Porter Collins and Vincent Daniel - Big Shorts and Big Longs (Capital Allocators, EP.325)

26:22You have to really look at it at a more targeted approach in a normal environment. When you were so deep in financials, how did you start thinking about the process of adding in other sectors to become a generalist? Most financial services funds or people that still do financial services funds, they do banks. And as long as I've been an investor and doing banks, I've hated banks. And there's been a lot of bad management teams. And so we historically, for 15, 20 years, had been short banks along other parts of financial services. From that angle, it wasn't all that hard. And what we did a lot of is looked at companies that financed all different types of businesses.

27:07So is leasing businesses, leasing ships, leasing cars. So from that angle, we touched a lot of industrials. And even back at Formpoint, we did a lot of industrials and cyclical stuff. because financial services touches so many sectors. You had to really learn and be up on a lot of that stuff. And so it was a natural extension. I think it's fair to say Vincent and I are not good at is a growth investor. So we didn't want to force it and change something that we're not really good at. That's not my expertise. I can't buy a 35 times sales business and hope it goes to 50. That's just not who I am.

27:45How'd you think about constructing your portfolio when you took off the shackles of being at a pod shop. One of the things that we've always done is identify themes. And from there, just start compiling names and putting together a portfolio like that energy. And we learned along the way. The way I thought about it initially was because we really didn't know what we were doing for lack of a better term. This is just new frontier for us. How many people are this brutally honest about it? It is what it is. I mean, look, that was the beauty of it being your own capital because you could be brutally honest, that we've never invested in ExxonMobil.

28:20We never invested in certain names. So we started with a little bit of our capital with the thought process that the initial risk management perspective was take a sliver of your capital so you can take on some of the risks and some of the adventures that you guys want to go on in terms of investing. And then from there, figure out your style as more of a generalist, hopefully that it works. and thankfully it did. So our initial risk management parameter was just sheer size of our total net worth. We started from there. Then as Porter said, that we started to realize a lot of themes that fit our brain, our contrarian value brains.

28:56Probably I would say the biggest for us was when Exxon got kicked out of the Dow for Salesforce.com, us schmucks, everybody else in the world goes and buys Salesforce.com because it's going to be in relative indices and the like. We go, let's take a look at Exxon. So we started investing in Exxon as a trade and started doing the work behind the trade and realized that this has the potential energy. This has the makings to be one of the greater contrarian long value trades of our careers, because this was a sector that is desperately needed for the world to work more than anyone would ever dream or imagine at that time.

29:35That was left for dead. We did an exercise. That's so much fun doing this exercise. which was we took all the large asset management complexes. I think Wellington. Wellington, Fidelity, Neuberger, you name, Capri, you name them, and say, okay, let's figure out where their largest energy exposure is and what number it is in their portfolio. They're taking old filings. And you couldn't get an energy name below 50. Now this is Exxon, Chevron, Shell, BP, massive, massive names. Most of you would get to number 76. So we're like, no one owns this. They're cheap. These things are deleveraging. If X, Y, and Z happens, these things can be moonshots.

30:18And that was our first foray in a big asset allocation to something aside from financials in Sea Wolf 2.0. How did you blend the knowledge that you built about risk management and all the risk factors with this theme-based approach when it came to taking risk and sizing positions? That's the easy part. That's the part that you've been doing your whole life and trying to think about managing position sizes, managing inflection points and maybe a chart or stuff like that of when to add, when to take off, and when to trim positions. That part for us was like breathing. In order to generate the returns you guys have the last couple of years on your own capital, you had to have a portfolio that looked a lot different from the ones you had in the past.

31:04What does the structure of that portfolio look like today? What we are is value investors. Even when we were doing financial service only, the average PE was five. I think now our average PE is three. And we love finding little gems in the middle of nowhere where people don't think it can go anywhere. And sometimes we like to keep it in the portfolio and sit on it, and you know that there's an inflection point coming, when that catalyst comes is hard. Klarman's book, Margin of Safety, which is one of my favorites, that really speaks to me in terms of the stock doesn't have much downside. Maybe it has 10%, 15%, 20 % downside, but if things go right, it can be a, I think we had 12-bagger last year in some of these names.

31:53And go back to our credit experience. We always start with the balance. sheet? What does the balance sheet look like? How much can we lose here? What happens if the income statement inflects and it all becomes circular? Because the income statement inflects, the cash flows get better, the debt goes down, the cash goes up, then they start buying back stock, the share count goes down. And that's the iterative nature of the stuff that we're looking for. I'm again, putting my own capital behind this. I sleep super well at night because I know that this is not much downside. And if something goes right, I think I can make a lot of money here.

32:29And being patient and not worrying about, I don't know, the market's up 2 % today. I just don't worry about that. And you sit around and I feel like that's what Buffett does. He doesn't worry about day-to-day. He finds good companies. He looks for great investments. That's a little bit more of what we're doing than trying to scalp pennies. Because we can't beat the machines. You cannot beat the Citadel analysts. There's 50 of them all looking at the same name and back book behind it. And it's hard to beat that. What are the themes you're most excited about today? One of our favorite themes has been and continues to be uranium and nuclear.

33:07We found this one early. And I think it was Josh Wolf who said, if they found uranium today and called it something else other than nuclear. I forgot what he called elemental power. They would crown this the holy grail and there would be a massive deployment with ESG backing beyond belief, but it has such a checkered past and such a poor marketing. That being said, what we want is clean energy in this world and we want strong baseload power. Nuclear provides that. They also have technology that allows it to be significantly more safe than all the doomsayers say. So as a result, for me, this has been something that we started deploying really early, about 2020.

33:50Other than doing the work to ensure that we are correct, we haven't really even thought about it all that much other than add-on dips. And thankfully, the story, the trends have improved over time. As I say this, I always get mad at myself. It's like, Vinny, people are going to look at these charts and say, you idiot, these things have already worked. And they're right. They have. I would not be necessarily deploying additional capital here, but I'm not selling either. One of the things that looks like a short but isn't is our long gold position. And it sounds stupid, but you think about gold as an insurance product.

34:28If the world goes to hell, usually gold does very well. And then you think about the inflationary environment that we're in, and we think about what the Congress is doing to the balance sheet of the United States, we have this asset on our long side, but we think about it more as a short than a long, if that makes any sense. I think you'd have to reimagine how to think about things in a new world where I'm trying to compete against computers. And yes, it sounds crazy, but it's worked pretty well. Everyone loses money on shorts, except for last year. But that's a short that I feel pretty good about that I think gold's going to go up over time.

35:03And if you take a long view of gold versus the dollar, it's done very, very well. What are your thoughts on the banking system? It's a loaded question because as Porter said, we've covered the banking system our entire life. We've been investing in the banking system for the latter part of 20 years. And I think we could probably say that we were constructive on the regulated banking system maybe 15 % of that time. I think the banking system has long-term cyclical issues. The biggest one being now is that they have a competition problem, probably for the first time ever in their existence. Maybe in the 70s, they did as well, in that we as savers or people who are looking to save their money or park excess money in a bank just kept it there and didn't even really think about it.

35:50Forget about the operational accounts, the true mode of the banking system, I'm talking about savings and the like. If you're a corporation and you have excess capital, you're not going to keep it in a bank. You're going to move it to a money market fund. You're going to move it to T-bills because you're getting 5 % as opposed to 80 basis points or 1%. It was Jim Bianco or Bob Elliott, I got to give one of the two credit, calling it the deposit walk, that deposits are leaving the banking system. And that is truly the moat of the banking system relative to everybody else is that low cost of capital.

36:23If that trend continues, the banks have really a funding issue. Over the last three months, it was chronic and it was very difficult for a handful of banks. But I think for the banking system as a whole, it's a problem. And so as a result of that, we have not been constructive on the banks for quite some time. That was their only competitive advantage was the deposits, because they're certainly not better underwriters. And the balance sheet's completely controlled by the Fed. They can't go to the bathroom without asking permission. It's a real problem. And do I think that more are going to fail?

36:58I don't know. We saw pretty clearly what was happening at First Republic and Silicon Valley and Signature and Silvergate, and we were short all those essentially to zero. And we were short them at the highs for the right reasons. And it honestly wasn't all that difficult. And the guys who were in the know, who've been doing this a long time, they were all short them too. I don't think it's anything special, but they're just, the bank system's in a bad place. Nothing's going to change until the Fed cuts rates 400 basis points. And then on the other side of the equation, you have what is turning out to be the more superior business models, which are the publicly traded private equity names.

37:36Now they have their own near-term issues that they have to wrestle with in that there were big, big deployers of capital over the last two, three years. So we'll see how the economy serves to that cohort. But in general, it's a better business model. Last week, I was watching probably a little bit more Bloomberg than I should have. If I heard another institution doing direct lending as a growth engine in an asset management complex, I was probably going to vomit. But it makes sense because think about the statement I'm about to make. Regulated banks do not want to make an unsecured loan to corporate borrowers.

38:09They're not allowed to, for the most part. The risk weights are too high. So you talk about my buddies at Aries or Blackstone or all the newbies that are coming on board. Of course, they're trying to fill the void. Aries just simply, they're way better underwriters than any bank out there. And they have much more flexibility. They have everything you want. And the banks are just in cement shoes. Where are you seeing the next wave of something to fall hard in the same way that subset of banks that you nailed earlier this year? What I think we're wrestling with right now is that you have tech stocks reaching to the all-time highs.

38:48The Fed on its most aggressive hiking campaign ever. I realize that they're pausing today and towards the end of the hiking cycle. But it's hard for me to compute that in my head of, again, I'm not really a growth investor, but looking at some of this stuff, there's nothing attractive to me in some of those areas from a valuation perspective. But on the other hand, you have a lot of, I would call normal industry stocks not doing very well. And I think that's more reflective of a slower world. If you look outside the United States, there's a lot of dynamics going on. Look at inflation in the UK or Australia.

39:24It's still super high. It's 7%, 8 % and there's not much growth. And then you have countries like Brazil where rates are 14 % and inflation's falling and they have fiscal surpluses. The world's going through a lot of different shifts here where the United States' balance sheet is really, really poor. That's one of the things I think we're doing is trying to do a little bit more investing overseas. We've been big holders of Petrobras recently, and that's one of our better stocks is that it was selling it again, one to two times earnings and giving yourself a 20 to 35 % dividend yield. And people kept on telling me that Lulu was going to take all my money.

40:07Well, if I look recently, the UK last year did a profit windfall tax of all these major oil companies. So tell me, who's the communist out there? It's interesting. Everyone's like, well, the world's much more civilized. Well, that's just not true. The obvious one that people talk about all the time, and we have some exposure to it, is commercial real estate, particularly office. But commercial real estate in general is challenged. In typical real estate fashion, they'll figure it out. But nevertheless, I think they have to wrestle with a wide bid-ass spread given where rates are right now. I just feel like a lot of things are mismarked, which probably gets back to while I have a tremendous affinity for the private equity model, I think they have some issues and challenges associated with the assets they've deployed over the last two years.

40:52When you talk about something that concerns you, the bigger issue is that I think the majority of our issues now going forward are in domestic sovereigns. Our governments can't seem to run fiscally neutral at all. And as a result, we've built up tremendous amounts of sovereign debt, which were, I guess, manageable when rates were at zero, where rates are not at zero anymore. So as a result, there's a tremendous crowding out factor that is occurring right now. It's building. Anyone we speak to about this and we ask who's going to buy our debt, people just walk away and they don't want to talk about it because it's the boogeyman in the room that we all know that is coming sooner or later.

41:33It might be 20 years from now might be 10, but it doesn't feel like it's that far away anymore. This is what really concerns me is that if all of what we are allegedly to do is based upon the risk-free rate of return, and the risk-free rate of return is an unknowable thing because the thing that's dominating the risk-free rate of return is running chronic fiscal deficit, it screws up my head. And it should screw up a lot of other people's heads, but thankfully for a lot of other people, they choose to ignore it. It's hard to ignore, at least the way my brain works. What are some of your other favorite themes?

42:05Porter was just referencing one, Brazil is a theme for us. I joke around and say, well, think about the country. They're better looking than almost every other country in the world. It's a country that can feed itself and fuel itself and has enough of those two commodities to export. They run a fiscal neutral position and the stocks are really cheap. And not only that, the other thing that I will say, and this is so qualitative, but I truly love it is of all the BRIC nations, I don't remember Brazil ever starting a war. So in many respects, investors can feel safe not worrying about hostility and conflict associated with it.

42:42So that is one of our bigger themes on the long side right now. I think one of the things that we look a lot, again, is at balance sheets. And you look across the energy spectrum and a lot of the old cyclical stocks, the balance sheets are really, really good. and they have a huge net cash position. And as these stocks are out of favor, I think you're just going to see share counts shrink a lot. When the inflection point does come, the economy inflects, or we have a super cold winter across Europe and the United States, and energy prices again skyrocket. People have forgotten that Putin took away all their natural gas and gas prices go up and coal prices go up.

43:23These stocks are going to be moonshots. That's how we own a lot of them. And just being patient around when that point is and how we think about it. But we're not going to sell them. But is there a near-term catalyst? No. But again, when we talk about pet peeves, that's always been a pet peeve. What's the catalyst? Well, if everyone knew the catalyst, is it really a catalyst? I'm curious to get your perspective on the hedge fund industry. Again, going back to when we left Citadel and what do we do? and you look around the landscape of the hedge fund industry and it consists of all the big levered funds and then a couple of the large hedge funds.

44:03And everybody else in between looks like a family office with a couple investors. I don't know what. I don't think there's any institutional appetite for a fund like ours. We haven't looked, but I think the world is very, very different these days. And I think a lot of people are going to an Aries, and Apollo and stuff like that. And that's where the job market is. And I think people really are looking at the equity markets with the zero day expiration options and all these computers. And is there a place for humans? And you look at the passive industry and the passive industries, I want to guess 60 % of all assets, and then the rest is quants.

44:44What is the use of a human these days in markets. And so that's my bearish look on the equity hedge fund portfolio side. Fixed income is a little bit different. And I think I've said this many times, passive is one of the stupidest ideas ever in fixed income, but in equities, it's worked. I'll just echo his sentiments. I think the hedge fund industry is dominated by vol targeting more of the interesting aspects, the action and market reaction that it causes as a result of it. I don't see it changing anytime soon. Those guys have proven that they know how to make a dollar for investors with very high sharp ratios.

45:21But in order for it to work, and this comes another cynical part for me, in order for it to work consistently, whenever something goes wrong, they have to call the bat phone, which is the Federal Reserve. So I really truly believe that they are the new shadow banking system, that whenever something goes awry, There's a reason why Millennium hired who they hired, why Citadel hired who they hired to make sure that when the calamity occurs, they call the Fed for either direct QE or clandestine QE. And that's not us speculating. That's actually what happens. And so as a result, I don't see them going away because they're very well connected.

46:00So what does that leave for the rest of us? I think the rest of the hedge fund alternative industry and ignoring private equity for a second. We have to be smaller, more nimble, more patient. And we also have to accept to a certain extent that volatility is a contract that's going to happen as a result of the way you're managing money to produce outsized return. You're going to have more volatile returns. The markets, from what I can tell, has never been more mispriced than it is, both the long and short. And things go to extreme levels. On the upside, in terms of where they take stocks, when these short squeezes happen before they last a day or two.

46:39Now they go on for six weeks. How the hell is the stock still squeezing? What's going on? The true value of where Warren Buffett or a private equity would come in and pay actual physical dollars for some of these stocks is 90 % lower in a lot of different cases. But in the case of some value stocks and most value stocks, you're really not paying very high multiples for any of these companies. I'm pretty excited by that. We look around and there's tons of value out there. When you put together being patient around these ideas, having a value mindset, and at least willing to accept the volatility that comes with that, if you painted that in a brush that you were reporting to someone else what your returns looked like, put some numbers around what that volatility means in order to achieve what you guys have achieved.

47:30Great example. Last year, we obviously were pretty decently, plus 150 % or a little higher than that. But we had a 30 % drawdown at one point in the year. For us, that's part of the game. You just got to control your leverage and accordion that leverage. When you see opportunities, you got to be able to be flexible and really pull in the reins and do a good job on that. That's the critical key to me. The last part Porter said, we try to keep it really simple, red light or green light. When it's red light, when you're not really seeing anything, when you don't have tremendous opportunities, your gross capital deployed probably should be very, very light.

48:04And so as a result of that, you can control the risk factors and the volatility that you're going to see. Vinny used to use this line to the Citadel risk manager. He goes, I just want to go home now and watch the prices right. And the guy's like, what are you talking about? He goes, I know when I'm over earning in this really tight, long, short book, can I just degross completely? And the guy goes, absolutely not. We're going to give you more capital. He goes, that doesn't make any sense. And he goes, yeah, it does. We're going to give you more capital. And they whomp on our$2 billion on top of you.

48:36And you're like, I just told you, I'm out of good ideas. I want to degross. And they don't let you degross. That's the thought process of what did we learn? We learned that when VIX falls, they regross, they keep on going, which is the exact wrong time. And listen, they're good at it, but a lot of the chasers aren't good at it. And not only that, when volatility goes the other way, watch out, because wherever the short-term momentum is, you best be sure you're not on the wrong side of that, because that mountain of capital going against you is going to be seismic. And that's when we're going to come in with the shorts, because we've been waiting and we see that they've taken stuff to extremes.

49:16We know the boat's very one-sided and we'll come in and that's where we can be more opportunistic shorting stocks What would it take for you guys to decide you wanted to bring in outside investors? Ooh, this is a four-year running conversation and usually we end up just mumbling We've thought about it. We've had so much fun That's the thing. We're a very lucky lot and we've done very well, but what do you solve for at this point of life? We're very good friends and we work well together. And yeah, we yell at each other about two times a year, usually at some sort of inflection point, but we have a lot of fun doing it.

49:54And we enjoy being on Twitter and more public because we can, because no one else can say anything. And we feel like we can speak the truth in a world that's full of non-truths to just call people out and say it like it is. And it's been fun for us. But we have spoken to people in the past during Seawolf 2.0 and saying to them, in many respects, I have to underwrite you more than you have to underwrite me. Because what we're really looking for, to answer your question, if we would open up, we would really want like-minded individuals, investors who understand what we're trying to do and are very comfortable with what we are doing.

50:31And we would also like to make it more of a partnership type of process. And what I mean by that is we love talking to investors. And we were speaking to someone the other day and saying, please call us on names. We love that stuff. We love when people challenge us about stuff. We want that feedback. And a lot of our good friends challenge us. And we want that type of partner where they get just as much out of it as we do. And that's really what we're looking for. If we found that, then we would definitely open up. Would we be large? Ted, I doubt it. Because I don't think what we're doing here is infinitely scalable.

51:07Whereas I look at what a millennium and Citadel have done and I get the scale that they run at and I think it's amazing. But the way we like to run money, we can't be big, but we can have a few good partners that would go on with this journey. All right, guys, I want to ask you a couple of closing questions before we wrap it up. Can we make them colorful? You can make them however you want. All right. Porter, we'll start with you. What's your favorite hobby or activity outside of work and family? Well, that's an easy one. I'm obviously a rower and exercise is a big one for me. Last week, my son and I went to a rowing camp together.

51:40He was going to be a sophomore in high school. And I can honestly say it was one of the best weeks of my life. I think I had more fun than he did, but being able to share that with him, being outdoors, feeling fit, it makes me happy. You mentioned this before. I'm a big sports fan, professional sports fan, and we went through the sad teams that I like. I'm also a very poor but loving person who does fantasy baseball with a bunch of guys from Aries who kicked my ass, which is good. The last thing I would say, my hobby, is that I'm getting better at golf. I love it. I'm not that good, but I'm getting better at it.

52:18And then whenever I drop my son off to swim, I'm always out there with a gnawing iron or pitching wedge and just practicing and practicing. The process of practicing does not bother me one iota when I'm golfing. Aaron Rodgers? I got to tell you, he's doing a great job embracing New York so far. So right now, Porter and I were talking about this before. Right now, we're in our typical Jets honeymoon, which is everything feels great up until the first game. We used to call the Jets Super Bowl was the draft every year because they always had the top five draft. So it felt pretty good, right? Benny, what'd you dream about doing when you were a kid?

52:58I wanted to be on the mound at Shea, but I also wanted to be general manager of the team. Believe it or not, growing up in Queens, working on Wall Street was what I wanted to do. So I pretty much achieved my dream of what I wanted to do. The realistic dream. I knew I couldn't throw leg good in. So this was the realistic dream. Porter? I had a 1988 Olympic hockey team pennant on my wall. And when the 92 Olympics came out, I begged my dad to get the Olympic, NBC Olympic package, the rainbow package. And I sat there for two weeks and watched everything. And I had no idea that I'd end up becoming a Olympic athlete.

53:38And so it's funny for me, at age 21, I felt like I had experienced everything I'd ever wanted in life. So everything else from that was gravy. Porter, what's your biggest pet peeve? Ooh, I could do a whole podcast on pet peeves. So I think it's the shenanigans that's going on in corporate America, in the investment space, in the Fed, in Congress. All of it just makes me so frustrated. Whether it's stock promoters, whether it's pump and dumpers, whether it's the shorts that smash these stocks and then cover them. Vin and I live by old school rules of being honest, being truthful, being good people.

54:23And we try to invest that way. And I just feel like the rest of the world doesn't invest that way anymore. I'm a red-blooded American and watching what's happening to the US balance sheet really is disheartening to me. And I sit there and I I mumble and complain, and then I mumble and complain at the Fed even more. And there's a scene from the big short where Libman's character asked, how's the angriest hedge fund in America? I guess we've been angry for a long time. You nailed a lot of what I was going to say. I'll just add, the grift drives me insane. I guess because given the seats that we sit in, all of us that we sit in, we're one or two degrees of separation of seeing the grift, how it happens, and how the rules of engagement are changed to make sure that the world is going to work.

55:11The Silicon Valley Bank thing had very mixed emotions about how it all went down. I get the fact that we needed to save all the depositors. When you sit in the cheap seats, you could say a lot about what you're going to do, but when you're sitting in that seat, it's entirely different. But the people who got bailed out of uninsured deposits and the ones who complained about the entire banking system in and of itself, and then were begging and they got bailed out. That was a pet peeve of mine that drove me insane. Vinny, what investment mistake have you made that you'd never make again? If you have a bad management team, just stay away.

55:45Bet on the jockey, not the horse, right? No matter how compelling or a valuation is, if you don't have the right management team there, chances are it's not going to work. And we've had one or two examples in prior structures where we were just wrong because management sucked. In 2016, we had a big position in this name that there was so much value there and the CEO and management just didn't execute. And that's the issue with value stocks. You need that management to execute and to realize that value. And that was our mistake. And that's what drives us crazy. Porter, which two people have had the biggest impact on your professional life?

56:28The number one's pretty easy, and that's Steve Eisman. Steve taught us a lot of what we know, and he was an unbelievable mentor. We always said he gave us enough rope to hang ourselves. Or to thrive. Or to thrive. He was super generous to us through the years. He really acknowledged when you did well, instead of he could have been the guy that said, no, it's all because of me. But he was never that way. He was extremely generous to us. And he taught us a lot about the business. We had some ups and downs, but overall, Steve is just a wonderful man. He taught me early on, because I work with him at Oppenheimer on the sell side, A, about the business in and of itself.

57:14But the one thing he did, I'll never forget, I was six months into the business and he would take me on his meetings to see buy-side clients as well as CEOs. And here I am at that point, 24, 25-year-old kid sitting there and watching the titans of finance at that point in time, being in the middle of this large boardroom CEO of American Express. And he took me with him. He didn't have to do that. And he did, and he kept doing it. And then he would allow me to do it on my own at such a young age. I'm forever grateful of what he allowed me to see at an early age when I saw it. And it was all because of him.

57:50One of the things that Steve did, and there's really not many other people that do this, is call out CEOs. And he did it one after the other. And he was not afraid to do it. And everyone around was like, yeah, why didn't anyone else say anything sooner? Because there's a lot of these bad management teams, these crooked management teams. There was a subprime finance company that was doing really shady tactics to screw this consumer. And Vincent helped as well. And we got an author to write about in the paper. And they had to change all their tactics. And the company eventually folded. Steve done a lot of other really good things.

58:28And I wish there was more of that right now. Then what teaching from your parents, or your mom in this case, has most stayed with you? I would actually say the teaching she's giving me right now is staying with me. I don't want to bring the room down, but she's had stage four lung cancer for six years and various other ailments. And God bless this battle acts of a woman, she keeps going. And she has a will to live like I've never seen. She recently got her latest scans, it was telling Porter, and the tumors are shrinking and she hasn't had chemotherapy in two years. And she had a bypass in her leg.

59:04Sorry, that's a lot for a lot of people, I understand. It makes me so proud of her. And all she wants to do is go to my daughter's graduation or go somehow, some way she's going to get there and do it. Just watching her and her will to live is really, for me, it just resonates to me on a daily basis. Porter? I guess we're both product of strong mothers. Both my parents have an incredible work ethic and are still working to this day. My father was a military guy, and for him, showing up 20 minutes early was on time. My mother is one of the toughest women you've ever met. She just doesn't take no for an answer.

59:44She's one of the reasons that I got so far in my role, and she's just, Porter, keep going. You can do this. You got this. And so I'm incredibly grateful to my parents. All right, guys, last one. Porter, we'll start with you. What life lesson have you learned that you wish you knew a lot earlier in life? After the 96 Olympics, we got a disappointing fifth and my grandfather wrote me a letter and he said, poor, I saw the Olympic motto, which talks about life's about the journey, not the end result. I remember reading the letter. I'm like, whatever, he doesn't know what he's talking about. And of course he's right.

1:00:19And life's about that journey and creating your own failures and learning from those failures. And it's a process. and not say I enjoy the failures of life, but I've learned from them and moved on and tried to adapt. And luckily I have the will to keep going. This is a lesson I learned early on in college because I can easily become an introvert if I truly wanted to. And I surrounded myself in college with a bunch of guys who are not introverts. They're quite the extroverts. And so as a result, I found myself going out and socializing more and more than I ever thought I would going to college.

1:00:56I knew I had to keep my grades up. I knew I had to do well because if I didn't, I wasn't going to get a job. But that being said, a lot of them taught me how to communicate and how communication and humor and networking is extremely important. So as a result, that was one life lesson I learned early on that I still teach to kids in my alma mater, Binghamton. I was like, guys and women, you can go and study all you want, but I don't know how to tell you this, go out to a bar, meet people, hang out with different people and converse with them and take their numbers down and stay in touch with them and connect the network.

1:01:33And that's the thing that I think I learned that really helped him round it out probably what is a weakness for me. I learned early on just watching them and saying, wow, this shit works. And so I might not be as good as they are. No, I'm not, but it definitely works. This has to rub off on you. So Vinnie Porter, thanks so much for sharing the story. Awesome. Great time. Great seeing you. Thanks for listening to the show. If you like what you heard, hop on our website at capitalallocators.com where you can access past shows, join our mailing list, and sign up for premium content. Have a good one and see you next time.