About Gordo Byrn

I write for my kids

Parenting 2019

2019-03-15 08.09.40Ten years in, fatherhood still feels new to me.

At my current rate, I am going to settle into my role by the time they start to leave!

Recently, I took advice from a father, that’s been at it for close to twenty years.

On the subject of family governance, he is the most believable person I know. So, I was listening carefully when he shared ideas about what he wished he knew.

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No judged sports

No phones, alone, in the bedroom

Read: iGen by Twenge and Coddling of the American Mind

Optimize your family’s life for the family, do not create a series of “micro lives” for the individuals => schools, activities, geography, holiday time => make it work together.

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I know a lot of readers have kids even younger than mine (6, 7 and 10).

Somewhere between six and twelve, your family rules are going to get set — one way or another.

There’s a lot of pain involved (for everyone) if you wait until high school to change direction.

Choose wisely and be the brand.

Managing Towards 1,000-Day Outcomes

2019-02-23 09.55.59I can get a lot done, while achieving nothing meaningful, by solving problems all day.

Am I managing towards desired outcomes, or focusing on my problems?

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My favorite thing is doing stuff in nature and I want to have a successful marriage.

So, I try to be open to the experience of sharing things in nature, with my wife.

One catch…

  • 1,000 days ago, my wife couldn’t ski
  • 500 days ago, she was better but we were not sharing the vibe (more like enduring it)
  • So, we both did what it takes so that we could share skiing together, and enjoy it

1,000 days of focus was enough for the two of us to capture the bulk of the benefit (but it did take 1,000 days!).

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The big picture points:

#1 – We managed to strengthen our marriage by doing something neither of us was good at three years ago.

#2 – If your younger self was achievement-oriented then working towards mastery in middle age is extremely satisfying.

This is a game we can play, together, for the rest of our lives.

2019-02-24 09.18.11

1,000 days ago, this guy was Level Zero at the ski school. We kept signing him up for lessons and he didn’t get one tick on his skill list!

He showed NO signs of aptitude, for a year, but he enjoyed the process.

Now he’s skiing the entire mountain and loving it. His price was a whole lot less than mine. It took him ~100 days on snow and a million vertical feet.

If you don’t the work then you’ll never know if you could have achieved the result.

Be wary of letting “problems” get in the way of gradually moving towards desired outcomes.

40s Post Mortem

2019-02-05 07.30.58There were a lot of good habits in my first firm. One was holding a meeting to review all our dud deals. We tried to get value from our mistakes. Often, it would take many, many repetitions of the same mistake for the lesson to sink in.

So, if I could give you one thing to achieve by the time you are 50… it would be to write down how you get in your own way.

  1. a willingness to rely on competence, rather than kindness
  2. an enjoyment of getting too tired to care
  3. a tendency to not react, or completely over react

Do you know your list?

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Invert your errors and consider… what makes your life better?

  1. Get up really, really early
  2. Daily Exercise – low standard deviation, no zeros, frequency not load
  3. Roll a simple, visible, written schedule

Better, not easy!

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The best decision I made in the last ten years was to stop competing when my oldest turned two.

Take (some of) the energy you spend on competing and focus on being a better person at home.

Why only some?

  1. Because physical energy declines over time
  2. Because older, under-scheduled people think better
  3. Because being “busy” is a trigger for ALL the ways I get in my own way!

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Also because I recommend you don’t give too much to your baby.

I have a hunch that many of the downstream issues in families start with a young parent not defining personal boundaries and getting completely tapped out.

=> infidelity, addiction, anger, abandonment… all forms of release

The best thing you can do for your entire family system is set clear boundaries and remember that it is OK to say no.

Childcare benefits the marriage.

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Before I had real babies in my house, my “baby” was school, work or athletics.

Giving one’s self completely is a great way to live when you are young and single. Once you’re married with kids, there are a lot of unintended consequences of being single-minded.

Leaders keep their houses in order.

What I Learned This Year

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You’re probably going to feel different about that later.

I say that to myself, a lot.

And I never regret following what flows from it.

Namely…

  • Not acting on anger.
  • Resisting the urge to “say what I really think”

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2018-11-19 16.44.04I recharge in solitude, ideally in nature.

I seek to fool myself that the solution (to everything!) lies in withdrawing from society.

I counter this faulty thinking by saying to myself… “I know you feel that way right now but you’re likely to need help, at some point, over the next 20 years.”

If you’ve ever been in a bad relationship then you might have a similar thought pattern…

…thinking that the problem lies in all relationships, not simply the bad ones.

I don’t have a mantra to help you get past your pain but I can say that my marriage is a great source of strength, stability and happiness for me.

“Better” is out there and it’s worth looking around.

Put yourself in a position to meet someone who shares your values.

Try to make yourself into the person you want to meet.

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2018-10-31 08.09.49My BIG change for 2018 was waking up earlier, way earlier.

I’m up two hours before the rest of my household.

At first I used the time to surf instagram and drink coffee on the couch.

Eventually, I started going to the gym.

“Gym Days” are better.

Not easy.

Better.

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Life is better when I’m stronger,

Even at 49.9 years old, I’m able to be stronger than just about all my peers.

Being stronger is available to you.

Four days per week, 30 minutes per day.

Results in… better!

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Get up early, lift weights, be pleasant to those around you and when you are thinking otherwise remember…

…you’re probably going to feel different about that later.

A Little Economic History

2018-10-31 07.52.14It is much easier to position your life before, rather than during, an economic crisis.

It’s also truly amazing how fast a credit crunch can sweep across markets.

This month, a decade ago, was the mid-point for the toughest 90-day stretch of my financial life. Taking it back to October to December 2008…

  • My prospective earned income went to zero at a time when…
  • My Business/Personal cash burn rate was $10,000 a week. Simultaneously…
  • My net worth dropped by 67% and…
  • I was facing a potential claim 20x in excess of what remained. The one bright spot was my family life…
  • Our first child was born and we were very happy within our marriage.

The only reason I didn’t follow a friend into bankruptcy was a pre-crash restructuring. I had been scared by four events :

  1. The US was offering loans without income verification.
  2. The UK was offering loans without bank covenants.
  3. Down in New Zealand, I used both of the above and borrowed to pay my living expenses at a time when…
  4. I had a personal guarantee outstanding that covered most my assets, and all my net worth.

There is a line in Fooled By Randomness about Russian Roulette. It goes something like…

Even if the gun has a million chambers, there are some games you don’t want to play.

I was enjoying my life and didn’t want external circumstances to force a financial reboot at 40-years old. So… 2005-2007 was a time of significant change.

The restructuring took three years (2005-2007). It prevented ruin, but still resulted in a lot of pain when credit markets slammed shut in 2008.

At the time I was working in the UK. The entire chain of my business life went from Great-to-Insolvent in 180-days (bank, joint venture partner, developer, general contractor, sub-contractors, employer, CEO).

Just like that.

Gone.

2009-2012 were spent clawing back.

Key steps:

  • Downsized family home, spending and aspirations. Embrace Your Hubris!
  • Invested the downsized capital into a Downtown Boulder rental property. Two units, where the little unit’s rental income would enable us to live for “free” in the larger unit.
  • Invested our remaining funds in a redevelopment opportunity that I could hold FOREVER, because it was debt-free and cash flow positive.
  • Turned a loss making triathlon hobby (draining $75k annually) into a cash generating consulting business ($4,000 per month).

By 2013, we achieved cash flow break even. We were so blasted from our young family (up to three kids) that I don’t remember appreciating the significance of what we achieved.

Within my financial peer group, our story is not unique. Lots of people had a similar ride. However, they don’t necessarily blog about it.

Financial memories are short.

Remember.

You don’t get killed by prices falling — price volatility is emotionally painful but not financially fatal.

Companies, Your Personal Ethics, Friends and Families… All can get crushed by running out of cash in a banking crisis.

Where’s your cash flow statement?

Being Wrong

IMG_4015Some of what I know to be true is false.

Being (somewhat) wrong is a natural state of being.

It rarely harms me.

But when it does…

Boom!

What to do?

Pay careful attention where error has the greatest impact on my life.

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Blindspots – what are the areas where I am unlikely to be right?

In a marriage, a business partnership, an investment, a sport… the greater our personal, emotional investment… the bigger the fall when a new reality slams against our old beliefs.

Often a feeling of righteous anger comes forth, and along with it, a desire to lash out.

When these feelings arise I remember:

  1. I fooled myself. Make a note! It is going to happen again!
  2. Acknowledge, we all want to be fooled. I am not alone, nor am I the first to experience this situation. Nothing personal, bro.
  3. Further energy invested into a (clearly) losing situation is better spent creating the life I want, within my new reality.

It is easy to get hooked into a cycle of mutual retribution – it might even feel good, for a while…

…but you might not be aware of the harm you are creating.

Sleep, skin, hair, mood swings, cravings… all useful signals when we are off-the-path.

Tough to point this out directly to someone! The people who have been effective with me have said something along the lines of…

“I wonder if there might be a better way to handle this…”

“You’re right, of course, but you might feel different later…”

Attention

What’s the penalty for being wrong?

  • Marriage partner
  • My last haircut
  • Sports with a high degree of concussion risk
  • Sunscreen
  • Business partnership
  • The shirt I wear
  • Personal guaranties
  • The color of my socks
  • Borrowing money
  • What I am having for dinner
  • The ability of my children to teach themselves
  • My choice of car
  • My temper

Be willing to talk about what matters, with the people who matter to you.

Real Estate Review 2018

Screenshot 2018-10-19 10.14.26

A starter home in Boulder is about $1 million => if you can find one.

How do I look at rent vs buy?

Because it is so expensive to sell real estate, I consider a minimum five-year block. I ignore inflation and future predictions.

For our starter home, I assume that five-year rent is $180,000

My alternative uses of the funds, with five-year income shown:

  • Five-year treasury bond $150,000
  • Yield on Investment Real Estate $100,000
  • Yield on Vanguard Portfolio (using my 40/20/40 mix) $100,000

If I buy then I don’t get the income (from the alternatives) and my cost of ownership is $75,000 across the period (maintenance, taxes, insurance).

To keep things simple, I haven’t assumed a mortgage. I didn’t buy my first house until I could pay cash. I earned a premium on my career by being able to easily change cities.

What does the above say to you?

Here’s what it says to me… if you think there is a good chance you will be able to buy during a market decline then rent.

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The last time I bought a house (winter 2012/2013), the rental map was bare. Here it is this week…

Screenshot 2018-10-21 09.09.55

Real estate and equity investments have the potential for capital appreciation/depreciation. Real-economic growth drives long-term asset values. I’m bullish for Boulder, Boulder County, Colorado and the US.

With real estate, my capital is locked in and it will cost me ~$55,000 to get out (exit costs are about 5.5% of sales price).

With real estate, you can get priced-out of a market. Relative to what I can afford in Boulder, I am priced out of London, Hong Kong and San Francisco (three cities where my skills are highly marketable). This “pricing out” happened within a five-year window.

Beware of FOMO (fear of missing out), after three years of rapidly rising prices, our minds will extrapolate never-ending appreciation into the future. It won’t happen. Your goal should be financial independence, not real estate ownership.

Inflation, future asset prices, vacancy risk, insurance hazards… can’t be known. Sometimes they can be hedged, insured or mitigated.

I don’t seek to predict an unknowable future. I ask myself, “Is this a good price, today?”

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I have a few friends that sell real estate. I watch their their high-end sales to understand the mood of the market.

Nobody needs a 5, 10 or 20-million dollar property. So…

When the ultra-luxury deals start closing with regularity we can assume that we are on the upswing. The last 18 months has been a great time to be selling high-end real estate in Colorado.

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I force myself to review: (a) annually, (b) prior to making any new investment decision and (c) prior to changing strategy.

For now, I’m not sure what to do.

My rule-of-thumb, when unsure, is rebalance, watch and wait.

A cash buyer in a credit crunch can count on a 10-20% discount from pre-crunch prices. Given the magnitude of the last downturn, deals were available at 25-40% discounts.

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