2 Kinda Important Things Business Professors Won't Teach You
My dream life turned into a nightmare
My first business venture failed miserably.
I had it all figured out, too — that’s the scary part.
As a senior in college, I started researching commercial real estate. I remember pulling up graphs in the school library illustrating the 10-year trajectory of commercial leasing. The future was money green, and I was hooked.
I talked to every alumnus who worked in the industry (I even played golf with a few of them) and cold-called all the major firms willing to talk to a 21-year-old ambitious kid.
After I graduated, Colliers International hired me to be a research analyst. There would be no gallivanting around Europe for me. I leased a cheap apartment close by and got to work.
Here’s the basic timeline of what happened next:
Year 1: The firm promoted me to Junior Broker.
Year 2: I was working with Fortune 500 companies and had a great mentor teaching me everything he knew.
Year 3: The firm awarded me Broker of The Year and Rookie Broker of the Year.
Year 4: My business failed, and I quit.
Now, I would never blame college professors for what happens post-college. However, they’re a few things I wish I had known while riding this roller coaster.
1.) No one can predict what’s going to happen
Business professors like to warn students about the cyclical nature of markets.
Expect a correction every “10-years” they say. Stocks go down, bonds go up, and tech gets their pockets cleaned. Time to buy because money is cheap.
Here’s what they don’t tell you: Markets aren’t “that” cyclical. No professor can tell you what will cause the next recession or why it will occur. That’s what makes them so devastating — they’re a surprise. No one actually sees them coming. And the gap between each downturn has increased by random margins over the last century. To say something happens every 10 years is a misnomer.
Nobel Prize winning Psychologist, Daniel Kahneman, has a great quote about this:
“Whenever we are surprised by something, even if we admit that we made a mistake, we say oh, I’ll never make that mistake again. But, in fact, what you should learn when you make a mistake is that you did not anticipate something. The world is difficult to anticipate. That’s the correct lesson to learn from surprises: That the world is surprising.”
I started working in commercial real estate in 2015. Office space was cool then. Everyone wanted the open floor plan, hardwood floors, and ping-pong tables that emulated Google or Pixar.
Office space felt like the right product to place all your chips on.
So that’s what I did.
Enter Sandman. The Corona Virus.
Markets can be cyclical. But Corona Virus was a surprise. A surprise, rendering office space irrelevant for two years and leaving a question mark for its future practicality.
Business professors can teach you about mistakes made in the past — all in hindsight. But surprises make markets rise and fall.
2.) You’ll change more than the market
There’s a quote from Morgan Housel’s Psychology of Money that I got a kick out of:
“The underpinning of psychology is that people are bad predictors of their future selves.”
He means we shell out tons of money for extravagant weddings at 25 years old just to spend even more money for a nasty divorce at 35. We go 6 figures into debt for a law degree at 22 years old, then take a job as a high school history teacher at 32.
Professors won’t tell you how much you’ll change.
At 25 years old, I sat comfortably in a lifestyle that I had specifically picked for myself based on my skills, interests, and goals I had when I was 21 years old.
At least once a week, I played golf with my clients and colleagues. I networked and played basketball at the Athletic Club. I wore a suit every day and drank beers at happy hours after work.
It was my dream life.
But time passes and one day, you find that the lifestyle you thought you wanted no longer aligns with your interests, skills, and goals.
I was miserable at 27 and screaming at my 21-year-old self.
I didn’t want to wear suits anymore. It turns out golf is not good for your health if you’re just riding around in a cart drinking the whole time. I didn’t want to network and suck up to people I didn’t like.
I wanted to hang out with people I actually cared about.
I wanted to create. I wanted to write.
If Corona Virus hadn’t killed my business, my eagerness to do weird things like run marathons and blog certainly would have.
The most important rule is to stay in the game
I found this quote from Ralph Waldo Emerson, written 150 years ago. It inspired me to write this article.
“If our young men miscarry in their first enterprises, they lose all heart. If the young merchant fails, men say he is ruined. If the finest genius studies at one of our colleges, and is not installed in an office within one year afterwards in the cities or suburbs of Boston or New York, it seems to his friends and to himself that he is right in being disheartened, and in complaining the rest of his life.”
Failing when you’re young is nothing new. Shit happens.
I’m very happy with my current lifestyle. I work for a fantastic start-up that pays well and gives me the flexibility to write and train for marathons. I also get to live in Austin — probably the coolest city in the world.
Here’s what I learned from my first business failure:
No one is shielded from surprise and change — call it a tax for walking the earth. But we don’t like to talk about these things. Professors certainly won’t teach it.
Why?
Because you can’t plan for them.
Like Daniel Kahneman said: “The world is difficult to anticipate. That’s the correct lesson to learn from surprises: That the world is surprising.”
What’s the antidote to this beautiful fact?
I’m not sure there is one, but if I had to guess, it would go something like this:
Don’t lose heart, and stay in the game as long as possible.
Your time will come.