My Worst Investment Ever Podcast

Bobby Casey is managing partner of Global Wealth Protection. His company helps clients from around the world to internationalize their assets and take advantage of unique investment opportunities globally. Bobby is a lifelong entrepreneur, investor, and student of life. He is a believer in privacy and freedom and fights this fight through words and actions globally. As a renowned speaker on anarcho-capitalism, free-market economics, and offshore business, Bobby travels the globe working with like-minded clients to help them properly structure their businesses and their lives to minimize risk and maximize reward. He holds two undergraduate degrees: a Bachelor of Science (BS) in finance with a minor in economics; and a BS in international business with a minor in Russian. He also holds a master’s in entrepreneurship from MIT.   “In reality, the worst investment ever related to taxes is not taking the time to properly plan and minimize your tax obligation.” – Bobby Casey   Worst investment ever Not putting effort into minimizing taxes is a mistake by inaction He says his No. 1 worst investment ever was probably the same as it is for every person listening to the podcast – taxes. In a way, he is joking. But what he really means is people don’t think about taxes as being a bad investment, because most people think they’re doing something they must do. However, the first time they write a six-figure check for taxes, it should make them think about what other better action could be done with that money than pay those taxes. He doesn’t mean breaking the law. But he says, while abiding by the law, there are a lot of things people can do to minimize taxes. Many people don’t think about it and write it off as the cost of success, but Bobby points out they could have reinvested that $40,000 or $80,000 into something significantly better if they had taken the available and necessary steps. Substantially worst investment For several years, Bobby used to host around two offshore investment conferences a year, primarily in the Caribbean. Around that time, he developed personal connections in the private investment space who had opportunities they were promoting, and the events gave people a chance to learn about alternative investment solutions other than just building a stock and bond portfolio. Bobby become close with one apparently hard-working guy, “Rick” (not his real name), who was offering such private investment options on the conference circuit, giving presentations, and raising money for his private company. At the time, he was selling preferred shares in his company, and Bobby bought about $100,000 worth of private preferred shares, for him a substantial sum at the time. Rick was doing press releases relating his success in bringing in lucrative investors, sometimes $5 million clients, sometimes $10 million, and saying what returns were going to be achieved. One release said, “We’re going to be up 300% this year.” Bobby was impressed. Adding credibility to the investment considerably was that Rick gained approval to take the company public on NASDAQ, and Bobby watched him on TV ringing the opening bell on the first IPO day of trading. Bobby thought he was going to make a killing on the stock. Rick even employed a friend Bobby had introduced. Enterprise exposed as a complex fraud The result was something far from a success. From top to bottom, the operation was a complete pump-and-dump scam. Rick was raising money selling preferred shares, speaking at conferences everywhere, in order to raise the stock price. With the millions of dollars he took for preferred shares, with all the press releases, Rick really did have a business, but it was not nearly as profitable or busy as he had claimed. Rick was arrested at an airport during an SEC investigation of his fraudulent pump and dump scheme. He had been taking money from the company promotions, funneling it through multiple offshore companies in Belize; those companies had brokerage accounts with tiny firms in the US, which were in turn buying up all the shares with it to inflate the share price of the listed company in a big money circle. By doing that, if the share price was $10, Rick would take all the money he had raised at a conference, $5 million for example, funnel it through the Belize companies, which would then buy $5 million worth of stock. This blew the price up. He was also paying “analysts” to write extremely glowing reports on the listed company. The stock would then rise from $10 a share to $15 to $20, and he would through his private holdings, sell them through the Belize company. Bobby’s friend indicted and jailedIt is difficult to believe that NASDAQ actually listed this company without enough due diligence to realize the scam for what it was. Sadly, Bobby’s who worked for Rick was named in the SEC charges and was jailed for six months, because he was a “public figure”, and even though he had no knowledge of the situation. Some lessons Don’t take anybody at their word on an investment. If you’re investing in a project, especially one that is an alternative asset class, such as a condo in Panama, don’t just look at a smooth-talking salesman and a really great PowerPoint presentation and give him a $50,000 deposit. Go to Panama, look at where they’re putting shovels in the ground, see if they’re actually building something, do a little bit of homework and spend a little money to investigate, fly down to Panama, for example, and if that $1,000 saves you $50,000, it will be worth it. “Whether the project is a complete scam, or just poorly executed, the results the same – you’re still going to lose your money.” – Bobby Casey Know yourself and find your investment comfort zone. Invest in an area you know about and stay in it. Bobby has his a comfort zone that works for him, but when he has strayed from it, he has paid the price. “I’ve been investing for 30 years, and every single time … I started making investment decisions that were outside of my area of expertise and my comfort zone, they would never go well.” – Bobby Casey If you go outside your comfort zone, do a great amount of due diligence before you throw your money down.   “Whether the project is a complete scam, or just poorly executed, the results the same – you’re still going to lose your money … so do your homework.“ – Bobby Casey Andrew’s takeaways Mistake No. 5: Misplaced trust Mistake No. 2: Failed to properly assess or manage risk. Believe no one. Try to make sure that people can prove their claims or that proof is made available easily. Don’t hesitate to ask for advice. However, usually people fail to ask for advice until it is too late, because they are too excited about the potential return, which blinds them to possible risks. Find someone with interests aligned with yours, with expertise in the asset class and location you are investing in, such as a good lawyer in Panama, for example, if it’s a real estate deal there, who can understand what’s going on and hopefully keep you out of a scam. But don't be afraid to ask for advice. And usually people don't ask for advice until it's too because it gets so excited about the potential return. No. 1 goal for next the 12 months To build his crypto mining operation to maximum capacity, taking advantage of his location’s inexpensive electricity bills. He does believe crypto prices will return to former levels and is a big believer in blockchain technology in general. Parting words The number one investment you can make is in yourself, your own education and spending your time with people who are going places can lift you up and who you can life up also. You can also check out 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 Connect with Bobby Casey: LinkedIn  Twitter   Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast 

Dr. Eelco Fiole is co-founder and sole managing partner of Alpha Governance Partners (AGP), a risk-governance-focused fiduciary services firm with alternative assets under the governance of US$15 billion across 12 jurisdictions globally. He is also CFO of the Tezos Foundation, a blockchain endeavor that has enjoyed one of the largest fundraising levels globally. Eelco is an adjunct professor in finance ethics at HEC Lausanne (the faculty of business and economics of the University of Lausanne in Switzerland, 2018 winner of the global CFA Research Challenge) and chairs the Annual Conference Advisory Group for the CFA Institute. He has gained almost a decade of fiduciary COO and CFO experience in alternative investments, emerging markets, wealth management and blockchain at Credit Suisse Asset Management, with operational responsibility for US$17 billion in alternative strategies, (in Zurich, London, and New York). He was a consultant for five years at PwC in Zurich, and his work there included a focus on frontier markets. He started his career as an institutional banker with ABN AMRO in Amsterdam, after spending early working years as an engineer in the oil-and-chemical industry. Currently a master of studies in social innovation candidate at the University of Cambridge, Eelco has completed advanced degrees in economics (PhD, Basel), ethics (MAS, Zurich), positive leadership (MPLS, Madrid) laws (LLM, London), and business (MS, Rotterdam School of Management, Erasmus University). His holds a bachelor’s degree in mechanical engineering from Rotterdam University of Applied Sciences). A chartered financial analyst (CFA) and a chartered director (CDir), Eelco holds various other leading finance and management designations. His global travel for business and education has included private and professional exposure to China for 20 years. He is based in Zurich and Singapore and is fluent in English, German and his native Dutch, has conversational French, and basic Spanish and Mandarin. Worst investment ever Background After finishing a business degree and working with major organizations, Eelco felt he had a pretty good understanding of what was going on in the financial investment arena, but he was yet to receive his CFA designation. Reliance on flawed research A friend of Eelco’s sent him an equity research report by a CFA charterholder who was working at a well-established, reputable investment house. The report projected that a large telecom firm’s stock would go up from 17 to 20 euro. Eelco thought that based on: the credibility of the research house; the compelling nature of their argument; that it was not a speculative stock; it was a large telecom firm; and the level of his own expertise to read such a treatise, he decided to buy the stock. However, soon after, instead of going up from 17 to 20 euro, it went down to 6 euro, in tandem with the inherent deception surrounding the tech bubble. What he hadn’t realized what that part of the valuation performed on the stock (outside of the usual equity research carried out on any stock) was based on the psychology of the market at the time around the tech bubble, and Eelco paid the price. He has remained involved in the investing space ever since, going through the ranks of various organizations, but submits that this was one of the key experiences of his career, even though he became a CFA charterholder later. Suffice to say, the report he had relied on and the result of the reality going the other way, was a memorable shock.   “The frameworks that we get offered through the CFA or some other academic material are not enough to reflect reality in the end … you need to be able to apply your own judgment.” - Dr. Eelco Fiole Some lessons Do your own analysis. Don’t rely solely on even the most professional research. An investor needs to also invest time to clearly understand a recommendation and the analysis behind an investment. Develop your own opinion on investment, even if you obtain information from t the most credible of sources. Think outside of the box about risk. Even though Eelco felt confident about his understanding of the risk in his investment, going through about the report itself and the firm’s reputation, there was obvious risk outside of those considerations, which hit him hard. You cannot assume that what you are reading about is enough to do guarantee results, you need to check your assumptions, and adjust your views on things as well. Educational and learning frameworks are necessary, but they are not enough. Yeah, The CFA or similar programs provide a great framework on how to think about investments but investors also need to stay open to the broader regional and global picture, particularly about risk, and arrive at their own conclusions, use their own judgement in the end. Such learning frameworks are enough to reflect the total reality to which a stock is subject. Be aware of your own assumptions, biases, and check them. Eelco realized that he had made a whole lot of assumptions that he was not checking, including those about his own ability, the time to judge what I was looking at. So I learned also that we need to be humble in how we approach these things. “Looking back I realized that I made a whole lot of implicit assumptions there that I wasn’t checking … so I learned also that we need to be humble in how we approach these things.” -  Dr. Eelco Fiole Andrew’s takeaways Do your own work. If you want to be successful in any career, learning is essential. Investing is the same and we have to do the work to try to be successful. However, in the world of finance, hard work is not enough. Risk can come from anywhere. Ethics are involved in doing your own work. It’s part of investing ethics and the responsibility of an investment analyst that is learned in the CFA courses, that even if you overhear a good tip from Warren Buffet, you still have to do your own work. Separate the research work you do on return from the research work you do on risk. That way, all the excitement and positive feeling you get about a great investment story is moderated by distinct and separate research on risk. If fact, tear it apart from a risk perspective. The idea of detached risk work is so critical. Actionable advice Be skeptical, not negative, be cautious. Be skeptical about what people are offering you and then come back to do the work for yourself, and apply your own judgement. No. 1 goal for the next 12 months My goal is to push better governance in the investment space so I’m actively committed to support initiatives around better governance, specifically risk governance. This will mean better risk-adjusted outcomes for investors. Risk governance takes place on boards and in all kinds of investment entities and involves applying fiduciary duties on those involved in playing around with a lot of other people’s money. Parting words Risk nowadays is idiosyncratic … I would wish everybody to increase their awareness and help people make sound choices, both professionally and ethically. You can also check out 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 Connect with Eelco Fiole: LinkedIn  Email  Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast 

Edward Stephens is director of the global brokerage at the Angel Investment Network, where he’s worked since 2010. In that time, he’s helped raise money for more than 400+ start-ups, including What3Words and Simba Mattresses. He also hosts a podcast called The Startup Microdose, which he started with a colleague. Guests have included the founders of Huel, Depop and Killing Kittens.   “Something that was meant to be liquid, easy, cash in, rolling the business through, turned to absolute hell.” – Edward Stephens   Worst investment ever Young deal-maker wants a piece of the action In 2012, Ed was 25 years old and had had two years of deal-making already at Angel Investment Network, getting a feel for what a good deal looked like. It was very appealing to look at what investors are looking at and feed off their excitement. Until that point, he didn't have any money of his own to invest but he felt it was strange to be deal broking without having any real experience of the pain points for investors who were having their capital put at risk and not understanding it. He started thinking about joining in all the fun. Sets eyes on attractive lending business idea Ed was working on a deal on a lending business called “Cash until Friday”, that was looking great. The entrepreneur liked Ed, and the investors were really excited. It was to be readied for trading on AIM, a secondary market of the London Stock Exchange. One big investor was putting in 500,000 UK pounds, so Ed joined in with 2,500 and he persuaded his father to invest 10,000 pounds. Conflict arises almost as soon as money goes in Almost as soon as they did, the main investor and the entrepreneur had a falling out. They were accusing each other of dark practices and the investor was adding strange fees onto the listing statements of the shell company. The investor also started to add consulting fees for the entrepreneur to pay to regain his investment and then wanted to pay for his investment in instalments in some kind of “weird equity clawback”. Sky darkens further Meanwhile, the AIM market looked as though it was on the verge of collapsing. The type of business relies on operating – lending cash – and the investor was angry and wanted to start lobbying other investors to get a court order to stop the business trading. If the business did so, it would die and be scrapped for the remains and the spoils divided. Battle lines drawn The ex-army entrepreneur started to put up the barricades and wanted to play hardball and it appeared as though Ed and his father were not only not going to get their equity in the business but that they would lose their entire outlay. They had not been given share certificates, the entrepreneur had their cash, and they had no means of getting it back. Deal’s off but father offers a life lesson  Ed didn’t sleep for a week because of feelings of failure, the loss of his own money and that of his father, but his father reminded him: “This is life. Shit happens.” His calm parent advised that they sit down with the entrepreneur and appeal to his goodwill. The entrepreneur agreed to service their capital back to them as a 7% loan. Chasing payments adds insult to injury While they had to chase the entrepreneur’s payments on a monthly basis, and sometimes the guy disappeared for months at a time, they got their equity back at 7% interest. In the end, it wasn’t that bad a result. The AIM market survived, there were no lawsuits, and the company was still trading as some kind of bridging-loan company. But Ed says the shocking thing was that it went bad so quickly. And it took such a long time to get the money back that even getting the repayments ended up being a nightmare. So it was a big relief when the last payment was made. However, the opportunity cost of capital, the stress to everybody for the 7% definitely wasn’t worth it. While it definitely built up some strength in Ed, it was “really unpleasant”. Some lessons Stick to what you know. This situation had Ed playing outside his field of expertise. He does add however: “But don’t limit yourself; you can always explore new things.” – Edward Stephens Don’t invest in what you don’t care about. If it does go wrong, then you find it hard to reconcile the loss of time and energy that has gone into such a shallow purpose. Ed admitted that he was just chasing money and had no real interest in the activity. Create a check-in plan, a period of time you allow yourself in which you can’t look at your investment so you don’t have it under a microscope. When you’re in a bad investment everything can look bad. Looking at an investment every day, good or bad, will drive you crazy. Andrew’s takeaways It’s fine to make a play in new areas. Try different things but do that with a very small amount of capital, particularly in the beginning. Be prepared for external events. Most people forget to think about this when they invest that there are all manner of unpredictable external events that can happen, such as the oil price shooting up or dropping cataclysmically, interest rates climbing, or the government changes policy. Such things can’t be predicted but we must expect that they can happen, and better still, have contingency plans in place when they do. Bringing family into any investment is hard. Sometimes we go into ventures blindly, thinking we’re doing a favor for somebody in our family. But in the end, it can be extremely dangerous. However, if it doesn’t work out, if you need to close a business, or if the investment doesn’t go according to plan, do not feel too bad for the investors and yourself if you have made clear from the beginning that they were investing in a high-risk, start-up enterprise. Sadly, sometimes people are going to lose, but that is what investing is about and that is what is involved when investing in start-up type companies. Actionable advice Strip away the money side of the investment. Stick to what you know and what you enjoy being invested in. Otherwise, it doesn’t really make sense. No.1 goal for the next 12 months Ed wants to grow his group’s podcast, The Startup Microdose, by talking to some more entrepreneurs “because it is really great to learn from people and their experiences”, and because he sees it as a legacy activity. He would also like to take the Angel Investment Network to further growth on the world stage and start to focus attention on impact-related investments, involve more women investors and get more and more people into the discussion worldwide. Parting words “There is a lot of uncertainty in the world … I think in the face of it, it’s pretty good if everybody takes some individual agency over the decisions we make, because I think, in aggregate, if we make the right decisions starting from us and don’t feel like we are victims of external circumstances, I think the world will generally become a better place bit by bit. Too many people feel like they’re bobbing around in the ocean, with politics preying on them and that is true to some degree, but we are still empowered to make our own choices and vote with our capital where possible.” You can also check out 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  Connect with Edward Stephens  LinkedIn  Twitter   Startup Microdose Twitter   Startup Microdose Podcast   Email  Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast 

Christopher Wong is currently the chief investment officer of Banjaran Asset Management, an alternative fund management house based in Singapore. He joined the company in January 2019. He was previously with Aberdeen Standard Investments and his last position was as investment director for Asia-Pacific and Emerging Markets. During his 17 years with Aberdeen, he was a senior member of the team that managed both country and regional equity funds. He was also on the board of directors for Aberdeen Islamic Asset Management (now known as Aberdeen Standard Islamic Investments [Malaysia]) and was a commissioner at PT Aberdeen Standard Investments Indonesia.  Prior to that, he was an associate director at Arthur Andersen Corporate Finance, acting as financial advisor for mergers and acquisitions, private equity, finance raising and valuation transactions. Christopher graduated with a BA in accounting and finance from Heriot-Watt University, Edinburgh, Scotland, UK. He is also a CFA charterholder and a fellow of the Association of Chartered Certified Accountants, UK.   “Sometimes in a moment of madness … you try to push the boundaries, in terms of risk … so you tend to take a slightly different approach to test your investment ideas on your personal finances.” – Christopher Wong Worst investment ever Strangely, after a long time at Aberdeen, with its rigorous, careful, methodical, and consensual manner of building portfolios, Christopher decided in “a moment of madness” to take a different approach and test his own investment ideas with his personal finances. He puts this down to the same temptation many people succumb to when faced with multi-bagger stocks that peers sometimes talk about in the break room. This detour came during the heydays of oil prices that were at all-time highs above the US$100 mark, finally peaking at 130. Christopher’s friend and colleague had become a billionaire as an investor, had retired early after investing money, and had bagged many multibaggers. After they went through the rationale, his friend took a big placement in a technology based oil and gas company listed in Singapore. The venture had technology to find oil through its software that had been tried and tested in Europe. The family owners had skin in the game but needed working capital to explore their findings from that technology. So Christopher took a stake and his friend took a bigger stake and “the rest was history”. By history he meant the dark ages. The price collapsed after it was discovered that the technology didn’t work as well as the company had claimed. The investment dropped close to 90% of its value in the span of a year. So that was a massively painful lesson for Christopher. Some lessons A good track record in the past is no guarantee of future success. Christopher thought his friend had the Midas touch and that in terms of investing, could do no wrong. Never lose focus on the fundamentals of a target company. Christopher learned from this experience that he had lost sight of the things he was trained to do in finance, such as looking at the balance sheet looking, the cash flow and the company’s ability to survive. He assumed that the status quo would continue and that the company’s high share price would stay high. “I think a lot of mistakes are made by … professional managers … when they don’t follow the script and they’re not disciplined when it comes to following what they have mapped out initially, and that the ends up a recipe for disaster most of the time.” – Christopher Wong   Andrew’s takeaways Investors must do their own research. Following great investors is never enough, so following such a friend and guru will rarely work out well. Always be on the lookout for impending “macro factors”. Internally with a target company, everything can appear attractive; good products, management, but external factors can arise that work against a company or industry. In Christopher’s case, the macro factor was that oil price was at its peak and then it collapsed. Be on the lookout for fraud and seek third-party verification of the quality of the goods or services of your investment target. People often misrepresent the abilities of their products so talking to an actual customer of your target company, helps check on whether the goods or services are effective. Size your position. You don’t have to eat all of the apple. Relative to your overall wealth, think about how big a bite of this company is really wise. In Christopher’s case, the 90% fall in the stock could be manageable if it were only 5% of his overall wealth. “If there’s a macro trend that’s massively moving against a company or an industry, it’s extremely hard to win in investing against that.” – Andrew Stotz Actionable advice Understand what you are buying by doing your homework. This is all about managing risk, and when you manage risk, the upside will take care of itself. #1 goal for next 12 months Because in this current situation we are seeing a lot more geopolitical risk, Christopher has will continue for the next year to put more money into more-secure-return type investments in private debt funds. Parting words “Be disciplined and enjoy investing. I think it’s one of the greatest activities, and one that you can carry with you, even after retirement, as it stimulates your brain.” You can also check out 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  Connect with Christopher Wong  LinkedIn  Email   Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast 

Camilita Nuttall is the world’s No. 1 “Rock Star” international speaker, is the founder of Event of Champions®, a seven-time award-winning corporate sales and business growth expert, an executive business coach, an entrepreneur, an author and a property investor. She has been featured in Forbes magazine and quoted in Think & Grow Rich for Women. Camilita has appeared on SKY TV, BBC Business News and with Dr. J. B. Hill, Napoleon Hill’s grandson, in front of 20,000 people. Camilita is a top sales expert who works with companies to increase their profit and create workable systems through strategic planning. She has traveled to 50+ countries and lived in Spain, Germany, Trinidad, Netherlands, and the UK. “So we went to see the lawyer and he told us there had been a big upheaval because the guy who sold us the land, who my brother had put us on to, had sold the land three times over to another 10 or 15 people. We just froze because we knew then that there was no way we would ever get our money back.”  – Camilita Nuttall Worst investment ever You trust your family, don’t you? Camilita grew up in the Caribbean, where family means trust and helping each other, especially growing up poor so you tend to believe your family. After moving to the UK and enjoying some success, her global businessman brother who had earlier moved to Britain thought with Camilita’s success she might be interested in some opportunities back in Trinidad. Amazing property deal Her brother introduced an “amazing” property deal to develop a piece of land because Camilita was already a property investor in the UK, and they could make share profits touted to her as in the millions, with her brother managing the project on the ground. So he introduced Camilita to the purported landowner, who was going to inherit the land from his father, or so she thought. The landowner was quite pushy about the benefits of the deal ‘Don’t worry, he’s legit’ Her bother said he knew the man, he trusted him, said he was legitimate, the brother had seen the land, said it was great and that it was not far from where he lives and that he would watch the deal carefully. Then he asked Camilita to send US$10,000 as a deposit to hold the land and “don’t worry”. ‘My brother won’t let me down’ She thought: “This is my brother, he would not betray me. I trust him. He wouldn’t let me down. Camilita’s husband was very skeptical but I sent the money and then they went to Trinidad to do the paperwork. Her brother then suggested using the same lawyer that the “seller” was using. Despite studying law, she agreed to share lawyer in land purchase Camilita studied law, but she still agreed to this unusual arrangement. She trusted her brother because he is her brother. The lawyer assured them he could handle the whole matter and that everything was in hand and they felt confident. Then the lawyer asked for more money for the process. And added, that there was more land available and suggested buying that as well and that with more land, Camilita could make more money. Her and her husband and brother thought they might as well buy all the available land because of the opportunity. Loaded up on more land On an outlay of $50,000, they could make $2-3 million in developing the land. They went ahead with it, but they were spending more and more money to pay for this supported land. The lawyer was supposedly doing all transactions, and they had paid him upfront. Return to Trinidad to find house built on ‘their’ land About a year and a half later, they returned to Trinidad to find there was a house on the land they had supposedly bought. They went to see the lawyer who said there was a big problem because the guy who sold the land, who her brother had connected her with, had sold the land three times over to another 10 or 15 people. They then realized there was no way they would ever see that money again. Revelation that seller and sold the same land to many Camilita and her husband stayed in Trinidad for another two months trying to get their money back. Meanwhile, she was neglecting their existing businesses back in the UK. They never got a cent. The lawyer however returned their money as he acknowledged he should have done better due diligence. Some lessons Do thorough due diligence. Use independent lawyers. Have a contract in hand before handing over any money. Have multiple streams of income so that loss in one deal doesn’t ruin your life. Andrew’s takeaways Most common mistake investors who have spoken to Andrew is: Failure to do their own research. Andrew said that wasn’t Camilita’s core mistake, but it was more about mistake Failed to properly assess and manage risk. That includes not just research what return an investor is going to make but all the risks as well. Separate the process of researching the return of a project from assessing the risk of a project. Actionable advice Camilita's Trust no one Have a contract with a legitimate attorney for everything that you do. Andrew’s Don’t ever feel bad about having contracts, because it’s normal business practice. No.1 goal for the next 12 months Camilita has three To grow my inner circle to really support entrepreneurs across the world, to really understand what they need to do to build, sustain and develop a global brand. To grow my podcast so that we can have other successful entrepreneurs, people that I follow and people that follow me across the world, and to interview some more amazing people. To grow my Event of Champions to really support entrepreneurs at events so that they understand what their needs are and allow the speakers to meet their needs. Parting words “If it’s not making money, it’s not making sense. Do your due diligence." You can also check out 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 Connect with Camilita Nuttall: LinkedIn  Facebook   Twitter   Instagram  YouTube   Camilita.com   Event of Champions   Email Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast 

Josiah Smelser is the current podcast host of The Daily Real Estate Investor podcast, a show on achieving financial freedom through real estate investing. Josiah runs his own appraisal business, is a licensed real estate agent, and runs his own investment property business along with a partner. Josiah is currently a licensed certified general appraiser (can appraise commercial and residential properties) and spent time working for companies such as CB Richard Ellis CBRE as a commercial appraiser in his past. Josiah was formerly a finance professor at the university level for several years, where he taught a number of finance courses including real estate. Josiah has an MBA from the University of North Carolina and is writing a book titled The Daily Real Estate Investor, so stay on the lookout for that. Josiah is happily married, has three children, and lives in Huntsville, Alabama.    “Since we have this property that’s just sucking money out of our business, we can’t go and do other deals and that was the greatest loss of this whole thing – the opportunity cost. This property was a nuisance. We’re having problems constantly that were eating up our time …. eating up our investment capital. We thought at one point we’re going to have this thing for a year to who knows how long … we can’t get rid of it and we have to keep making these payments.” - Josiah Smelser   Worst investment ever Josiah tells an extraordinary, harrowing tale of flipping a house in which the extent of what went wrong went way beyond Murphy’s Law. The sheer amount, kind and combination of renovation obstacles Josiah and his partner had to overcome to get their property ready for sale were staggering. Their business model is to buy a property, do value-added renovations to it, get it rented out, and then refinance it. Their business model on flipping, is buy a property, renovate it, sell it as fast as they can and try to make a minimum of US$25,000-$30,000 per house profit, and invest the capital back in the investment side. But because of delays with this one early venture they were unable to do any more flips, and were unable to do any more buy and hold properties. The long list of obstacles included: Location was not in the center of the city, lacked proximity to many amenities, but had good schools Bank rejects their multiple price offers to buy the foreclosure property Second visit reveals water pouring through the ceiling of downstairs bathroomDiscovery of extensive termite damage Armadillo infestation and massive holes in the yard Rotten wood discovered around windows, half of which need to be replaced Margin quickly shrinks as repair costs and holding costs go up massively After listing, Josiah does some research and realizes properties in the area are quite slow to be sold – They “just don’t move as fast” as homes in other areas – because there were not enough buyers looking for houses in the area Finally he gets a buyer, Josiah visits the house to find “a sea of hornets swarming the front yard” that had been nesting in the ground revealed right before the visit of prospective buyer. The hornets had been kept in check by the armadillos A water pipe breaks off a wall behind their the new air conditioner they had installing, pouring water Mysterious event of a window being left open day after day, as though a thief has been breaking in. This issue remained unsolved Another buyer comes along who demands multiple inspections and long lists of almost never-ending post-inspection tasks and repairs added up to more than 50 items A foundation specialist inspector is brought in, and he finds water and water damage under the property Discovery of a previously unknown septic tank in the back yard, and prospective buyer wants inspection No. 5 to be carried out to make sure the tank works. The septic tank needs to be dug up, repaired and reburied One item is to fix the fireplace. Once complete, the repairman while cleaning blows instead of vacuums soot from fireplace all over the floor and walls of the house, just hours before handover, and the walls need to be painted Pressured desperate countdown and clean-up prior to handing the keys over, and Deal represents excellent case study in ‘opportunity cost’ While they lost only $20,000 on the deal, it took six months to complete it. They had stopped their investment business and for five months were far from achieving the goals they had set for that business because they could not sell the property. Therefore the main cost Josiah says was the opportunity cost of not being able to buy properties, refinance, get their money back, and continue to buy property with that capital. The actual loss he estimates was more like hundreds of thousands of dollars on top of the stress of the entire project. Josiah and his business partner still to send each other text messages of a meme of two old men laughing in remembrance of the sheer happy relief to lose money and walk away from the deal when they finally sold the house. Some lessons Get inspections. Josiah would highly recommend getting an inspection or multiple inspections of different types. Be wary of expensive properties. This one property was on the high end. Now Josiah will not get involved in flips that are this expensive. As you go up in price on properties, there are fewer buyers. The higher up in price you go, the harder it is to sell a property. “If you’re going to flip a house try to find properties that are in the sweet spot where you have the largest number of buyers out there.” Josiah Smelser Overestimate your expenses. Do an initial estimate and when you’re finished it, add 20%. Look at the days on the market of your comparable sales, nail that down. Then try to try to ask yourself realistically: “Can we turn this around and be out of this, be out of this as quickly as we want to be?” Don’t underestimate the impact of buying outside a city. Because Josiah and his partner were not in the middle of a city or town, the days (months) they spent with the property on the market killed their benefit. Andrew’s takeaways Always try to reduce the amount of inventory you are holding. This concept applies to all types of business, whether in manufacturing or real estate. It is easy to forget the fact that it consumes time, energy and capital, but also inventory can deteriorate, then you can have even more problems. Beware of lemons. Some failures can really be down to just bad luck, or the wrong time. Despite all the quantifiable measures possible, there’s a randomness factor in business. Sometimes we are going to get exposed to a client or a project with which everything goes wrong. It’s at that point we just have to face it and push through. Persistence is honorable. Josiah stayed and worked through every problem and kept going until it was finished, despite having to shun his commission and taking the loss in the end, he did complete a hellish project and learned many lessons. Big respect for that. Opportunity cost is brutal and very real. This is because it is not only financial, but it is also related to the damage that the resulting emotional state can do to the investor, to their partnerships, to business deals, and to one’s confidence. Your time is the greatest opportunity cost loss wise that you can bear in a deal, because we have a limited amount of time. And Warren Buffett talks about that all the time, your time is your greatest resource … So you want to spend your time well … when it comes to opportunity cost, be very diligent about cutting your losses, and moving on and continuing and persevering, you know, because they don’t all work out.”   - Josiah Smelser    No. 1 goal for next the 12 months Business goal: To add to our portfolio 10 or more cash-flowing properties in good areas/high-appreciation markets. Parting words Josiah hopes one person can avoid some of the pitfalls that he and his partner had on the deal described. “It was great having the opportunity to do this. I really appreciate it.” - Josiah Smelser You can also check out 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  Connect with Josiah Smelser LinkedIn Website Email Instagram – @dailyrealestateinvestor Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast  Further reading coming soon  Josiah Smelser (2019) The Daily Real Estate Investor   

Daniel Schwartz is an author, senior executive and investor in sales, marketing, business development and management, with extensive contacts and relationships throughout Asia in many industries, through the intense networking and relationship-building he’s been doing over the past 20 years. As a co-founder of 3TNetworks, members and customers are empowered to build their wealth in both traditional and the emerging cryptocurrency arenas. His 3T networks is a phenomenal business opportunity for people want to learn and grow. 3T focuses on financial education in both cryptocurrency and forex product development, ICO consulting (an Initial Coin Offering [ICO] is the cryptocurrency equivalent to an initial public offering [IPO]), Bitcoin over-the-counter activities and personal development products and training to help customers and members grow. He personally has significant experience in training, selling and networking. Dan has developed seminars in all three of those areas as well as MC’d for international speakers and hosted a monthly news segment on Channel 3 TV Thailand. “I like to talk about winning and learning, not winning and losing and take the emotion out. And if you really want to do your own trading and your own investing, do the research, get the information from experts.” – Daniel Schwartz Worst investment ever Daniel had some friends who were making a lot of money working in the investment research advisory business for specialist companies who promoted penny stocks. They would receive commissions on when and how many stocks were bought. One of his friends would call him and say: “Hey, Dan, take a look at this company.” Daniel would read the very brief reports and buy around US$1,000 of stock at a time based on the little information provided and the recommendation of this friend.He doesn’t remember any of the company names because he feels that the brain likes to block out bad memories. Sometimes he would win, sometimes the prices would be stable, and sometimes he lost it all. It was an interesting experience, but he likens it more to gambling, because he didn’t really know what he was doing. On all those investments, he lost up to US$40,000 but he learned a lot. He says it was a very bad idea from the point of view of an investment decision to be playing around with penny stocks put forward by people who were earning commissions. Some lessons learned It is a very bad investment idea to trade in penny stocks. Especially when such stocks are promoted by people earning commissions. Trading is best left to the experts and other people. Know your own personality profile. Best Through that you can know also what kind of investing you should do, and in which types of business or professions suit you. Stay away from the hype. Greed is not good. Wise people talk about the idea that the time to be fearful is when others are greedy or the time to be greedy is when others are fearful. Suffice to say, greed comes with it an emotional response, and that is not something carried out by the logical part of the brain. If something seems too good to be true, it probably is. Go with experts with verifiable track records that you can look at yourself and read the material. If talking about trading, go with someone who has a verifiable positive track record. Remember to check experts’ record also in a down market. Always remember – past performance is never a guarantee of future results. No one can predict the future and unheard of events can be just around the corner. Listening to someone on commission, pitching you over the phone, is probably not the smartest idea when it comes to buying stocks or putting money into investments. Andrew’s takeaways Never invest when somebody calls you to introduce it. When somebody is calling you about an investment idea they are most definitely compensated in some way for doing that. People are not on the phone, randomly calling people for the benefit of the receiver. Be aware that our minds can be hijacked by the excitement of promised “amazing” returns, such as the “50x” example that Daniel gave. Penny stocks are a great example. Investing is truly a physical thing, causing a physical reaction and we do things based on emotions and mental triggers that are being pulled by phone salespeople. Make sure your interests are aligned with the people that are helping you with investing as best that you can. This can never be achieved perfectly but it’s something to always bear in mind. Actionable advice If someone calls you or approaches you with an investment idea, do not make that decision in the moment. If anyone pushes you to buy over the phone when you do not even know them, they are using all kinds of psychological tools to get you to act – such as playing on the human fear of missing out (FOMO), “the take away” – run away and run fast. #1 goal for next 12 months Daniel wants to recover from the past 12 months of craziness in the markets and be in a position, personally and professionally, to take advantage of what is happening now what has been learned with the markets in the crypto space, in Forex and in stocks. He wants to use that experience so he can help more people to be successful. He also wants to watch his three-and-a-half-year-old son grow, spend time with him and try to instill in him knowledge so that when he gets old enough he’ll have the benefit of Dan’s experience and past mistakes so that he can make a whole range of different mistakes. Parting words Be careful with your money, take the emotion out and think, and don’t let the greed part take over. You can also check out 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  Connect with Daniel Schwartz LinkedIn  Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast  Further reading mentioned  Jason Zweig (2007) Your Money and Your Brain: How the New Science of Neuroeconomics Can Help Make You Rich 

Catherine Flax has had a distinguished multi-decade career in financial services, fintech and commodities. She is currently an advisor and board member to numerous start-ups and mature businesses, bringing expertise in business and strategic growth, innovation, talent development, regulatory affairs, and more. Catherine was the CEO of Pefin, the world’s first AI financial advisor. Before Pefin, she was the managing director and head of commodity derivatives, foreign exchange and emerging markets sales and trading for the Americas at BNP Paribas, was chief marketing officer at J.P. Morgan, as well as the CEO of commodities for Europe, the Middle East, and Africa.   “What I didn’t factor in was what might be the damage beyond the dollars … I put myself in the position of mixing friendship and business, (and) that it would destroy a friendship.” – Catherine Flax Worst investment ever Catherine had been a professional in financial services for some time when she got into her worst investment about 15 years ago, so she was well versed at examining possible outcomes and potential loss cases. A good friend approached her with a business investment that was outside of her usual range of expertise. It was an established business, not a start-up and, from an analytical point of view, she was thorough in examining the probability of loss, the upside and all the typical calculations a financial professional goes through before getting involved. She did, however, neglect to factor in the “damage beyond the dollars” if the investment did not pan out. While the outcome was not beyond her expectations of the potential downside risk, the investment did not go well. So her math was fine. But, as this was the first time that she had mixed business and friendship, she didn’t realize the biggest loss would be the friend who had involved her. For Catherine’s part, she wasn’t angry about the financial loss, but her friend was so embarrassed that the friend felt too uncomfortable to maintain ties with Catherine from that time onwards. In retrospect, Catherine feels that the outcome should have been obvious to her, but that it was not a result she had thought about at the beginning. While she calls this damage, “irreparable”, she was happy to say that similar arrangements have worked out better since this time. Some lessons Be very cautious about going into business with friends. Communication, as with all relationships, is paramount. Vital are clear conversations about exit strategy, as in a normal business. Discuss how failure could affect your friendship and “really look somebody in the eye” to help them understand that a bad outcome is certainly possible. Then you can move forward as friends, if not as business colleagues, when a venture or investment doesn’t turn out as positively as was expected. Andrew’s takeaways Place principles before personalities in the business. This is a powerful concept that offers a simple guide on how to survive without letting our personalities destroy us. Our personalities are ultimately driven by fears, and not higher thought or principle. In his own businesses, Andrew has practiced this and even made an agreement with a friend and business partner that if they ever felt their business was going to destroy their friendship they would close the business. Actionable advice Sit down and think deeply about the worst-case scenario in an investment or business venture and what you would do if the friend or person you’re in business with is angry or humiliated. Plan and set the stage to be helpful, to let them know that you are still their friend, and to not let this bad decision or investment ruin your friendship. Then you can make the investment after having the planning conversation and most likely you will be able to mitigate a bad social outcome, even if the financial outcome falters. No.1 goal for the next 12 months Catherine aims to continue advising the numerous companies she is linked with and help them flourish to the best of her abilities this year, and to avoid all the kinds of mistakes discussed here and in other episodes of My Worst Investment Ever. Parting words “This is such a great format. I’ve enjoyed the previous podcasts and thank you so much for having me.” You can also check out 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 Connect with catherine Flax: LinkedIn  Twitter   Connect with Andrew Stotz astotz.com  LinkedIn Facebook  Instagram Twitter  YouTube My Worst Investment Ever Podcast 

Ian Dunlap is an investor with one of the highest win percentages in the country and founder of Red Panda Academy. Through Red Panda, Ian teaches his blueprint for success to students, who often have little to no experience with trading. Using completely custom formulas, Ian is able to teach in 30 days what took him years to grasp. In December 2018, Ian celebrated his third highest day in trading, earning US$56,000 in about 2 hours. Ian’s passion for investing is rooted in his upbringing. Growing up in East Chicago, Indiana, he didn’t come from an affluent area or a rich family. Perhaps what had the greatest impact on him most was when a relative was taken advantage of by a dishonest investor. Through that experience, Ian witnessed the fear and distrust that can accompany investing. “One of the biggest ones (mistakes I made) was not investing early enough in the market. I got started late at 24. And the stock market is the easiest thing to invest in.” – Ian Dunlap Worst investment ever A college friend called Ian into his dorm room one day in 2005 and showed him a social media website, asking if he had seen it and if he was on it. Twenty minutes later, he had signed up for an account and was hooked, spending maybe two to three hours a day on the site. He mainly using it for his party promoting and other business, and started using it to run advertising. He called a relative and said: “Listen, I don’t call and ask you for anything. When I tell you, this is the greatest thing I have come across in life, I’m willing to take the last of my money, if you will take some of your money (he had a lot of money), and invest in this company with me.” His relative answered: “What the hell are you talking about? You’re in college … What do you know about investing in a technology company?” This clearly was a different time for venture capital. His relative refused. He tried to get other friends and other family members involved also, but got the same answer. And Ian was young black college kid. At the time, one of his friends worked at MySpace, which at the time was the hottest thing that was being tipped to destroy Instagram. Referring to the website Ian wanted to invest in, his friend said: “I think this company is going to kill us … I know we have all the artists, all the kids are on here, but this thing that you’re on, is nothing like we’ve ever seen.” It turned out that the US$125,000 investment, of which he would have put $10,000 of his own money would have turned into $26.4 million. That company was what was known as TheFacebook.com. Now every time he sees his relative on the holidays, the relative says: “I probably should have given you the money you wanted. Ian says we all have made such “boneheaded decisions”, in which if we would have just invested a little bit of capital, it would have changed our lives forever. Some lessons Be more convincing. Ian laments not being persuasive enough to get the family member to put in some money so they could invest in Facebook (FB:US, FB.OQ), which is currently trading at - US$190.56/share. Facebook turned into one of the biggest tech companies in history, and he regrets not following up more and failing to make a better case for the investment. Stay true to your convictions. Whenever you have a position that is true to your heart and you know it is going to work, you may be the only person on the face of the earth that believes it, but you have to let your conviction carry you. “Most top investors did not start out in the industry. They took back roads, got into the industry and formulated their own strategy. And that’s how they became so effective.” – Ian Dunlap Andrew’s takeaways Investigate. When you see a business that you think is interesting, investigate it, ask questions, and find out if you could invest in it. At some point, an investor has to take action. But do not act without doing research. Do not act without assessing the risk. Size your position. This is a critical risk management concept because sizing your position matters so much. Investigate, do your preliminary research, and try to invest US$10,000 (if you have US$100,000 liquid) to get the step of taking the action going, but then size that position carefully. Actionable advice Put some money into the market every month. Start with a small amount. Then you will have the financial freedom that you want. Even in a down market, especially when we hit a recession in a couple years. Buy more.   “I always tell people just buy index funds, hold them … You don’t have to be the second coming of (Warren) Buffett to make money, just buy the S&P 500, the Dow or the equivalent in your country. I got started late. That’s why I’m so passionate about it.” –  Ian Dunlap #1 goal for next 12 months To have a more balanced life. The money is fun but first and foremost, take care of your health. “I’ve had 14 family members died in 17 years. At no funeral have I ever thought about business. Not once. I didn’t care about a chart, long-term, short-term. It doesn’t matter. Take care of your health. That’s the most important thing. The money will be there … especially if you’re investing automatically.” – Ian Dunlap Parting words “Listen to every past episode (of My Worst Investment Ever) so you don’t make the dumb mistakes and that the other guests made.”   You can also check out 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   Connect with Ian Dunlap LinkedIn Twitter   Connect with Andrew Stotz astotz.com  LinkedIn  Facebook  Instagram  Twitter  YouTube  My Worst Investment Ever Podcast      Further media mentioned Michael Lewis (2010) The Big Short Inside the Doomsday Machine  Gregory Zuckerman (2009) The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History  Michael Burry (2006) A Primer on Scion Capital’s Subprime Mortgage Short Adam McKay, director (2015) The Big Short  

Ian Ng is currently the CFO at Nielsen China and he has spent six years providing accounting and auditing services at Big Four accounting firms, covering manufacturing, construction, and trading services. Prior to that, he spent 13 years in corporate finance, doing mergers and acquisitions and all kinds of business support and business strategies. His expertise incorporates business partnering, which includes contract review, price setting, and market outgrowth approaches. He’s also applied his talents to compliance and effective reporting to US and China accounting standards including GAAP, business performance forecasting and control and strategic planning for organizations to achieve the best use of their resources.   “Makes more friends. Because once you have more friends in the markets, you tend to learn more about other industries.” - Ian Ng Lessons learned Past trends of performance are definitely not a good or mandatory reference. China had been on a growth trend if you look back 15 years, China growth, GDP, investment, and all the indexes seemed good. But everything changed. A lot of the time when we are uncertain about the future, we tend to look at the past trends to give us some comfort and confidence that things will repeat, but in today’s world, this is not the case. Don’t be stubborn. Be flexible and practice self-reflection. His lesson was he relied excessively on his our commercial team and had little close connection with the customers. Be ready for change because today’s world is ever-changing. Prove all assumptions that you make in business. Andrew’s takeaways Don’t fight the price. In some ways, in corporate finance and in business, this idea does not apply at all, but in many ways, it does. It is often said “the trend is your friend” or, “understand the direction that a price is going”. Pay a lot of attention to the price of your final product. Go out and meet the potential customers to confirm real demand. Sales people are naturally optimistic so be very careful about accepting their word for the level of demand for a product. When you are making an investment decision, it is critical to meet potential customers and verify that there truly is demand. “In other words, don’t totally trust what the sales team says.” Observe the market before making business or investment decisions: try to figure out is there any market or demand for particular products and make survey from the external environment not just only from internal staffs. “No matter how great a business person you are, it is extremely difficult to build a successful business in an industry where the price is falling, and falling significantly.” – Andrew Stotz You can also check out 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 Connect with Ian Ng LinkedIn Connect with Andrew Stotz astotz.com  LinkedIn  Facebook  Instagram  Twitter  YouTube  My Worst Investment Ever Podcast