This is my two-hundred-seventeenth weekly reflection or update.

Lately, I haven’t gotten as much from my weekly reflection posts. I’ve consistently done them, so I want to keep that muscle memory but try something different. I’m going to test moving from a reflection to an update on a personal project I’m working on.

I like the update email format because writing about what I’ve done forces me to be real about my execution, and writing about what I plan to do adds accountability and forces me to course-correct every seven days. Keeping people in the loop and letting them know how they can help are benefits too. I figured that instead of sending out an email, I could do a blog post, and it would be equally as valuable.

Current Personal Project: Reading Books About Entrepreneurs and Sharing What I Learned from Them

What I completed this week:

• Read biographies of Robert ”Bob” Johnson and Jim Simons
• Recorded 19 audio posts: 12 catch-up recordings and 1 daily recording thereafter
• Adjusted schedule to post recordings in the morning to be more consistent
• Sought feedback on recordings. Had six feedback sessions
• Meet with a potential partner who may be able to help with extracting highlights from books

What I’ll do next week (holiday week):

• Read two biographies
• Write seven blog posts and record seven audio blogs
• Adjust recording titles and descriptions
• Compile feedback from sessions and identify insights
• Make changes to audio recordings based on feedback
• Complete five feedback sessions
• Test Google NotebookLM
• Explore audio-related metrics

Asks:

• Listen to my audio recordings and provide feedback on how I can improve them. The more candid the better! Email me at: hello [at] jermainebrown.org

Closing Thoughts:

• Since this project began, I’ve published 35 recordings. I’ve heard that most people never get past 20 recordings, so that’s encouraging.  
• My objective with this project is to share with entrepreneurs the wisdom I gain from the biographies I’m reading. The recording that was mentioned most in my feedback sessions was about my failure to establish my recording habit (listen here or read about it here). I wasn’t expecting this. It reminded me that talking about struggle and how people overcome it brings value to entrepreneurs. That was good to hear. I’ll try to do more posts sharing the ups and downs of this project’s journey.
• Finding content–market fit will be a journey. I’m thinking about what recording frequency and duration are best, crystallizing the target listener I want to offer value to (I’ll probably need to start with a niche), and finding the right balance of information, insights, etc. when recording.

Week two hundred seventeen was another week of learning. Looking forward to next week!

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

Now that I’ve read Gregory Zuckerman’s The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution, it’s clear to me that people were Jim Simons’s greatest asset.

Massive losses from investments based on Simons’s judgment were crushing in Renaissance Technologies’ first year or two. Simons was forced to clarify his mission. “I don’t want to have to worry about the market every minute. I want models that will make money while I sleep,” Simons said. “A pure system without humans interfering.”

Simons was brilliant but couldn’t build this system himself; he didn’t have the skills to build the models that would power it. He needed to recruit people who could. So, how did he find the right people for this seemingly impossible mission?

Spotting

When Simons was working at the Institute for Defense Analyses (IDA), peers noticed that he had a gift: “His ability to identify the most promising ideas of his colleagues was especially distinctive.”

“He was a terrific listener,” one person said. “It’s one thing to have good ideas; it’s another to recognize when others do . . . . If there was a pony in your pile of horse manure, he would find it.”

In short, Simons had an eye for great ideas. He recognized them even before the person with the idea realized what they had. Simons would leverage this strength in recruiting his team.

Talent Pools

After working at IDA and Stony Brook University, Simons maintained relationships with these organizations—shrewdly, given the exceptional mathematical abilities of their people. He kept his contacts up to date with what he was working on at RenTech and how things were going. He inquired about what others were working on and who seemed promising. He also acted as a conduit, connecting people who could help each other. He stayed top of mind at IDA and Stony Brook and kept a finger on the pulse of these organizations.  

Simons strategically assembled a team that could build the “pure system” he envisioned. He leveraged his natural strength in spotting great ideas and his relationships with organizations with talented mathematicians.

“He told one Stony Brook professor, Hershel Farkas, that he valued ‘killers,’ those with a single-minded focus who wouldn’t quit on a math problem until arriving at a solution.”

When Simons found someone with the rare combination of killer persistence, great ideas, and original thinking, he aggressively recruited them to RenTech.

It was a slow and winding journey, but it eventually paid off. Simons assembled a team that slowly created the model that would power a highly profitable trading system that didn’t require human intervention. RenTech’s outsize and consistent investment returns enabled Simons to build a personal fortune exceeding $30 billion. And he had control of his life and a company where he felt at home and could be himself.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

I’m finishing up reading The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution by Gregory Zuckerman. The book gives readers insights into Jim Simons’s life and how he built Renaissance Technologies into a $130 billion investment firm.

As I shared yesterday, Simons racked up accomplishments early in his career. He was an Ivy League professor and started a manufacturing company in Colombia, among other things. When he started RenTech in 1978, Simons was forty. His success at RenTech was anything but up and to the right.

Simons knew that to succeed, he had to build an environment of original thinking and exploration and also one of collaboration and great ideas that could serve as a foundation for other people’s future ideas.

To do this, he recruited mathematicians, let them develop mathematical models, and gave them capital to trade using their models. Some worked for RenTech, and others Simons seeded as independent firms. He encouraged everyone associated with RenTech to collaborate and share learnings.

Simons closely monitored the models’ progress and returns. Some took several years to reach production and longer to become profitable. Simons merged the most promising models into a single model at his flagship Medallion fund. And once a model was incorporated into the fund’s model, it was part of RenTech’s core investment approach and something others could continually improve upon.

Navigating this journey was far from easy for Simons. He went through a divorce, two of his sons died in separate freak accidents, and he struggled with self-doubt. Professionally, he endured crushing losses at times. Some key employees and fund managers whom he’d seeded jumped ship. Simons pushed through.

In 1990, twelve years after launching, RenTech was finally on solid footing. A reliable statistical model that could generate above-average returns was in place. RenTech had only $30 million in assets but generated a pre-fee profit of $23 million that year (the year before, it was $0). Three years later, the firm had $122 million in assets and generated $66 million in pre-fee profits. By 1998, the firm had $1.1 billion in assets and generated $628 million in pre-fee profits.

Simons’s early career was characterized by rapid success and many accolades. Then he became a founder. Twelve years of pain followed before he saw consistent and accelerating results. Every founder’s journey is different, but Simons’s reminds us that sometimes things take longer than we planned: persistence is key. You have to stay in the game long enough to win!

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

Jim Simons was the founder of Renaissance Technologies, a $130 billion hedge fund. It’s a private partnership that usually invests in public markets. When I read an article about Simons passing earlier this month, I decided to read the biography I’d purchased months ago.

The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution by Gregory Zuckerman details Simons’s life and journey to build RenTech. Simons generated incredible returns for his investors and created a personal fortune worth over $30 billion.

Simons was a gifted mathematician. He taught at MIT and Harvard, worked at the Institute for Defense Analyses (IDA), and cracked coded Soviet Union messages. He chaired and built the math department at Stony Brook University from scratch. He received the American Mathematical Society’s Oswald Veblen Prize in Geometry. By age 40, he was accomplished by any standards.

What motivated him to become a founder? Why did he build a hugely successful investing firm from nothing? I learned that his motivations were like those of many founders.

Outsider

In an interview for the book, Simons shared, “I’ve always felt like something of an outsider, no matter what I was doing.” “I was immersed in the mathematics,” he said, “but I never felt quite like a member of the mathematics community. I always had a foot [outside that world].”

Simons didn’t enjoy the community at Harvard. He had interests that other academics didn’t have. He’d traded soybean futures and loved the thrill of being in the markets. After teaching at MIT, he started a company in Colombia with a college buddy manufacturing vinyl flooring and PVC piping.

Simons needed a place that embraced everything he enjoyed: entrepreneurship, markets, and math. He didn’t feel comfortable in a standard box.

Control

As an academic, Jim didn’t have much money. He borrowed to invest in the Colombian manufacturing company. To pay his debts, he secretly moonlighted, teaching classes at Cambridge Junior College.

He took the job at IDA partly because it doubled his salary. Even at IDA, Simons searched for ways to make more money to pay debts. A failing attempt to launch iStar, an electronic stock trading and research firm, was one effort.

Jim realized he wasn’t in control of his destiny when IDA fired him for opposing the Vietnam War in a Newsweek article. With three children, he was rocked by the abrupt firing. He uprooted his family to Long Island, New York, and took a job at Stony Brook University.

These and other experiences reinforced his need to control his destiny. He realized that money equated to control and power. “He didn’t want people to have power over him.”

Founders are a different species. They don’t fit in standard societal boxes. To be the best version of themselves, they need environments where they feel in control. These worlds don’t exist, so they need to create them. Founders are world builders. So, in 1978, Simons created his own world, RenTech.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

Brett Pulley’s The Billion Dollar BET: Robert Johnson and the Inside Story of Black Entertainment Television chronicles Robert “Bob” Johnson’s journey, his highs, and his lows.

Bob wasn’t a well-rounded founder and didn’t have a well-rounded founding team. Bob had deficits, but he shrewdly got around them to navigate unfamiliar waters. Some people work on their weaknesses. Bob took a different approach: he leaned on his strength, relationships (he was a lobbyist). Here are a few examples:

Satellite

After launching, Bob wanted BET’s programming to expand from six hours a week to 24/7. Through his cable relationships, he learned that HBO had unused satellite capacity. It was worth $2–$3 million a year, money Bob didn’t have. Bob negotiated a deal with HBO: it took a 15% stake in BET in exchange for the satellite time. HBO was owned by Time Inc., a major cable system, so Bob was now partnering with two large cable systems, Time Inc. and TCI (i.e., John Malone). And BET was a 24/7 network.

Sales & Marketing

Bob had no sales or marketing staff, so he struggled to sell advertising or convince cable operators to carry BET. His relationship with Time Inc. solved this problem. For $450,000 a year, Time agreed to manage BET’s marketing and affiliate sales using experienced HBO employees. This deal jump-started BET’s charging per-subscriber fees to cable systems, a new revenue stream. BET also leveraged Time Inc.’s lawyers for negotiations and its engineers for developing BET’s technical skills. After several years, BET gained expertise in these areas. The partnership ended in 1988. Bob hired a sales leader and built a sales team. By 1991, BET reached 53% of US homes wired for cable and reported $50 million in annual revenue and $9.3 million in annual profit.

Finance & Capital Markets

Bob knew nothing about raising money or about capital markets, which put him at a resource disadvantage. Luckily, his first investor, John Malone, was a financial engineer and master capital allocator who sold TCI to AT&T for $48 billion. Bob sought his counsel on capital-related issues. Malone was instrumental in Bob using savvy tactics in the early years, such as paying interest on $8 million of debt by issuing additional BET shares while not diluting Bob’s or Malone’s stakes. Malone planted the idea of BET capitalizing on a booming stock market by going public. He coached Bob through the IPO process, and the company’s stock began trading on NYSE in 1991. He helped Bob navigate BET buying Time Warner’s equity for a discounted $58 million (it was worth $191 million two years later). And he advised Bob to take the company private again, which he did in 1998 at a $1 billion valuation. Malone was at Bob’s side for the pinnacle of his career: negotiating and selling BET for $2.3 billion in stock to Sumner Redstone and Viacom.

Bob’s tactic of leaning in to his natural strength—relationships—was masterful. Using the expertise and assets of his partners kept him from wasting time and making mistakes while simultaneously lessening his weaknesses.

You can listen to audio versions of my blog posts on Apple here and Spotify here.

This weekend I read Brett Pulley’s The Billion Dollar BET: Robert Johnson and the Inside Story of Black Entertainment Television. Pulley details Robert “Bob” Johnson’s path from poor kid from Mississippi to cofounder of BET and billionaire.

When Bob landed John Malone’s investment in BET, he’d never run a business. He asked Malone for advice (after getting the investment check). Malone was direct: “Get your revenue up and keep your costs down.”  Bob took that advice to heart and combined it with a mercenary founder mentality to find a profitable content strategy.

Bob couldn’t afford to produce content on par with broadcast networks like NBC and CBS. He needed something else. Music videos were the new craze, but Black artists weren’t being played on MTV. BET got promotional videos from record labels free of charge and aired them. Viewers loved them, and artists loved getting national exposure.

Bob had hit on a winning strategy: Find a form of entertainment with high Black demand not being satisfied by other networks and a large supply of Black talent. By connecting supply to demand, he added value to both sides. Also important was that the talent valued the national exposure it couldn’t get anywhere else and didn’t expect much, if any, compensation. Bob had found a highly profitable content strategy.

ESPN launched and was a success. Bob noticed that ESPN didn’t broadcast games played by Black colleges. BET began broadcasting football and basketball games from well-known Black colleges such as Grambling and Jackson State. He made sure to broadcast the half-time performances of school marching bands and dance teams, something Black communities enjoy to this day. BET could broadcast games for less than $15,000 per game, while networks like ABC paid up to $50,000 per game. Black colleges enjoyed the national exposure, viewers enjoyed watching games they couldn’t watch anywhere else, and BET got exclusive low-cost programming.

Bob also noticed there were many talented but undiscovered comedians. BET launched ComicView, and the show became one of its most successful shows ever. The show propelled the careers of now-famous comedians such as D.L Hughley, Cedric the Entertainer, and Kevin Hart. Keeping costs down was taken too far, though. The result was a mini public relations crisis. BET learned from this and modestly increased pay to comedians and moved production from Los Angeles to Atlanta, whose comedians were plentiful and non-union. A one-hour episode of ComicView cost $18,500 to produce—while “inexpensive” half-hour sitcoms cost big networks $500,000 an episode and hits like Friends cost over $6 million an episode.

Bob’s focus on entertainment content gained him critics in the Black community. But his goal was clear: generate profits and become wealthy. He aligned his content strategy with that goal. Advertisers were paying BET rates that were less than half of those they paid MTV and other networks, yet when Viacom acquired BET for $2.3 billion in 2000, BET’s profit margins were the highest in the industry and strongly influenced Sumner Redstone’s decision.

You can listen to audio versions of my blog posts on Apple here and Spotify here.

Reading about John Malone and TCI’s early BET investment led me to Sheila Johnson and Robert “Bob” Johnson, BET’s founders. I read Sheila’s autobiography and just finished reading The Billion Dollar BET: Robert Johnson and the Inside Story of Black Entertainment Television by Brett Pulley. The book details Bob’s journey before, during, and after BET.

Bob Johnson grew up a poor kid from Mississippi and was the first person in his family to attend college. But Johnson didn’t let his starting position define him. He found creative ways to overcome obstacles. How he launched BET is a great example.  

Johnson was a cable association lobbyist. He knew Malone needed low-cost programming that appealed to the large Black audience covered by a cable system Malone acquired in Memphis, Tennessee. Johnson saw an opportunity to create a nationwide Black cable network. Johnson understood the cable industry at a high level—but not how to start a cable network. He needed a plan.

Ken Silverman was launching a network for viewers age 50 and older and asked Johnson to lobby for him. Johnson realized that Silverman’s plan was a blueprint that could be applied to the network he envisioned. He got Silverman’s permission to modify and use the plan. Johnson changed “elderly” to “Black” and had a plan demonstrating that his idea made business sense.

Johnson still needed capital. He needed time on a satellite to transmit his channel to various cable systems, which was a major expense. He budgeted $10 million for leasing a satellite and other start-up expenses. An investor was interested in his idea, but $10 million was too much—more than the investor’s entire fund. Raising $10 million wasn’t an option.

Bob Rosencrans had just started what would become USA Networks. Rosencrans was leasing a satellite but had two problems: He didn’t have enough programming to fill time slots 24/7, and he needed to increase subscriber revenue (so he needed more subscribers). Johnson saw an opportunity. He asked Rosencrans to give him two hours on Friday nights free of charge for Black programming. That would help Rosencrans, so he agreed.

Johnson's original plan required a satellite lease and a studio to transmit to the satellite. His agreement with Rosencrans eliminated those costs, so he needed only a fraction of the $10 million he originally sought.

With a business plan in hand, distribution in place, and a lean $500,000 start-up budget, Johnson pitched Malone. Malone was impressed. He invested $180,000 for 20% ownership in BET and provided a $320,000 loan.

Johnson had zero entrepreneurial experience, but nevertheless he managed to reduce the amount of investor capital he needed to raise by 95% and turned his idea into reality by leveraging partnerships. If Johnson couldn’t overcome a hurdle or didn’t understand something, that didn’t stop him—he found someone who could help him and creatively partnered with them. His use of partnerships has been a key strategy throughout his career.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

I was disappointed in myself for not consistently recording audio versions of my blog. Yesterday I figured out what was tripping me up and what changes were needed. Today I implemented those changes and recorded twelve audio posts. I’m happy to report that I’m all caught up!

Now, I’m focused on staying current and getting reps daily to improve the quality of the recordings and, eventually, my storytelling skills.

A few takeaways from today’s recording session:

• Mindset matters – Shifting my mindset to getting practice reps helped. I felt more relaxed, and the words flowed more smoothly.
• Mistakes – I didn’t sweat the small errors. I rerecorded when I made big mistakes (like coughing loudly mid-sentence). After listening to the small errors during playback, I decided they make the recordings more authentic. I’m not the only person who stumbles over words occasionally, so why take that out? We’ll see if my thinking evolves on this, but right now, I like the idea of being human (flaws and all) in these recordings and not a perfect robot.
• What I like – I now think about recording what I want to hear, not what I think other people want to hear. If I like the recordings, then others will like them too. If I don’t like them, then no one will.
• Talking to yourself – Talking to yourself is harder than I imagined, and listening to yourself talking to yourself is even harder. I have more respect for people who do this regularly at a high level. It’s simple but far from easy.
• Books – I’ve been reading at an accelerated clip lately. The posts sharing takeaways from books are my favorites. Reading and writing about what I learned from my reading is a powerful combination. I knew this already, but hearing these recordings reinforced it and motivated me to do more of this kind of post.

I’m energized about getting this habit formed. I think good things will come from it. I don’t know of anyone who blogs and records their blogs every day. I’m excited to see if I can accomplish something hard that others can’t or won’t do.

You can listen to audio versions of my blog posts on Apple here and Spotify here.

I didn’t record or publish a single audio version of my blog this week. The reasons don’t matter. I failed to do something I committed to doing, and it’s been nagging at me for two days. I expected the audio launch to be like the blog launch on March 9, 2020. I started writing daily and haven’t stopped since.

Today I reflected on what I need to change:

• Accountability – I launched the written blog as part of a 60-day challenge with my friend. The challenge was an accountability tactic and helped me form my writing habit. I need to add more accountability to this audio project. I’m going to tell more family and friends about it. I’ll ask those interested in following to consider subscribing via a podcasting app. I’ll also give those interested permission to ask me how it’s going.
• Rhythm – I’ve been trying to do two audio recordings every other day. That didn’t work because I never formed the habit. The gap between recording days hurt me. My personality is best suited to zero days off until the habit is formed. I wrote for 60 days to form that habit. Now I need to record for 30–60 days straight to form the audio habit.
• Format – I tested reading my blog posts verbatim and summarizing them in a more conversational format. The conversational format sounded better, and I tried to do more of that. It was a mistake. I’m new to recording, so I ended up doing multiple takes for a single post, which was frustrating and time-consuming. I need to start simple and read the posts verbatim. Slowly I can make each daily post a little better than the day before until it’s more conversational—or whatever format I settle on. I need to focus on getting the most recording reps possible, not making each recording perfect. If I do this, over time, the quality will improve. It will be painful to listen to all my mistakes every day in the meantime.
• Editing – After a few recordings, I edited them to make them sound better. That was another mistake. It wasn’t a good use of my energy and time because it didn’t align with my goal. My goal is reps and continual progression. I’m not going to edit a recording until this habit is fully formed. I’ll publish each post as is or rerecord the whole thing if I don’t like it.

It's important to me to form a daily audio blog habit. It’s a stepping-stone to a bigger audio project I want to do. I know what I need to change going forward to increase my chances of getting this habit entrenched and making the bigger audio project a reality. Wish me luck!

You can listen to audio versions of my blog posts on Apple here and Spotify here.

This is my two-hundred-sixteenth weekly reflection. Here are my takeaways from this week:

• Routine – This week, I was forced to change my morning routine. I thought the change served me well. But today, I reflected on my week and realized that it felt good because it was different. However, it played a significant role in my output decreasing. Next week, I’m going back to my normal morning routine. This week was a reminder to think hard before changing a routine that’s working well.
• Audio blog – I made no recordings this week. I’m disappointed in myself for letting this slip so much. I can’t let it happen going forward. I’ll work on catching up and making this a daily habit.
• Gaps – I had the chance to be part of a fireside chat. The audience was small business owners. These entrepreneurs are smart and work hard. The experience was a reminder that early-stage entrepreneurs in traditional businesses have large gaps around strategies for obtaining growth capital, as well as other areas.

Week two hundred sixteen was another week of learning. Looking forward to next week!

You can listen to audio versions of my blog posts on Apple here and Spotify here.