Bulls Make Money. Bears Make Money. Pigs Get Slaughtered.

Good times and bad, there’s always an opportunity to do well. Just don’t be greedy.

“Bulls make money. Bears make money. Pigs get slaughtered”

I first heard that from a banker friend of mine. It’s an old Wall Street expression. It’s so true.

Ever since my first job in Silicon Valley, I’ve always  – whenever given the chance – cashed in some stock options as soon as they vested. The way I saw it, if the stock continued to go up, I would still have plenty of unvested shares to ride that wave. And if I did a good job for the company – they would keep giving me more. But if the stock went down – or worse yet, the company went out of business – better to have taken something off the table than nothing at all.

It’s true even when you’re immensely confident. At Looker, Lloyd Tabb and I sold secondary shares into every round. And it wasn’t because we didn’t believe in the company. We were 99% sure Looker was going to be a huge winner. But we weren’t 100%. 

It’s an unavoidable truth that you can’t predict the future. There is just no such thing as a sure thing. Or as they say on the front page of every piece of financial analysis you read: “past performance is not indicative of future results.”

Even though Lloyd and I couldn’t be sure what would happen to the company, we did have complete confidence in our math.  If this thing really did take off, then having that extra 5% of our stock to sell wasn’t going to meaningfully change our lives.  But if things went to shit – through no fault of ours – then having taken that 5% of our holdings off the table was going to look awfully smart.

When my son’s first company was acquired in 2015, and he was paid out in stock, I pleaded with him to sell a bunch. “You never know,” I warned him. He called me “chicken little”.

A few years later, when a large corporate investor offered to take us out of 50% of our investment in a hot fund, I argued that we should take it, cover our costs, and still have plenty of upside. I got overruled. This time he called me a “Debbie Downer.”

He doesn’t call me either of those things anymore.

When it comes to investment, I’m neither a glass half full nor a glass half empty. I’m just a realist. And I do everything I can to not follow the herd. When times are great – I try not to get swept up in irrational exuberance.  And when times are tough, I’m always looking for the opportunities that everyone else might be missing.

Entrepreneurship and investing are cyclical games perfectly suited to those willing to think for themselves. (And for those with tough stomachs.) 

But the real lesson is that regardless of whether markets go up or down, there’s always an opportunity to do well. Just don’t be greedy.


Many ideas in this post were first discussed in the Neverland entrepreneurial community. Join us there!

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