make a written plan. Define how employees who come up with ideas implemented in the company will be rewarded. Ensure that your rewards are something better than an in-house product. It should be something special that makes the employee feel appreciated. Gisela insists on the written plan because if you don’t encourage creativity in black and white, it won’t happen.
You create positive energy in your business by acknowledging that you need creative ideas from your...

BIO: Connor Steinbrook is the Founder of the EXP realty Wolfpack Revenue Share Organization, with more than 2,700 agents operating in all 50 states and 12 countries. The group closed almost 10,000 houses and 3.5 billion in sales in 2022.
STORY: Connor came across a house in a high-priced area that was being sold for dirt cheap. It caught his attention, and he decided to buy it. It turns out the person who sold the house to Connor had killed the homeowner and stolen his identity.
LEARNING: Always be careful when going into properties to meet strangers. Before you go to view a property, ask the right questions and do due diligence.
 
“Just because you wouldn’t do something or you wouldn’t think that this could happen doesn’t mean that people think the way you do and that they’re not setting you up.”Connor Steinbrook 
Guest profileConnor Steinbrook is the Founder of the EXP realty Wolfpack Revenue Share Organization, which has more than 2,700 agents operating in all 50 states and 12 different countries. The group closed almost 10,000 houses and 3.5 billion in sales in 2022.
Worst investment everWhen Connor started in real estate, he got a regular appointment to check a property out. The property was an old house that looked like a single-family house but was built in a duplex-type way. The property was in a high price point area, and the owner asked for a very low amount that didn’t make sense. The owner was not there, and after waiting for a while, Connor decided to go home. After about 15 minutes on the highway, the owner called him, and since the numbers looked so good, he decided to go back.
Connor found the door open, and when he went in, he couldn’t believe his eyes. It was quite a rundown house. While doing a tour of the place, he had this strong intuition that there was something off about it. But he shook off the feeling and went ahead and bought the property.
About six weeks later, Connor got a phone call from a detective of a famous murder detective show in Dallas. The detective informed Connor that a resident had found a dead body at one of his properties, and he needed him for questioning.
It turns out the guy Connor had bought the rundown house from was not the actual owner. The guy had murdered the homeowner, buried him in the backyard, and stolen his identity to sell the house.
Lessons learnedAlways be careful when going into properties to meet strangers.
Andrew’s takeawaysThings happen when you’re least prepared and least expecting it.
Actionable adviceBefore you go to view a property, ask the right questions and do due diligence. When you go for the viewing, take another person with you.
Connor’s recommendationsConnor recommends several books for self-education and development:
Think and Grow RichOutwitting the Devil: The Secrets to Freedom and SuccessAs A Man ThinkethThe Richest Man in Babylon
No.1 goal for the next 12 monthsConnor’s number one goal for the next 12 months is to get his EXP organization to 10,000 agents. He also wants to develop properties in North Dallas as a long-term investment plan. Connor also wants to get his new a...

BIO: In 2013, Zachary Resnick began to make a living from playing poker cash games and investing in other poker players, providing a unique understanding of risk management that is largely shaped through leveraging volatility to outperform others in the high-risk, high-reward situations of poker.
STORY: Zach invested in two founders with a brilliant idea and overlooked the fact that they were not A+ founders. He ended up riding the company down by more than 80%.
LEARNING: Back people that completely blow you away. People are super important, especially at the earlier stage of the business that you invest in.
 
“When investing in early-stage companies, the qualities of the founders are paramount and almost inarguably the most important thing for that company.”Zachary Resnick 
Guest profileIn 2013 Zachary Resnick began to make a living from playing cash games and investing in other poker players, providing a unique understanding of risk management that is largely shaped through leveraging volatility to outperform others in the high-risk, high-reward situations of poker.
In 2016 he made his first personal investment in Bitcoin and, by 2017, was focused on investing and trading crypto full-time.
In 2018 he founded Unbounded Capital, an early-stage venture capital firm focused on payment infrastructure.
He is also the founder of FlyFlat - a luxury concierge service that specializes in last-minute, heavily discounted business and first-class air travel.
Worst investment everZach’s company invested in these two founders, who loved the company’s media content on the blockchain world. The founders were building a solution that Zach believed was A+. It would be a 100x improvement to existing solutions. There was one problem, though; the founders were not A+ founders. This became the first startup Zach’s company rode down by more than 80% since he started the investment firm.
Lessons learnedBack people that completely blow you away.People are super important, especially at the earlier stage of the business that you invest in.Know your investing style.
Andrew’s takeawaysWhen investing in a startup, you’ve got to trust the founders, believe in the idea, have a ready market and ensure the startup has the muscle to execute the vision.
Actionable adviceIf you’re in the startup investing business, especially in the early stage, meet with founders in-person before investing.
Zachary’s recommendationsFor frequent, flexible travelers who fly business class and want to save money, Zach recommends checking out Fly Flat.
To enhance deeper thinking, Zach recommends reading great books such as The Elephant in the Brain: Hidden Motives in Everyday Life and Thinking Fast and Slow.
Zach recommends reading his first e-book, How A Scalable Blockchain Will Win, to learn more about how scalable and efficient blockchains will transform the internet and how data and payments operate worldwide.
No.1 goal for the next 12 monthsZachary’s number one goal for the next 12 months is to have more spaciousness in his life so he can spend more quality time with his amazing partner....

BIO: After poor experiences with the financial industry early in his professional life, Chris Mamula educated himself in investing and tax planning.
STORY: Because Chris trusted his parents, he also blindly trusted their financial advisor. It was only after he stumbled upon better financial advice that Chris realized he’d wasted well over $100,000 in fees and another $100,000 in taxes.
LEARNING: Gain financial literacy and take responsibility for your financial situation. Don’t trust financial advisors blindly.
 
“The less money you spend on your financial advice and financial products, the more money you’ll have to invest.”Chris Mamula 
Guest profileAfter poor experiences with the financial industry early in his professional life, Chris Mamula educated himself in investing and tax planning.
He now draws on his experiences to write and speak about wealth building, investing, financial planning, financial independence and early retirement (FIRE), and lifestyle design at the blog “Can I Retire Yet?”.
Chris is also the primary author of the book ChooseFI: Your Blueprint to Financial Independence.
In addition, he works one-on-one with those looking to improve their finances and use them to create a better lifestyle as an advice-only financial planner with Abundo Wealth.
Worst investment everChris was a college graduate with a master’s degree starting to learn how to make and spend money. Like many people, he was overwhelmed and intimidated by the technical parts of finance, investing, and tax planning. The advice Chris would hear everywhere was; if you need help, seek a recommendation from someone you trust. So he went to his parents, whom he trusted more than anyone else. Chris’s parents were generally decent with their money as far as stretching a paycheck, managing a budget, and taking care of their children’s needs.
Chris didn’t realize that his parents used a financial advisor because they had no idea what they were doing. And because Chris trusted them so much, he started using the same advisor and blindly trusted everything he told him—no questions asked.
After a decade of this, Chris finally stumbled into some better investment advice and found out all the mistakes he had made. He realized that over a decade, he had wasted well over $100,000 in fees and another $100,000 in taxes. Because he’d started it so early in life, it could easily be a million-dollar mistake when you compound it over time.
Lessons learnedSo many conflicts with financial advice exist, so you can’t blindly trust anyone.When looking for an advisor, ask as many questions as possible. What does this person know well? Is there a conflict between your interest and theirs? Are you getting the best advice?Gain financial literacy and take responsibility for your financial situation.
Andrew’s takeawaysInvesting is actually quite simple, but financial professionals often make it complicated.Never invest in anything that somebody calls you about.A piece of advice could work for someone but not necessarily for you.You have the right to ask for further clarification if you don’t understand the fees you’re being charged.
Actionable...