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Here are some reflections on my first 3 years as an entrepreneur.<\/p>\n
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Focusing on Performance<\/strong><\/p>\n I launched my newsletter before Substacks<\/a> were cool.<\/p>\n When I launched, people associated newsletters with scammy companies like Agora and Empire.<\/p>\n I wanted to be different.<\/p>\n I was told to underemphasize performance. Afterall, who knows if you will outperform.<\/p>\n But I wanted to be accountable.<\/p>\n So every week in my newsletter, the first page shows absolute and relative performance of every pick (current and past).<\/p>\n So far so good.<\/p>\n Average holding period: ~12 months<\/p>\n Average return: +25.5% (+10% vs. S&P500)<\/p>\n <\/p>\n Was quitting my job and launching my newsletter risky?<\/strong><\/p>\n It depends on how you define risk.<\/p>\n On the one hand, yes it was.<\/p>\n My wife wasn\u2019t working and I had one kid and a baby on the way.<\/p>\n But I don\u2019t think it was risky.<\/p>\n I did some \u201cfear setting\u201d (H\/T to Tim Ferriss) and asked myself \u201cWhat\u2019s the worst that could happen?\u201d<\/p>\n I had two years of living expenses saved.<\/p>\n Worst case is after two years, I would have to go back and get a job.<\/p>\n Maybe I wouldn’t make the exact same salary right off the bat. But I was confident that I would be able to work my way back over time.<\/p>\n In my opinion, it was risky to NOT take this shot.<\/p>\n Jim Koch summed it up well when he wrote, \u201cIsn\u2019t the biggest risk of all that you\u2019ll waste your life doing what you don\u2019t really enjoy doing, making compromise after compromise?\u201d<\/p>\n <\/p>\n What have been the biggest challenges?<\/strong><\/p>\n First, my 2nd and 3rd pick were $KLXE and $RVRA. Ouch.<\/p>\n I lost a lot of money but what felt worse was letting my subscribers down.<\/p>\n Luckily, since then, the winners have more than made up for the losers.<\/p>\n The other challenge was in early 2019.<\/p>\n My business was growing but not fast enough.<\/p>\n At that growth rate, I would eventually run out of money and that was stressful.<\/p>\n <\/p>\n What has worked?<\/strong><\/p>\n <\/p>\n What hasn\u2019t worked?<\/strong><\/p>\n <\/p>\n Is $114K of recurring revenue enough to support my family?<\/strong><\/p>\n In short, no. I live in an expensive suburb of Boston and have two kids.<\/p>\n But I write a micro cap newsletter for Cabot Wealth and am also a Partner in a Private Equity Firm (check out Better Way)<\/a> that my former boss started.<\/p>\n With these other jobs, I can fully provide for my family.<\/p>\n And business is good!<\/p>\n I estimate I will make more next year than I made when I was at Citi (my last employer).<\/p>\n And the best part is I\u2019m in control of my life and my upside is unlimited.<\/p>\n <\/p>\n What are my next plans for my newsletter biz? <\/strong><\/p>\n There is a ton of low hanging fruit.<\/p>\n 1) Currently I only have 1 tier of service. I will eventually offer an intro tier and a premium tier.<\/p>\n 2) Other products. This is tricky because I only have so much time. So I will likely have to hire someone to lead the product. Ideas include: bank thrift conversion, merger arbitrage, SPAC research, options, etc.<\/p>\n 3) Create a course on how to find, analyze, value and invest in spin-offs.<\/p>\n 4) Write a book. This won\u2019t be very profitable, but I would love to write a book and share all that I\u2019ve learned.<\/p>\n <\/p>\n What\u2019s my long term future?<\/strong><\/p>\n I\u2019m not sure. But it’s exciting.<\/p>\n I always wanted to start an investment partnership. I figured the newsletter biz would provide me with the recurring revenue to support my partnership as it scales up.<\/p>\n But I\u2019m really enjoying writing the newsletter and managing my own money.<\/p>\n Time will tell.<\/p>\n <\/p>\n Should You Write a Newsletter?<\/strong><\/p>\n YES!<\/p>\n\n
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