Guest Article by Benjamin Hardy: 21 Behaviors That Will Make You Brilliant at Creativity & Relationships

When you see things from multiple perspectives, you realize you can achieve almost anything you want in far less time than you imagined.

Yet most people have fixed and limited views about themselves and what they can accomplish.

They have fixed and limited views about the resources available to them.

They have fixed and limited views about time, and how long things must take to accomplish.

In this article, I squash all of those limiting perspectives and provide concrete strategies you can use to achieve your goals. There are no fixed limits.

Here’s how it works:


Core Principles

1. Set absurdly ambitious goals

“When 10x is your measuring stick, you immediately see how you can bypass what everyone else is doing.” — Dan Sullivan

Goals are most likely to be accomplished when:

  • They are intrinsically motivating. As Napoleon Hill explained in Think and Grow Rich“Desire is the starting point of all achievement, not a hope, not a wish, but a keen pulsating desire which transcends everything.”
  • They must be difficult, or else they won’t be motivating.
  • They must be time-bound, to create a sense of urgency. Shorter timelines are one way to go 10x, since they force you to shed artificial constraints and think more creatively. As billionaire Peter Thiel is known to ask: “How can you achieve your ten-year plan in the next six months?”

As with all things in life, you get what you want. If you prefer to make excuses and justifications for a lack of progress, then just admit you prefer your current station in life. Self-acceptance can be a beautiful thing.

However, once you desire progress more than convenience, obstacles no longer stop but propel you. As the Roman emperor Marcus Aurelius is famous for saying, “The impediment to action advances action. What stands in the way becomes the way.”

2. Reframe subconscious patterns and get bold insights via auto-suggestion

“What is impressed in the subconscious is expressed.” — Dr. Joseph Murphy in The Power of Your Subconscious Mind

While awake, your conscious and subconscious mind are often at odds with each other. For example, you’re trying to be positive, but your subconscious patterns simply won’t let you.

Yet, while transitioning from being awake to being asleep, your brain waves move from the active Beta state into Alpha and then Theta before eventually dropping into Delta as we sleep. It is during the Theta window that your mind is most receptive to reshaping your subconscious patterns. Hence, Thomas Edison is known for having said, “Never go to sleep without a request to your subconscious.”

As a result, just before you fall asleep, it is key to visualize and even vocally state what you are trying to accomplish. When you repeatedly state a desired goal, visualization is key because you want to have as emotional an experience as possible. You need to feel what it would be like to have what you seek.

You can absolutely trust that by planting these subconscious seeds, thoughts will pop up at you, often at random intervals. You need to record these thoughts throughout your day. The bigger the goal, the bolder will be the required action to attain it. The clearer your why, the more inspired will be your how.

If you’re serious, you’ll need to act immediately upon the impressions your subconscious is transmitting to your conscious mind. If you brush off these insights, you’ll get less and less of them. You’ll demonstrate to yourself and the source of your inspiration that you don’t really want the changes you claim to desire.

3. Learn and work in counterintuitive environments

1905 was Albert Einstein’s break-through year where he published four research articles, known as the Annus Mirabilis papers, which went on to substantially alter the foundation of modern physics and changed views on space, time, and matter.

Interestingly, when Einstein published these papers, he was not working in an academic setting, but rather at the Swiss Patent Office. His work in this counterintuitive work environment allowed him different reflective angles and questions than a typical physics lab.

As Elon Musk’s wife, Justine, has said:

“Choose one thing and become a master of it. Choose a second thing and become a master of that. When you become a master of two worlds (say, engineering and business), you can bring them together in a way that will a) introduce hot ideas to each other, so they can have idea sex and make idea babies that no one has seen before and b) create a competitive advantage because you can move between worlds, speak both languages, connect the tribes, mash the elements to spark fresh creative insight until you wake up with the epiphany that changes your life.”

When you work in a different context from the majority of people in your field, you can make distinct and unique connections. You can integrate and cross-pollinate different ideas. You can avoid dogmatic thinking and expectations. You can learn to integrate ideas from seemingly dissimilar fields.

4. Learn from counterintuitive resources

“What does following in the footsteps of everyone else get you? It gets you to exactly the same conclusions as everyone else.” — Ryan Holiday

As Holiday explains, if you read what everyone else is reading, you’ll think like everyone else thinks. If you think like everyone else thinks, you won’t be able to come up with anything unique.

Follow your curiosity. Chase down obscure leads. Find stuff that no one else has found. In this way, your work will be truly valuable to others.

5. Focus on the process (not results) of those who are succeeding big

“Success leaves clues.” — Jim Rohn

Focusing exclusively on results is one of the primary reasons the current academic system is broken. Kids are being taught to train for the test, rather than seeking novel and unique ways of doing things. No two kids are wired the same, nor should their contribution, creativity, and talent be viewed from the same standard.

When you want to develop expertise at something, rather than focusing on the results of those at the top of your field, study and emulate their process.

What are they doing?

Once you get process-oriented, as opposed to results-oriented, you realize you too can achieve amazing results. The process, or your behavior, is completely within your control. Conversely, when you focus solely on other people’s results, you can quickly become overwhelmed and give up.

6. Ignore what almost everyone else is doing

In the book Relentless: From Good to Great to Unstoppable, Tim Grover explains that the world’s elite don’t compete with other people. Rather, they make others compete with them. They set the tone and make others react to their environment.

Most people are competing with other people. They continuously check in to see what others in their space (their “competition”) are doing. As a result, they mimic and copy what’s “working.”

Rather than worrying about what others are doing, live your values. Put first things first. Spend more time with your loved ones and away from work. While working, follow your own curiosity, not what others are doing.

7. 80/20 Analysis of highest leverage activities

“Today everyone is a generalist, a deliberate move on the part of most as a reaction to the economic times.” — Leonard Smith

When studying the process of those you seek to emulate, don’t try to do it all. Everyone has their own strategy. Even those at the top of your field have imperfect strategies.

Find the patterns. What are the key things you must master? Master those.

Then innovate beyond those patterns when you’re ready, so your process comes to exceed the process of those you admire. Eventually, your results will exceed theirs as well.

8. Over-learn high leverage activities

Learning something new is all about memory and how you use it. At first, your prefrontal cortex — which stores your working (or short-term) memory — is really busy figuring out how the task is done.

But once you’re proficient, the prefrontal cortex gets a break. In fact, it’s freed up by as much as 90%. Once this happens, you can perform that skill automatically, leaving your conscious mind to focus on other things.

This level of performance is called automaticity, and reaching it depends on what psychologists call over-learning or over-training.

For example, if you want to quickly learn how to write viral articles, study several hundred headlines of viral articles. If you want to write a book, study just the table of contents of hundreds of books. These are your lay-ups.

Start with small sets of information, then expand from there. By over-learning a particular category of learning, you’ll be able to better understand how it relates to the whole. You’ll also quickly be able to apply what you learn. You’ll quickly see the patterns others miss. Time will slow down for you as your cognition expands.

9. Learn to apply, not to procrastinate “the work”

“The key secret to success is not excessive expertise, but the ability to use it. Knowledge is worthless unless it is applied.” — Max Lukominskyi

Learning is best done while you’re doing the activity. Public education has taught people they must first master theory, then attempt to transfer that theory into the real world. In a similar way, people’s love for information via the internet has led them to use “learning” as a form of procrastination.

A better approach is “context-based learning,” where you learn while doing.The key principles of context-based learning include:

  • Learn a concept in its simplest form.
  • Put your rudimentary knowledge to practice in a real-world scenario.
  • Get coaching and feedback (feedback often comes in the form of “failure”).
  • Apply the feedback through repetitious practice.
  • Get coaching and feedback.
  • Repeat until proficient (see #8 just above).

Interestingly, researchers examined the effects of role-playing on the self-concept of shy adolescents. One group of adolescents got traditional discussion-based training while another did role-play based training. The group that did role-plays experienced a significant positive change in their self-concept, which has a significant impact on their behaviors.

In our digital world, simulation training — based on role-playing real-world scenarios — is becoming increasingly popular.

Additionally, research has found that getting consistent feedback is essential to effective learning. You can use this. By making your work public, you get immediate feedback.

Getting immediate feedback has been found to be a flow trigger. It heightens performance. Especially when the feedback is real world, and there are real consequences for success and failure.

10. Focus on quantity in the beginning

“Plant a lot, harvest a few.” — Seth Godin

In the book Originals: How Non-Conformists Move the WorldAdam Grant explains that “originals” (i.e., people who create innovative work) are not reliable. In other words, not everything they produce is extraordinary.

For example, among the 50 greatest pieces of music ever created, six belong to Mozart, five are Beethoven’s, and three Bach’s. But in order to create those, Mozart wrote over 600 compositions, Beethoven 650, and Bach over 1,000.

Similarly, Picasso created thousands of pieces of art, and few are considered to be his “great works.” Edison had 1,900 patents, and only a handful we would recognize. Albert Einstein published 248 scientific articles, only a few of which are what got him on the map for his theory of relativity.

Quantity is the most likely path to quality. The more you produce, the more ideas you will have — some of which will be innovative and original. And you never know which ones will click. You just keep creating.

11. Track only a few things (ignore everything else)

“If you have more than three priorities, then you don’t have any.” — Jim Collins in Good to Great: Why Some Companies Make the Leap…And Others Don’t

If you want to improve at something, you need to quantify it. If you don’t quantify it, you don’t really know what’s happening. As Thomas Monson explains, “When performance is measured, performance improves. When performance is measured and reported, the rate of improvement accelerates.”

I can personally attest to this principle. When I started measuring a few metrics, such as each set in the gym, my income, and how much time I spend in “flow” while working, I dramatically improved in these areas. The reason is simple: tracking helped me become aware and objective about my weaknesses. Thus, I knew exactly where I should focus and could do it systematically.

12. Heighten expectation for what you can accomplish

“I think the ability of the average man could be doubled if it were demanded, if the situation demanded.” — William Durant

I started working out with my current workout partner about two months ago. He’s nearly 20 years older than me, and can lift substantially more weight than me.

One of the first things he told me was, “Most people never get stronger simply because they don’t put themselves under the weight.” As a result, our first several workouts involved me being heavily spotted while benching and squatting way more than I ever had before. The purpose was to feel the weight.

It hasn’t taken long at all to increase my strength while working out with my new partner. He’s raised my expectations. Yet I don’t let his expectations dictate what I can do. As will be shown in the following section on mentorships, the expectations of those around you create the context for your growth and potential.

But you don’t need to be bound by those expectations. For instance, just because many of my favorite writers publish twice per week, I decided to hold myself to a different standard when I started writing. In large measure, you get what you expect you will. According to Expectancy Theory, one of the core theories of motivation, motivation involves three components:

  • the value you place on your goal
  • your belief that specific behaviors will actually facilitate the outcomes you desire
  • your belief in your own ability to successfully execute the behaviors requisite to achieving your goals

Learn from the best. But don’t be bound by their standards. Run at your own pace, even if that pace is faster than those you aspire to be like.


Mentorships

13. Surround yourself with people with higher expectations than you have

According towhat psychologists call “The Pygmalion Effect,” other people’sexpectations of you heavily influence how well you do.

When you’re a child, the expectations of your parents “set the bar.” Interestingly, these expectations form an invisible barrier from which it becomes very difficult to exceed.

For instance, scientific experiments have been done on fleas, wherein they’ve been put in a glass jar. Without the lid on the jar, the fleas can easily jump out. However, the fleas can be trained to stay in the jar by putting a lid on it. After only three days, the lid can be removed and the fleas will be constrained by an invisible mental barrier.

Not surprisingly, the “next generation” of fleas is also constrained by this new and invisible barrier. The Pygmalion effect explains why: the next generation develops the same expectations for themselves as their parents have for them.

If, however, you were to take one of those fleas out of that jar and place them in a bigger jar, surrounded by fleas jumping much higher, mirror neurons would fire and that flea would soon be able to jump higher. Mental barriers would shatter, soon to be replaced by the mental barriers of those in the new jar.

When seeking mentorships, it’s important to realize that the expectations of your mentor reflect the flea’s jar, and invisible barrier, as opposed to your inherent ability. There is no fixed ability. Nothing, and nobody, has an “absolute” value. Everything is contextual.

Even still, by jumping into a much bigger jar, you’ll quickly grow. Actually, you may learn to jump much higher than you ever imaged with the help of a caring mentor. Thus, it is extremely important for you to surround yourself with those who have high expectations for you. It may be difficult, frustrating, and humbling to develop and grow. But if you stick to it, you’ll eventually reach a new invisible cap.

14. Expect to expand and adapt

Human beings are highly adaptive. For instance, Viktor Frankl reflected on his experience as a Nazi concentration camp victim and sleeping comfortably next to nine other people on small beds. Said Frankl in Man’s Search for Meaning, “Yes a person can get used to anything, just don’t ask us how.” Indeed, this was one of the most surprising aspects of living in a concentration camp, the rapidity at which the shock and horror became apathy and “normal.”

No matter how far-reaching and discontinuous the jump from one environment to the next, a person can and will adapt, whether that means going from zero kids to three (trust me), or from completely inactive to exercising with professional bodybuilders.

Take, for example, Collin Clark, a 20-year-old who lost 64 pounds and 30 percent body fat in six months. The process was simple; he went to the gym and began to emulate the bodybuilders who were there. Eventually, one particular bodybuilder took an interest in Collin, and became his mentor. By working out daily with a bodybuilder, Collin transformed. The example of Collin Clark is particularly notable, as he has down syndrome.

When you first enter a new and larger jar, you’ll feel excited and perhaps even intimidated by all the jumping room. However, like gas which spreads to fill the space it’s been given, you too will adapt. Thus, you won’t want to overstay your welcome. Remember, the jar is a reflection of other people’s expectations.

Hence, the next point:

15. Don’t get stuck with one mentor

“When the student is ready the teacher will appear. When the student is truly ready, the teacher will disappear.” — Lao Tzu

High quality friendships should last forever. High quality mentorships, on the other hand, should not last forever.

One mentor can only take you so far; they can only give you one “jar.” If you want to evolve beyond that jar, you’ll need a new mentor. And this is exactly what any true mentor would want for you as well. It’s not about “them.” They are investing in you. It is through your best work that they can live on forever.

16. The mentor sets the expectations, but the mentee sets the tone

Although the mentor’s expectations and abilities reflect the size of the jar, it is the mentee that sets the tone for the relationship and how well it will go.

I’ve been in mentoring relationships where I’ve been a good mentee and a bad mentee. In each case, it was not the mentor, but me, who determined how well the relationship went. No one cares more about your success than you do. It is up to you how far you go in life.

Darren Hardy, author of The Compound Effect, has said, “Never take advice from someone you wouldn’t trade places with.” Thus, you should be highly selective about the mentors you seek. If you aren’t intrinsically motivated to “set the tone” with you mentor, ask yourself: Do I really want to be like this person? If the answer is no, then they are the wrong mentor.

When you have the right mentor, you’ll know, because you’ll feel extremely lucky to have even a few moments of their time. You’ll do all you can to deepen the relationship, provide value, and learn. You’ll be willing to bend over backwards to help them. You’ll take on greater responsibility. You’ll make their life easier. You’ll make them look good.

17. Give credit where credit is due

Although you are responsible for your own success, you are not the sole cause of that success. Far from it. You are not independent of all the help you’ve received. More accurately, you are the product of all the help you’ve received.

You are standing on the shoulders of giants. Acknowledge them for that. And never forget where you came from. Also, never speak poorly about your mentors or those who have helped you along your journey. This does nothing for you. I’ve made this mistake and destroyed important relationships with people I deeply admire — people who invested lots of time and energy into me.

As Ryan Holiday explains in his book, Ego is the Enemyalways be a student. Remain humble. Don’t let ego take over, or it will lead to your inevitable demise.


Mental Models

In this final section, I will detail beliefs required for rapid growth.

18. Think astronomically

“You have nothing to lose and everything to gain.” — Robin Williams

There is some brilliant new research on the concept of Awewhich has been defined as a feeling that arises when you encounter something so strikingly vast (in time, scope, complexity, ability, or power) it provokes a need to update your mental schemas.

Awe, or having a peak experience, can happen during an optimal sports performance or even a deep spiritual experience. When you become mindful, you can experience awe even during mundane moments.

Research has found that experiencing awe can expand your perception of time, alter your decision making abilities, and enhance your well-being.

I can personally attest to these findings. I’ve experienced awe several times. I strive to experience it as often as possible, which for me provides a much richer and deeper perspective of life.

Awe alters your experience with time because it helps you see things more astronomically. From the perspective of light, for example, time stands still. Thus, this moment, from the perspective of light, is both an instant and an eternity. Time fades into the background of infinite possibility. Nothing becomes impossible. No distance too far.

Awe alters your ability to make decisions because you no longer fear trivial things such as other people’s perceptions, failure, or even death.

Lastly, awe alters your well-being because the mind and body are one. When you improve one aspect of your life, all others organically improve as well. Thus, when you experience a deeper connect with yourself and the universe, you live differently. You see yourself differently, and that perception has the power to alter your biology. Your emotional state also matures and becomes more healthy as well.

19. Think laterally

“Lateral thinking doesn’t replace hard work; it eliminates unnecessary cycles.” — Shane Snow in Smartcuts: How Hackers, Innovators, and Icons Accelerate Success

Most of the United States presidents spent less time in politics than the average congressman. Moreover, the best, and most popular presidents, generally spent the least amount of time in politics. Rather than spending decades climbing the tedious ladder with glass ceilings, they simply jumped laterally from a different, non-political ladder.

Ronald Reagan was an actor. Dwight Eisenhower laterally shifted from the military. Woodrow Wilson bounced over from academia. These men spent considerably little time in politics and became fabulous presidents. They reached the top by skipping the unnecessary “dues-paying” steps. Insanely productive people think the same way. Rather than climbing up ladders the traditional ways, they think of alternative routes. They skip unnecessary steps by pivoting and shifting.

Shane Snow himself used this tactic to get published on some of the biggest media outlets in the world within six months of blogging. How did he do it? He started by pitching articles to low level blogs with basically no bar of entry. After getting a few articles published on those, he leveraged his new position and pitched to slightly higher level blogs.

He did this by sending editors of the slightly “better” blogs an email reading something like: Hello, I’ve written at these blogs which reach similar audiences as your blog. Here’s an article I think would be a great fit for your audience.

Because the editors of those blogs knew about the blogs Snow had been published on, he was able to be published on theirs as well. He followed this pattern over and over until, within six months, his work was published at Fast Company, WIRED, and others.

20. Think more flexibly about “limits” on resources

One of the faultiest and most crippling mindsets people have is over-categorizing things, and then being bound by those categories. Psychologists call this having a “pre-mature cognitive commitment.”

When you see things from only a singular perspective, you’ll assume there is a limited supply of that thing.

Money, from most people’s perspective, is a limited resource. However, research has found that after basic needs are met, what people really want is a state of mind. Yet, that state of mind doesn’t have to be tightly bound within the cognitive category of money.

Consequently, from a mindful perspective, you can look at certain things, like money or even yourself, from multiple viewpoints. You don’t have to get stuck with fixed and rigid definitions. In nearly any case, you come to realize that what you want is always available to you, if you’ll simply alter your viewpoint. As Ellen Langer, Harvard psychologist has said, “If we examine what is behind our desires, we can usually get what we want without compromising.”

The most detrimental thing we can view from a limited standpoint is ourselves. Don’t let your own assumptions and categories determine what you are. You have no clue who you are or what you can become. Different angles and more flexible definitions allows for limitless possibilities.

21. Think more flexibly about “limits” on time

“It is utterly beyond our power to measure the changes of things by time.” —Ernst Mach in The Science of Mechanics: A Critical and Historical Account of Its Development

Time is an abstraction, which we conceive by the change of other things. For example, the changing of the seasons, or the aging of a child.

Many people have rigid notions, for example, about how long certain things must take.

You can’t finish high school until you’re 18 years old.

You can’t be successful until after you’ve paid your dues.

If you break your leg, it must take a few months to heal.

These fixed notions about time are constraining and limiting. Change can occur at different magnitudes and qualities depending on the context. For example, there is a concept called, “Spontaneous Remission,” wherein an illness or disease surprisingly and immediately changes.

When I started my writing career, I was told it would take me at least three to five years to get the amount of subscribers needed to get a literary agent and subsequent book contract. I was told this by a highly credible source, actually a literary agent herself. However, that was based on her assumptions of time and resources, which resources also included my abilities and motivations.

She had no clue of my context, desires, and abilities. Thus, her assumptions about how long it would take me were absurd. Yet, she was just going off what she had seen, which caused her to be mindless about the situation. Within months of the conversation with that literary agent, I was in the position she said would take several years.

Takeaway: Let go of your beliefs about fixed limits of time. Time is a unique concept, which few of us understand. It need not be linear nor lead to entropy. Again, many scholars are seeing that these are nothing more than assumptions, or fixed mindsets about how things work.


Conclusion

Achieving your goals is very doable. It need not take as long as you may have previously assumed.

2019 Private Markets Due Diligence Survey – Findings Report

Insights into the key factors influencing one of the most critical junctures between investors and fund managers—Released May 2019 by eVestment

 

Due diligence remains the foundation for investors looking to build quality portfolio and generate above market returns. It is arguably the point at which investors have greatest influence on the outcome of their commitments and an area we have observed an increased focus on in recent years. Consequently, due diligence is one of the most important junctures between investors and fund managers and a crucial part in forming and building successful, long-term relationships for both parties. This is why eVestment Private Markets conducts the only annual
industry survey specifically focused on the key elements of the due diligence process from the investor, consultant and fund manager
perspectives. This year, we’re pleased to present you with the fourth edition of our report in association with Nasdaq, the parent company of eVestment. With a renewed set of questions and topics explored for 2019, the survey continues to uncover the emerging factors impacting
fundraising, performance analytics and manager selection.

Key Findings

Returns expected to decline, but respondents see some specific opportunities. Respondents’ greatest concerns for the future
of private markets were identified as having a generally negative impact on returns, with more than 40% of investors expecting a decline in
performance for both existing and prospective investments.

When investigated by sub-asset class, the weight of opinion was against private equity, venture capital and real estate. Real assets and infrastructure were strategies that investors were most bullish on. Competition for deals is the number one concern for both investors and fund managers. Investor and manager respondents both voiced their highest level of concern about competition for deals, with investors indicating a stronger level of concern. This topic was only rated the fourth highest concern in our 2018 survey, but climbed to top this year’s survey — potentially as investors and managers begin to realize the effect of record fundraising levels flooding the market with available capital and an ever-growing list of fund managers chasing the same assets.

Close to two-thirds of investors and fund managers expect a market correction within the next two years. The prospect of a market correction was a top three concern for both investors and fund managers, and the majority of both groups reported it would be within the next two years. While investors indicated this would lead to an increased focus on monitoring their portfolio, fund managers saw the biggest impact on the timing of exits. Fund managers underestimate the importance of metrics and analytics during due diligence. In terms of specific elements of the due diligence process, it was clear that fund managers underestimate the importance investors place on key pieces of analysis such as loss ratios,

PME and the impact of fees. A new element uncovered this year was the growing importance of calculating horizon-based returns — perhaps
in an effort to better assess private market performance alongside other asset classes as allocations grow in size and the strategy evolves
from alternative to mainstream.

See full report:  https://www.evestment.com/wp-content/uploads/2019/05/eVestment-Private-Markets-Due-Diligence-Survey-2019.pdf

Updates From the Other Hedge Fund Conference This Past Week. Ideas From Sohn

Although lacking the glitz and pizzazz that SALT has, the Sohn Conference is an outstanding hedge fund event and takes second place to no one. It brings in some of the best trade ideas the industry’s elite has to offer, while supporting a great cause by raising funds to support research to eradicate pediatric cancer and other childhood diseases.

Hedgie bigs there included Larry Robbins, Bihua Chen, Dan Sundheim, Jeff Gundlach, Scott Goodwin and a host of others.

Known for his insights into the turbulence of daily life, Gundlach told the Lincoln Center gathering, “Respect everyone. Know life is unfair. Take risk. Step up in the tough times. Face down bullies. Lift the downtrodden,” “And never, ever give up.”

Other hedge fund managers that spoke included David Einhorn who said he was wagering on AerCap while betting against GATX. Larry Robbins, quite literally an expert in trading health care stocks said he thought hospital systems were good investments as a whole. Cohen protegee, Gabe Plotkin said the environment for stocks was “pretty good”.

Have always felt the Sohn Conference attracted the best with the best ideas, no different this year.

The 3 Keys to Becoming Irresistible What the people I adore all have in common….Guest Article by John Gorman

There’s a routine question asked in job interviews, first dates, table games and so on: What is the most important thing you look for in other people?

There’s variations on this format (i.e. “What’s the most attractive quality you look for in a potential partner?” Or, “What’s your greatest strength?” And so on) but, in general, the answer remains the same: The character trait you hold above all. When pressed, I’ve often stumbled and resorted to something trite and probably not true: honesty, humor, confidence, charisma, etc. Those are fine answers but they’re not in my estimation the correct ones.

And so one day I sat down on my pleather couch, brewed some holy basil tea, queued up some Anderson Paak on the Spotify and really, truly tried to whittle down the essence of what makes truly admirable, special people exactly that. I analyzed people I looked up to, people I was attracted to, and people I just couldn’t dream to be without. And I found that the answer could never be just one thing, and that many of the things I think I admire are manifestations of other, deeper things I admire more. Here are the three components that, when taken together, create a spellbinding supernova of a person — one who can command a room and control their destiny, one who can be both altruistic and intelligent. And so I give them to you and make a case for each.


Humility

This trait is the root of all growth, learning and kindness. It’s the belief that you are not yet so great that your mind cannot be opened, and it’s the presence of mind to remember that we are all interconnected equals, and that injustice against one is an injustice against all. It is, flatly, an absence of entitlement. People who exhibit humility let their work speak for itself, they remain stoic in the face of their own suffering, and they remind themselves — and others — that life is fragile and therefore valuable. Humility quells ignorance and cultivates grace. I want this in the people I hold dear.


Curiosity

Without curiosity, you cannot be enthralling or even engaging, nor — most rudimentary of all — successful. It is frankly impossible. Curiosity drives an insatiable quest for knowledge, culture, novelty, experience, beauty, art and connection. It is the bedrock upon which you can build a life filled with stories, memories, accomplishments and relationships. People who exhibit curiosity can become masters, or polymaths, or auteurs — but they must first always have an open mind. They first seek to listen, to absorb, to immerse, to traverse. The world is too large and their time on it too short to ever remain fully satisfied in their pursuit of whatever new ideas pass in front of them. I want people around me to remain curious, routinely examining the world through fresh eyes, and using their eyes to find fresh corners of the world.


Empathy

This trait is the miracle drug of humanity (and elephants, and dolphins). It is the simplest, sweetest attribute one can possess, and the most worthwhile one worth cultivating for social success. Empathy brings people closer, and makes others feel understood and less alone inside. And if there is one thing we’re all looking to become a little less of, it’s alone. When I see truly empathetic people, I see people who genuinely care, but also people who remind us that sometimes it’s okay to be still with someone else and not invade their space or encroach their boundaries. This unique ability to understand the world through others’ eyes and cut to the heart of what others are feeling and experiencing. Empathy breeds compassion, connection and love. It is an important precursor for honesty.


You may have noticed the three are closely related. This is no mere accident. In fact, when you stack humility, curiosity and empathy, you can easily see how they amplify each other.

Humility is the soul. Curiosity is the mind. Empathy is the heart.

Humility is how you value yourself. Curiosity is how you value your others. Empathy is how you value the bonds between yourself and others.

Humility is the soil of knowledge. Curiosity is the water that helps it grow. Empathy is the sunlight that shows us which way to bend.

And if you take any two without the third, you’re missing a crucial component: Humble, curious, apathetic people are slothful. Humble, disaffected, empathetic people are sensitive but not very interesting. Brash, curious, empathetic people are exhausting. But when you bring them all together, you create a benevolent triad.

These three traits are the key to becoming warm, smart and memorable. They’re irrepressible and irresistible. They’re my favorite qualities in others: the most attractive, the strongest, the most admirable. And whether I’m hiring them, dating them or learning from them, these are the qualities I look for above all others.

John Gorman, Amateur life coach & insightful writer. Read More by JOHN

Merida Capital Launches Third Fund Targeting Cannabis Space

Mitch Baruchowitz’s Merida continues to build positions in the cannabis space. The firm just launched its third fund that will look to invest $200m across the entire cannabis ecosystem. The PE firm is only two years old, but has already invested in several dozens players in the space.
Merida also announced the opening of an office in Toronto, Canada to look at deals in a country where cannabis is entirely legal.

Citrin Cooperman Annual Report on Independent Sponsors Reveals a Growing Industry Becoming Ever More Sophisticated

 

When we launched the first Citrin Cooperman Independent Sponsor Report last year, our goal was to shed a light on the largely unchartered landscape of the independent sponsor world, the “Wild West” of private equity, as one of last year’s esteemed contributors Bruce Lipian aptly described it. Last year’s Report was the first of its kind, reaching a large number of independent sponsors (245 to be exact) on a
wide variety of topics – firm evolution, deal flow, capital raising, economics and liquidity events, among others.

This year, we wanted to capitalize on the success of last year’s Report and to dig deeper. We continue to explore the themes covered last year, but we have also expanded our analysis of economic terms, in response to feedback from many of you. In a sector where one broken deal can be financially
devastating and one successful liquidity event can set you up for life, the stakes have never been higher. And so this year, based upon responses from over 200 independent sponsors, we have identified typical” terms and calculations while also finding considerable variation in economic structures. By sharing these data points, both the typical and atypical, it is our hope that independent sponsors and their capital providers will have a greater understanding as to what the market will bear.

When we started our independent sponsor survey effort last year, there was no playbook for the sector. This year, we hope to create the beginnings of one so that all independent sponsors – novice and experienced alike – may benefit from the findings shared. We are indebted to our survey respondents and our esteemed group of external contributors, both independent sponsors and capital providers, for sharing their insights with us and for making this year’s Report possible. We hope that you enjoy the Report, and we look forward to discussing our findings with you.

Sincerely,
Sylvie Gadant, Partner, Citrin Cooperman

 

THE RESEARCH

This is Citrin Cooperman’s second Independent Sponsor Report. This year’s Report incorporates results from an online survey and interviews with leading independent sponsors and capital providers. Some statistics used throughout the Report may reflect rounding.

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This year, 208 professionals in the independent sponsor space shared their views on industry outlook and operational issues such as deal flow and mechanics, capital sources, deal economics, relationships with portfolio companies and liquidity events. The survey was conducted in April and May 2018, and interviews with leading independent sponsors and capital providers were conducted in July 2018. One hundred and seventy five respondents identified themselves as independent sponsors. Like last year, the majority of these independent sponsors are at firms that have been in existence more than five
years. Most firms (60 percent) have two or three principals, and 27 percent have only one principal. The majority have one non-professional staff member. All major regions of the United States are represented by our respondent population.

Not surprisingly, many of the younger firms (80 percent of them) represented firms (80 percent of them) represented in our study (defined as those in existence less than five years) have not had a liquidity event. Among older firms (those in existence more than five years), 25 percent of them have had four or more liquidity events. Of those firms that have had liquidity events, 12 percent have returned an average realized equity multiple of greater than 5x.

The independent sponsor space has experienced a significant evolution over the past two decades. In
the early days of the model (back when independent sponsors were still known as “fundless”
sponsors), former private equity and investment banking professionals dominated the space. But now,
as our research shows, professionals from other backgrounds – company management/ operations
and consulting, among others – are seeing it as a viable career path. They, like many, are embracing
the risk inherent in the model, realizing it allows them greater control over their investments and holds
the lure of outsize returns.

“The model makes good economic sense both from a GP and LP perspective: you have the benefits of
not dealing with the dollar cost averaging of multiple investments and fund management issues
associated with committed capital,” explained David Acharya, Partner, AGI Partners LLC. “In addition, the model has strong limited partner alignment on issues such as fees, carried interest and discretion to review each investment opportunity.” Like the independent sponsor sector itself, the firms represented by our respondents have also meaningfully evolved over the years.
Once our respondents gained a track record, they found that capital flows more freely. Several
noted that they are now seen as a legitimate alternative to funded groups, whereas early on, that was not the case. Many respondents described how their network of capital sources expanded and changed over the years. For some firms, capital partners have become more institutional. Other firms partner with family offices. Repeat funding relationships have become an option, especially for those with decent track records.

Deal sourcing strategies have also changed for our respondents through the years. When many independent sponsors were just starting out, broker referrals and auctions were the dominant sources of deal flow. Once independent sponsors developed a track record with a few deals under their belt, inbounds and proprietary deal sourcing became more popular.

In addition, many of our respondents have become more selective in which deals they pursue. Some avoid auctions entirely. Others have changed their focus, for example, moving up-market to focus on control buyouts or companies with higher EBITDA. However, all independent sponsors face a uniquely tough situation – the need to balance myriad demands – sourcing, portfolio management, capital partner relationships and general operations to name a few – with limited resources. In response, many of our respondents have added personnel, both principals and junior staff, which enable them to  respond quicker to inbound opportunities, source more deals, allocate resources more efficiently and manage investments more effectively. Streamlining processes is also essential to scaling an independent sponsor firm. Recognizing this, our respondents have employed various strategies: implementing CRM systems to manage investor and contact relationships, creating investor portals, establishing protocols
for investigating deal leads, managing due diligence and streamlining portfolio management. “Replication of returns comes from replication of processes,” advised John Fruehwirth.

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THE CAPITAL PROVIDERS’ PERSPECTIVE: EVOLUTION OF THE INDEPENDENT SPONSOR SECTOR

As the independent sponsor model has grown in popularity over the past two decades, it now has more credibility and traction with capital sources. “In the 90’s, independent sponsor deals were typically referred to us,” said Evan Gallinson, Managing Director, Merit Capital. “But we soon realized we were getting good deals from this source, then called fundless sponsors, and they were adding great value
post-close.” Merit Capital launched a specific outreach effort and created its first fundless sponsor conference in 2005. “Now, we are the ones actively seeking independent sponsors and proactively trying to build relationships,” he added. “These relationships have also developed into more of a two-way street, and we sometimes are referring out deals to independent sponsors when the deal isn’t right for us.” Gretchen Perkins of Huron Capital agreed. “We are in active outreach mode to independent sponsors. We want to maintain visibility with this crowd and be there for them when they find an opportunity and need capital to complete an acquisition.” Capital sources available to independent sponsors have also expanded significantly. “Even in the past five years we have seen a radical change,” said John Fruehwirth, Managing Partner, Rotunda Capital. “Endowments, families, and institutions recognize there is good talent in the independent sponsor field, and they are trying to harness it
through one-off or repeat relationships………FULL REPORT HERE 

 

Pitch Book Named Best Research Provider

SEATTLE, March 20, 2019 /PRNewswire/ — PitchBook, the premier data provider for the private and public equity markets, announced today it has been named the Best Research Provider by Private Equity Wire, as part of its 2019 Private Equity Wire Awards. Private Equity Wire is a leading publication serving institutional investors, wealth managers, investment managers and advisers across all asset classes. The Private Equity Wire Awards are based on a ‘peer review system’ whereby Private Equity Wire’s readers elect a ‘best in class’ in a series of categories via an online survey. Categories include, best private equity managers, investors, consultants, advisers and service providers. Audiences recognized the value of the PitchBook platform to fundraise faster, build custom benchmarks, source investments targets, conduct smarter due diligence, plot exits and ultimately drive value for portfolio companies.
“At PitchBook, our mission is to deliver a better way for our clients to do their job,” said John Gabbert, CEO and founder of PitchBook. “Winning the Private Equity Wire award for Best Research Provider based on client and peer voting is a tremendous honor and validates our dedication to providing the highest quality data and unparalleled customer service.”
Since launching in 2007, PitchBook has become the go-to resource for data and research on the private financial markets, including private equity, venture capital, and mergers and acquisitions. The PitchBook Platform, mobile app, API and analyst research empowers users to make informed investment and business decisions by surfacing hard-to-find financial data on companies, investors, funds, LPs and service providers. PitchBook is one of the fastest growing financial information companies in the world, having seen a 65% increase in customer base in 2018 alone and nearly doubling global headcount since 2016. For PE firms in particular, the PitchBook Platform has informed some of the most influential deals in the space with its mission-critical intelligence and real-time private- and public-market data that allow PE firms attract and retain the best investors, identify and vet investments and generate market-beating returns.

Candidate Assessment Traps>> Killer Product or Sales Skills?

The age old question always asked when hiring a capital raiser. Is the candidate’s track record a function of deep investor relationships and their sales ability, or is it the market demand for the fund they are selling? We have studied that very question since conducting our first hedge fund search in 1990. Here, we will try to provide clarity around the best practices used in assessing fund raising talent. This is part of an ongoing series that will cover the full range of functions in the industry. Our purpose is to inform our audience about assessment methods currently employed that are the best predictors of candidate success in the investment space.
Since 1990, our firm has worked on several mandates every year to recruit a capital raising professional for one of our investment management clients. Every search is unique, each client different in culture and size. That said, when hiring a marketer, they all need an individual who has deep relationships and a proven track record of raising capital. Our firm’s task is to determine which candidate’s fund raising prowess provides our client with the best probability of securing allocations for the fund. To that end, we have used a process that employees our network of managers and allocators that we have cultivated over a period of 30 plus years, to answer that very question.
 Our assessment process begins with an overview of the funds the candidate has marketed over the course of their career. We rate the funds on a scale that measures how easy or difficult it was to raise capital for that fund at the time the candidate was marketing it. It is scored using our own quantitative and qualitative process that assigns a value to this first component of our assessment, which is to what degree did the fund effect the candidates capital raising track record.
We then move to the second component of our assessment process and map the allocator universe for the various funds the candidate has sold, and compare that universe to the number of relationships the candidate has in that universe. That provides us with the second value, which is to what degree does the candidate have relationships he/she can monetize.
Lastly we interview the candidate to determine cultural fit. We use a work history behavioral analysis that gauges how well this individual will fit in to our client’s work culture.
Over the decades this process has evolved as each engagement we take on provides us another data point to test the accuracy of our methods, and observe if our assessment model proves itself in a real world fund environment. That is, we track the performance of the people we recruit and continue to update our process on what we learn. As with any endeavor to predict human performance, it needs to be a continual agile process of improvement.