My Worst Investment Ever Podcast Paul Krake – Surround Yourself With Experienced People
BIO: Paul Krake is a global strategist focusing on mega themes of climate, China, digitization, and demographics.
STORY: Paul quit a prestigious job where he had seasoned mentors to start a hedge fund. After a few years, he realized he wasn’t mature enough or emotionally prepared to run a business on his own.
LEARNING: Surround yourself with people who are more experienced than you are. Think about all the scenarios where an investment can go wrong.
“For every good idea out there, there are a million ways (that you can’t think about) for it to go wrong.”
Paul Krake
Guest profile
Paul Krake is a global strategist focusing on mega themes of climate, China, digitization, and demographics. View from the Peak, Paul’s consultancy was formed in 2011 after an 18-year career in investment banking and as a macro hedge fund manager, where he covers global institutions on these mega themes. His latest venture is Climate Transformed, a global community of climate investors, entrepreneurs, and corporate leaders who are practically implementing the $100 trillion investment required for us to achieve decarbonization and sustainability.
Worst investment ever
Paul’s dad passed away in November 2004, and a couple of days after his funeral, Paul was sitting in his mom’s backyard at four in the morning. At that moment, he thought of the idea of starting a fund.
Paul went ahead with his idea and started a hedge fund even though the timing was wrong, and it was for all the wrong reasons to follow through with this idea. There was such a high degree of emotion involved in making this decision that he didn’t really think through it and consider all that he was giving up.
At the time, Paul had a prestigious job at Caxton Associates. He had the support of great mentors and trainers. He gave up all this to start his business.
After about three years of running the hedge fund, Paul realized he wasn’t emotionally prepared or mature enough to do what he was doing.
Lessons learned
- Surround yourself with people who are more experienced than you are.
- Think about all the scenarios where an investment can go wrong.
- Think of a business as trade and have an exit strategy if it doesn’t work for X years or if you spend X amount.
Andrew’s takeaways
- When you get that wind of confidence and want to invest, take a step back and think things through.
- When you quit a job to start a business, you lose support and have to do it alone.
Actionable advice
Before you make any investment:
- Think about your processes.
- Consider your entry and exit position and treat everything with the same agnostic clinical approach.
- Always have an exit strategy for when things don’t work out.
Paul’s recommendations
Recommended resources: The secret to not getting stressed over not finding ways to de-stress is to use fewer resources.
No.1 goal for the next 12 months
Paul’s number one goal for the next 12 months is to successfully roll out 30 in-person events in nine countries.
Parting words
“I love this. I think it’s a great way to get people to seriously think about the benefits of failing.”
Paul Krake
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Connect with Paul Krake
Andrew’s books
- How to Start Building Your Wealth Investing in the Stock Market
- My Worst Investment Ever
- 9 Valuation Mistakes and How to Avoid Them
- Transform Your Business with Dr.Deming’s 14 Points
Andrew’s online programs
- Valuation Master Class
- The Become a Better Investor Community
- How to Start Building Your Wealth Investing in the Stock Market
- Finance Made Ridiculously Simple
- FVMR Investing: Quantamental Investing Across the World
- Become a Great Presenter and Increase Your Influence
- Transform Your Business with Dr. Deming’s 14 Points
- Achieve Your Goals