← Success Story with Scott D. Clary
Success Story with Scott D. Clary
Lessons - The Decision-Making Framework That Leads to Profitable Investments | Shane Neman - Strategic Investor
00:13:40
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- [00:00]
A
In this Lessons episode, discover that successful investing is less about capital size and more about disciplined decision making. Learn why removing emotions from investment decisions is essential. Understand how surrounding yourself with expert mentors sharpens your strategy. And uncover how diversification opens doors to new opportunities, even in volatile markets. So I asked you if you're, if you consider yourself a professional investor, but at the very, at the very minimum, you are a professional decision maker. That's what you.
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B
I think.
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A
But everybody is. I think that just. I think that. Well, actually, it's all relative. I was going to say because there's more. There's more capital, there's more stakes, but it doesn't really matter because at any level it's all relative.
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B
Right.
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A
Like you could be putting in like five grand into a company and if you lose it all, that's still five grand gone. And if you're only making 70 grand a year or whatever, that's. That's significant to you. So it doesn't really make a difference.
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B
So being a good investor equates to being a good decision maker and also being able to remove your emotions from the investment. It's very hard to do. It's very. I am not particularly good at it, but I'm seasoned and I'm hardened over.
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A
So you, you sold easy texting.
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B
Yes.
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A
You started investing.
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B
I started investing. I made a lot of mistakes.
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A
Okay, so. But even like the thought process, because again, I do see you being more active than a lot of the people that I know. A lot of people I know who sold a company, they only invest in the thing that they know.
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B
Yes. And across the board and.
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A
Or real estate. That's like the only. Like you could be like a SaaS founder and you just do like early stage prop tech SaaS and then plus real estate. Or, Or.
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B
Yeah, but you do everything I do because.
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A
And you have to talk about the stuff that you put money into the very.
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B
Oh, yeah. So I'll tell you, my strategy is very different now than it was before, but started. Yeah. But I think that being able to control. If you, if you look at the best investors, like a Buffett or those guys, right. They're all like, all slightly on the spectrum and so they don't experience emotion the same way that, I don't know, quote unquote, normal people do. Right. Or you and I do. Or, you know, so. So they could see like a huge loss on their account and not flinch because they're so certain about what they're. They just did. And they're just like, I'm willing to wait, wait, be wrong for a long time until I'm right. Yeah.
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A
But for, for most people, you have a heart attack.
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B
Yeah. You go, you go in and see your account down 30%, 40%, 50%, you're going to have a heart attack and you're going to make a bad decision. Okay. And so that's an acquired skill. And sometimes it's even when you acquire the skill, like, even during COVID like, I was on the verge of making some really bad decisions that I'm thankful that I didn't make, but I was this close, you know, like, I'm not immune to it. Right. To making emotional decisions. And so, you know, that that's a, that's a practice. It's, it's really, it's, it's just like working out. Right. Like, the more you practice it or, you know, yoga or whatever it is, the more you practice it, the better you get at it. And, you know, you can start small. I found, you know, a few, few people who I respected. I, I, I still talk to them all the time. It's very hard to find those people in, in whatever you're looking for. Like, for me, it was for investments. You know, for other people, it could be in health. You know, you, you know, I know you and Gary are tight.
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A
Yeah, yeah.
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B
Now. Right. And, and, you know, you, I know.
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A
Has his own, like, I mean, he's built a massive social media business with Valeria. So, like, he's one of the guys that I look to for that. But there's not many people that.
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B
Yeah.
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That are killing it. Like, the 0.001% is for a reason. Right.
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B
Yeah. So, so it's worth your time and effort to try and find those people that you want to surround yourself in. That's probably the 90% of the game and the amount that I learned from those people, and now I'm adding value to them because I learned their techniques, I learned from them, and now I'm, like, contributing. Right. And so I think that that's, that's a, that's an essential. You, you, you really want to find those people that are experts in what you're trying to do and put yourself around them and put yourself into scenarios that give you high probability of meeting those people and situations. So. Yeah. So now my investment thesis is very different than before.
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A
What was it when you, I don't even think you told me.
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B
I think I was trying to do a little bit of what you said. I know I did real estate and I did SaaS and things I knew initially, but then, you know, when I put myself around other, other investors that were really smart, they were opening up whole new worlds for me and showing me biotech and showing me, you know, deep tech and showing me cpg like we did in athletic greens, for example. One of the investments that I did with one of my friends, it's a amazing investor as well. And then looking at late stage businesses, you know, like we did Pacific park at the Santa Monica Pier, which we bought that business, which is one of the. It's the number one tourist destination in Los Angeles.
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A
I know. So you, you've lit. You literally bought the Santa Monica Pier.
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B
We didn't buy the pier itself. You can't own the pier. Right. You can just like it sounds.
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A
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B
It sounds cool. We bought the business of the Pure, so it's a little bit different, but there's, you know, there's a real estate component to it. But I think right now my tech.
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A
By the way, are those some of your biggest ones? So athletic greens.
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B
That's. Yeah. So I think athletic greens. Athletic greens. The pure is one of the biggest deals I've ever, I've ever been involved with the. I did a company called Figure AI recently, which is a humanoid robot that Brett Adcox founded. I don't think I knew you when I first invested. We invested two years ago. It was a unique time because the Markets were doing really poorly at that time. It was 2022, I think. And, you know, tech was down a lot, inflation was raging. And Brett comes out and he's like, I want to build a humanoid robot. And all he had was a few guys that he and that he had hired from Boston Dynamics, a sample of a hand of a robot and a bunch of, I don't know, like computerized prototypes.
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A
But he had a track record, though.
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B
He had a track record and he. And he was putting in 20 million of his own money. So that's. See, that's the thing. When you make decisions, you have to also kind of take into. Because. Because if you just look at it, at the face of it, you most. 99.9% of people would never even like, even consider it because it's like, he's going to build a robot, a human robot that works. Yeah, whatever. Right.
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A
Like, but when you put your money where your mouth is.
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B
Yeah. As a founder and going into details matter, right. So like those things matter. You know, he had a track record. He had two exits. He took Archer Aviation public. So he had a lot of hardware experience and scaling hardware. He was putting his money where his mouth. Mouth was. He had gone pretty far even with very little money of actually making a functional hand, which is the hardest part of a robot mostly. And so when I first did that investment, most people thought I was batshit crazy because, you know, first of all, the markets were in turmoil at that time. So it's very hard under fear to make investments.
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A
But that's where the removing your emotion piece.
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B
Absolutely, absolutely. Like, whether it's in the public markets or the private markets is. It's irrelevant. Right. People get disgusted and they don't want to look. Right. They don't want to look because they, they see their account down, right. And they're like, oh, yeah, now I'm going to make an investment and like take even more money out of there.
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A
But the thing is those two, those two, two things are completely separate from each other yet.
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B
It is, logically speaking, but people are. But it's very hard to separate it out. And so anyway, as luck would have it, which I think 90% of all this is luck, obviously Brett was successful. He made a prototype that actually works. It's actually deployed in Amazon and BMW right now. It's probably the Him. Him and Optimus from Tesla are probably the incumbents in the field where they have a real viable product that can actually replace human labor. And if you think about a human labor, physical labor is a $3 trillion TAM, like everything. Like, it's all the work that no one really wants to do, right? Like this, you know, no one wants to go and pick and pack in a warehouse and go down aisles and pull things from boxes and, you know, take a piece of sheet metal and keep putting into a press a thousand times a day, which is where he's starting, which I think is the right thing. And also in a warehouse, you know, a robot's in a controlled environment. So the safety issues are kind of much more manageable.
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A
Mitigated a little.
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B
Yeah, they're much more manageable. It's also talking to a computer that's giving it directions, like a warehouse management system versus, you know, me, you know, robot being in my house. And I'm saying, wash the dishes, right? It's a little bit different.
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A
It's almost like, well, robots exist in car manufacturing already.
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B
They do, but this is certain parts.
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Of certain parts of it. So this is just like almost finishing or, or more parts of the. The factory is now going to.
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B
So Tesla, I think, you know, their idea is that the entire process will be done by a robot. And as a practical matter, all the other robots that work on anything are, you know, the environment is retrofitted for the robot so that the robot can work correctly in that environment. But the world is meant to interface with humans. It's meant to interface with hands, feet, you know, you know, stabilize, like a human, like even an iPhone. If you go and actually look at how it's made. A lot of it's done by hand. You can't even imagine, right? It's done on a huge scale in China, but a lot of the pieces are being done by hand. And so if you can really, truly replace that, the, the, the, the opportunity is huge. It's almost like bigger. As big as cars were when cars were invented, right? The opportunity is, is huge in the entire physical labor.
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A
So it's funny when, whenever an investor, an entrepreneur is like tam, like total addressable market, and they say some ridiculous outlandish number and you're like, well, if I just captured like 1% of TAM or whatever, then company will be successful. But this is, this is, this is.
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B
Really, truly a giant tam. I mean, like the payroll that. I mean, first of all, Amazon and all these places, they can't even get enough workers. There is not enough workers to that want to do this. So they have to constantly raise the price of, of what they're willing to pay. I mean, the port workers, you just saw what happened. It was just happening?
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Strike. A huge strike.
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Yeah, no, it got resolved. But they're getting paid, like, $65 an hour now.
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That's. That's. That's significant. That's huge.
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Yeah. So, like, why wouldn't you replace that person with a robot if you could? Yeah, it makes no sense. Why do you need a person to, like, move cargo from one side of the port to the other? And, like, there's a lot of issues with that because there are safety issues, like if, if, if, you know, if. If a piece of cargo falls on a. On a robot, no one cares.
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A
But if. If that injures a person, that's millions of dollars.
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B
And, yeah, the productivity gains, the things that come with it. And so anyway, just recently, they raised 650 million from, like, Microsoft and OpenAI and Jeff Bezos put $100 million. And so, you know, I look smart now, and then let's see what happens in two years. Right? Like, it could be a zero. Right.
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A
Thanks for tuning in. If you found this valuable, don't forget to hit that subscribe button so you never miss an episode. And if you want to dive deeper into this conversation, check out the links in the description to watch the full episode. See you in the next.