By: Mark Marxer
Not long ago, I was driving down a stretch of highway that always reminds me of an event that changed my perspective on life, people, and situations, and a lesson I would come to realize years later: what it means to understand people and manage risk.
Over two decades ago, after graduating from college and moving from the West Coast to the Midwest, I was a young professional in an investment training program that allowed me the privilege to work in all of the different facets of the investment business over a three year period. The purpose of the program was to give me exposure to all of the various pieces of the investment business before I chose my focus. This included everything from trading, research, and portfolio management to operations and marketing.
While the experience itself was amazing, one of the most important things I needed to learn was not a specific focus of this professional training.
During that same time period, I was out for an evening in downtown Minneapolis with a group of friends, enjoying a night of music at one of the biggest events of the summer. As the evening developed, it was determined we would head back to a friend’s place and crash there to save money in cab fare. In the morning, I was abruptly awakened by my friend who lived at this apartment. He seemed a bit uptight as he explained to us for the first time that he needed to leave immediately if he was going to take us home as originally planned; he had an early tee time on the books at a local golf course. We scrambled off the couches, got in the car, and dropped off one friend who lived on the way. As we continued on, he looked stressed out that he might be late, so I offered to let him drop me off at a convenient place where I could have my roommate pick me up. He looked over at me and said,
“Look, I don’t have time for this. I need you to get out now.”
At first I thought he was joking; we were in the middle of a major Minneapolis highway at 730 am on a Saturday. Get out now? Here? Really? He didn’t even look at me when he said it. I first laughed, then realized he wasn’t kidding. Finally, I started to protest as he pulled over on the shoulder of the highway and said, “You’re just going to have to get out right here, I don’t want to be late for this tee time.” As the car stopped, I think I was in shock as I reached for the door handle and stepped out of the car while he mumbled something blaming this oddly important tee time. I stood there for some time, wondering if this was all a big joke and if he would show up after I walked to the next exit.
Did someone put him up to this? How was this even possible? How many times have you seen someone just wandering down the interstate? It was a brutal feeling, standing there trying to get my head around all of this while sporting the previous night’s “going out” ensemble of loafers, parachute pants that made me look a MC Hammer wannabe, and what I think could have been a throwback shirt from Saturday Night Fever. First, I reached down and checked my wallet, and unfortunately the prior night’s festivities had totally wiped out my cash. Even worse, I realized I had quite the hike before I’d reach the next overpass and it was starting to get hot. And of course, I was getting a few honks as well. I will never forget what went through my mind on that walk and how that day helped to shape how I would eventually approach and manage situations in life and in business. The whole debacle was an eye opener regarding people, tendencies, motivations, and managing risk.
After I finally reached the nearest exit ramp in my spiffy outfit, I walked what was seemed like ten miles (and was probably only one) until I headed across four lanes of traffic and over a fence to get to a Burger King. I only had my ID in my wallet (I had spent all my cash the evening before) and this was before credit cards and cell phones were standard issue. And cash cards? What were those!? I called my roommate collect from a pay phone multiple times, but got no answer. At this point, I was still pretty new to the Twin Cities and didn’t have a huge list of friends I felt comfortable “collect calling” to pick me up at Burger King at 8 o’clock in the morning. I went through what I thought were all my options, and then started calling cab companies to ask if they would be willing to pick me up, take me to my place so I could get cash, and then get paid on the back end. Three cab companies and a few odd looks from the breakfast crowd at BK later, I was able to convince one to come pick me up, agreeing to pay 2x the normal fare given I had no other options.
This may not seem like a big deal, and it may sound like just another funny life story that we have all had; however, I have always believed that if you are really paying attention and reflecting there’s something to be earned and learned from every situation.
This wasn’t a walk of shame in the traditional sense, however a similar lesson would apply. In this situation, the first lesson I learned was to always evaluate who I’m friends/partnered with in both life and business. How well do I really know them? Do I understand their motivation or what drives them? Do I have a similar value system? How do they act under pressure if things don’t go their way? Or, to throw in an old cliché, would I want them in a fox hole with me? Business is all about people, and through experiences like this I have learned how to read and understand people and manage risk. To be clear, I have learned more from my failures in this department than my successes, and I have plenty of scars, bumps, and bruises on my body to prove it. The important part is being able to apply the knowledge gained from these experiences to ensure a higher probability of success in everything you do.
How in the world does being left on the side of the highway transfer to business? Upon reflection, I didn’t manage the risk as well as I should have. I didn’t know my “friend” well enough, and didn’t read his tendencies or understand what motivated him. I wasn’t prepared for what might happen (no backup plan, no cash in my wallet, no plans around alternative paths). I was too shocked and overwhelmed when something I didn’t expect happened, i.e. too shell shocked to slow it down, ask questions, find another solution, or even ask for money for a pay phone before he sped away. Should I have seen this coming? What could I have done to avoid this? All of us find ourselves in situations we wish we weren’t in, most of which (if we are being honest) we put ourselves in. Some things are obviously out of our control, but most of the time we should be able to look ahead, consider different paths, foresee problems and different outcomes/solutions, create opportunities for success, and avoid situations that could put us in compromising or uncomfortable positions.
In business we need to thin slice and read each situation before it occurs, and we need to understand all the variables while projecting the potential outcomes, successes and risks. In our case, we need to put our managers/partners/clients in the best possible position to succeed, helping them by using our experience to read each situation so they don’t find themselves stranded on the highway.
Understanding your partners is critical. How well do you actually know the firms and, more importantly, the people you partner with in business? We need to know our partners exceptionally well, and we spend a lot of time up front listening to and understanding everything we can about each prospective partner we encounter. We assess everything – where they are from, what their value system looks like, what culture means to them, what motivates and drives them, and how they have reacted when they’ve been stranded on the side of the highway by themselves. We live in an intense world, and it’s extremely important to understand how potential partners handle stress in difficult situations. We always ask ourselves if we can achieve mutual success and maintain a strict alignment of interests while under pressure. Most importantly, we make sure we know what will happen when one of us is late for that tee time. We always are striving to maximize our years of experience collectively to prepare ourselves and our partners for both the expected and unexpected. In business and in life, will you experience the walk of shame or will you be prepared to elevate your game…