I started my own boutique, real-estate focused consultancy, in the first week of September 2008. You’ll notice that’s about the time the global real estate market – and everything else, by the way – came crashing down with it.
A lot of people have described that period as feeling like the world was ending. It didn’t quite feel like the apocalypse, I never felt in physical danger. But it did feel like the world order was shifting, that something fundamental was gone.
You can debate all day long whether or not that’s actually true, but for the end of 2008 and during 2009, I was in a state of confusion and loss.
You might think that given what I wrote about my previous job, I was crazy to branch out and start my own consulting company based on it. Optically it is so.
But I had a lot of good reasons too. I had cultivated some good relationships with who I thought were solid clients. One of them, a savings bank that was running itself like a hedge fund, had promised me and my partners a retainer and guaranteed contract over the next two years, worth a few million dollars.
As it turns out, this particular client then went to jail. I didn’t know yet that savings banks shouldn’t be running themselves like hedge funds.
Another good client of mine, an entrepreneur-turned-developer, wanted me to help them actually project manage the construction of their theme park. Moving into an actual implementation and development role sounded exciting to me, after being in the world of theory for years. I believed in this client, because they were one of the only ones that seemed savvy about the whole game – I was and eye-witness to them wrangling about $600 million in concessions for their project from the government.
It turns out a global financial crisis cuts off funding a little bit. $600 million in savings means nothing when you’ve lost $1 billion in other commitments, I guess.
The third reason was that I felt that being an independent consultant meant I would be my own boss. Meaning I could work on other projects on the side. Because simultaneously with some other friends, I was arranging another partnership focused on real estate acquisitions and development deals in LA.
With my consultancy, I thought I would be making millions. And with my private equity group, I thought I would be also making millions. Pretty soon, in a few years, I would retire. It was a neat little plan.
You might notice that even though I believed the world had gone insane in terms of real estate development, I was still fully committed to the field.
This might sound like a paradox, but it was a true blind spot. I thought that for sure, the projects that the ‘other’ clients were working on were crazy and wouldn’t work, but for sure ‘my’ clients and projects would work.
This is classic bubble thinking, and you could also call it heavy commitment bias, youthful arrogance, delusion, maybe even a form of insanity.
Needless to say, things didn’t work out that way.
2008 closed out with weekly kicks to the face of bad news after bad news. I learned all the verbal commitments had been worth nothing. All the projects I had planned became mirages. My romantic relationships were blowing up. At one point, I was earning nothing, and it got so bad that I had to move home with my parents. Back to the San Gabriel Valley where it all began.
At one point, I became so depressed that I decided to write myself a mantra. It was about a paragraph long, and I wrote it every day for about two months until I felt like I could actually get up in the morning. I wish I could find it now, which is another reason to keep a journal.
If you talk to people in my generation in the finance or real estate industries, the ones who were a few years into their career when 2008 happened, we are all a little shell-shocked, still. It was a defining moment, when suddenly the rug got pulled out from under us.
Everyone still daydreams about another financial crisis. We still think it might be around the corner. And we have a huge portion of our assets stashed in cash, not equities, just in case something like this happens again.
This is also probably deluded thinking.
But, there are a lot of ironic things that happen in a complete meltdown. Things reverse in more ways than one.
I gave up on the RE fund. My partners there, were less serious, than my consulting partners. And I needed to focus.
But what happened, ironically, was that 2009 turned out to be my best year financially, up to that point. This, despite working far less. This is just what happens when you remove overhead.
Despite all that, I didn’t feel any triumph or joy at the end of 2009. It still felt unstable. Besides, I was still working and living at home with my parents, and therefore what I was doing seemed illegitimate.
In the years since, I would reverse my opinion on that, but I was still insecure. What I’ve realized in the years since, is that companies and structure fulfill many needs for people, but one of them is a feeling of legitimacy. For me too, for a long time.
Being your own boss is not for everyone. For some people, being able to go into an office, being surrounded by a corporate structure and procedures, and a predictable routine, just feels more stable. Seeing all the people around you engaged in the same mission drives you. And the office, the people, and the purpose, give you the sense that you are part of something stable. Whether it’s true or not.
But all that is what I missed the most when I first quit to become an entrepreneur. Being your own boss is hard. You take ultimate responsibility for everything. You are responsible for the sales, the marketing, the production. You determine your own working hours, your work-life balance. All this usually fills you with anxiety.
And the only thing I can recommend for anyone who is thinking about going independent is to install routines and protocols as soon as possible. Carve out space for the work, away from your personal life, especially your bed. Create a workplace, whether it’s real or virtual. That way you will “go to work” and do professional things as a routine or habit, and not just when you feel like it.
Because you’ll only build a business with the accumulated, compound interest of putting in work every day. This self-regulation was the single hardest hurdle for me.
With more time on my hands and the funds to do so, I started traveling more.
It’s true what they say about memory and learning. You don’t know what will stick. In an International Finance course, I had a professor who left us with some words of wisdom during the last day of classes.
I don’t remember much else about the class, except going to him during office hours with a newspaper of exchange rates, interest rates, and other financial news. My question was that why was the exchange rate moving in the other direction than as predicted by the models we were learning about?
He smiled and just said it was price movement from trading, and that’s when I learned about how there was a force of human nature called trading that helped violate all neat theories.
Anyway, at the end of this class, he wished us well, and recommended that we should visit two places in the world before we died: Machu Picchu, and Angkor Wat.
And so during my consulting jobs, I went to Angkor Wat. And as he recommended it to me, I will recommend it to you. Archaeological sites are fascinating for many reasons, but I love them – and love Angkor Wat the most – because of its Ozymandias and memento mori themes.
An ancient kingdom in the middle of the jungle, rich beyond imagination as attested to by the sheer volume and intricacy of its stone buildings, moats, and storehouses. Grandeur and glory, extravagance, reverence, arrogance, fear, and ultimately, life – you can feel all of these things in the ancient city, where humans once lived under a kingdom that believed it would last forever. Built by people whose names we no longer know.
Anyway, so you’ll see that the year was a lot of soul searching for me.
And the last lesson I learned is that, whether it’s with yourself individually, or the world around you, in your darkest and deepest times is when the seeds are being planted for future growth.
You should rejoice and celebrate when you feel like you’ve hit bottom. The journey down to the bottom is the demoralizing, hard part.
The good part – although it’s not easy – is when you’ve actually hit bottom, because that’s when you’re free. Freer than you’ve ever been.
And likely, when you make it out again, you’ll be a different person. You’ll be proud of who you became in the process because you’ll have learned how to fight. And much, much later, you’ll look back at this young, hungry version of yourself in admiration and wonder what happened. At least that’s how it was for me.
When I think back on this time, I realize that during that year, when I felt like I had no options left, I actually had the most options ever, since graduating. I could have literally done anything, studied anything, become anything. A world order had collapsed, and no one would have said anything to me about a career shift or transition into a totally new field.
I could have, but I didn’t. I was too fearful – what would my resume look like, what would I do to survive, etc. In hindsight, these were trivial worries.
I did know I wanted something new, something different. And I would indeed find it in the years to come.
But at the same time, I was also scared to walk away from what I already knew.