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[VIC - 160] Hurst Inc 2019 Annual Letter

January 5 · Issue #160 · View online
Jeremy Hurst
I enjoy the turning of the year. Not because of parties (I DO enjoy parties 🥳), resolutions, or anything like that. I like when years change because I enjoy reading annual letters. These are the letters that CEOs write discussing the prior 12 months and looking ahead to the future. The letters I enjoy most are the ones that show a certain consistency of thought, but also how it evolves over time with changing circumstances; the letters that are more about the philosophy and principles of the business, as opposed to the nuts and bolts. Two of my perennial favorites are the letters from Warren Buffet (Berkshire Hathaway) and Mark Leonard (Constellation Software).
With this VIC 160 that happens to fall on the turn of the year, I’ll use this opportunity to write a personal annual letter of sorts. I hope you enjoy!

Doing Less
Life has a way of always trying to add more to your plate. More relationships, more commitments, more interests, et all. In reaction to this onslaught, 2019 was a year of doing less. Let me give you a few examples.
  • I reduced my public equity holdings to 20. That marks a reduction of 63% from January 1, 2019. I’d like to keep that number between 10-20 in perpetuity if possible. A lower number of larger and higher conviction bets, if you will.
  • When it comes to digital content consumption, it hit me at some point that I was spending more time consuming content from other people than thinking about my own ideas and priorities. That felt backward, so I spent a good amount of time clicking the “unsubscribe” button.
  • I said no to a ton of social engagements. I love nothing more than seeing friends & family and having a good time, but time is finite and non-renewable. And there is much to be done.
I expect that this “doing less” trend will continue.
I am likely more confident than I should be. But don’t get self-righteous, because it’s likely that you are too. It’s why we all fall prey to things like confirmation bias and assuming cause and effect correlations when none actually exists.
This might have something to do with why a sales career suits me. In many fields, you make the majority of your income in salary. That is, you know in advance what your income will be for the year. In enterprise sales, only 50% of your income is guaranteed. You only get the other 50% (your commission) if you hit your sales target. And in reality, assuming you have a strong team and you over perform, the actual percentage income that comes from commissions ends up being 60-80%. So you might say that sales self-selects for people that have above-average confidence in their ability to perform.
It also relates to why I’ve greatly reduced the number of digital information sources and the number of stocks I own. I’m trying to force myself to admit that I actually have no idea about most things and that I’m not as smart or skilled as I’d like to think.
I’m not sure of the exact date when I first muttered it, but at some point during 2019, I started using a sentence that I rather like. I’ve begun talking about the driving purpose of my life as the desire to reach economic and intellectual escape velocity. Intellectually, I want the space and time to think about the things I choose to think about. Economically, or financially, the goal is to have enough to the point where my assets and investments are throwing off enough cash that I could opt to spend my time just relaxing (if that were to ever become a real desire). That would mean that I could relax while all expenses for myself and my family were a non-issue.
Simplifying that, you might say my goal is freedom.
Today I am not free. Yes, I can basically buy what I want, go where I want and do what I want, but only to a point. If I decided to simply relax and read books all day, while maintaining my current standard of living, I would have perhaps 10 years before going broke. Add a child to the mix, and that becomes 3 - 5.
And that limit on economic freedom puts a drag on intellectual freedom.
But I am hopeful, because I can see the path to freedom. And that path has been illuminated by technology.
After college, I started working at AT&T. In some sense you can say that it’s a giant technology company, but not really. AT&T operates in a government-sanctioned oligopoly, so the incentive to innovate isn’t really there.
After AT&T, I joined a late-stage startup in the advertising technology space. The business was moving faster than AT&T, but they operated in a fairly mature and commoditized niche of advertising, so the vibrancy of the early days was largely gone. I was one of maybe 300 salespeople selling a product that I wasn’t excited about.
But then I joined Datorama as employee number 40 (or something close to that), and everything changed. I was one of the first salespeople to join after the founding VP of sales, and a small group of us worked together to refine the go-to-market strategy and sales process to great success. The journey at Datorama made 2 things clear that I hadn’t fully appreciated before that:
  1. The value of equity ownership. My tiny equity stake in the company was more valuable than the aggregate money I had made in salary over 3 years. Economic freedom is about equity and ownership, not about salary.
  2. Building something from nothing is exhilarating, exciting, and fulfilling in a way that a job will never be (for me, that is). I was not a founder at Datorama, but I joined early enough that I knew every person in the company and we were all busting our asses to take this small thing and turn it into a really big thing that solves a real problem for tons of businesses around the world.
So what?
2020 will be an important year for many reasons. Doing less, being self-aware, and focusing on achieving escape velocity are the calling cards. These are not resolutions, but rather clarifications of intention. You can expect to hear more from me on all 3 in the coming months.
I look forward to continuing this journey with you all this year and, hopefully, for many more after that. We live in exciting times!
It's A Wrap!
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