The New Rules of Money in Your 20s — with Jack Raines

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26:27You argue that ambitious young people tend to cluster around a few sectors, finance, big tech, tech startups, law consulting, and that something such as tech sales is undervalued because it reads as low status. What do you think are some of the other things that young people might be overlooking for that same reason. So the tech sales one is funny because there's been this whole rebrand of like calling sales go to market because nobody that went to like Yale wants to say that they do sales. The, if you join like, I don't know, like say you join Cognition on there, like they're one of the hottest like AI coding companies right now, right?

27:05If you join as like an account exec there a couple of years ago, you've made so much more money than somebody who's like in private equity and their fund is kind of trash and the carry's underwater. Like the idea of saying I'm an associate at KKR sounds really good because people in New York know what KKR is. Guess what? The person out there slinging like cognition to random like tech companies might've pulled between 500K and a million depending on what their like OTE is. So there's like a real arbitrage and like being able to take a job that sounds less sexy to like the other kids who went to Wharton undergrad, but you can make way more money.

27:41Like, um, the guy I know, Sam Buck, who like joined rap really early, he was a Goldman for a couple of years. He was just like basically an SDR rap and nobody really heard of rap. They're like series eight at that point. And guess what? Raps valuation has like, I don't know, 50 X since then he's now like a very high up VP or exact there. It was sales. Like even before, like even excluding the equity comp, like I'm sure he had a very good commission cop on that as he grew into it. So like, I think sales jobs in general, unless you are like a dialed financial markets, like I want to be a trader or hedge fund analyst, I think your typical investment banker, consultant, or like private equity associate could probably earn more money and enjoy their life more if they just leaned into doing like sales partnerships, whatever.

28:28um i think there's other stuff too with like like you were talking about being like a tax accountant accounting is another one where like it's boring most people interested in finance would prefer to go into banking but if you can carve out a niche where you're doing taxes estate planning stuff like that and like move up where you're dealing with like higher and higher net worth clients there's just so much money to be made um so like as a general rule boring thing where like you either have to be like sociable or like fairly good with numbers to do and you don't think it would be that impressive to like tell a girl at a bar there's probably companies where you can join and do that and make a lot of money um versus i would argue like private equity which is still the hot finance thing so much of the compensation is back loaded and carry and like private equity is an industry you could argue is bloated and a lot of the their marks are unrealistic on their portfolio companies like are you going to get any of that carried interest in eight years i don't know, they keep raising continuation funds to try to keep the game alive.

29:27But that's what everybody's still pattern matching to. So my hot employment take is like tech sales is probably a better bet than private equity for your typical investment banker. We'll see if I'm right in five years. You are right. I think the most overcompensated, if you think about relative to the structural risks they take or the amount of hours they work, the most overcompensated people in our economy are the salespeople. And typically I've found in the companies I've started, people hate them because they show up at nine, maybe 10, they're hungover. And they're reasonably smart, but they're not geniuses.

30:07But they played with either the wrong toys or the right toys. And I can't figure out if good salespeople have especially low or especially high self-esteem. And I think 98 % of the public isn't willing to sell. I used to knock on doors and sell magazine subscriptions when I was in high school. And, you know, it just, the ability to endure sales is something most people are not willing to do. Do not call me again. Oh, so you're saying I should call you back in two weeks, maybe. I mean, you have to be willing to get out such a big spoon and eat so much shit. And most people just aren't willing to do that.

30:42So as a result, the people who do bring some intelligence, some EQ, can just make a shit ton of money. It's also funny because like in every industry at the top of the ladder, it's still like a sales job. Like investment world, guess what? Like you like at the end of the day, the actual boss is the LPs and like the guy raises money. Yeah. You want to go raise$500 million? You're selling yourself, your reputation, your performance. Like the whole like picking stocks or companies doesn't even happen if you can't convince somebody to give you the money in the first place. The two people that run a hedge fund, the two partners, the two co-founders are usually an introvert who sees the matrix, who really understands investing, and then a high EQ person who can go convince CalPERS to give them, you know,$100 million.

31:31And that's the chocolate and peanut butter. A few of your recent posts also cover trends that we talk a lot about here at Prof G, that we're all informed, but no one really knows anything, that optimization culture turns people into slaves through their metrics, and that publishing AI-written work disrespects the reader. Say more? Yeah, I mean, one of my favorite takes is like the whole, like I've never had a smartwatch, right? Like I think the entire, oh, like my eighth sleep said that I didn't sleep well last night, Now my day is going to suck. It's like, I don't know, man. I sleep on a normal mattress.

32:07And if I wake up and feel weird, I probably need to take a cold shower or go to the gym. And I don't know. I think this whole metric obsession, especially with health, is a little bit problematic because you then start architecting your life around how do I hit the right number versus in an ideal world, the number informs you of like, oh, maybe I've been drinking too much or should change my diet. But in reality, the number starts driving the decision rather than informing it. And I just, I don't know. Like we have so many metrics for everything. Health, like you have performance data on social media posts that can lead people to like audience capture.

32:43If they're a YouTuber or a podcaster, you have like health stuff that can make people, I don't know, like you can't really quantify how fun it is to have three beers with your friends on a Friday, but guess what? Like my sleep score is probably worse on Saturday if I got a little bit drunk, but did I have fun? Like, how do you quantify the, like the social benefit of like, I don't know, like three heinekens versus like getting the heineken zeros i think the trade-off is probably worth it if you don't have it like a like an addiction or substance abuse problem um and the same things you're talking about like ai and content it's like there's such this performative influence which is like i need to keep putting content out that like like on twitter i know you don't really you're x i know you don't really post on there anymore but there's a whole like and the vc startup world the amount of like obvious like claude slop that people are trying to be thought leaders on there.

33:33I just don't read it. Like I don't read a single X article because it's probably just performative slop that, um, I don't know. It's, it's all just like, I think metric chasing and performance chasing without actually thinking through like, how do I want to orchestrate my life and what actual goal am I optimizing for is pretty dangerous. Cause you can just find yourself running around circles and doing things. And you're just like letting a number drive your life decisions rather than like lightly inform it. You argue that where you live is an underrated driver of well-being and that every person should spend a couple of years in New York before having kids, which again, we also agree with.

34:12Talk a little bit about where you live being an underrated driver of well-being. So I'm from a small town in South Georgia called Tifton that has like 20 ,000 people. I love being from there. Never want to live there again. It was just like deer hunting, high school football. You go to church on Sunday. That's it. Fine. I lived in Atlanta, Georgia for two years after college, spent a year kind of bopping around Europe and Argentina. And then I was in New York for two and a half years for grad school. And right after San Francisco for a year, now I'm back in New York. So I've done small town USA, West Coast, East Coast, I'm a little bit bopping around everywhere.

34:49New York is my... My take on New York is one, it's my favorite city. I think if you're in your 20s, it's like just scrap up, live with two buddies, get a three bed, one bath when you're like 23 and just make it work, live in Murray Hill, you're going to have a blast because like you can go out every night. You're going to meet like so many interesting, ambitious people doing a little bit of everything. The density of like cool people you meet, both for what's useful for like work, just like general fun. You never know who you're going to meet at the club, the restaurant, the bar, whatever. Your dating life, you just have so many more touch points at a time when like you should probably be your most social.

35:30And then for me personally, it's like, I've been here for a few years and it's still my favorite place because I don't know my apartment, like this is a studio apartment in the background. It's, I paid more for this than some of my buddies do for their mortgages in like the Atlanta suburbs. They have like three or four bedroom houses. Guess what? My studio is like$4 ,400 a month. That's like a house payment, but I'm not optimizing for like square footage of a house. I'm optimizing for surface area touch points with like a lot of my friends who live in New York and like job opportunities and like girls I want to date.

36:03And New York is just the, it's like the gravitational center of life when you're in your twenties and even thirties versus like when I'm back home in Georgia, I'm bored. Like I feel like there's nothing to do. I go home. I love seeing my family for three or four days and then I'm kind of on this, what's next. So I think it's like life stage specific. Like there's a version of me, San Francisco is the same way. I think it's one of the prettiest parts of the country. I also found it like really boring and a little bit monocultural when I lived there. It's so, as a VC, it's very tech VC centric. And like, if I was married with kids and living in like Marin or South Bay or whatever, I might feel differently, but I just like didn't really enjoy the like day-to-day outside of work that much versus New York.

36:46It's a lot more socially stimulating, but it depends. If you're more introverted than me, you might find New York overwhelming and would prefer to live somewhere else. If I was like married with kids and wasn't at the point that I could afford like a very comfortable, much larger place to live, I'd probably move to like New Jersey or like further upstate or Connecticut or Long Island. Right. Um, but like the, the happiness boost you get from being in a city that you actually like is so underrated. I think a lot of people will make a decision. I need to move somewhere for a job without thinking about the hit on their like wellbeing.

37:19And if you aren't happy where you are, if you're not around people you want to be around, you can double your salary, but you'll be twice as miserable too. We'll be right back.

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39:01We're back with more from Jack Raines. So you, you're VC now, but you've sort of gained traction or awareness and I imagine deal flow through writing and you spent some time in media. Just curious to get your take on the media industry and the creator economy? Yeah. So on the media industry, I think this might be a hot take. I actually think it's a very good time to start a media brand because you can just do stuff a lot leaner now. Like if you look at the radio industry, it's like there was so much infrastructure. You had so many people working in the studio versus now you can launch a podcast and hit publish and effectively get distributed to the entire world immediately.

39:43Like I know you have a whole team that works with you. That team is still probably way leaner than it would have been 40 years ago to try to have the same level of distribution, right? So there's a lot of like, what I would say is like bloated media companies that didn't really adapt to social media and now kind of influencer creator first stuff that like their revenue model and their cost structure just doesn't really make sense. But for like individuals or lean teams, whether they're building subscription model, ad model, whatever, I think there's like a lot of value building in niches with like a pretty low cost basis and low headcount.

40:17On the creator front specifically, like the fund I'm at, Slow Ventures, we actually have a, like, we have our fund that invests in startups, like tech, AI for whatever, yada, yada, yada, like Silicon Valley, New York, we do everything. We have a separate fund that invests in creators and creator-led businesses, where the bet that we're making there is that the internet is getting more and more siloed, where like I have my internet, you have your internet, like algorithms and interests drive everything. People that are kind of like cult leaders in different pockets, have interesting opportunities to build businesses around like their niche or their audience where if you're kind of seen as the like like market or industry leader on your thing and you have hundreds of thousands of millions of followers like can you build businesses on top of that platform we think so so i go two ways where i think old media has like a just a revenue and expense problem i think really scrappy entrepreneurs who like get the social media game and are down to run like lean teams can build businesses where they're pocketing six to low seven figures a year and i think we're hitting a point now where like pretty niche creators again most creators aren't that entrepreneurial but the ones that are that really get distribution they basically instead of having to pay for meta ads they have it built in right so they're like go to market has a massive advantage so like i think if you can carve out like i have a niche and i have industry expertise in this thing.

41:43And there's a pretty interesting opportunity to, I wouldn't necessarily say build a media business, but leverage podcasts, YouTube, Twitter, LinkedIn, whatever. So just drive a lot of revenue. I'm curious, what role does AI play in your written work? How do you use AI? So the number one way is like as a thesaurus, like when I was working on my book, for example, I actually tried to do a couple of like, I know you've written several books. I don't know what your process is. This is my first time doing one. And I underestimated like how mentally like strenuous writing a book is. It's not linearly more difficult than like, it's not 30 times more difficult than a blog posts.

42:22It's a 30th of the length. That's like 300 times more difficult. It was my advice to be just keep at it so you can find out it gets worse. Yep. Yep. Yep. I can't, I can't wait. It doesn't get better. But on the, on the AI stuff, I actually try to do the like, okay, could I have voice to text a rough draft faster and then manually edit it? Well, that didn't work. because you have to wrestle with the sentences and stuff. So I actually tried to do so many versions of like, can I accelerate the process? I feel like there's a lot of self-published books that are probably written by AI or even like regular books where, you know, that like 90 % of books are whatever written by Ghostwriters.

42:58I'm sure there's some Claude in that. I actually, I was like, can it even like mimic my voice? It couldn't. I fed it all my blog posts to like see what it could do. But the thing that AI was very useful for, is very useful for is like minimizing the feedback loop of like getting some version of feedback on your thing. So like when I was working through like draft chapters and I do this in blog posts, sometimes I will, to be clear, I never let, I've never published a single word of like anything. I don't think that was AI written, but I will say like, Hey, here's old writing samples. Like here's different drafts.

43:33Here's whatever. Now here's the one I'm working on. Tell me where the voice is weaker than other stuff I've written. Tell me if I'm using an anecdote multiple times within this book. Tell me if the flow here doesn't... Basically, tell me everything that sucks about the writing and the weakest points and strongest points go. And then it's like getting an extra layer of feedback where you disregard some of it, you take some of it, and then you go back and workshop it. But when you're writing your own stuff, it's hard to be objective about how good it is. When you give it to AI, it can just digest all of it immediately and pulling out obvious flaws where you can start working again faster.

44:07So like my human editor is phenomenal. I got to do a lot of micro edits between the human edits where I just got more feedback faster. And on my blog posts and stuff, it's obviously a game changer for research. Perplexity is very useful for pulling stuff quickly. Having cloud codes synced up to my computer, I can pull from different files where I have different information on companies that I want to query quickly. The information retrieval and review or just sped up a lot. It's kind of the biggest thing. Yeah, if you disarticulated the different people or skills in writing, there's the writing itself, there's the fact-checking and the editing, and then at the very beginning, there's the research.

44:48I find it's a good researcher, a great editor, and a lousy writer. Yeah, you summed up my three-minute monologue in about one sentence. Yeah, I agree with that. And what's next for you, Jack? I mean, hopefully sell like a million copies of a book. I don't know. No, I mean, like right after this, we have our like partner meeting and the fund I'm at to talk about startups you might want to invest in. But like in general, in life, it's like, I think I'm always going to write. I don't think I'm ever going to have a like full-time media type of job again. But like I view writing as a like very useful cathartic way to like flesh out ideas and figure out what you actually think.

45:29I think it like strengthens you mentally and like ideally write more books even though I don't have the next one now. I also like the call it investing tech industrial complex of like all the developments in AI are like really cool. It's fun to get to talk to these founders all day, look at different deals. I try not to think like too, too far ahead on like what specific thing do I want to do as far as as much as like being really opportunistic about like where are the like coolest, most interesting high leverage opportunities in this like broader tech investing space and kind of like stay in that funnel.

46:05At the end of the day, it's like, if you're working in a broadly growing market with really interesting people and really interesting stuff, I think there's like good financial outcomes there that are interesting. So that's kind of the game I'm trying to play. And then the writing and the platform is sort of my differentiator and sort of business card. I'm like, this is who I am and how I think. If you want to work with me, hit me up. Jack Raines is the writer of the newsletter Young Money. His new book, Young Money, A Field Guide to Wealth and Purpose in Your 20s, is out next week. In addition, Jack will be joining us in October to answer your questions on personal finance, wealth, and more.

46:45As always, you can send them to us at officehours at PropGmedia.com. Again, that's officehours at PropGmedia.com. And one last thing, if you'd like to join future live streams, subscribe to PropG Plus at PropGmedia.com. And if you're not already reading Jack's work, check out his sub stack and preorder his new book, which we'll link in the show notes. Jack, thanks for joining us. Scott, thanks for having me.

47:27Algebra of Happiness, No Mercy, No Malice, the newsletter we put out every Friday, turns 10. It initially started as L2 was a reinvention of my first firm, Profit, but rather than being in a transactional model where I ended up selling the company for 2.8 times revenues, I wanted a recurring revenue model. And the way we would try and predict renewal rates was through engagement. So we launched a series of media products, a video series called Winners and Losers, talking about digital innovation, And then I started a newsletter every Thursday night that went out to all of our clients. And I would talk about whatever was on my mind.

48:03It was part engagement with clients, but it was also catharsis for me just to talk about whatever I wanted. And also, I enjoy writing. And I'm fundamentally a lazy person, so I have a lot of self-imposed deadlines. And I think that, again, success is a series of small acts of discipline. So every Friday for the last 520 weeks, we have put out a missive. It can be on anything from engagement levels on Snap to the valuation of WeWork to putting my dog down, which was the most read post of anything we've done. We started with 200 subscribers. We're now 430 ,000. We don't monetize it. Occasionally we have an ad, but for the most part, it's sort of the center of our content flywheel.

48:46And that is, it gives us ideas around books, chapters, stories for one or more of our podcasts. But it's sort of my home base and kind of the thing I would argue I, I wouldn't say I enjoy the most. It's the most rewarding thing. Generally, the most rewarding thing and the hardest thing are the same thing. And that's what No Mercy, No Malice has been. And I used to write it every Thursday night, just me, after having a few drinks. I'm not proud of this, but I think some of my better posts were written when I was a little bit fucked up because I'm less guarded. And I try to imagine that no one's ever going to read it but my kids in 20 years and that hopefully they'll understand me and the world a little bit better and miss me and see how much I thought about and love them.

49:35And I know they feel that, but sometimes I think it'll be really rewarding for them to know that at some point in the future after I'm gone. And also just to be fearless and use it as a means almost like working out, supposedly physically working out makes you live longer. But I think mentally working out keeps kind of the Alzheimer's away, if you will. And I find that focusing on or trying to restructure that last sentence keeps me sort of a sort of a mental crossfit for me. Also, I do believe that the written word is still the most powerful means of communication. And that is, I just don't think people are going to be listening in 10 years to any of these podcasts.

50:14I don't think they're going to be going back and thinking, well, I want to listen to that podcast from a decade ago. I do think there's a significant number of people, though, that will read a couple of my books. And then my sons will read my posts from decades earlier. and it's very rewarding to think that you're doing something that sort of immortalizes you and that is the medium is the message if someone comes up to me and high fives me i know they saw a video if they come up and start speaking to me as if they're my friend i know it's they're a podcast listener but if someone comes up and wants to talk about the loss of their mom or the balance between being a present father and trying to establish economic security i know that they've read something.

50:58And it's very, it's exceptionally rewarding. And I would, what's the lesson here? If you want to be a great communicator, if you want to be a great storyteller, which I think is the fundamental skill as it's the means of transmission for survivability. And that's why Mick Jagger gets to hang out with a 35 year old ballerina because he's an incredible storyteller and artists get so much attention, it starts with the written word. If you really want to be a great communicator, I think you have to learn how to write well. Also, the idea, or essentially, if you want to immortalize yourself, if you want to live forever, the only piece of advice I would have is the following.

51:45Start writing.

51:49This episode was produced by Jennifer Sanchez and Laura Janair. Cammie Reek is our social producer. Bianca Rosario Ramirez is our video editor. And Drew Burrows is our technical director. Thank you for listening to the Prop G pod from Prop G Media.