Ep788: Justus Hammer – Good Idea Versus Wrong Timing

Andrew Stotz 00:02
Hello fellow risk takers and welcome to my worst investment ever stories of loss to keep you winning. In our community. We know that to win an investing, you must take risks, but to win big, you've got to reduce it. Ladies and gentlemen, I'm on a mission to help 1 million people reduce risk in their lives. And I want to thank my listeners in Sydney, Australia for joining that mission. Today. Fellow risk takers this is your worst podcast Oh Is Andrew Stotz from a Stotz Academy, and I'm here with featured guest, Justus Hammer. Justus, are you ready to join the mission?

Justus Hammer 00:36
Let's do it.

Andrew Stotz 00:38
All right. Let me introduce you to the audience. Justus is the Group CEO and co founder of Mad Paws. He has invested in over 45 startups over the past two years serving as an advisor, an early investor to Airtasker and a founding investor and advisor to VICE Golf. He has not only been involved in starting more than 10 companies in the tech space, like Spreets and Mad Paws, but has also developed a growing interest in cash flow businesses over the past 10 years. just as take a minute and tell us about the unique value that you are bringing to this wonderful world.

Justus Hammer 01:16
Well, thanks for having me, Andrew. So yeah, I mean, I've, I've come from Germany to Australia, and I've been in Australia now for the last, you know, 18 years, I think nearly. And I think it was I've been I've been quite lucky that I've been involved in the startup space, for a long period of time, I've actually started in Germany working in a startup there and kind of got the back a little bit. Very unusual, I think, history from a, from a startup perspective. You know, it wasn't, I wasn't selling orange juice out of my front yard when I was young as I was a, I was a basketball player, I actually played professional basketball for a little while. And but I think what I did was, I took that kind of determination that you need in terms of sports. And I took that into business. And I think, you know, that's kind of what I've been doing for the last 20 years, started a couple of businesses, some successful, some not, and I'm sure we'll talk about some of those. But I think what I really enjoy is kind of working with early stage startups, I've got a lot of experience and kind of the some of the things you can, can do and can't do. And I think the only thing you know I can help people with is trying to avoid a couple of the mistakes that are made along the way to smoothen out the process that doesn't give you any guarantee that it's going to work. But, you know, like you said, we can probably reduce the risk slightly to get you to success. It's

Andrew Stotz 02:48
interesting. You know, when you said about basketball, then it started making me think, Okay, let's go to box. So boxing, it's one person is allowed in the ring against you. And now they happen to have risen up to be the best in that class to challenge you, let's say or you're challenging another, but you're playing against one person. Now basketball, okay, it's one team against another. So technically, you could say that you are playing against all the other people in that team. But they're only allowed, you know, a certain number of players to come on that basketball. What is a basketball? It's not a field, what is it? I'm losing my sports. References. But then I was thinking about business. You know, the amazing thing about businesses, there's no restriction as to who can come on that court. 50 people can come on, or the best guy and a nowhere could come and start a business and compete with you. And it's like how, how raw and unlimited. And, you know, the competition in a free market is just meant to be so intense that you would think about people who are successful in startups and stuff. You think it's incredible.

Justus Hammer 04:05
But I mean, there's I think there's, if you think slightly differently, and you think more about the people that rise to play professional sports, right, then, I mean, I was far away from kind of being at the top there, right, but I kind of had a little of sniff or kind of what that means. But the people that really make it to the top is I mean, a you need a bit of talent, right? But yeah, that's one thing. But then really, I mean, it's a famous saying let's 10% talent and 90% hard work. And, you know, I've seen that quite a bit. So, you know, you're talking about the competition on the court. Yes. But the competition really is about you moving up, you know, to the next level. And you know, in basketball, you want to make it to the NBA. In soccer, you want to move to the Champions League, but that's you know, the point 000 1% of players that start playing soccer at some stage right so the the determination I think you need to kind of get to that point is I'm something where you find quite a quite a big, quite a big correlations between sports people and then being successful later in life in in business as well, because you need that drive to kind of have a goal and kind of go for it.

Andrew Stotz 05:16
Yeah, I mean, what you can see is that there's a process that gets you to that core, it's not like you only got on that court, there was a huge amount. And it's a screening process as you're competing, it's a self selection process. Because if you just find that you're not good at it, eventually you're going to give up, you know, or you're going to be kicked out. But actually, I look at sports now very differently after doing this podcast, I used to think that it is a function of some kind of unique talent, you may be tall, you may be able to jump higher, run faster, maybe your reflexes are better. So there's some unique physical talent, combined with hard work. Now, I kind of I don't believe that as much. And the reason why is because you have to logically think about it. Is that out of billions of people on the earth, are there really only this small number of people they could play at that level? So okay, you could say there's access, you know, some people just don't, they don't live near a basketball court. So they never played basketball, it's not in there. There's sports, you know, genre for their country as an example. But then this is the one that I got now, I think about law is that how many great talented players got injured, or one could never recover from their injury? And I would probably have I,

Justus Hammer 06:49
yeah, I actually talk about this quite a bit. Because the, I mean, I talked about 90 percentile. And so 10% Tell 90% Hard work, you've got to be able to put in the hard work, right. So you can only put in the hard work in sports, when you're healthy, right. So actually having a functioning body for a long period of time, that allows you to put in the, you know, 5678 hours of training a day that you need to get to the peak, is, you know, it's kind of the foundation that you need to even have a chance, right, because you can be as talented as you want. If you're not healthy. You'll, you'll stop progressing at some stage. And, and I mean, the other bit, I think that comes to that is where it's not just talent. And, and, and hard work is picking the right sport, right? Because, and it probably translates into business a little bit as well, is, you know, plenty of people that say, you know, you've got to pick, you know, what you're passionate about, and kind of follow your passion. I mean, I probably describe more to the ones where you've got to follow your skills, right? So I think you've got a much better chance to be successful in sports or business. If you choose something, you tap, you've got a talent in and you've got the basic foundations to be successful in that field. Right. So, you know, if you're not good in math, and even if you're passionate about finance, probably not the right spot, right. So you know, there's just stuff when it doesn't work. And it's the same in sports.

Andrew Stotz 08:23
I always said, if I was to start a gym, I would have it all about reducing risk. So on the wall, I would say here's the research on the top five injuries. And the highest most common injury is a soak shoulder injury. Here's how it happens. Here's the mechanics of that. Here's how you avoid that. With the objective to be we focus on reducing risk so that our customers come back.

Justus Hammer 08:51
Yeah, good point.

Andrew Stotz 08:53
But just one last thing on basketball. And I wasn't a huge basketball fan, but I was a huge Michael Jordan fan when I was growing up. And I'm telling you that I'm watching the last dance on Netflix for the fourth time now. And just screaming out loud, as you know, as I'm going through his journey, but I don't know if you've if you've watched that. And for the listeners and viewers. The last dance on Netflix it just to me the best argument and I think I've ever watched.

Justus Hammer 09:23
Yeah, no, it is. It is amazing. There's another one on Netflix about cultures and then how some of the top coaches in sports kind of what's the philosophy and kind of how they get their teams to be top performance. And one of them is about Doc Rivers, which was one of the one of the it's one of the hips coaching Boston for a long period of time. He was playing at Boston for a long period of time. And very successful coach, and he was coaching the Lakers at that time, I think and you know, it's Just how he talks about and kind of what was important for the team and kind of how they wanted to present themselves. Yes, some amazing lessons in that is called, I'd have to look it up escaped my name. But if you look, if you look for Doc Rivers on Netflix will come up.

Andrew Stotz 10:18
Okay, got it? Why don't I put that in the show notes for the listeners out there perfect for this too. Okay, well, now it's time to share your worst investment ever. And since no one goes into their worst investment thinking it will be tell us a bit about the circumstances leading up to the intelligence your story.

Justus Hammer 10:39
Perfect. So, I mean, I've been tossing and turning last night live kind of which one, and we're going to pick because, you know, I've been, like I said, I've been involved in startups now for 20 years. When you play the startup game, it's it's a bit of a from an investment perspective is obviously a bit of a numbers game, you know, it's very, very unlikely you're going to invest in one startup and kind of hit the jackpot happens, but it's, it's most likely pure luck. You've got to, you've got to accept that you lose more than you win, right. And so when I think about kind of my losses, I kind of put them in three different buckets. And I'm going to pick kind of one bucket to tell you a little bit more about that. But just to get a bit of an idea. One is, one is just bucket of bad decisions, right? So that those are the ones where I kind of knew something was wrong with the investment that I'm making. But, and I didn't trust my gut feel. But it was really about greed, or something else taking over with or fear of missing out, that kind of took over. And I kind of still made that decisions. And so those ones, those ones financially, were normally the ones were lost money or lost money quick, because it just didn't work. And so you know that those are the ones I'm most frustrated about, essentially, because I knew something was wrong about it from the beginning. But it didn't follow my gut feel the other one second basket is the ones where I was actually ready to make an investment. I did all the work on it. But then found an excuse not to make them. And so I've got a couple of those. And again, from like from a financial perspective, obviously didn't lose money, right. But it lost huge sight on a couple of those deals. And I'm not talking about, you know, I'm not talking about should have bought apple in 2010 or something like that. I'm talking about businesses, we've done the DD, I've worked with the founders, I had a term sheet on the table on it to invest money, and I just had to put my signature on it. And then I found an excuse not to do it. And you know, those excuses could have been cashflow at that time was a bit tight. And I thought maybe I wait a little bit. But those are the ones were probably lost, the biggest potential upside of one of those businesses was easily a two and a two and a half times upside I would have had on that business. And I didn't make it now. And so it's easy, right? So you can't really dwell on those things. I only dwell on the ones where I'm like, why didn't you make that decision. And so I'm kind of trying to push myself more and more on those decisions to kind of get to the point where I'm like, if you feel this is a good investment, you've got to find a way to make it. If you've done the work, right, these are not these are not gut feel decisions. But then last one, and you know, I'll tell a little bit more about this is, is the ones who are not just lost money, kind of financially, but also time, right. And so, you know, that's obviously a huge factor, because you've got a very limited amount of time in your life. And so losing money on one side, yep, that's painful. But if you spend a lot of time on something as well, you've got to make a call at some stage on when, when it is too much, right. And so the one that comes to mind for me this we started a company when we saw a big opportunity in the real estate space. And, and we saw a couple of companies doing this around the world as well. And it was all around kind of improving and making the process of purchasing the next property easier. Alright, so think about you know, you've got a property, you want to buy a new property. It's a whole process that you've got to go through, right. So a you've got to find a new property, you've got to find a way to finance that new property. Do you sell your old property? Firstly, by first kind of all decisions you've got to make. You've got to find financing for that you need bridge financing and so forth. So it's a whole lot of process. It's a whole lot of angst that goes with that. And a lot of people are very scared about that process and sometimes get it wrong. And so what we looked at is kind of is there a better way to get you from property A into property Be Right. And so we spent a lot of time on it. We had great partners in Australia, some of the biggest real estate companies in Australia kind of backing us as well. And, you know, at the beginning of kind of was working, right, so we found some customers where it was working for we found, we transacted I think, total of 40 to 42 properties or so. But it was a tough time in Australia for the market in terms of real estate, I mean, if you, if you know, anything with those Australian real estate market normally just does that goes up, up, up, up up, the whole government is pretty much set up to support that. And me as a German, I had a very hard time to get my head around this when I came here, because I thought property was very expensive when it came to Australia. But since then it has kind of gone up, nothing but two years where it kind of went down. Now, one of the years went down, we started this company. And so we ran into a whole lot of issues. And the main issues I think we ran into as one was timing, right, so market was going down, which meant we were buying properties, we were trying to improve them and then sell them in a very short period of time. But obviously, if the markets going down, you're kind of trying to buy it here, and then sell it here. Now you've got to give the seller a good price for it, because they're not going to give it to you unless you give them a decent price. But you've got to be very careful with kind of you knowing that when you're going to sell it, the market potentially has dropped even more, right. So we ran into the problem of not being aggressive enough on the buying side. So we couldn't get the properties. But if we weren't aggressive enough, on the buying side, we might have overpaid. Because then we didn't get the money back on the sell side. Now, we kind of manage even that process fairly well. And we made money on, you know, I think 60 or 70% of our properties. But we had a couple that really killed us, you know, where it just market dropped more than we thought we couldn't sell them for a period of time holding costs were higher, and so forth. So so but we were thinking, Okay, we get through this process, right, and the market is going to get better. And then once the market turns might get better for us, right? So we kind of sat through it, we learned a lot about the stuff and learned a lot about the assumptions that we had about the market as well. But we didn't really look close enough, right? Because we it was a bit masked, you know, kind of what the market was doing. And we thought the market is gonna save us on the other end. So anyway, we kind of went through this, we got a bigger debt facility, and we came out and the market kept dropping, right? And so we were like, okay, shit market's not turning as quickly as we thought. What do we do now. So next thing was that we kind of look closer into the numbers look closer into the unit economics and kind of what has been working. And we kind of figured out Wait a second, this model is actually working really well in Spain, you know, some of the companies we've talked in Spain, Italy, Turkey, and so forth. But then we realized there's some big change, but some big differences in those market because at the beginning, we were like grind it's working there. It's just the market slightly different here. So we've got to wait it out. But then kind of when we look closer and closer figured out that they were actually differences in the market. So you know, real estate agent here in Australia is about 2% On average, real estate agent in Spain has about six 7%. Italy's but six 7%. Property values lower, right. But you already have a built in much bigger built in margin. Now if you consume that real estate margin, in terms of the loss then here in Australia, we've had 2% Right. And so that was different. And then the other thing that's very different is Australia is actually one of the most sophisticated markets when it comes to finance and financing your property. And it's one of the it's one of the smoothest in terms of transitioning from one property to the next. Right. So it's much easier to get rich loan here, it's much easier to get financing for a new property. You can get a mortgage in two days, no problems like even same day. Sometimes you can get that done right. So those hurdles in Spain, Italy and Turkey much higher. Right. So again, another reason on kind of why it doesn't work here. And so kind of more and more we kind of looked into it, we were like shit, we're fighting an uphill battle here. Right? And so we were kind of at the point where like, Okay, we nearly had a bigger debt facility because we thought we've got to, you know, we've got to go bigger, we've got to go national, we've got to have more volume through the business to kind of make it work. And then COVID hit. And so now COVID obviously changed the dynamics completely. The debt facility providers pulled back, not providing us the facility. And we kind of still tried to say Have it for probably a month or two and kind of trying to figure out, can we? Can we change it? Can we change the business model into force, but our real estate partners turned around and said, like, look, we don't know what's going to happen, because the beginning of COVID, everyone was like, Shit, this could be, you know, this could be the, the drop in real estate value that we've never seen in Australia, we've got to figure this out first, now turned out to be the completely other way around, and properties doubled in the next 18 months, which is also crazy. But you know, we had all these things against us then. And finally, there, we kind of made the call on Wait a second, we stepped back and kind of looked at everything from the outside, and we're like, we actually got the model wrong. And so I think the issues that we ran into there were that we were probably looking at, you know, I liked this, I kind of like looking at different models around the world and see what's working and learn from that and kind of make it work here. But I think what we didn't appreciate in that time was the differences the market had, and thinking that we can overcome it by just the market turning and, and getting the timing right, and the timing levels. Right. So you know, it was, it was not just from our financial because I put money into the business, obviously trying to make this work. But also from a timing perspective in our spent spent a good three years of my life on it. On, on trying to get this to work, where we probably should have after nine to 12 months kind of looked at it and gone. Like there's something wrong, we've got to change the model to actually make it work for Australia.

Andrew Stotz 21:37
Can you remember the day that you guys decided all right, it's over?

Justus Hammer 21:43
Yeah, so I mean, really, the day was when lockdowns happened in Australia, right? Like, because before that we were like, ah, and, you know, the other anecdote on this, this kind of map post, which is the business I'm running at the moment which we started, you know, a couple of years before that, five, six years before COVID. I still remember the board meetings, we were like, COVID is going to be fine. You know, it'll be a month or two of kind of slow down travel and so forth. But we'll be good. You know, two weeks later, we're sitting in the same room, and, you know, our revenue was down 90%. And at the same time, we were looking at the real estate business going like, Okay, this is not going to happen.

Andrew Stotz 22:26
What a challenging time. I mean, for people in the future, when they look back, they won't really understand how bizarre it really was, you know? So how would you describe the lessons that you learn if you put it into 123? Or something like that?

Justus Hammer 22:40
Yeah, so I think the real lesson I learned there was that a works in a doesn't work in B. Right? So yeah, I mean, fundamentally, I knew that from the beginning, right. But I think I underestimated the, the changes that the markets that different markets can have, and the dynamics that coming out of that particular for kind of a high acid business, you know, for, for retail, if you do something in the US get a high chance works in Australia, right? If you do something on retail, you do a product or something like that, there's a high chance of works. For something like real estate, we're talking I mean, it's a biggest asset class for people, right that they normally own in their lives. And the dynamics of that market very different between US, Europe and here. And we didn't appreciate that at the beginning. And I think that's something that we kind of picked up there too. If we look at these kinds of models to go deeper into saying, like, if it works in Europe or us what are the differences between those different market? What's the different dynamics? And what are the risk if we kind of tried to do something similar here?

Andrew Stotz 23:51
Maybe I'll share a few takeaways from that. I was just taking notes as you were talking, and I wrote down a bunch of stuff but first thing is timing matters. And but you can never really know whether your timings right until after. So my best friend and ideal started our coffee business in Thailand in 1995. And so we set up our factory everything was good. And then 9097 Asian financial crisis happened and then boom, all the revenue was gone. And we were in darkness for two or three years. And it's only that for different reasons we were able to survive the one of the reasons was because we thought It's just coffee. I mean, we're not trying to reinvent the wheel. We're not trying to bring some tech solution that nobody knows about. And also you know, just determination that you know, it was just we wanted to do it. But the second thing is so I wrote down I wrote down good idea wrong time. Simple, good idea wrong. Now the second thing, second thing I wrote down was just transferring a business model doesn't always work. So in even in our case with coffee, we were like, Okay, this is simple. In America, offices have pots of coffee, and you brew a pot of coffee. So we went to America, and we bought secondhand brewers, we shipped a container to Thailand and said, That's it, we're going to bring up we're going to refurbish these brewers, which we knew how to do really easily and cheaply. So we're going to, you know, 15 bucks, it's going to take us to get this machine onto the desk, or onto the counter in the, in the, in the lunch room. Of course, what we didn't realize was that ties didn't drink brewed coffee. They either drank instead, or latte, you know, espresso type, but they'd never went through the brewed coffee phase. So we and you know, silly us, you know, we should have seen it, but we didn't see it, then there was the complication, there's 100% tax on imported coffee, we didn't ever really understand the implications of that until we started getting tangled up in then. So all of a sudden, all of these, what should be a pretty simple business transferred from America to Thailand, became very complicated. So that's where the lesson about transferring a business model doesn't always work. The other one I wrote down was, you're going to be on a roller coaster, no matter what, you know, it's really a matter of making it through holding on through the times now. I was just, you know, thinking that that's, you know, what business is all about? And eventually you let go if, if you're just realizing I'm not going to survive the next turns, right. Yeah. And that that, I mean,

Justus Hammer 26:57
that's, that's, that's a hard decision sometimes, right? Because you've got to, you've got to find the right balance between holding on because it's always going to be hard, right? And you've got to always gonna come home at some stage and go look, what the eff, like, what am I doing here? You know, this, and if you hold on, sometimes you get out on the other side, and it's perfect. And sometimes it's not, right. And so, like, how many of those cycles they have to get through to kind of get out on the other side, and, and when you kind of make the call and saying, like, Now wait a second, have spent three times three years on it, but it's not going to happen? You know, it's a, that you constantly have thoughts, those thoughts, and, unfortunately, there's no, there's no magic, you know, silver bullet that tells you I'm kind of went to do it. And I'll often have those discussions with entrepreneurs as well, whether invested in them or just kind of trying to help out. It's kind of where they are at that point and go, like, should I keep doing this or not? Like, you know, it's a really, really tough decision. Yeah,

Andrew Stotz 27:54
I agree. You know, there just is no correct answer, you know, for, you know, whether to hang on and go through the next turn, or whether to say, No, it is never going to stabilize, then therefore, I gotta get off. But it made me think about the last thing I was thinking about, you know, and that is, timing really matters, in the sense that, on the one hand, if you were facing a rising market, when you started, it's possible that you could have made enough profit to figure things out as you went along. But because you started in a potential, you know, in a down market or a tough time, it kind of forced the reality of these problems up to the surface that would have been covered, possibly, by a rising mark. And that brings me to one of the lessons in one of the podcasts that I learned was the lesson that, you know, I think it was like, big companies die slowly. Because they have a lot of cash, and it's not revealed. And so on the one hand, you could say, Well, bad timing in this case, because you know, things went down, but you could also say, no good timing, because it revealed something that we realized it, we didn't see, and it became pretty clear, we weren't gonna be able to resolve that in a profitable way that was gonna lead to so even even when you could say all bad timing, no, maybe good timing. Yeah.

Justus Hammer 29:21
No, and I think like, that's what I said, I struggled last night as well and kind of figuring out what was the you know, my my worst investment because I mean, a you've got a lot of learnings from it, but be some of those learnings I've used now for some of the other businesses that we're running. So, again, like I said, beginning this startup game is obviously a numbers game as well, right? You can't expect to start every single one and it's going to be up invest in every single one and it's going to be 100%. of success. So and like you said, you know, I think that the time with COVID Good and bad like the good thing is that it gave us The realization of like, okay, this is not going to happen now. And we've got to stop this now because there's no way for us to change it. The bad thing is, on the other side, you could look at it and go like, Okay, if it wouldn't have been for COVID, we might have gotten a debt facility, and we would have had a chance to turn it around and, and, and pivot it into something else that works. Right. But, you know, I mean, I think I think the one lesson out of that, for me is as well that you can't, you can't have regrets in this game, right? You've got to, you've got to take the good and the bad. I've had this discussion with my wife, from time to time where she's, she's very different to me, she's, she's not a risk taker. She's asked questions made on a daily basis on why the EFF I'm doing what I'm doing. And, you know, why don't we get, you know, a stable job and all that stuff. Now, you know, in tongue in cheek, obviously, she kind of think she secretly enjoys it, that I'm doing this, but But yeah, it's if you, if you accept that, that's what you're doing, you've got to accept also, there's gonna be some bad outcomes as well. And then you've just got to take the good of it and not dwell on it, right? Because otherwise, otherwise, you'd be doomed.

Andrew Stotz 31:04
Well, let her listen to this story. And then you can find out whether she secretly enjoying it or not. Discussion, there is great research done in the field of finance and investing, where they analyze the fight the long term performance of male versus female fund managers. And they found that females outperform, and they attributed to their perspective of risk, the males were much more aggressive and willing to take risks, whereas the females were more risk averse, and therefore their actions with their portfolios were different. And in the long run, you know, in the field of investing, it really is not losing, you know.

Justus Hammer 31:50
So that I think, I mean, that's also like, I think that that equation changes significantly over your life as well, right? Because, you know, when I, when I started doing startups, I was like, in 20s, you know, started my first companies didn't really matter, you know, and I kind of kept telling this to myself, as well as, like, if I do this and try to make something happen, build a company, now's the time, the easiest time to do it doesn't mean you can't do it when you're older. But the implications are different, like, I didn't have kids didn't have a mortgage didn't, you know, I could still find a good job if I needed to, if it didn't work out. So the implications of that were quite simple for me, right? It was kind of it was, I saw an opportunity there, there was a big power of the works. The downside of it wasn't that big right? Now, that equation, I think, changes over over life. Right? So once, once you get into, you know, marriage, house, kids, stuff like that, obviously, you know, there'll be the obligations that you have, and kind of keeping your family safe, and will they different. And, and even for me kind of, you know, it's not like I'm taking the same risks that I took 10 years ago or 15 years ago, right? I mean, this these things change, your portfolio changes, the cash that you have to invest changes. So, you know, very different kind of how I look at investing now than I looked at it, you know, 1515 years ago,

Andrew Stotz 33:12
I have a debate with a friend of mine. And he's really, really into startups. And, you know, his argument is, you know, a pretty common argument, which is, make your mistakes while you're young, this is your chance. My argument is do not make your mistakes when you're young. And my point is, the power of compounding is enormous. When you're a 20 year old, you got to go to 60, you got 40 years. Part of the reason why Warren Buffett is a saint in the world of investing is because two years in the 70s, he made over 100% return. And he allowed that to compound over 50 years. If he had not made those two years of more than 100% return, he would have just been another excellent fund manager. Yeah. And so there's a balance there. Now, let me ask you, based on what you've learned, and you know, what you continue to learn, what's one action that you'd recommend our listeners take to avoid suffering the same fate?

Justus Hammer 34:22
Good question. So I think I think for me again, there's an interesting interesting on how you look at it. I'm, I'm kind of thinking there is there is also a time of you know, if you if you and I was thinking I read something about this the other day, but I don't remember the book now. But anyway, but the like, what I was always thinking about this in in response to what you just said, around not making your mistakes early. Right. It's also there is a it's a very different scenario because, you know, people talk about starting to save early compounding interest over long periods of time. Now, Warren Buffett is a, you know, it's a very simple example. But I think it's also a outlier example. But the reality is, for most people, you know, when they ended 2025 26 is right, when they just come out of work. If you make, like $60,000, and save 10 grand of that, and put that away and double count, compounded, or you take some risk at that time, and make a much higher return over the next two or three years, the, the amount, it sets you back, because the base of what you start is so small, is actually not that big, right? Even on compound matters. And so I think you've got to find the right balance there on kind of a, what do you want to do? Because it's perfect. There's, there's different people, and there's, there's different? No, there's not one single strategy that works for everyone, right? Because if my wife would have done what what I'm doing she, you know, she would have been, probably, she, she would have been very unhappy to put it lightly over the of the over the, over her lifetime, where if I would have done what she's done, I would have been unhappy with this, like, get a bigger job early, I could have started it. You know, when I started my first company in Australia, I had a job with Google lined up, very well paid, you know, nice signing bonus, and all this stuff, I still don't think I would have, you know, would have been where I am now. Because I decided to take the risk and say no to that job and start my first company. Right. So. So unfortunately, I don't think there is a single truth and a single strategy that kind of works for everyone. But I think what you have to do is kind of sit down and think about it and go like, what is it actually I want to achieve? And what's the most likely scenario for me to get there. Right? Because in money is one thing, right? And yes, we all want kind of money, cool. But there's a high value also to doing the stuff that kind of gives you some kind of non monetary benefit, right. And that is just, I mean, I talked about the beginning kind of, you know, you want to do something that you're good at, right? And not just follow your passion, right. And I'll kind of subscribe to that. But at the same time, you don't want to do something that makes you miserable, either, right. So you've got to strike that balance there, to get to the point where you have a financial result that works for you, but also something that works for you from a pure life. Enjoyment perspective, striking

Andrew Stotz 37:36
balance is once a resource, either of yours or a book or something that's helped you that you'd recommend for our listeners.

Justus Hammer 37:49
Yeah, so um, there's a couple of things that I'm always terrible with names. But if we think about books, what I really enjoyed reading was atomic habits. by James clear member, actually, but James clear, that's right. Just because it gave me a bit of bit more perspective around kind of, how can you structure your life and what's the stuff you should be worried like working on? How can you stack some of those habits to make things easier? And it actually went up? When I heard about it, I was like, Oh, shit, this is why, in that stage of my life, things were actually easy because it was doing X was that right? So you kind of find a couple of really nice nuggets in there. I think that that helped me. And the other one I really liked was is the what's it called the subtle art of not giving a fuck, Mark, Mark Manson, I think brought it similar kind of, to kind of how I live my life again, kind of I think that kind of theory works really well for me on not dwelling on some of the stuff that really doesn't matter and kind of trying to focus and really find the stuff that matters. I think he talks in his book around you know, life is always going to be some suffering right? That's like bottom line like forget about Instagram right all looks nice and shiny for some people, but I guarantee every single one has their fucking issues. Now find a niche, find something we can at least enjoyed the most important part. So those I think those those books I really enjoyed. I've read them a couple of times. And then podcasts for example. I try to listen to a lot of podcasts, different ones because I'm not I don't want to hear just one angle. I think that's a big problem in our life these days that people just listened to one one source and so I'm trying to read and listen to all kinds of different stuff. One I like around the kind of retail world online retail is limited supply. limited supplies podcast. That's It goes really deep around online retail, marketing, and everything that comes with it. It's one of the few that I thought they don't just touch on stuff kind of on the surface, but kind of really go deep. Interesting.

Andrew Stotz 40:17
Okay, I've got that. And I'll put it in the show notes. limited supply. That's Nick and MOAs. Yes. Okay, great. And, in fact, atomic habits, I've actually written a course on it, which I'm going to include in the show notes for people that want to go check it out, because I've read courses on books that I enjoy. And I've got about 50 or 60 books that I've written courses on. And I just thought to myself, Hey, I shouldn't be talking about those book courses on this part. It took me a little while to get there. But yes, that's a good one. All right. Last question, what's your number one goal for the next 12 months?

Justus Hammer 40:59
So I mean, I'm still running one of our companies that we started to list the company in our med pause. So I think the key focus for me is kind of getting that business to a better position. And I think, you know, it's one of those things where their business is actually doing really well. We've done a lot of work over the last, you know, particularly kind of three, four years to get it to this point. market hasn't quite appreciated it. Small caps in Australia, a bit undervalued at the moment, and unloved. But we know that's going to change. So I think we've got a huge opportunity for that business kind of pushing that forward. And positioning that even better than we are now. And so I think that's going to be a big focus for me from from operations perspective. And on the other side, I think I mentioned it's, you've mentioned in my bio, is kind of cashflow businesses. So from an investing perspective, I think there's a huge opportunity in in cashflow businesses, just from a generational perspective, and so forth. So that's something that I'm I'm looking at, from an investment perspective, get a bit of an idea and kind of how how, you know, we can benefit from that.

Andrew Stotz 42:09
One of my prior guests from India said, cash is not King. Cash flow is king. And I love that. Yeah, cash creates the cash. So well, listeners, there you have it another story of laws to keep you winning. Remember, I'm on a mission to help 1 million people reduce risk in their lives. As we conclude justice, I want to thank you again for joining our mission and on behalf of a Stotz Academy, I hereby award you alumni status for turning your worst investment ever into your best teaching moment. Do you have any parting words for the audience?

Justus Hammer 42:43
Just you know, even though you're all about avoiding risks and saving, you've got to take some risks, but make sure you measure it as much as you can.

Andrew Stotz 42:54
Yeah, that's a great point. In fact, I'm not about avoiding it. I'm about reducing it. So let's that's a wrap on another great story to help us create, grow and protect our wealth fellow risk takers, let's celebrate that today. We added one more person to our mission to help 1 million people reduce risk in their lives. This is your worst podcast host Andrew Stotz saying. I'll see you on the upside.