In this episode, I talk to Daniel Evans. He is the CEO and founder of Evans and Company. He helps high-growth Entrepreneurs and CEOs in the health, food, beauty & fitness space by building their financial confidence and reducing burnout to have more time for the things that matters most to them.
We talk about investing in the stock market, investment apps for new investors, qualities of a good financial advisor, and so much more.
“Billionaires are risky in their businesses, but they’re not risky in their wealth management.”
- (02:14): Interest in finance and stock market
- (06:45): “Cash is king” still true?
- (11:05): Investment apps for investors
- (4:39): How to build an investment portfolio
- (17:39): Qualities of a good financial advisor
- (23:00): Financial planning and investing in the fitness industry
- (35:48): Things to consider before you enter into investing market
- (40:39): Importance of technology in your business
How to connect with Daniel:
Bite-sized action items to go from dreaming to streaming your podcast.
Hey, welcome back to another episode of Inside The Mind, I am your host Misbah Haque. And before we dive into today’s episode, I just wanted to say a quick thank you to our sponsor. This episode is brought to you by Pod Mahal. They help people who have a purpose, they have something they want to share something they want to say, and they want to profit, but they want to do it without perfectionism. So get started on creating content for your business has never been easier. You literally show up, you speak your ideas into existence, and they take care of the rest, they are able to authentically preserve your voice. And translate that into Instagram posts or your own podcast on Apple and Spotify, or YouTube videos if that’s your thing. So check them out at pod mahal.com. And if you want to start a project, tell them we send you email [email protected] so much for supporting the show. And without further ado, enjoy today’s episode.
Daniel, what’s up, man, thank you for joining me all the way from New York City. I appreciate you being here today. You’ve been involved in a lot of different industries and arenas to where anytime I see someone who has replicated success in this field and then gone over here and try to apply some similar principles and something vastly different. That always picks up my ears a little bit. So I’m excited for you to drop some gems around tactics and strategy and just stories you have to share from probably all the years that have trials and error that you’ve faced in order to get to where you are today. So thank you so much for joining me today, Daniel.
Not supposed to be here. Misbah Haque. Appreciate it.
For anyone who is kind of hearing you for the first time. Would you mind giving kind of quick background on what is most exciting to you right now? You mentioned there’s a lot of fun stuff here. You’ve got a book coming out, you’ve got some courses, you’ve got financial planning for teens, which I think is fascinating. You’re doing that with, your son. So very interesting an arena that you’re diving into, what kind of got you into it. And if you can take us back to like the origins a little bit?
Well, I’ve always been interested in finance, since high school, I took an economics course, in my senior year, which is, which was really great. I got to visit New York Stock Exchange, got to see all the excitement on the floor and how stocks are treated. So that was cool. And but you know, it’s funny, I saw the movie Wall Street when it first came out. And because it was really big into movies when I was in high school, so that was cool. The whole But Fox situation with him analyzing financial statements and companies and taking it to investors and pitching it. And that’s really nice. Gordon Kenny looks so cool. And it looks cool. It was a very well done movie. And it just got me excited about the process of investing in companies and learning how to get returns and talk to investors. Although is a very exciting process. And then Trading Places came out with Eddie Murphy, Dan Aquila, which is in Philly, I think right or takes place in one of the things. Yeah. Yeah. So Eddie Murphy went from being homeless to becoming like this commodities trader and ended up, I think they tried to use them or something. I mean, and then they just they made these, these old guys made a bet and they lost. One guy got rich. I mean, it was cool. Those are all like fun. Little benchmarks for me that the guy may said about finance. But then I took the economics course. And I was like, wow, this is how this is. This is like the cherry on top. This is exactly what I wanted to be doing. And so I majored in economics, and the highest in college, and then went to work in venture capital in London. I was wanting to work abroad, too. So I worked in London for a while. That was great. Got to meet lots of entrepreneurs, and a lot of great ideas. So that was a good process, then ended up working on Wall Street as an investment banker, and doing that, for a few years. That was fun. I’ve worked with Snapple, iced tea, and Revlon. I worked on the Viacom purchase of Paramount Pictures.
That’s like Comedy Central and stuff, too, right. Like they fall under Viacom. The Comedy Central channels like Comedy Central, I think fall under Viacom, too.
Comedy Central, MTV, and they were trying to be a studio themselves. So they acquired Paramount Pictures, and that was a big deal at the time. I mean, yeah, $10 billion deal, and people were like, Oh my gosh, it’s huge. It’s a lot of money made nowadays is nothing but back then it was a big deal. And nobody understood why you would acquire an asset for so much, you know how you’re gonna get your money back. But we saw all these technologies sort of converge and rapidly emerge during that time with digital compression. We went from like 12 channels to like 1000 units. Now you had all these outlets for content. So just so it was good, it was obvious was a good purchase for Viacom and in retrospect. But it was one of the most exciting things I worked on. It was actually the first thing I worked on when I started working there. It’s like the last week.
I feel like talking in such big numbers, you’ve probably got I wonder if you get desensitized to it like $10 billion deals 10,000,001 mil, you know like you’re dealing with large numbers, large companies. And I don’t know like from the movies, right? And even from billions, I don’t know if you’ve seen that show. Love it. It is kind of like an inside, or it tries to give you kind of an inside look of what it is like a little bit on Wall Street and you have this like, I don’t know, this image of like how ruthless it is how it’s like a chess game, everybody’s you know, trying to like out when each other and a lot of attention to detail and interpretation. You’re like, yeah, it’s above my understanding. But I’m curious for you, in all the years you’ve been in it, like now, in 2022, how different is it from? You know, even I would say five years ago, 10 years ago, maybe you will say, I don’t know, you tell me like, Are there principles that are still okay, this is the same not surprising? Or are there things that really have caught you like, Wow, I can’t believe this is happening in the investing world?
That’s a good question. A lot has happened. I mean when I was first when I first started, cash was King if you had cash flow, everybody wanted to be a part of whatever you were doing. But it seems like just in the last 15 years, I would say most investors will invest in companies that don’t have cash flow but don’t have the ability to pay their bills unless they have an investor. You know, now they know a company is measured by revenue growth or year over year growth, because for some reason, it became this thing where revenue became a future indication of cash flow. That’s, that’s, that’s true. But if you’re trying to create, if you’re trying to separate yourself from the competition, and you’re in, you’re a technology company, or some sort of tech company, you got to create this what they call this moat, between you and your competitors. There’s a wide river you don’t want to be in a red ocean? Obviously, you want to be in a blue ocean, but do you want to be on the other side? So that’s where a lot of money goes. With a lot of companies who are investors, they’re paying to be set apart from their competition. And the problem really becomes they only have revenue, they don’t have they have negative cash flow. Because they’re spending money out of their invest investor money. And then they went they do they send these news companies. And then there’s the exit, the companies need to exit within three to five years. So the investors get their money back. And then hopefully most companies exit through acquisition. So another company comes and buys them. And so now they absorb all of that into their operations. And then it’s no big deal because the big company is probably a multi-billion-dollar multinational company. They can absorb losses, like a way bounty paper towel absorbs water. They’re acquiring intellectual property and other assets to show they have revenue. And they’re like, Okay, that’s it. So it’s way different than it was back then. It was more like people were a pill people back then I felt we’re building companies with cash flow, and keeping them in the family, for generations type of thing. And I think that stuff is starting to turn around now. But in the last 15 years, it’s been total euphoria. You got to technology, here’s $10 million. Let’s spin money on Google and Facebook ads and let’s build this thing. And then that’s it in three to five years. We’ll sell it to somebody else. Everybody’s happy we’ve all exited onto the next one.
That’s a vast difference. And I would say like, I don’t know what does this mean for someone who is on the other side, who’s not in the same rooms as maybe you are observing this but at the same time, you are seeing like, oh, this affects how I spend my money. Do I put it in Robin Hood? Do I put it in bonds do I put it in an I don’t know, like, what is the gold? Is that making a comeback? What’s kind of the strategy change or shift that you think you’ve seen from that cash flow to revenue thing? I think one thing I took from what you said is like, Bring cash flow back maybe. And that’s how you do still create a moat. And that’s a timeless principle, maybe, depending on what game you want to play, if you’re like, I want to create this the company and exit like, I guess that’s a different strategy. But maybe for the vast majority of like small business owners or freelancers or coaches or something like that. You’re looking at it from an investor perspective, how can I like create assets and build leverage? And then how do I maybe build that same moat around myself? Because I may not be getting acquired, or I may not acquire another company, but I do need a moat I want the blue ocean. So what do you think, is there something from this that you have taken away from a strategy standpoint?
Well, going back to what you said about Robin Hood and all those different platforms. I mean, those have been great, especially for younger investors, learning how markets work. But I think that if you have, I think if you are goals-based if you’re a goal-setting type of person, you probably don’t want to open an account with Robin Hood, you probably want to open an account with an advisor that can help meet those goals. I mean, even a large company, hires an investment bank to advise and guide them into the right types of deals, the right types of financing for those deals, so they can continue to be a company, that they’re not doing things though overextend themselves. And then and then those bankers have to convince other investors to invest in those companies, especially if they’re raising money on capital markets, they have to go to institutional investors to do that. But for individual investors, you see a lot of people going into Robin Hood, and all these platforms to invest money on their own. And what we’re seeing today is that doesn’t really it’s fun when the markets are up, because you turn on your app, and you see all these returns in your portfolio of all these ETFs and all these fractional ownership of shares. But then when the markets are down, like right now, what we’re seeing is red people panic when they see read, and they start selling, and then the stocks and the rebounding. And they’re like, wait a minute, why sell? Yeah, people are really emotional. When it comes to things, people are really emotional about money. And so when they invest it, they’re also really emotional about investing, they invest with emotion, which is not really investing, it’s mostly trading you’re speculating on a stock that you purchase, because maybe it’s, maybe it’s your favorite. Maybe you use the brand in some way in your life. And that’s sort of like conventional wisdom, buy a stock share your favorite item that you like, yeah, it’s great. Because I mean, for example, you might be a big Netflix fan, and then you bought Netflix five years ago, and you’re like, Oh, this is great. Netflix was going up for like years now. It’s 50, almost 50%, down from what it was five years ago, is it still your favorite? I mean, is it still your favorite stock, still your favorite company? Because down? Are you checking out, most people will check out. And that’s why people who invest with robo advisors don’t don’t do well, because they have, they’re just too emotional. You need an advisor. If you’re trying to build a portfolio, you need an advisor, most important you need to know how to invest money and create a portfolio that you don’t have to look at all the time.
When you think about this, like building a portfolio, what is for most of us, right? Like, what is the safe bet that still maybe holds true? I hear like, okay, Roth IRAs are a good place. If you’re still in, there’s a cap or whatever, right? If you make less than this amount, you can still have a Roth IRA or whatever, you can put this much into it. Okay, put your money there or do one of those tax the or, or the date, target date, retirement funds, or whatever. So it’s, it gets so I don’t know, not complicated, because I’m sure when you look into it, it can be simplified, but like, it seems complicated. Firstly, like, there are so many options, which one is the right one? I mean, is there a hierarchy to this, right? It’s like you would say, Okay, step one, look into here, step two, look here. And then step three, maybe Robin Hood, or whatever your play investments might be.
So the best way to answer that as far as building a portfolio, it’s like driving a car. So when you’re driving a car, there are a lot of moving parts. You’ve got the engine, you’ve got your accelerator, you’ve got your alternator, you got all these moving parts, but you have but at the end of the day, you don’t move without a steering wheel. So it’s like yeah, Have, you need the steering wheel to move, and that’s only one. If you think about it, that’s one part of the car, just a steering wheel, you have to use that to sort of navigating your way to your destination. But meanwhile, behind the scenes, you have all these different parts moving. So that’s how portfolios should work, you should be building, the way I like to build a portfolio is, you need to look at dividend stocks first. Those are stocks that don’t move that much, but they pay profits back to the shareholders, being a shareholder is key. Because when you’re a fractional share owner, like a Robin Hood account, you’re not a shareholder, you don’t have rights, you might get some fractional share of dividends. But I think it’s really cool for you to actually own the company.
I have a piece of it, especially if you’re like, not, maybe you’re you own your own business or you plan, you don’t want to start one or you don’t want to get into real estate or whatever it’s like, well, it is a form of leverage to own something. And why not bet on a series of places or companies or people that you’re like, Okay, I believe in this, or I can see this making sense. And yeah, it feels like it’s kind of working for you beyond just you putting your time into it, which is, maybe a utopia or like something, we all kind of want to some degree, right? So, okay, that makes a lot of sense. Now, is there a certain place you say, to start kind of looking for this like, because there’s a lot of companies too, right, like, Vanguard and Charles Schwab? And then you’ve got like, find individual advisors, the thing that’s fascinated me about what you said, there, it’s like, money is emotional, ran, and most people are emotional with it. And so having someone who was on the other end who’s like an actual human, versus an app, being like, Yo, like, this is what you need to do, or this is what you said you wanted, I’m sure you have a lot of like, you just have a lot more insight being on the other end of it. It’s just like in fitness coaching, that’s kind of the world I came from. Yeah, you could do stuff on an app, right? But when you have someone on the other end, who wrote a workout for you, you’re a little bit less you’re more guilty, you feel a little more guilty. When you skip it, you’re like, ah, someone put time into this. And so there is something to that, I think, with working individually with a person to customize it. What do you look for, I guess, in someone who’s a good because there’s a lot of options, I think, just like there is in every industry now. Right? Lot of trainers, a lot of lawyers, lot of real estate agents, what do you look for in a good financial advisor?
Number one, a good financial adviser will start asking questions about you, who are you? What are your goals? What excites you about the markets, and which excites you about life in general? What are your plans in 10 years? What do you expect to be? In five years? Do you have any major purchases that you’re thinking about? I think a good faith adviser will invest time and getting to know you as a person, and start to also understand what your risk tolerance is, you know, like, for example, what kind of person are you? Are you Are you someone who’s good with, like, 10%? downside risk? I mean, that’s kind of jargony sorry, but if your portfolio went down, 10%, would you be okay with that? What about 15%? But about 20%? So everyone has their, their? Their, their red line? I don’t want to lose more than 10%. I think I’d be okay with 15%. Because long term 20% I don’t think so. That type of thing. So, so you really get to know the person, the temperament, the risk tolerance, their goals. And the idea is to create a financial plan with all the resources that that person has to meet those goals. I think a lot of advisors. And honestly, I think that’s the reason why there are so many people opening Robinhood accounts because they feel like they’re not getting advice. They feel like they’re not meeting people who know them. Even if you have like an on-demand financial planner, through someone like Vanguard, which is a great company. I think guard is a great company. But they’re not, but they’re too big. And they’re not like I would I would say they’re not set up like a large wealth management firm, like UBS to have a personal relationship with clients. But the only issue with UBS is that they have very high minimums. If you don’t have half a million dollars or more, you can’t really be a UBS client. So what does everybody else’s? But there are plenty of advisors that can work with most people, but they should start by asking questions about who you are, where you’re trying to go, and how do you want this money to work for you? Are you what kind of risk are you willing to take to achieve this goal? And then and then should be to put a plan together to help you meet that goal and help you meet your expenses down the road. You know, all kinds of cool stuff that will help you get financial freedom. That’s what good advisors should do. And they should be acting in your best interests. Number two, for example, a lot of advisors sell products. Some of them specialize in insurance. And they’re convinced that insurance is what you need to do to grow your assets. But you might not think so. you might be like, weird, like, why would I invest in insurance? Now, there’s Yeah, there is a place for insurance. But it’s not for everybody. But some advisors, they’re so convicted, the like, this is it this week. And you don’t want to kind of wants to hear from those guys or gals, because, you know, they have a conviction, they have a specialty, Tobias. They’re not thinking about you. They’re thinking about what they can do and sometimes it benefits them more than the client. So you want to find somebody who has your best interest.
That’s really good advice. I’m curious, to dive a little more into this money and emotion thing that you mentioned, because I think that is pretty present, especially as I’m thinking about, like, a vast majority of people under 3035, maybe 40. Even like, nowadays, there is this feeling of you’re constantly behind the eight ball, right? Like, oh, I didn’t get started early enough. And it’s too late, or I don’t have enough savings yet to get started in this. Like, when is the right time, maybe to begin? Like because you said, Okay, half a million, that’s like one company’s quota, right? But then maybe it’s like, hey, maybe start even when you’re paying off your student loans, or whatever it might be. So you have a plan. But so that’s one side of it. But the second thing that I’m curious about is more so like for you personally? What was your shift if you had one with money, and emotion? So did you find for yourself that you at a certain point? Maybe were ruled by that? Or can you recall a lightbulb moment, where maybe it’s just from being in that world? Like, once you’re in London, doing deals, like it becomes normal for you to just like, I don’t know, be less emotional about money or feel like, oh, yeah, I know how it works, I can acquire it just different energy around it. I’m curious, about what you have also picked up around that because I think you probably see that a lot the same way. In fitness coaching, we see that with clients, like there’s a lot of preconceived notions and a lot of wiring that you really have to work with, where you have to help kind of, you know, bring to light a little bit. And so do you ever notice that, or deal with that personally, have you? between money and emotion and how one can get in the way of acquiring? You know, more of it?
It’s funny because you mentioned fitness, and there are so many analogies to financial planning and investing. Because even with some fitness coaching, they offer meal plans, there’s two sides of that, right, there’s the there’s the exercise part, and there’s the diet part, and then some have to come together to achieve whatever outcome, I guess you’re trying to achieve for for your client. Same thing with finances. It’s really a mindset thing, too. It’s a mindset shift. Mindset is a big part of investing. And if things are not right up here, then things are not gonna work. Well with investing, because you really have to make that shift. I think most people make the shift when they’re leaving their corporate jobs. After they’ve been contributing to their like, 401 k plans they have they look up one day and they realize, they have 100,000 or 50,000, or whatever the amount is in their 401 K plan. And they’re like, wow I have I have some money. What do I do with it? Now, other than leaving my job? Do I keep it here? Do a rollover into my next company? Or do I use it to help start my business? What do I do with it? That’s when I feel people are ready for a mindset shift. They’re ready to hear options. They’re ready to be coachable or teachable about money visit can do with it, the array to see what the projected return might be if they left the money alone, versus spending it now for the majority of people that is where the biggest mindset mindset mindset shift happens with money, and then they start to realize that you know what, I can’t do this on my own. There are so many different moving parts here. I have so many goals and things to do. I really want this to work for me, and I don’t want to be emotional about it, I really need help. So that’s when they’ll call somebody like me or some other advisor to help them. And some of them are calling me because they’re changing jobs, or they’re calling me because they’re starting a business. And I help people start businesses and get off the ground as well. might introduce to investors to so because most of my businesses with entrepreneurs and CEOs of companies, yeah, all different stages.
I was gonna say, like your clientele and who you may have dealt with like you said, they’re at that stage where they are ready, like you don’t just like, I mean, I’ll come back to fitness coaching again, right? You’ve got clients who are ready and who aren’t. And ones you have to fight to, like, get off your program and do it. And then ones that are like, willingly, hey, I’m ready for this. It’s time. And those are two different experiences for both the coach and for both the client, right? And so you seem, especially as in any career, I think as you keep going, it’s like, you begin to get more people who are just more aligned with your stuff already, or they’re ready. And so I’m curious when you have dealt with CEOs and business owners who are, let’s say, like, behind that stage, right, they aren’t quite ready. And you may have had to even walk them through pivotal shifts in their mindset in order to reach the next stage. Is that what is that for a lot of fresh, like, smart, let’s say some really small businesses, right, like solopreneurs, to maybe a couple of assistants or whatever, like, small to medium size is there like because I know these markers, for me, at least I’ve paid like, okay, a year and a half and right, that’s like a year and a half and is where you start to see some returns on all your energy, like the stuff you’ve been putting out if you’re your messaging and your audience and content is all clicking. Sometimes it’s faster, but it’s just kind of like, okay, around this time, this is like a level up, where it requires different thinking and what you needed to get started as different than what you need to kind of keep growing. So what have you noticed and fresh starts like that? What’s the first hump that’s like, I need to conquer this mindset-wise, to get to the next level with maybe money.
I mean, if you look at CEO compensation, especially the CIO, the CIO, CEO in early-stage company versus later stage, totally different CEO and the early stage, most of them have funding already, they have salaries they have, they have stock options, but they’re private companies. And so it’s a much different planning process, if you will, it’s more, it’s more or less, it’s more traditional, like business owner, type of planning, where you want to make sure all their personal goals are sort of on track. They’re not being derailed by the business type of thing. Especially if they’re getting a salary of investors they have to count to, and a lot of it too. I come in also as one of their advisors trying to answer investor questions, learning about the valuation of their company learning how to look at data. So I help support them in that way, as well, where a CEO and a later stage, they don’t really need me for that per se. Because they’ll they’ll have CFOs will have people in their C suite, I can help them with that. They’ll also have stock options. And a lot of these companies are already public, or they’re about to be acquired. So that’s a whole different ballgame. Because now you have large blocks of concentrated stock, some of its in the form of options, some of its in the form of what’s called restricted stock, we just get stuck. But then once you’re public, you have about six months, sort of like a blackout period where you can’t do anything, the stock price is not so volatile, right? That you’re under the money if you will, not at a loss. So then you have to start creating sort of different kinds of investing strategies called Risk Management, where you want to protect the downside of that stock as much as possible. Because I’ve worked with several I’ve worked with allows us as I work with have large concentrations of stock, so and we don’t sell them all at once, although some do. But others hold on to it. Especially the ones that the CEOs that sell their companies, they’ll hold on to the stock, sometimes they’ll have a tree, we’re gonna buy your company with our stock. So now they have the stock of the acquirer and then the CEO and she stays on for about three years so that that person can’t compete against their firm in another company, and they’ll get a salary So that salary sort of covers when they have a salary and it’s a decent salary. They’re not worried about the constraint stock. Sometimes, having that country of stock does really well, depending on the company, of course.
Well, that’s where I guess the risk management comes in, right, we’re gonna help kind of evaluate that. That concept is really interesting to me because I knew somebody when I was a younger family friend who was studying math and getting into that world, and I didn’t quite understand what it was. But you put that pretty simple, and it makes sense where it’s like, you’re protecting the downside. And in this case, it stocks but I think that’s a great probably concept that you could apply to a lot of things like anywhere, you’re investing your energy, your time, your money, your attention, what can you do to protect the downside of it? I’m curious from a stock standpoint, like what do you like? What are you doing? What are the strategies to protect your downside? Are there some obvious ones that are like, Okay, this is universal? And you could maybe apply this to some other stuff, too.
Yeah. So what most people do? Well, if you really want to protect your downside, you can buy what’s called a put option. Basically, what you’re doing, you’re selling by by you sell a put option. So for example, let’s say, we’ll say own Disney stock, for example. And it’s, I don’t know, $50 a share, we just make it up for now. I don’t know what it is. Let’s say it’s like.
It was like 140. Right, or 120?
Yes, it was. I think it’s definitely more than $50 a share. I just wanted to make it Yeah. But yes, it says you can also share, you can actually celebrate. So when you do, you can create an option and say, Okay, I’m going to sell my shares to someone else, if it drops to $45 a share. So when it hits $45 a share. So basically, you sell the options contract, that person buys the contract, so they now have the right to buy your shares for $45. So let’s say there’s bad inflation news now coming. Now your stock is down to $45. A share, guess what that person now is obligated to buy the shares from you for $45 a share, you’re probably thinking, but I lost money, I just lost 10% of my stock purchase, but no, you have offset it, because they paid you for the option you didn’t lose. Because you so people forget that when you sell an option, you get money for that it’s called a premium. These actually sell the right, you sell the rights to buy the stock. So you get, it might be like $5,000, for 100 shares or whatever. So now, you’ve got $5,000 in cash, then you sold your stock for $45. So now your loss now 10% loss, maybe like 5% loss 2%. So so that’s how that works. That helps. Now, of course, you only saw the put option, if you think the stock is actually going down to like 30. You have to be really pessimistic about Disney to do a put option.
Which is I guess, where it’s like if you were that pessimistic about Disney in the first place that maybe you shouldn’t have maybe bought it right, you kind of want to be in a position where you’re like, I’m gonna ride this out. I do think after this hump, maybe it will come back. But then I guess that’s where it’s tough. It’s like how long do you wait for them to come out of the hole if they do? And so okay, that makes sense. And me thinking about like that, just to, I don’t know, I think about like energy and time a lot. it is the same way, like you’re investing in 30 minutes. I mean, you invest an hour with me today. It’s time, right? And it’s like, you could have been doing anything else. And so it is valuable. And the same way people say, time is money. Like there’s truth to that. And so I think it’s like when you invest your time and stuff, how do you deploy the skill of like risk management, where it’s like, what you’re doing the downside of it is not like, like, it’s almost like you’re, you’re in a win-win situation, I don’t know if you feel this way about podcasting, but I did, like, for me, it was like, um, anything I suck at this, like, I’ll probably learn a ton from the people that I talked to, I will maybe hopefully get better at, like, fewer filler words and verbal tics that I had and stuff like that. Maybe I’ll ask better questions. I thought of all these things that was like, Okay, what’s like, if this does still suck in the suck, what’s like the thing that’s still kind of like, Alright, I’m, I could maybe get this out of it. And I think that’s a very tactical way to maybe go into whether it’s a stock or anything you put your time into, you’re like, okay, like, this is a win-win. And it kind of, I don’t know, I guess it helps you sleep a little bit better at night. When someone’s in charge and helping you manage some of that risk, and the more I learned about, like, successful people are you hearing their stories? They’re very, it seems like they’re very risky. But it’s really that they’re risky, within a very constrained set of like boundaries, they’ve just managed all the other risk very, very, very well. So that they can kind of go all-in on a couple of different things or whatever. So I don’t know, maybe I just answered my own question there. But that’s kind of how I am looking at it outside of that the stocks and investing world. Have you ever? Is that something that you’ve ever considered with risk management? Or is that just me with just hearing the two terms kind of fair together?
I mean, first of all, I mean, when you talk about podcasting, anything that you tried, that’s brand new, in, no one’s gonna be good at it at first but what’s funny, a lot of people like to try things that like to do new things. And they realize that it’s not perfect in the beginning, they just give up, everybody just gives up in the beginning, it’s not perfect. I’m not losing weight or making money in the stock market. So just give up, you put it in a savings account somewhere, or they go back to what they usually do go back to their eating habits, whatever they do, they just go back to it. Because they seem like everybody wants something to happen so quickly and so perfectly. And it doesn’t work that way. And people with a people who are, I wouldn’t say it’s a billionaire mindset, but a success mindset. You always start something, it doesn’t be perfect in the beginning, but it can be perfected over time, people see the effort people see the learning, you’re growing, you’re better at interviewing or you’re better at doing this, or you’re staying consistent. People see that, and automatically things get drawn to you. When you do that, when you’re consistent at it, at the very least you have to be consistent. And as far as risk. What’s funny about risks, especially with billionaires, because I had no I haven’t, I’ve only have two as it goes clients actually. And so here’s the thing, all of the risks they take is in their business, they all say the same thing. They say what, Daniel, all the risks that I’m taking in my business, I’m taking it, I’m just going for it. But in case it blows up in my face, I want to make sure I have money as a buffet, right? So they’re not their whiskey in their businesses, but they’re not risky in their wealth management. It’s pretty boring. I’m investing in muni bonds, and maybe obviously, some, some blue-chip stocks. And some of them have concentrated stock because they have worked, why but other companies, so they have large blocks of stock of the acquired companies, or they have large blocks of stock of their public companies. But they always have one portion of it. That sort of like, like savings accounts on steroids, some muni bond account. Yeah, muni bonds are tax-free interests. So okay, it generates tax-free income, which you don’t have to pay taxes on. So they can often live off that. Or they can reinvest it back in many bonds, and knowing they have that peace, gives them the comfort to take all these risks.
It gives you the little moat that you’ve talked about the kind of building around you. So that you can take on that kind of risk. You talked about how your involvement in media now, right and how you are like you’re just making not just in podcasting, you’re doing more videos, you’re getting really creative in what you’re doing. And, and I am so curious how that ties into the, I guess valuation of things. Now, as you said, at the beginning of this episode, it does affect it, like people if you’ve got 10 million Tik Tok followers, but no cash flow. And it looks like you might have a promising coffee bean that you’re going to come out with. It’s like, it all of a sudden creates some value out of nowhere, right? That you’re just like, all it was was media. So I’m very curious, like, what’s your take on the impact of that? Because you’re constantly evaluating things right? And say, Okay, this is, is this worth this much? Is this the right time to buy this or sell it or whatever? So, how, what have you observed from seeing like the impact of how someone could be sitting like no camera even right like podcasts are a great example of that. It’s just audio. And if you hit a nerve and you’re connecting with the right audience, your content aligns, and there’s a good business back end to that like you’ve now added in I don’t know perception around your brand, like something that didn’t feel valuable or was valuable all of a sudden, there’s a story around it. And the more you break down how big companies do that, it’s just that on steroids, right? It’s like, oh, they did it with podcasts, they have a newsletter, they do ads, they do this and everywhere. They’re like, creating value through media in some way. Because I don’t know, I’m curious, has that changed a little bit? Or what’s your like, from a financial advisor’s perspective, watching all this go down on Instagram, Tik Tok, podcasts, and YouTube. And also being now involved somewhat in that world.
Someone told me what to say, five, seven years ago, that if I don’t have a website, they don’t exist as a company. Yeah. And now they’re telling me in 2019, that, if I don’t have a LinkedIn account or Facebook account, I don’t exist. Right, right. So keeps growing. And they’re kind of right. I mean, what’s amazing about technology, and media, is I can do a commercial for my company, at the same quality that a large wealth management firm can do, at a fraction of the cost
Probably faster too.
And faster exactly, with all the different reports, multiple reports and a large company, and things that let me sign off on, it could take days, weeks, and even maybe a month or two to actually get a commercial at a large firm. And then even when it’s done, it’ll probably be done. So out of touch with what investors want to see or hear because, I mean, from where I stand, a lot of large Wealth Management management firms are still talking about IRAs, 401 Ks, and, talking about the stuff they’ve been talking about for years, and what I find, especially young investors, they want to know, where does your advice come from? What informs your guidance tell me where did you get the idea of asset allocation? Like how to how to, how do you choose what stocks, like you said earlier to invest in those things, are really, actually really easy to communicate through social media, really easy to communicate through video. And most times, I don’t have a bunch of multiple, I don’t have a big company, I might have 10 employees, I can take out my cell phone and just fill myself and have it edited within 10 minutes, then I could just post him just like that, and people get to know, Well, I grew up on a farm. And this is how farming is done. And this is an investing the same way so I can share all kinds of cool stories. I just share the story today about how I got cut from the Little League baseball team, I’m a really big baseball fan. And I wanted to play Little League, and I got cut. And I remember I cried so hard, and my dad was like, what, next year, you will make the team need the practice. And with baseball, you need someone to practice with to hit the ball pitching, catching the ball. So my dad did that for me, every single day for a month, I made the team I did really well and scored home runs I hit home runs I stolen bases, the whole thing we made to the championship won the championship came MVP of the championship game into the year ago, a year ago, I got cut. So again, it goes back to I was saying in the beginning of our conversation about the importance of working with someone, it really just accelerates things even with you with fitness. I’ve worked with fitness trainers, and personal trainers, it’s always accelerated my growth, I always lose weight quicker than I would have. If I did it on my own watching YouTube channel in the gym trying to figure out how to have the right posture for different dumbbell weights or whatever. So it’s always easier and always more enjoyable to work with somebody to kind of like keep things consistent, keep you motivated when markets are down. That’s when I talk to clients. And when I say what, everything’s okay. Everything’s going to be okay. Here’s how we’re going to look at this moving forward, and then that’s it, they can go back to sleep, you don’t have to stay awake worrying about what’s happening. When you’re by yourself you worry about what’s happening. You don’t sleep like well, maybe I should have sold the Apple stock, and bought Netflix.
Paralysis analysis right? You just overthink to the point where you’re like, Ah, screw this I’m not gonna do it.
Exactly. Gonna wait it out. And then we’re winning and that was probably the best thing to do. I mean, the end of the day. To don’t do anything.
That does work. I’m curious you, you mentioned this thing about how you grew up on a farm. And all of a sudden, I didn’t know that. And now I know that and it gives me this thing where it’s like, oh, that the adds to your story, that one sentence that informs, I don’t know what it does. But in the brain, it makes you go, Okay, this is Daniel’s background, like, I now have something to it’s not just that you grew up on a farm, but what I mean? Like, you have the strand a story a moment that you’re, like, attaching to this person. And I often think like, in a world of financial advisors, where the advice, a lot of it is constant, right, like, it’s still smart to do some of the boring stuff that you mentioned. So how do you talk about that? And how do you storytelling around that to make it interesting? And I think what you’re doing, like how you just shared that story, but you told something valuable in the financial world with it, is that what separates, you know, financial advisors online now, in terms of like, okay, I connect with somebody who grew up on a farm or whatever. And then somebody else who’s like, I’m an investor, I’m, I’m also into fitness. And I’m into this guy because he likes CrossFit or whatever. And you have your choice, right of like, very, very specific stories that you can connect with. If you don’t like this advisor, don’t go with them, there are a million others that you can choose from. So that form of leverage that you’re talking about, you’re right, it’s like you couldn’t make a commercial on your own. You spend $10,000 on it, and your life savings maybe to like, okay, let’s maybe get a return on this 45-second commercial when now it’s like, okay, maybe for free or less than 100 bucks, even you could make something happen. And that form of leverage is definitely still relatively new that that wasn’t accessible to us, and to people like 20 years ago, 30 years ago. So yeah, I’m curious, like in your world, how, how often in the billionaires, millionaires, like people who are doing business closing deals and negotiating, how often do they communicate in stories? Do you know what I mean? Is it very cut and dry? Is everything very transactional? Or is it very, like, not schmoozing? I want to say, but like, you’re just sharing stories. And there’s a big likability factor to like, alright, this billionaire trusts me and likes me. And so I connect with my story or whatever. And so I’m, and I know, he knows, it signifies where it came from, and what I’m doing. So I might win the deal there, what I mean? Is it is that prevalent in your world? Or is it very, like, Hey, I’ve generated millions of dollars for people. So I win the business because like, everybody’s looking at very looking at a very transactionally or are people moved by stories in the millionaire and billionaire sector the same way? Like we all are as humans?
They are moved by stories. In fact, if you go to a cocktail party, they’ll introduce you. Oh, this is my financial advisor. You didn’t grow up on a farm? Right? Oh, he’s a surfer too. He also serves, I don’t serve, that’s pretty cool, that’s how they introduce you. They don’t, they don’t say, Oh, this is Daniel Evans. He’s the founder, and CEO of Evans and company, and this is his background, 20 years. And they don’t do that. They’re like, right, this guy used to, like, use a hoe to turn the ground. What did you plan when you told me you can hear the day to make this guy point tomatoes? Can you know, after a couple of drinks is like, you came and plant, grass it’s like, the love the stories that connect with the stories when you’re on a certain level, I hate to say when you’re on a certain level, I hate seeing that. Everyone sort of like has the same access to the same things. BUTCHER, they just take advantage of it. They do a lot of reading and observing and they take away different bits of wisdom on how they can do things differently in their lives, and how they can be better I share the stories so that people can be smarter can be better at what they do see things differently. That’s certainly a reason why I show and I share them so they can get to know me in growing up on a farm. There’s so much I’ve learned so much about investing. In fact, a lot of the takeaways I use in investing come from farming, and baseball, and in baseball, you win a game you hit a single double a home run, and you can hit all kinds of different hits. Eventually, you get points you get you to get runs and you hope the ones have the most you win. Same thing investing not every style cuz it’s gonna be like a favorite that’s going to shoot for the moon, one stock might go up 60%, or they might just go down 10 That’s not their day. But at the end, you’re looking for a net return that helps meet a client’s goal. So you tell stories like that people understand it. Once when I first started the business, I wasn’t as self-aware as I am now. But one of my favorite foods was pizza. And people used to ask me, So what’s asset allocation? You know, I say, Well, imagine you have a big pizza pie, and one side is plain. And the other side has sausage and mushroom and peppers. Say, that’s, that’s allocation. There’s a big pie with different types of things on it. And that so they get it. Some people get it. Now, I understand. I actually, also love chocolate chip cookies, I use these chocolate chip cookies, as an example, you have to take the flour and the baking soda and the chips, and then you mix it together. And I know it doesn’t look that great, and maybe doesn’t taste great at first, but if you put it in the oven, you finish it. It’s awesome.
I love that I love when people like to make that work. It’s like stuff that’s so there’s a uniqueness and universal ness to what you said, like baseball, and growing up on a lake, those two analogies give you this launching off point that even though I haven’t grown up on a farm like there’s something universal to the struggles of growing up there, maybe like maybe I’m from India, or whatever. So I’m like, I remind me the village or it like signals, images in our minds when we hear stories, right, or good stories. And so, as we kind of wrap up, I’m curious, you’ve heard a lot of stories, you’ve told a lot of stories, a lot of different ways, and you’re still continuing to tell them today. What’s something you could leave the average Joe with here? For me, and or for anybody who’s listening, that we could apply? To help use stories to make more money, and to build wealth? And all the things that you kind of talked about today? And who knows, maybe it could be a mindset thing, right? Like a story that’s driving you or it’s like, Hey, have a cocktail party story ready? And find that for yourself of how you might make that work for you. I don’t know. What’s your kind of takeaway? What do you want to leave us with around storytelling, money investing, and all that good stuff?
Well, it’s funny, we’re just talking to my dad this weekend about whether or not squash and butternut squash grows actually burn out squash, you can harvest it in October, but Jeff, you actually have to plant it in March. So that’s a good six months, before you actually see anything. We’re not so fresh. And the thing is, like in March, it’s really rainy, it’s really cold. And you probably think to yourself, like why am I putting the seed in the ground? Like, I feel like it’s not going to grow, maybe I should not plant the seed. Now. Maybe I should wait till later when the sun is out. But no, he was just explaining to me this weekend that it’s very important that you plant the butternut squash seeds in March, no matter where no matter what the weather is, like, because it’s going to grow, no matter what. You just have to be patient. And it just made me think that even in the middle of a violent storm, or a very heavy rainfall month. During that time of the year here in New York, you got to put the seed in the ground, you got to start somewhere. Don’t look at the circumstances. Don’t look at you know, don’t overthink, you know, oh, this is a really bad time to invest money, this is a really bad time to have plans really bad, I need to just take this take a step back. I can’t afford gas, I can’t afford this, you can start somewhere a butternut squash see is literally I can’t I mean, I probably couldn’t hold it probably couldn’t see it. With my hand. It’s almost a small mustard seed. I’d be probably covering it up or something. But you know that one seed, actually, you can create for butternut squash and of that feed a family of 12. What is the idea of putting something in the ground to investigate any level when this Robinhood account or E-trade account or with an investor? I mean with an advisor, you just plant a seed in the ground and just over time, just watch it grow. Now, in these months as we head into summer, you have to water it a little bit. So if you want to add, add to the growth you could do that doesn’t have to be much and just watch over several months. It takes time. Nothing ever happens like right away. We live in a culture where we want instant gratification. And there’s a real art to just patients but you have to plant the seed first.
I love that. What a great way to the kind I’ll wrap things up here. Where can we follow along with what you’re up to? Because you’re doing so many different things that I think are cool. What do you have a website, Instagram where you kind of most active and where we can kind of support what you’re doing.
So my website is www.evansandcompany.com. Right on the homepage is the join Mailing List button, you can just press that to join the mailing list. I’ll be watching audiobooks. The two digital courses. One is financial planning for kids. One is to help traders become investors. The book is coming out in November I’ll probably be doing a newsletter that’s only for the email subscribers. You can also catch me on LinkedIn, Daniel Evans. Be hard to miss me. I don’t think there’s I mean, there’s probably a few Daniel Evans. But I got my wife and my son in my profile picture or whatever. headline or banner?
There are so many components to a profile now, right? It’s like every profile has a different thumbnail. You’ve got the story highlights, depending on where you’re at. But I love that I will. I will link up all of that good stuff. Thank you so much for sharing your time with us today. I really appreciate how you need a lot of complicated concepts. Very simple all the way down to the butternut squash. So thanks again, Daniele. This is fun, and I’ll talk to you soon.
I appreciate it. Thanks for having me.