Fastlane AMA: James Altucher; Startups, Publishing, Bloggin More...

[J. Altucher]

This is a bit of a darker question. I've read several of your books and blog articles about losing everything and ending up on the floor.

What do you think it is inside people that leads them to lose it all? We see stories in the media over and over again showing the same sequence of events.

Good question. I've really thought about that a lot and the result of that was my latest book. I wanted to understand, what made me make it (several times), and what made me lose it (several times). I've sold several businesses for 8 figures. I've made a bunch of good investments. etc Over a the past 15 years. But at least 3 times I went broke.

So the last time I was literally on the floor considering suicide so my kids could benefit from my life insurance policy I had to really ask, "what am I doing wrong".

And the answer is: who the F*ck cares.

The key is: start doing things right. That plugs the holes on the ship.

I don't want to sound corny but the key for me getting successful was/is:

- physical health
- emotional health - being around people who love me and who i love. people who inspire me and who i inspire.
- mental health - always exercising my idea muscle. becoming an idea machine.
- spriritual health - always exercising my gratitude muscle. every day being grateful for the abundance in my life.

Note, I was DEAD BROKE. But taking that attitude literally created magic. And whenever I stopped improving in those four areas EVERY DAY, I would squander that multi-body health and thus squander and lose my money.

I felt when I made money that "OK! I'm DONE! F*ck YEAH!" but money doesn't make a finished person. Money doesn't make a success.

Frankly, the only thing every that is important is that every day i focus on the above four areas of health. Else I fail.

 

[InMotion]

I want to thank James in advance for taking the time to do this...Thank You James!!!


Fastlaner's will also find a treasure trove of information from James at the following sites:

James Altucher - YouTube


http://www.quora.com/James-Altucher

 

[J. Altucher]

2. How long did it take to make your first million, or in another words be financially successful?

I didn't try to make a million until 1995. Up until then I wanted to be a broke novelist or TV show writer. But then I started a company. I had the benefit of it being the Internet super years. But then I had the opportunity to start from 0 again in 2002 and from 0 again in 2008 after making millions each time.

The first time: I started a company making websites. We had every entertainment company as a client. We sold when I realized jr high school students were making websites. I cashed out of it in 1999-early 2000. So I would say 4-5 years.

In general, I think it always takes five years from scratch.

A) you read everything you can about an industry
B) you start "doing" (about six - 12 months in)
C) you start getting a good reputation and getting paid (about 2 years in)
D) you start getting paid a lot (about 4 years in)
E) you sell or cash out in some way or make a deal or get paid a big number (about 4-5 years in)

 

[J. Altucher]

2. MJ said you are an expert in cold emailing. I couln't find anything in your blog. Perhaps you give us some thoughts about how to do it right, to whom, in what situation etc.

Yes, there have been several situations where I've had no contacts, and even negative skilsbut needed to start building a network.

The key with cold emailing is
- have ideas
- subtle persistence

So instead of just sending out 20 emails to people saying, "can i buy you coffee" or (even worse) "I have a GREAT idea, can i just have ten minutes of your time" (nobody has 10 minutes, and billionaires don't need coffee from me), I would do this:

- I'd pick out 20 potential mentors
- I'd research every aspect of their business
- I'd GIVE them completely 10 ideas. Without asking for a single thing in return.

And hten I'd move on to the next list of 20. I'd do this every day. New 20 a day. And once a month I'd circle back and give MORE ideas. Never "have you looked at my email yet?" since that is rude and inappropriate use of THEIR time, which is the valuable resource here. My time was a commodity. I made my time valuable by giving FOR FREE, ideas.

Example: one of the 20, one day, was Jim Cramer. I wrote him 10 ideas for articles HE SHOULD WRITE. Not me. But him.

He wrote back, (the only one of 20 that day) and said,"you should write these articles!". Then 5 years later, after building up that relationship slowly and more slowly and with more ideas, he bought a company from me for $10 mm.

Another example:
I wanted to trade for Victor Niederhoffer (for many funds but he is the one who returned my email of abuot 40). I GAVE HIM software I had written that I had been trading off of successfully. I gave him all the code. Everything.

Then, he replied with questions. Then he asked me to visit and hang out. Then he asked me more questions. And more. I responded every time with code, with work, etc for free. Finally he gave me money to manage.

If he had not responded, then a month later I would've sent an email giving more ideas (maybe stock ideas, etc).

 

[J. Altucher]

==> What would *you* do??

You have a good idea BUT: if someone just sent me coffee I'd probably not drink it. I like my own coffee.

BUT, think of ten articles about coffee you can write for each influencer, FOR FREE. Or better yet, ideas you would read if THEY WROTE IT. Or better yet, write the articles and just send them.

WHat are some ideas:

"How to tell the difference between GREAT coffee and BS coffee"
"How many cups of coffee a day does it take to lose 30 lbs?"
"Does Coffee Make You Smarter - the answer right here"
"The Coffee Map - where the best coffee in the world is grown".
"The Coffee Age Diet - How Drinking Coffee Will Help You Live to 100"
"The Connection Between Good Coffee and Alzheimers Prevention"
"When Is the Best Time Each Day to Drink Coffee?"
"How Coffee Helps You Make Money"
"Why Coffee Mixed With Alcohol Is Good For Standup Comics"
"The Secret ingredient that is ony in the best coffees"

And so on. Influencers don't need coffee. They need ideas to help them make their job better.

 

[J. Altucher]

What are your thoughts on renting versus owning a home?

I would never own a home. I give the reasons why here in detail: Why I Am Never Going to Own a Home Again Altucher Confidential

But a quick summary:

A) its a huge illiquid investment that you can never sell when you need to (the worst qualities of an ugly investment).
B) historically, housing has never been a good investment (everyone has anecdotes but look at the actual historical returns over the past century)
C) if you like it as an investment, then lever up and buy a diversified REIT. Much much safer.
D) opportunity cost. Instead of that huge down payment, plus mortgage interest, plus maintenance, I'd rather invest in a diversified basket of other investments to mitigate risks while still trying to capture similar or better returns.
E) I hate mowing the lawn or shoveling the snow or changing the air conditioner or fixing the plumbing. That's what landlords are for.
F) I like having cash in the bank. There's a reason houses are called a money sink. That's a nicer way of saying a money toilet.
G) I'm in a 5 year rental right now right on the river that I can easily make 10 years in a great house. There's always ways to do that. And whenever I want to move, I'll move. I am totally mobile.

 

[MJ DeMarco]

Fastlaners!

I'm happy to announce that James Altucher will be joining us this week to participate in our very own AMA, or "Ask Me Anything". (Should start Monday, but please ask away!)

If you aren't familiar with James Altucher, here is his brief bio.

James Altucher has started and sold several business for eight figure exits. He's also started and failed at many businesses and has gone from millions to broke to millions several times. He is a successful trader, hedge fund manager, investor and sits on the boards of several private and public companies. He's a regular contributor for CNBC, WSJ, and other financial outlets and is the author of 11 books. His latest book, "Choose Yourself" (foreword by Dick Costolo, CEO of Twitter) was just released and instantly got on the WSJ Bestseller list. The book details how he "chose himself" for success to avoid the roller coaster ride and the specific techniques he used to achieve success both inside and out and how to stick with it (hopefully).

James' blog is also a MUST read, frequently linked here at the forum and always chocked full of Fastlane nuggets.

Altucher Confidential

James is also a successful author with his latest book, Choose Yourself. (Which has already been recommended here by several folks.)



To purchase the book, please VISIT HERE

And finally, please DO NOT speed me for this AMA -- all the "thanks" goes to Chris, or InMotion -- please SPEED him for putting this together!!

As for the AMA...

Here are some great topics where James has experience, successes, and war stories.

• -- Self-publishing
  
• -- Business startups and exits
  
• -- Cold-Emailing
  
• -- Blogging
  
• -- Investing, stocks, markets
  
• -- Losing money! And then getting it back!

PLEASE be respectful and try to steer away from questions which might be considered personally intrusive.

So without further adieu, if you have any questions for best-selling author, blogger, investor, internet personality, James Altucher, please fire away! (He will probably arrive on Monday).

Enjoy,
~ MJ

 

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[J. Altucher]

1.) What would you do if you were down and out again, but didn't have the list of important contacts at your fingertips that you had at the past?

This is exactly what has happened to me EVERY time I have been down and out. Once you are down and out you might as well throw your old rolodex away. Nobody will return calls. Everyone will hate you and spit on you in the gutter of the street. All of the people you used to call "friends" will deny ever knowing you. And family members will say, "if only your dead father can see you now" or "i want to have nothing to do with you".

I'm a little bitter about it but, ok, I got it out there. Vented.

If I were down and out again I would do what I have always done in these situations:

- physical, emotional, mental, and spiritual health. Just focus on that every day. I describe that that entails in my book and in an earlier post on this forum.

- i'd start rebuilding my rolodex. How can this happen?

Remember: nobody will answer you if you ask: "hey, can I take you out for a coffee". Nobody needs your coffee.

But everyone needs ideas how to improve their life and business.

Everyone.

So come up with 20 people you want to meet, come up with 20 ideas for each one, and send them out.

Nobody will respond.

So come up with 20 more people and 20 more ideas.

What will happen is: you will get better at coming up with ideas that are valuable. Remember, when you start, you won't have good ideas. Your idea muscle has atrophied or has never been exercised. After awhile it will get exercised and strong and you will be an idea machine but until then you have to keep exercising and trying it.

Ideas don't come out of thin air. They are dug up in your consciousness. Which means you have to read constantly and you have to practice digging.

In terms of which ideas to follow: when you don't know or you feel out of focus, it means you are not also exercising the other muscles: physical, emotional, spiritual. Guaranteed if you do that, you will know which ideas to follow. Then you truly become an idea machine.

I don't' say this in some corny self-help way. I'm not selling anything. I'm just saying: this is the ONLY thing that has worked for me.

Here's one trick, though - if you are coming up with an idea for a business, always write next to it the first execution step.

So, one idea for a business is: "tourism on Mars". But I don't have an execution step there.

Another idea for a business is: "help people reduce student loan debt". I have an execution step there. It might be "research 100 ways to help kids reduce their student loan debt" or "find an email list of recent graduates and price out what it would cost to rent that list".

"tourism on Mars" actually might have an execution step: "call SpaceX and see what they would charge". But my guess is that is more of a long-shot.

"The smart toilet" might have an execution step: "call TROV and license their urinalisys that detects cancer test"

In any case: get healthy, become an idea machine, AND THEN your rolodex will naturally build up but not before.

 

[J. Altucher]

How do you get so much done with so little time?

Make a list of all the things you do today, from the time you get up until the time you go to sleep.

Now do what writers do: rewrite.

Take out eveerything that was not necessary. Don't bullshit yourself:
- was reading the newspaper necessary? There's really no news that is important, even for traders.
- was surfing the Internet necessary (other than this site, of course!)
- you checked your stocks 20 times. Maybe 10 would've been just as good.
- did you need to watch CNBC or even that sitcom?
- did you have to go downstairs and across the street for that mid-day coffee (which will keep you up late at night anyway since caffeine stays in the blood at least 12 hours)
- did you have to eat dinner? I ask this only half in jest. Will you starve if you don't eat dinner?
- did you have to return those phone calls today? I am very bad at returning phone calls so I am not the expert. But often, not returning them saves time.

Even on a deeper level:

- did you have to wake up angry at your partner and then have all those imaginary arguments inyour head?
- did you have to count your money 27 times in your head?
- did you have to worry about investments that you've researched a million times already

And so on.

I only say all of this because these are ways that I commonly waste time.

It's a lot of time that adds up.

Sometimes when I make this list it might add up to 1-5 hours a day.

one to five HOURS.

That's a lot of time.

Just try a couple of days of this. See what you can take it. I'm not saying "don't have fun". In fact, have more fun. I have more fun and less newspapers every day.

 

[Vigilante]

Time for a quick commercial break.

Since nearly everything he has said already in this forum has the potential to change lives, I would encourage you to dig deeper. I just finished his new book Choose Yourself, and I am highly recommending it to friends. You can get more info on the book here:

Choose Yourself

Follow James on Facebook:
https://www.facebook.com/james.altucher

Twitter
https://twitter.com/jaltucher

or stalk his blog at
Altucher Confidential

Leave a 5***** book review at
Amazon.com: Choose Yourself! eBook: James Altucher, Dick Costolo: Kindle Store

and while you are there, leave a 5***** review for the Millionaire Fastlane at
Amazon.com: The Millionaire Fastlane: Crack the Code to Wealth and Live Rich for a Lifetime eBook: MJ DeMarco: Kindle Store

That's one small gesture to thank James and MJ for their time. Do it!

 

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[J. Altucher]

"How do you motivate yourself to push something out the door even if you know it's not 100% ready?

Perfectionism is the enemy of wealth.

By wealth I don't just mean financial wealth. but also emotional wealth and transformation.

I went to the gym for the first time in my life in 2009. I didn't know how to use a single machine, I was a little bit overweight by my usual standards, and I was totally out of shape.

But I went because I had a specific goal: get in better shape (because I wanted to look better for my yoga instructor girlfriend/now wife).

Figure out your goals.

If your goals is to get feedback from a core group of loyal users, then ship early.

if your goals is to get a speaking gig, then publish your book quickly.

If your goal is to get acquired because you are first in the space, then launch.

If your goal is to get on the NY Times Bestseller list, then wait until you think it's as close to perfect as possible.

Do what it takes to match your goals. Make sure your goals for a product are very clear and do not conflict.

When i write articles about companies without websites I tell them "just put up a website with a contact button". THey don't need a full website.

When I was publishing my last book, "Choose Yourself" I wanted a lot of readers and I wanted to hit bestseller lists so I made it close to perfect and very carefully planned every marketing launch.

When I started stockpickr I had a new version every week. The first version was so bad it crashed all the time and had almost nothing on it.

But the final version had millions of users a month. I had different goals each time.

"100% ready" doesn't mean anything. It's "100% ready according to A, B, C goals" that mean something.

 

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[J. Altucher]

James what do you think about the national debt? Continous budget deficits? The general direction we might likely follow going forward? Is Detroit leading the death spiral?

I think the national debt, Detroit, etc is going to lead to more money printing, eventual lack of faith in the US currency (depending on if there is any currency to take it's place, which is also unlikely) and inflation.

But technology is fighting that with various deflationary forces in all tech, energy, biotech, etc.

Who will win?

The politic-scumbag economy?

Or the innovation-opportunity-techno economy?

It doesn't matter.

But if you are always investing in innovation then in the long run you will win.

That's why I never think about the national debt. It's a waste of thoughts on my brain. Too many other people are thinking about it.

Let them think about it. They will either be right or wrong, like they always are.

But you will be right if you focus on what brings value to other people. That's where the money always finds itself.

 

[J. Altucher]

2. Your writing and being open and honest doesn't seem like it would be in harmony with your financial work. How do you find balance and maintain trust in a city full of secrets?

I think there is a big feeling that to be successful you can't be open and honest. I have found the exact opposite to be true.

We live in a transparent world. People can sniff out insincerity immediately. To truly stand out you HAVE to be open and honest. Then you succeed.

Let me give a really broad example. Google.

Google is a website. It competes with a trillion other websites.

But if I go to Google and say "Tell me everything you know about motorcycles" Google immediately says

"I don't know anything about motorcycles, but if you go to these ten websites, I think they know A LOT about motorcycles." THen it says, "And oh, by the way, if you go to these three websites, they might also know a lot about motorcycles but, and we're being honest here, they are paying us".

Then you leave Google to go to other websites. But who do you go back to when you need to learn about herpes? Google.

In the same way - be a mini Google in your personal business life and you will find your business life is very lucrative. Google is worth $200 billion or so. Not so bad to be worth a sliver of that.

As far as having time for social life, I rarely do. But, I make sure I only do business with people I like. Often I do business with people I like a lot. So I'm hanging out with my good friends when i"m making money. The best of every world.

 

[J. Altucher]

Any advice for a perfectionist who was labeled the smart kid his entire life and who's (1) realized his fear of failure has prevented him from really doing anything to protect that image, and (2) doesn't even know what he really wants to do?

Yes, take a big step back and realize you know nothing.

I tell this to my own daughter. She gets A+ on everything on her report card and is very proud. I hope i don't upset her too much but I say, "this report card is bullshit!" she knows I am kidding but only part-kidding.

But then I give her a real example. We go to play tennis and she gets upset if she misses one shot.

I tell her, "Your bullshit school makes you think the A+ is normal but real life is actually very hard. Tennis is hard. You have to practice adn be disappointed or you will never get sharp, you will never hit the ball over the net. This is not the bullshit A+ world you are used to. And everything else inlife is like this also."

She's a perfectionist. Perfectionism is the death of all talent and skill.

The good thing is you admit it. So understand now, just like someone with a deformity has to work extra hard to be good at something, so will you.

As for knowing what you really want to do? If you knew that then you and Larry Page would be the only two people on the planet who know what they really want to do. Most people just want to lie on the beach or something. And I Don't blame them. Most other stuff is a lie. Who wants to run a t-shirt store and say "this is my purpose in life!" and yet people run stores like that.

All purpose is man-made. The only real purpose in life is to eat, have sex, and relax in between. Everything else is fantasy (and sometimes sex is also).

If you write down ten ideas a day and stay healthy (e.g. sleep 8 hours a day, be around supportive people, be grateful every day), you'll find things that you want to do more than others. Give it time, give it six months. Start today.

 

[J. Altucher]

I am clinically depressed

You need to make sure you get healthy. Making money is a side effect of health. It's way down the road. It's not the important thing.

Health is important. Its #1.

When you say "clinically depressed" it means you feel a sadness that is not brought upon by any one event but more of a biological feeling that overwhelms you.

This happens for many reasons: biological, environment, genetics, history - who knows?

The Daily Practice is not just about coming up with 10 ideas every day. It's about making sure all 4 of your "bodies" - physical, emotional, mental, and spiritual are working well together.

But also first getting out of a crisis situation into a situation where you can start focusing on the Daily Practice is important:

A) see a therapist and if the Depression is serious enough, you may need to take medication. I'm not advocating that but for some people it helps.
B) Meditate for 1 hour a day. You have to find silence. Silence the monster that attacks every morning. That monster gets suffocated with silence. You MUST do this to survive. Not everyone can meditate. But someone who is clinically depressed needs to do it more than most.
C) Sleep 8-9 hours a day
D) No alcohol (which is a depressant)
E) Try to avoid eating late at night or eating sugar (both can mess with digestion and sleep)
F) Be around people who love you and who you love. Read books from people who inspire you. Watch comedy movies. One a day if you have the time.
G) If you can't come up with 10 ideas, come up with 3 ideas. Make them bad ideas. Really really bad. Come up with the 10 worst ideas you can possibly come up with. Here's a bad idea to start you off: "donuts laced with prozac". "a toilet that wipes you". "A Google Glass app that lets you see everyone naked (it puts fake naked bodies in below people's heads)." And so on.
H) Every day, when you feel the monster coming on, try to think of 5 things you are grateful for.

Don't rush into making a lot of money. ONe day at a time. You have to defeat the monster first.

 

[J. Altucher]

but if I understand you correctly...I send out the first salvo of coffee + letter...And then follow up with other communications...offering ideas, an article if i can pull it off...and hope that they capitulate and acknowledge that indeed the European Coffee Society is a great topic to mention in print....or I run out of effort-muscle.

No, I would start out by building your brand through knowledge. What is the fastest way to get them to say "yes" to something. If they are a magazine editor then the best way to get them to say yes is if you offer GREAT content for FREE.

Email them (or write a letter. do both) and give them ten ideas for an article you can write. Don't mention your coffee at all other than to say you are the CEO of the highest quality coffee brand in Europe (I hope your website backs you up on that with quotes, etc).

Then offer ten ideas for articles that you know will appeal to their audience.

Get them to a yes.

Once they say yes, write the article. They will say yes again. They will say "Thanks".

NOW, you have them.

Drive to their offices, and share a cup of coffee with them. Your coffee. This is your way of saying thanks.

They will say, "THIS IS GREAT!"

Then say, "Let me ask your advice. How can I do more for your magazine, given the expertise I have with this coffee."

Then listen to what they have to say.

This is a process and it takes awhile but it is how I would do it.

My worry is: ifyou just send them coffee, they will not try it and you will never hear from them again. You won't have your opportunity to get them to "yes". Find the yes first.

 

[J. Altucher]

What am I doing wrong? Am I over-thinking the whole idea part or just making excuses?

Both. The key is: not to come up with a good idea. Just come up with 10 bad ideas if you want.

The key is to not let the idea muscle atrophy.

If you don't walk for 10 days, your leg muscles will atrophy so quickly you will need physical therapy to walk again.

It's the same with the idea muscle. You need to exercise it every day.

There's a story about an ad agency. The boss said to everyone,"Come up with one good idea". Nobody could come up with an idea that day.

The next day he said, "Come up with 10 ideas". Now everyone came up with ideas.

Don't put so much pressure on an idea. Come up with a bunch of bad ideas. Then throw them out. Repeat tomorrow.

Here's some bad ideas for books one could write:

"The autobiography of Anthoney Weiner's penis"
"50 Shades of the Bible"
"North By North West, everything North of Kim Kardashian's new child"
"10 Jobs That Suck and Why, interviews with janitors, plumbers, garbagemen, and the women who love them"
"50 Suicide Methods That Might Not Hurt" - it's hard to kill yourself. Here's some tips.
"The Gospel of Satan" - as told to a three year old
"How To Pick Up A Girl Through Lying and Manipulation -3000 year old techniques that work today".
"A Complete Guide to Investing in Detroit for 2014"
"How To Default on Your Student Loan Debt Without Declaring Bankruptcy - 10 loopholes that WORK!"
"A Step by Step Guide to Performing Your Own Abortion"

There. 10 ideas. Bad ideas. They can be 30 page books, written and uploaded to Amazon within a week. Each one will probably bring in $1k income per month.

 

[J. Altucher]

1. What would be your biggest piece of advice for someone wanting to become a better writer?

Iwrite about "33 unusual tips to becoming a better writer" here: 33 Unusual Tips to Being a Better Writer Altucher Confidential

BUT, two or three quick tips that are the most critical:

A) Write EVERY day. Example: Stephen King, one of the bestselling writers ever (whether you like him or not, he's a pro) was once in an accident and couldn't write for two weeks. As he writes in "on Writing", he literally forgot how to connect words together when he sat down to write again. He had to get back in shape. That's how fast the writing muscle atrophies. And that's on the bestselling writer ever.

I write 500-5000 words a day, 7 days a week.

B) If it doesn't Bleed, it doesn't Lead. Don't tell us "top 10 ways to diet". Tell us YOUR story of dieting and how it failed and how you were fat and the girls made fun of you and then how transforming your body transformed your entire life. THEN tell us how.

Bleed, then entertain, then educate. In that order.

C) READ. I read 3 hours a day at least. Read GOOD stuff. Not stuff on the Internet.

 

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[J. Altucher]

=>> How do I get my email opened, at least?

Would you give me a few subject lines *you* would use?

- "We have a mutual friend in X" where X is a GOOD mutual friend
- "X suggested I write you about your business"
- "I wish you had trashcans in your lobby and 10 other things I would do if I were you to improve XYZ Co" - where XYZ Co is their company and they actually dont hvae trashcans in their lobby (or some other first idea)
- "My last 5 businesses succeeded and I really want to share one idea with you"
- "I've never done this before but I have a comment on your last business activity/article/speech/etc"
- "I need your advice on one thing and it's directly relate to your business."
- "I loved your last book/article. Two thoughts:"
- "I read an article you wrote in 1972 and I have one quick question about it. Fascinating stuff."
- "Whoever is handling your PR is not doing a good job. Here's what you should do today"
- "I found some security holes on your website. I have a series of fixes you might want to use."
- "Here's an idea specifically for your fund that will give you negative correlation to your returns."

 

[J. Altucher]

2.) Any adaptations to that approach that you would take for a first time author?

If I were a first-time author I'd:

A) improve my writing by writing every day and reading every day and developing a unique perspective. This takes practice and time.
B) start blogging for very popular sites to improve my skills AND my audience
C) leverage that into linking to your twitter account and personal blog to improve your audience.

I started writing for thestreet.com. I leveraged that into the FT, and the WSJ. Then Yahoo Finance. Then huffpo, techcrunch, thought catalog, elephant journal, and other places. Then I started linking those articles back to my blog. Then I started holding a Q&A on Twitter. This is how I built my initial platfor.


Another way to do it is by publishing A LOT of books. You say you are a first time author. Tkae whatever you have and upload it and now you are done with that part. Then work on your next book. Amazon will build your audience also. Don't worry about the size of the book. Just upload a book and DO IT.

 

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[J. Altucher]

Will you share with us your process for writing a blog post.

Everything from idea, to title, to the process of writing and then promotion.

I read for three hours ever morning. I'll usually go through chapters in 2-3 "dirty realist" autobiographical fiction books (Carver, Bukowski, Denis Johnson, Miranda July, James Baldwin, Tim O'Brien, Sam Pink, and about a dozen others are on my list of go-to guys), then I'll read some non-fiction, then some inspirational.

Then I'll sit down and think of something really shitty that happened to me that I would be embarrassed if my mother, kids, or current colleagues knew about. Then I write about it. Somewhere in the middle of writing it, I'll twist in what I learned, but not in a preachy way, more in a storytelling way.

An example might be:

My first customer is now dead: My First Customer Is Now Dead Altucher Confidential

or

I want my kids to be drug addicts: READY: I Want My Kids to Be Drug Addicts Altucher Confidential

Lately, I've been doing something new. I've been editing inside the Facebook status update window. How come? Because it makes me really cut out every additional line, word, paragraph. There can be no extra words in a facebook status update or people click away.

Usually my final revision (and I'll do up to 10-20 rewrites per blog post) is about 30% less than my original version. And, in general, I write less words per post now than two years ago just because I edit harder.

Another thing I do is go to kdp.amazon.com and look at the most highlighted passages from different books. I like to see what sorts of language and themes are resonating with people. I don't take those passages but I think about them and how they apply to my own life.

Everything ultimately has to be about my own life. I don't know about anyone else's. I can't advise on anyone else's. I know what shit I've been through and how I've gotten through it and I write about that.

So, summary:

A) I read a lot
B) I write every day. And then rewrite
C) if it doesn't bleed, it doesn't lead. Almost every line has to be a cliffhanger.
D) I have to entertain
E) last on the list is try and provide value. But this is hard. First I make sure I provide value to me. Writing ultimately is my way of finding out what happened to me.

 

[J. Altucher]

Hey, thanks for the first question. I'll tell you a story. On July 5, 2010 (give or take a day), I went on CNBC with Nouriel Roubini and he said the market was going to fall 20% and I said it was going to straight up.

After it went straight up for about a year a guy from CSFB that I didn't know send us both notes and said to Nouriel, "hey, you should at least invite James to one of your parties".

Nouriel responded, "once the recession begins and we go down."

Well, I'm still waiting for my invite.

Nothing against him. A lot of people were wrong. I was wrong in 2008 but I held on and now the market is at all time highs.

People are worried the market will fall if the Fed tapers.

Two responses:

A) when the Fed tightens, historically the market goes up. A great example is Spring, 1999. The Nasdaq 100 went up something like 80% after that. And THEN it crashed. But don't get out now. Get out then!

B) We llive in a two economies:

- the poltico-econo-scumbag economy
- the techno-innovation-opportunity economy

both economies work together. Sometimes one wins. Sometimes the other. Sometimes they both win. The innovation economy is what will drive the future in the long run, though. And you just have to look at Williston, North Dakota, or Silicon Valley, or the latest in cancer diagnostics to see where that is going.

Unfortunately everyone on tv argues about the scumbag economy but I try not to listen to that garbage too much.

 

[J. Altucher]

1. What are your biggest mistakes?

My biggest mistake is not having all my relationships in balance when I needed them to be. This is the cause of problems.

Here's an analogy. There are various groups vying for power in Egypt. When they get along, all is good. When they don't get along, actual armed revolt and violence happens.

It's the same thing with the self. If I am unhappy in marriage or relationships or partnerships or even with myself (if I want love too much or if I am filled with regret or anxiety) then I might survive for awhile and even succeed and make millions for awhile but eventually revolt will result and what happens afterwards is disastrous.

This is a coy answer. I can say my biggest financial mistake was investing $2 million in the GoAmerica IPO and watching it go to $0 or making a series of investments in private companies and not following up on them, or starting companies that were doomed to crash, or not hedging when I should've or whatever.

But the reality is, the different factions inside of me were not forming a good "democracy", I wasn't healthy on all levels, and revolt would result. And I would lose money. And not just in 2000. But in 2004. 2008 and maybe alittle in 2010 before I finally said, "enough is enough". Now every day I make sure I keep all the voices in balance.

 

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[J. Altucher]

James, you stress the importance learning how to sell in several of your talks.

How did you learn to sell?

Was it trial and error application for you or did you learn from a specific person...?

Initially, I wrote an answer to this here: The 10 Keys To Selling Anything Altucher Confidential

BUT, I want to update that with a quicker response:

basically, do whatever it takes to "find the YES". This doesn't mean push on the client until they say yes.

- will they say "yes" to anything? Then do it to get your foot in the door. In my above post I talk about the lifetime value of a client. If the lifetime value is there, then say "yes" to anything to get the foot in the door. For instance, I gave up 50% of a company once because I knew that would get them to "yes" on everything else I wanted, which was worth millions.

- if they are saying "No" then
a. be like water on rock. eventually water withers rock. send updates every month. make intros. add value to their business without asking for anything in return. send them clients, etc.
b. diversify who you are selling to. quantity is quality in selling.

How did I learn this? Trial and error and lots of failure. For instance, cold calling never works. But I learned quickly that if I'm in a room with someone and I can get them to say yes to anything, then I have the deal.

Btw, this doesn't mean "kiss a$$" until they say yes. It means understanding their business as well as they understand it so when you say something they say "YES! THat's IT!" and when they negotiate on price you can just say "YES!" because the lifetime value is worth a lot more than that initial deal.

 

[MJ DeMarco]

James, what is the core message of your book so I'd have an idea of what's in it.

Seriously? I've taken the liberty of deleting your message. Don't ask someone to do what you can do on your own in 16 seconds. It's is just disgustingly lazy, and the antithesis of James' message.

 

[J. Altucher]

Eventually you will have to focus the majority of your time and energy on one or two projects.

In 2006 I had a bunch of ideas and I decided I needed to switch careers.

I was running a fund of hedge funds at the time. We got an offer for 4x our revenues, whcih was great. The only problem was, they wanted me to sign a six year employment agreement. I couldn't do it. Even my lawyer said, "I thought they got rid of slavery".

So I realized I wasn't creating good equity value in my business and came up with new ideas. About ten new ideas.

On top of the ten ideas, came more ideas.

I started all of them. Probably a dozen businesses simultaneously. And I was working out deals, partnerships, etc for each one. And I was still running the fund of funds.

But then one site, stockpickr, which was in the field that I knew the most about, really started to take off. And the partnerships were driving real users and revenues.

So that's the one I stuck with. Execute on all to the best of your abilities and stick with the one that survives. There is no way to know in advance.

It reminds me of the process of writing. Stories don't come out of thin air. They have to be dug up from the ground. So you have to get out the shovel and dig.

 

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[Sir Ingenious]

James,

If you have a chance to read this, I would like to really thank you.

I read your earlier post in here about cold e-mailing and I've decided to immediately take action. So, I e-mailed a lifestyle blogger (here's his website) and I suggested 10 things that he should publish, one of them being my weight loss experience. He got back to me within the same day with a couple of things for me to share on his blog. So, we're currently working on a possible guest post about my 265 pound weight loss experience! When it's all and done (hopefully), I'll gladly share it with you guys when it's posted.

So, I would like to also note to y'all to choose yourself (and I bought and read the book as well, which I very highly recommend). It really works!

This turned out to be a very good day.

 

[J. Altucher]

Would you choose the one project that has the greatest potential then do that one completely first? Or something else?

Two answers:

A) I do like to diversify my income by having more than one thing going on at the same time Right now I invest, I advise, i write, i speak, etc. And each thing I do either increases the value of my assets or I derive cash flow from it.

B) But ultimately I do have one thing that I love doing more than anything else and I try to limit and /or delegate the rest. Writing is the least lucrative thing I do. And some of my assets are the most lucrative things. But sometimes you don't always have the time or patience or desire to work on the most lucrative things. I try to keep them going as best as I can but make sure I don't spent an ounce more energy than I have to.

Very important to not eat junk food.

When you do something you don't like to do, it's like eating mental junk food. When you do something you love doing, it's like eating mental health food. Ultimately you want to be healthy to increase your net worth in as stress-free way as possible.

So limit the things you don't like (but delegate if you can or come up with better ways of doing them) and focus on the things you love doing and in the end you will make more money, even if the source of that money surprises you (which it alwasy does me)

 

[J. Altucher]

Do you see any benefit of marketing yourself via your blog and your authorship?

...Even in cases where you are writing to people who are not your current business's target demographic?

Absolutely. When I expanded beyond by "business horizon" I made almost infinitely more money, more opportunities thrown my way, more everything.

Because I became a trusted voice. Information is a commodity. Trust is rare.

 

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[J. Altucher]

Do you have a list of potential black swans on the horizon?

From your conversations with other investors, which potential black swans seem the most plausible to you?

Don't worry so much about black swans. They are, by definition, rare and unpredictable, regardless of how they are priced.

For instance, there might statistically be a 1 in 10,000 chance of a nuclear war in the US. But it might happen in the next 100 years.

Either way, you lose. Either way, the statistics didn't matter.

What are the more likely black swans? Anything that is highly priced where people say, "we've entered a new era of pricing for this asset" is a likely black swan waiting to happen.

So, one can argue, interest rates and bonds fall under this category.

I can't think of anything else really.

The best way to avoid black swans is to invest in innovation. Innovation will move forward, sometimes more slowly during black swan eras, sometimes more quickly during money-flush eras, but it will always move forward. The way I survived 2008-9 was placing bets on social media. Some didn't survive. Some did very well.

The other way that understanding black swans helps is to understand the aftermath.

At 2008-9 everyone saying it's the end of the world.

Politically and economically I don't care what happened. All I knew was -it's never been the end of the world yet so why should 2008 be.

A current example is Detroit right now. Everybody was saying its very rare, if not impossible, for a major city to go bankrupt. In some cases (states) it's actually unconstitutional to go bankrupt but TV pundits don't seem aware of this (California).

Detroit went bankrupt but it's not a company, it's a city. Detroit can't be "liquidated" to pay bondholders.

So I look at the history of major municipal bankruptcies. There are very very few. Orange County, California in 1994 is the biggest ever.

Guess what: bondholders got paid back 100 cents on the dollar.

So I start to look at closed-end funds that have exposure to Detroit. It turns out almost all of them are at 52 week lows because of this bankruptcy. Not only that but they are all at all-time historical discounts to net asset value and they are all paying around a 10% dividend yield.

This is an opportunity if people are mispricing the black swan.

So that's when the real work begins.
What assets are in the bonds these closed-end funds are holding. What is the likelihood of these assets not paying? What is the difference between Chapter 9 and Chapter 11? What recourses do municipalities have that states or companies or individuals don't have. And so on.

It's actually a good thing that a city can't be liquidated like a company. A city eventually has to come back and borrow again. This means they will work harder than a company to pay back bondholders.

This means in this black swan, like all black swans, we have an opportunity to make a lot of money.

Don't look for the black swans that may or may not happen.

Look for the ones that DID happen and then pluck their graves like a vulture.