The generation that inherits wealth can never really understand the struggle of how it was built.

[00:25]

"the money that's built has to exist beyond itself. There has to be a purpose to it. And the generation that will inherit it can never really understand the struggle of how it was built. Like my family, my parents coming here with nothing as immigrants, with a child that they have to feed."

[02:48]

"But uh so so very specifically is the person that you are going to trust with your money, does he or she has skin in the game? Are they going to lose and make money as you are doing it?"

[07:15]

"And the rule I made for myself 11 years ago for any introduction made to me is unless you're somebody that I would leave my kids with, you weren't worth building that trust with"

Full transcript

Let's say that you're giving advice to somebody who's just come into some incredible wealth. If that was you, what's the one thing that you think you really would have wanted to hear as opposed to what everyone told you? Maybe maybe two things really quick. I uh so I definitely spend time with your family uh because the the money that's built has to exist beyond itself.

There has to be a purpose to it. And the generation that will inherit it can never really understand the struggle of how it was built. Like my family, my parents coming here with nothing as immigrants, with a child that they have to feed. Um I think of myself as a very capable person. I don't think I could do what they did.

And it's so important that we get to sit down together and build a legacy. It's like I always say like legacies built at the dinner table. So that's where you're really forming the purpose of the family. Um I will say what I wish I learned earlier and I have learned um and would like to let everyone else know is um don't be afraid of pain.

Uh I found that um wealth leads to certain comfort that could lead to certain complacency and uh pain is what probably build the fortune in the first place. Pain is what's going to keep it. So don't be afraid of that. And we actually as investors, we have the privilege to um share pain with the people that we're investing into.

Whether that's our capital or our time, we get to take that and you know the blessing is we don't get to keep it, right? But we get to alleviate maybe some of their suffering in that moment, build a stronger bond with them and become become stronger people, better people, and uh stay human in the process. Great. Thank you for sharing that, James.

Eric, your own thoughts? Yeah, I'm going to shift topic a little bit. I saw some people I didn't mean any, you know, discomfort with emotions with my story. It's all a happy ending. I forgot to tell you that he's got two kids now and I go ski with them every year. But when it comes to this trust, Yeah.

Yeah. That's that's that's truly remarkable. Uh I got to be a little bit more like specific and precise too and it ties to the question about what advice would you give to someone that stumbles upon money? Two things. Build a true structure in intention. Don't just start chasing butterflies and you know change all those things.

Be very intentional with what you're doing both for your capital preservation and how you want your money to multiply and go and choose your partners, right? Choose your partners very wisely. And the first thing I do, I mean I think we have 90% people here using claude for due diligence. It's it's easy. That's not the hard part anymore, right?

But uh so so very specifically is the person that you are going to trust with your money, does he or she has skin in the game? Are they going to lose and make money as you are doing it? And maybe even more importantly, are they going to lose money first? If I'm going to take care of somebody else's money, I want to be able to look them in the eyes and if I were to lose somebody else's money, I want to say, I lost first.

I lost more. We're going to win together. You're going to lose together. So that whole thing with like the GP LP alignment is a structural thing that I find to be super important in terms of actually building that trust and if you actually want to get into the deals that fits in whatever you're trying to do, make sure that element is there for good or bad of the outcome because you set up with the right expectations.

Yeah. And and ultimately if you're building trust, if you trust someone and they say, "Yeah, I'm going to do exactly what I'm going to do with your money. That's what I'm doing with my money." That for me is from a capitalist point of view, the ultimate trust. Thank you, Randy. Yeah, I'm going to approach it differently.

The first thing when you come into money, you really need to get a Tom Handler said this earlier, you need to have the right professionals. It's very critical. Um, the other thing is everybody thinks family office. Well, you know what? Not everybody should be a family office. So you first have to decide if you're going to be a family office and there ways to get the benefits of family office without doing it.

Um so professionals are key. Tax structuring, how you set it up. Understand your family. What do you want to do for your family? What are your goals? Do you want it to be charitable?

What do you want to do? The other thing is in today's world, technology for a family office is unbelievable. You can set up a family office very easily. The software is out there and you can do everything very remotely. So I mean if there's ever a time for somebody coming into wealth and be able to set up and use it now is the time.

So there's lots of things you could really advise, but I really, you know, or perspective that I have, but I I really think it comes down to a few things like what is the purpose of money and and how do you think about like what's the most precious thing you have, which is time? It's like people make lots of money for freedom of purpose, freedom of relationships, freedom of time, family. So I would really take a step back and say what does this money give me the freedom for based on my values and I would really start there because I think when I find that I make decisions based on my values they're always a lot better decisions certainly than based on fear. Um, so I would just take a step back and say, "Hey, I have all this money."

By the way, it didn't come generally out of nowhere. It came because you inherited it, which you knew over time you would most likely or because you grinded and built something and ended up with money. But I would take a step back and say, "Who am I? What are my values? What I want to be able to achieve?"

You know, many of you may be familiar with like EOS, which is like an operating system in a business that's pretty well known. Like what's my 10 year, 5year, three year, one year goals? What is my mission? What are my core values? Like a lot of this stuff goes on in business. Like take a step back and define that for yourself.

And then you could begin to say, well, who are the adviserss that align with my values? Who are the people that I would hire to support what I'm trying to achieve. So that would be the advice that I would share um for anybody that ultimately has a lot of money and just thinking about and I'll just make one other quick comment connected to this is people build and I'm a little bit speaking my book on this so I'm admit that I'm a little bit biased but people build lots of money for freedom of time purpose relationships yet so many people are building single family offices that have that aren't in the investment business. They didn't make their money in the investment business and even if they did is that what they really want to do because others are doing it etc.

So it's like how do you think about how do you want to spend that time? What is the right infrastructure to support you and what you're trying to achieve in the future? Great. I appreciate for all four of you your perspectives on this. Um I'm glad for that last question you each had a different take. Uh because being in full agreement wouldn't have given us the type of breath and depth that you all have lent to your families, to your businesses.

Uh when I first met Richard a couple years ago through my friend Daniel, um the one thing Daniel said was, "Uh, Richard brings his kids to his conferences." And the rule I made for myself 11 years ago for any introduction made to me is unless you're somebody that I would leave my kids with, you weren't worth building that trust with because everything came for me from a structure of understanding that I had to talk to the highest bar of humans. So I'm grateful for the four of you for being here. Please join me in thanking them for being part of this panel.

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