RWH048: Betting Billions On Outlier Talent w/ Adam Shapiro

We Study Billionaires - The Investor’s Podcast Network

Stig Brodersen

Education, Investing, Business

4.6 • 3.6K Ratings

🗓️ 4 August 2024

⏱️ 119 minutes

🔗️ Recording | iTunes | RSS

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Summary

In this episode, William Green chats with Adam Shapiro, Managing Partner at East Rock Capital. Adam oversees billions on behalf of eight vastly rich families, allocating their assets to everything from hedge funds to private equity. Here, he explains how to build & safeguard wealth over the long term; how he identifies the best fund managers; why he’s wary of index funds & ETFs; & how to thrive by building a powerful network & removing excess “filler” from your portfolio & your life. IN THIS EPISODE YOU’LL LEARN: 00:00 - Intro 07:29 - Why Adam Shapiro stopped investing in emerging markets. 11:26 - Why the U.S. is a great—but potentially perilous—place to invest. 25:31 - What he learned at Goldman Sachs about intelligent investing. 32:02 - How he identifies fund managers who are likely to outperform. 40:01 - Why he favors small funds run by young & hungry investors. 45:56 - What human qualities lead to investment success. 51:53 - How Adam built an investing edge through networking. 1:13:21 - Why Adam is wary of index funds & ETFs. 1:20:05 - How David Swensen’s Yale Endowment Model can be updated. 1:24:20 - How to reduce your risk & ensure survival in extreme conditions. 1:21:31 - Why his #1 financial rule is “never, ever run out of liquidity.” 1:32:22 - Why firms like Millennium & Citadel may be riskier than they seem. 1:43:16 - How to improve your portfolio & life by subtracting excess “filler.” Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences. BOOKS AND RESOURCES Adam Shapiro’s investment firm, EastRock Capital. Harvard Business School’s case study of EastRock Capital. Adam Shapiro’s articles in his LinkedIn newsletter. Check out Institutional Investor’s article on why early life-cycle funds outperform. Seth Stephens-Davidowitz’s book, “Don’t Trust Your Gut.” David Swensen’s book, “Pioneering Portfolio Management.” Roger Lowenstein’s book, “When Genius Failed.” William Green’s book, “Richer, Wiser, Happier” – read the reviews of this book. Follow William Green on X. Check out all the books mentioned and discussed in our podcast episodes here. Enjoy ad-free episodes when you subscribe to our Premium Feed. NEW TO THE SHOW? Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members. Follow our official social media accounts: X (Twitter) | LinkedIn | | Instagram | Facebook | TikTok. Browse through all our episodes (complete with transcripts) here. Try our tool for picking stock winners and managing our portfolios: TIP Finance Tool. Enjoy exclusive perks from our favorite Apps and Services. Stay up-to-date on financial markets and investing strategies through our daily newsletter, We Study Markets. Learn how to better start, manage, and grow your business with the best business podcasts. SPONSORS Support our free podcast by supporting our sponsors: River Range Rover Public Toyota American Express Fundrise Vacasa USPS AT&T Sound Advisory BAM Capital Shopify HELP US OUT! Help us reach new listeners by leaving us a rating and review on Apple Podcasts! It takes less than 30 seconds, and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it! Learn more about your ad choices. Visit megaphone.fm/adchoices Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

Transcript

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0:00.0	You're listening to TIP.
0:03.0	Hi there, it's great to be back with you on the Richer Wiser Happier Podcast.
0:07.0	Today we have a very rare in-depth interview with an investor named Adam Shapiro.
0:12.0	Adam is the managing partner of an investment
0:14.8	investment firm in New York City called East Rock Capital.
0:17.5	He oversees about $4 billion in assets on behalf of eight
0:21.6	super-rich families. His clients are required to invest a minimum
0:25.4	of $100 million just to open an account with Adam's firm. So as you can imagine, he's managing
0:32.1	money for some of the wealthiest, most prominent, and
0:34.8	most financially savvy people in the world, including an array of billionaires who made their
0:39.9	fortunes in businesses like homebuilding and hedge funds.
0:43.0	One reason why I'm fascinated by this conversation is that Adam gives us a very
0:47.6	unusual glimpse into one of the most privileged and exclusive realms of the
0:52.0	financial universe, namely the world of family offices.
0:56.0	Globally, there are now thousands of family offices with an estimated $10 trillion in assets under management, so these are enormous asset pools.
1:05.9	Within this field, Adams' firm, East Rock, has a reputation for exceptional performance, which
1:11.4	is built on its expertise in two areas, hedge funds and private equity.
1:16.5	Over the last 15 years, E-Strock has outperformed all of the best known and most admired
1:22.2	endowments, including those run by universities like Carver,
1:25.8	Yale, Stamford, Brown, and MIT. What's the secret of this success?
1:31.7	Well, Estr Rock specializes in identifying great fun managers
1:35.6	at a sweet spot in their careers when they're still relatively young and hungry.
	...

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