Tiny Office Hours #3 with Shane Parrish

Podcast Hosts: Andrew Wilkinson, Chris Sparling (Tiny)
Guest: Shane Parrish (Farnam Street, The Knowledge Project)
Date: June 10, 2021
Theme: Building careers, networking, operating holding companies, audience building, and lessons from entrepreneurship

Episode Overview

This episode brings together business minds Andrew Wilkinson, Chris Sparling, and Shane Parrish for an Ask Me Anything session, fielding questions from entrepreneurs and founders on everything from career transitions to the nitty-gritty of cold emailing, social media strategy, navigating regulated industries, and running holding companies. Proceeds from the session go to the Ottawa Food Bank, emphasizing the community spirit behind the advice.

Key Discussion Points and Insights

1. Discovering and Shaping Your Career

[01:46] - [07:49]
Question: How did you discover your careers, and what would you have done differently?

• Personal Brand & Audience:
  • Shane: “There’s multiple possible futures, and how do you prepare for the most of those futures that you can?” [02:32]
  • Build a personal brand and audience early on, leveraging unique experiences (e.g., being an Olympian) for future opportunities.
  • Use email to “own your audience without platform risk.” [05:36]
• Personal Moat:
  • Andrew: “Having an audience is really valuable...I call it a personal moat.” [03:21]
  • Regrets not doing social media and audience-building sooner.
• Unfair Advantages:
  • Chris: “I would really...just strategize and think what advantages do you have in life that the average person...doesn't have?” [04:45]
  • Example of Rob Fraser (ex-mountain biker) who leveraged his network to build a successful sock business. [06:08]

2. Building Communities and Serving High Net Worth Audiences

[08:02] - [08:57]

• Know Your Audience:
  • If you lack direct connections to high net worth people, first invest in understanding their real problems—interview them, learn from multifamily offices, don’t make blind assumptions.
  • Shane: “You need to offer value to them, and that's really hard without understanding some of the problems they might be facing.” [08:57]

3. Disrupting Regulated & Professional Industries

[09:19] - [14:07]

• Legal Industry Problems:
  • Andrew: “The biggest problem we see with law firms is just pace. ...no customer goes in and says, I wish this would take longer.” [10:07]
  • Simple project management and higher responsiveness are low-hanging fruit for disruption.
• Proactivity in Service Firms:
  • Shane: “I would love to see...proactivity instead of just reactivity...be a partner in that sort of sense.” [12:54]
  • Even top firms like PwC rarely suggest optimizations unprompted.

4. Rolling Funds, Venture as an Investment, and Transparency

[14:12] - [16:39]

• Caveats for Venture Investment:
  • Andrew: “I don’t recommend Venture for anyone who’s a first-time investor. ... Venture is playing roulette.” [14:51]
  • Only invest what you’re willing to lose; their own rolling fund shares minimum regulatory disclosures—avoid excess bureaucracy and focus on track record.

5. Transitioning from Operator to Investor/Holding Company Owner

[18:01] - [25:56]

• Buffett & Munger’s Lessons:
  • Andrew: Realizing “owning a business doesn’t mean running it necessarily.” [18:01]
  • Delegation was crucial: “You can make...a hundred thousand dollars an hour if you can learn how to delegate.” [21:38]
• Learning by Doing:
  • Chris: “Just go out in the world, experience, try to start different things, and...reading books at the same time.” [19:22]
• Delegation Philosophy:
  • Andrew: “If I’m not saying hell yeah every day, I know there’s something wrong.” [22:45]
  • Only after doing a job yourself can you effectively delegate it.

Notable Quote:

• “Always do the job before you delegate it.” – Shane [25:56]

6. Mastering Twitter & Audience Building

[26:43] - [34:42]

• Process & Principles:
  • Shane: Batches tweets in drafts, refines weekly; “Whatever platform you’re on...the algorithm rewards you for keeping people on that platform.” [27:34]
• Authenticity is Key:
  • Avoid outsourcing personal tweets unless you’re already a huge public figure.
• Measuring & Learning:
  • Analyze engagement to improve clarity and resonance.
  • Shane: “If you’re not getting at least 5% engagement, you’re probably not resonating.” [28:45]
• Stick With It:
  • Chris: “Just, you know, if you’re going to invest in your personal brand, stick with it for a long period of time.” [33:04]

7. Sourcing and Networking: Cold Emails that Work

[37:16] - [44:18]

• Offer Value; Be Succinct:
  • Shane: “I didn’t really cold email any entrepreneurs...I had already done something that they found valuable.” [37:26]
• Andrew's first cold email (to Steve Jobs at age 12) advice: “Find your own path.” [38:23]
• Practical Advice:
  • “The very worst is a cold email that just asks of something.” – Chris [39:59]
  • Offer value (e.g., redesign a website for free): “Solving a problem for them...just do it. Just solve the problem.” – Shane [42:29]
• Networking Mindset:
  • “Interesting people beget more interesting people.” – Andrew [38:23]

8. Handling Criticism & Negativity

[45:19] - [53:11]

• Meaningful Work Attracts Criticism:
  • Shane: “If you’re doing anything meaningful and different, there’s going to be people who try to take you down a peg.” [45:41]
• Empathy First:
  • Chris: “Take like an extreme empathy approach...better understanding the narrative or the sequence of events that led them to criticize.” [47:12]
• Filtering Feedback:
  • Shane: “If you’re not in the arena, if you’re not doing what I’m trying to do, then your criticism may or may not be valid, but it definitely carries a lot less weight.” [50:59]
• Protect Your Mindset:
  • Avoid reading negative comments as your audience grows.

9. Hiring, “Gumption,” and the Secret to Breaking In

[54:35] - [59:51]

• Demonstrate Work Ethic & Resourcefulness:
  • “The number one thing Chris looks for when he hires someone is gumption.” [55:46]
  • Shane: “If I ended up in a third world prison, would I trust you to be able to figure out how to get me out of that?” [56:00]
• Standing Out:
  • “It’s that one resourceful person who...gets in our face and shows gumption.” – Andrew [56:43]
  • Suggestion: Make a creative loom video or leverage connections, not just send a CV.

10. Acquiring and Operating Home Services & E-commerce Businesses

[35:06] - [63:17]

• Vendor Financing:
  • Chris’s approach to home services acquisition: “I do vendor takeback for sure...and try and do very low multiples up front.” [36:58]
• Amazon vs. Shopify Ecosystems:
  • Andrew: “We would never buy businesses in the Amazon ecosystem because by its nature, it’s just hyper competitive.” [60:23]
  • Shopify enables brands to truly “own their customer”; Amazon commoditizes and actively competes with sellers (“Your margin is my opportunity.” – Bezos [63:17])

11. Lessons from the Pandemic

[63:25] - [75:41]

• Institutional Trust:
  • Shane: “I've learned less trust in institutions like the WHO and the CDC...the bureaucracy, the misinformation.” [63:31]
• Supply Chain Vulnerability:
  • Need for margins of safety; offshoring can be a risk.
• Behaviors in Uncertainty:
  • Chris: Reliance on institutions exposed a lack of individual critical thinking; storytelling often trumps statistics (“There’s more power in stories, and unfortunately, charlatans are great at selling stories.” – Andrew [74:35])
• Investment Lessons:
  • Early pandemic bets on volatility and asymmetric returns, as well as lessons from greed, FOMO, and the importance of locking in gains while ahead.

12. Networking Techniques: Gifts, Thank-Yous, and Reciprocity

[75:41] - [78:29]

• Authentic Connection vs. Manipulation:
  • Andrew: “What I realized as people started doing it to me is I found it incredibly manipulative.” [75:56]
• Reciprocity Rule:
  • Chris: “When reciprocity is a factor, any little favor...you’ll make worse decisions as a result.” [77:30]
• The "Gift Psychology":
  • Over time, the giver expects more from the gift, while the recipient values it less; path to resentment.

Notable Quotes (with Timestamps)

• Personal Brand:
  • “Having an audience is really valuable...I call it a personal moat.” – Andrew [03:21]
• Delegation:
  • “Always do the job before you delegate it.” – Shane [25:56]
• Twitter Growth:
  • “If you’re not getting at least 5% engagement, you’re probably not resonating.” – Shane [28:45]
• Networking:
  • “Interesting people beget more interesting people.” – Andrew [38:23]
• On Gifts:
  • “I found it incredibly manipulative. ...I immediately became suspicious they’d read the same books I had.” – Andrew [75:56]
• Criticism:
  • “You have to be willing to look like an idiot in the short term to be a genius in the long term.” – Shane [47:12]
• Amazon competition:
  • “Your margin is my opportunity.” – Bezos (quoted by Andrew) [63:17]

Memorable Moments

• Andrew cold-emailed Steve Jobs at age 12 and received a blunt reply: “Find your own path.” [38:23]
• Real-life case study of Rob Fraser leveraging a sports network into a sock business. [06:08]
• Chris and Andrew’s pandemic S&P bet, going from $500k to $7 million, then back down to zero—a story of asymmetric bets, greed, and rapid market turns. [71:54–73:17]
• Shane’s “third world prison” test for hiring. [56:00]

Timestamps for Key Segments

• 01:46 – Post-athletic career advice
• 08:02 – Building a community for high net worth individuals
• 09:19 – Opportunities in legal/professional services
• 14:12 – Rolling funds and venture investment risks
• 18:01 – Journey from agency to holding company; delegation
• 26:43 – Twitter strategies & building an authentic personal brand
• 37:16 – Cold emailing entrepreneurs & networking lessons
• 45:19 – Handling criticism and negativity as you gain an audience
• 54:35 – Hiring for gumption and standing out for top founders
• 60:23 – Amazon vs. Shopify business acquisition strategies
• 63:25 – Pandemic lessons: Supply chains, institutions, and asymmetric bets
• 75:41 – Network gifts, authenticity, and psychological pitfalls

Final Thoughts

The episode is a treasure trove for anyone interested in building a defensible career, nurturing high-value networks, leveraging digital platforms for personal leverage, and avoiding common traps in business and networking. Real stories, tangible advice, and honest reflections—the kind you won’t get in a “how-to” blog post.

Supporting a Good Cause: All proceeds went to the Ottawa Food Bank, reinforcing the ethos of paying forward hard-won lessons.

This summary preserves the tone and practical insights of the original speakers, offering actionable advice and memorable anecdotes for entrepreneurs and curious minds alike.