Interview with Ted Seides
Ted Seides is the founder of Capital Allocators and the host of the eponymous podcast. He is the author of three books, including most recently Private Equity Deals: Lessons in investing, dealmaking, and operations from private equity professionals.
Relationship Drip List
Contents
Max Raskin: You must have to maintain just a huge number of relationships. I imagine you have a high Dunbar number.
How do you keep track of all of your relationships? Do you take notes after conversations or make little reminders about people?
Ted Seides: I don't systematically keep track of people. I use Outlook; I don't take notes in it, but that's where I keep all contact information.
MR: Are you meticulous about keeping peoples’ contact information?
TS: I'm pretty organized generally. It's just one of my quirks. But there are ways that I try to make sure that I touch base with certain people.
MR: How do you do that?
TS: It’s a tool I learned from Randall Stutman, who runs Admired Leadership. He's one of the great leadership coaches in the business world. I use a tracking tool. I print out a list that includes everything that I want to track in life, and I review it for a few minutes three or four times a week.
MR: Can you share some of your list with me?
TS: Sure [takes out list].
I have several categories. The first is “Health,” and it literally just says: exercise, meditation, stretch.
And then I have something called “Mindful Being” and “Mindful Thoughts” which are a couple of self-reminders of things that help me.
Then I have something called a GPS. My business school roommate, Matt Spielman, is a gifted executive coach and created a “Game Plan System.” It includes four goals — both personal and professional. The GPS starts with a vision and includes goals, an endpoint, consequences, and daily actions in service of the vision and goals.
MR: Can you share what any of them are right now?
TS: The four visions on my list right now are: 1) operationalize the business, 2) unreasonable hospitality, 3) capitalize on optionality, and 4) sound, mind and body. Each is attached to a goal, a consequence, and actions. It's great.
MR: You really do this?
TS: Yeah.
TS: That's barely page one. Then I have some things for podcast guests, my writing – What Ted’s Thinking, our advisory work, my wife, my kids, family, birthdays for all the family, and something I call a relationship drip. This gets to what you asked about connecting with friends. I have a few lists of people. One are super connectors. They are a dozen friends who just know everybody, and if I need to get to someone, I have the list in one place and can remind myself who might be able to help.
MR: Can you name me one of those people?
TS: Josh Gold. Josh is someone I refer to as the mayor of Boston finance. He knows everybody in Boston and everybody loves him for all the right reasons.
MR: Other than Outlook do you have any apps you use that most people won’t know about?
TS: I use Notion a fair amount.
MR: I would think some of the people on that list would be famous finance people — are there any?
TS: They're all investment-related people — mostly CIOs and money managers. Many are famous in our niche industry but not at all known outside it.
MR: But it’s not like Warren Buffett, Stanley Druckenmiller, and Ken Griffin?
TS: No. I've spent some time with Warren, but I wouldn’t call him to ask a favor.
Dave Swensen
MR: So I know this is a complex question that depends on your goals and temperament, but gun to your head, you have to put all your money with one person: Who would it be? And I’ll limit it to someone who is no longer managing money so you don’t have to pick favorites from your guests.
TS: Dave Swensen.
MR: When you met him, how long did it take you to realize that he was someone special?
TS: It was my first job out of college. I knew he was special from day one, but I didn't really have context to realize how special he was at the time. That took longer.
MR: What do you think made him so special? I'm not talking about a smart person answer, but just on a one-to-one human level, what made him special?
TS: It was a combination of things.
Philosophically-based discipline. He had a set of beliefs about how the investing world works and had extreme discipline in being able to stick to the implementation of those beliefs, except when he didn't. The exceptions were few, intentional, and almost always right.
He also had an instinct for understanding investing, evaluating talent, and coming up with micro-theses inside his broad framework. He wrote about his high-level asset allocation and manager selection framework in his book. But within it, he would regularly — once or twice a year —come up with something that really mattered. It might be a way to tilt a portfolio or an asset class or a characteristic of a manager. And it was always innovative. He was one of those people who just oozed wisdom.
MR: What about one-on-one? Did you pick up any habits from him? Was he funny? Was he quick? Was he terse? Could he hang out?
TS: He was a real family guy. Family clearly mattered first. I was born with that too, but that was always been a deep belief I've had.
It was interesting professionally and it took me a while after I left to realize that it was okay for me to express my personality differently from his. He was always the smartest guy in the room, and he was pretty tough on his managers. He had strong opinions and wasn't afraid to let people know. His style was true to his personality, and a little bit different from mine.
MR: In what way?
TS: I'm a little softer on people. I don't mind being hard on issues, but I’m not as tough on individuals. David sometimes conflated the two. You're investing with people, and people make mistakes, so I wouldn’t say there is a right or wrong in either approach.
MR: You must just get a huge amount of people reaching out to you to pitch themselves as guests on your show. And you’re one of the gatekeepers to people with lots of money who are your listeners.
What kind of model do you have for sizing people up?
TS: I'm smiling because of a repeated conversation I have with my wife about this. I like everybody. I don't know if it's because I'm a middle child, but my natural bias is to look for good in people. The idea of sizing someone up doesn't resonate for me.
My wife is very different. She's really, really savvy. Very street smart. I would not refer to myself as street smart in that way.
That said, part of what has made the show great is my long history of relationships and experience to understand what makes for a great money manager and investor. I use those skills and lean on friends still active in the business to help determine who to have on the show.
Reading Recommendations
MR: For someone who knows nothing about investing, what would you recommend they read?
TS: I have a 14-year-old who's really interested in it, and I'm trying to figure that out. I just gave him a book called Investing by Kristen Jacks. He told me he was up half the night reading it because it was so fun.
MR: And then for someone who reads finance every day who would you say to read? Who are the journalists you can’t miss.
TS: That’s easy — Matt Levine at Bloomberg View. Anything that comes up in the corporate finance world, Matt writes brilliant, nuanced views that help make sense of what’s happening. He's remarkable.
On the journalist side, even though he says he's written the same thing in different ways for 30 years, Jason Zweig is amazing.
MR: So there’s this genre of book that people in finance read, like Thinking, Fast and Slow or The Man Who Solved the Market — do you read them or do you read like Tom Clancy and John le Carré.
TS: I read a lot of finance books, not much fiction. I'd say half or more of my reading is books written by potential podcast guests. So it's a lot of investing-related stuff. I'm endlessly fascinated by it. In the genre, the best book for everyone is Morgan Housel's, The Psychology of Money.
I don't read much fiction. There's one author, Jeffrey Archer, I started reading in sixth grade, and I've read everything he's ever written. He’s an amazing storyteller.
The Wager with Warren
MR: So you famously made a one million dollar bet with Warren Buffett about whether a group of hedge fund managers would outperform an index fund. I heard you talk about it once and you casually dropped that you called Warren. How do you call Warren Buffett?
TS: On the phone. He’s easy to reach.
The first time I was nervous. We had been corresponding in letters and I hadn't spoken to him. But I just called. He has two assistants who are very friendly. We've probably talked on the phone two dozen times, and I think only once or twice I didn't reach him when I called.
Hiding Your Money (Managers) Under the Mattress
MR: I dug up a podcast you did from a few years ago where you said you wanted to sleep more — did that work out for you?
TS: Research shows about a half dozen things help you get better sleep. I've used wearables for five years to try to nail down what works for me.
MR: What are you wearing right now for instance?
TS: I have a Whoop, and I also wear an Oura Ring when I sleep. The Oura has the best form factor and is the most accurate sleeping wearable I’ve found. We also have an Eight Sleep that has data tracking.
MR: What’s that?
TS: It's a temperature-controlled mattress. Once you gather data, you can start figuring out what works for you. For example, for me to have a good night's sleep, I need to stop eating at around eight o'clock.
MR: How did you figure that one out?
TS: My heart rate doesn't stabilize until later in the night if I eat later. If I snack right before I go to bed, it'll take much longer for the heart rate to come down.
MR: But how do you isolate the variables? How did you know it wasn't listening to Metallica that got your heart rate going?
TS: The apps help you understand the key variables that lead to high quality sleep. Things like heart rate variability, heart rate, and time in deep and REM sleep. I suppose if I listened to Metallica every night when I ate late, it might prove more difficult to identify a causal variable.
MR: Do you nap during the day?
TS: I would love to nap every day. I probably nap two or three times a week.
MR: What kind of mattress do you sleep on?
TS: I went on a mattress search during COVID. We went down to the local mattress store, and there was a mattress that almost was under a halo. And the guy there told us it was a cooling mattress they use in hospitals for burn victims. We said to ourselves, “This is it.”
So we got that mattress, slept on it for about a week or two, and my wife and I both hated it and sent it back. Ultimately, we ended up with a run-of-the-mill Sealy with a pillow top.
MR: I was going to actually ask you this question when we talk about money managers, but when you’re going to buy a mattress or a new pair of glasses or shoes, how do you make your decisions? Do you ask your smartest friend? Do you Google and read reviews? Because I think that might be an interesting parallel to how you think about choosing money managers.
TS: There's a difference between what people do professionally and how they treat things personally. Often professional money managers are not good at managing their own money outside of what they do in their fund. My consumer purchase process is some combination of Google searches and talking to friends. I don't go deep down rabbit holes to try to find the perfect anything.
MR: Do you floss?
TS: I do. My mother taught me to floss before I was a teenager and I've flossed pretty much every day since.
MR: What do you drink the most during the day?
TS: Water and Hint.
MR: What flavor of Hint?
TS: Blueberry and watermelon.
White Whales and Black Swans
MR: What does your interview prep look like?
TS: I try to do as much background research on the guests as I can – publicly available materials, private materials, listening to past interviews. Then I'll have a half hour prep call with the guest. I’ll ask them what would make it a home run for them. What are the most important messages they want to make sure comes out? Any particular stories? I then take that and create an outline of where I think the conversation could go. I cut that down and turn it into a sheet of bullet points that I bring to the interview.
MR: What would make this interview a home run for you?
TS: Mention the new book — Private Equity Deals: Lessons in investing, dealmaking, and operations from private equity professionals.
MR: What about tech? What kind of microphone do you use?
TS: When I'm home this is Shure and I’ve got it wired into a RØDECaster. I haven't changed my setup in seven years.
MR: What do you use for transcripts and editing?
TS: We use a group called The Podcast Consultant. They're awesome and we’ve worked with them for seven years. And we use Rev for the transcript.
MR: For someone who’s never listened to a single thing you've ever done and maybe doesn't know anything about finance, what is the interview that you're most proud of or most representative that you’d want to share?
TS: The one that pops up in my head is my first interview with Annie Duke about her book Thinking in Bets, because it's just so broadly applicable to decision-making.
I had Charles Duhigg on recently who just wrote Supercommunicators, which is mind-blowingly awesome. It's the meta-framework for what happens in conversations — what makes people good conversationalists and communicate well with others. It's incredible. And he's great at telling the story.
MR: Do you have a white whale that you've been trying to get as a guest?
TS: I suppose Warren, but in truth, I don’t think about the podcast that way. The most interesting white whale for me is the next CIO or manager I don’t know who gets referred to me multiple times. There are lots of incredible people in the industry who aren’t often, if ever, on the public stage. They’re more my black swans than white whales.
MR: Last question: Do you have any stock tips?
TS: No, I don't. I barely pick stocks. I invest in managers. It's what I've done my whole career.