An investing twist on the fisherman and investment banker parable
Understand your life, career, business, and finding your purpose.
I first came across this parable written by Saahil Bloom a few years back and found it very meaningful. A recent encounter prompted me to add an investing twist to this parable from an emerging fund manager’s perspective. I hope you enjoy it.
Don’t lose sight of what is truly important along the way.
Original Parable - The Fisherman and the Investment Banker
A wealthy investment banker goes on vacation to a tropical fishing village. As he walked along the docks one afternoon, he came upon a small, run-down fishing boat with several large fish on its deck.
"How long did it take you to catch those fish?" he asked.
The fisherman looked up from his work and smiled at his new visitor.
"Only a little while."
The investment banker was caught off guard by this response. He liked the fisherman and wanted to help.
"Why don't you fish for longer so you can catch more fish?"
The fisherman shrugged and explained to his new friend that he had all he needed.
"Each day, I sleep late, fish a little, and spend time with my children and beautiful wife. In the evening, I go into town, drink wine, play the guitar, and sing and laugh with my friends."
The investment banker was puzzled. He wanted to help his new friend, who he recognized was clearly confused.
The investment banker had helped many businesses and had an MBA and other fancy credentials to his name.
So he laid out a plan for the fisherman...
"First, you spend more time fishing, so you can catch and sell more fish. You use the proceeds to buy a bigger boat, which allows you to catch and sell even more fish."
The fisherman listened intently, his face calm. But the investment banker was just getting started…
"Then you buy a fleet of boats. You hire a team. Vertically integrate. As CEO of a large, growing enterprise, you could move to the big city. You would take your company public and make millions!"
The fisherman looked confused, but smiled.
"And then what?" he asked.
The investment banker was shocked.
"Well, then you could retire to a quiet town! You could sleep late, fish a little, and spend time with your children and beautiful wife. In the evening, you could go into town, drink wine, play the guitar, and sing and laugh with your friends."
Not realizing the irony, the investment banker stood silent, waiting for the fisherman to express excitement with the plan.
The fisherman smiled broadly, thanked his new friend for the advice, and wandered off slowly into the warm afternoon sun.
Parable Twist - The Investment Manager and the Dealmaker
A dealmaker comes across a young, promising emerging investment manager who recently left his job to start his own fund and invest capital for others.
This investment manager had a successful prior investment track record as an individual, and all he wanted to was to keep investing for life.
He was determined to be a single portfolio manager for as long as he could, where he did everything, from research, analysis, allocation, sales/outreach, marketing, operations, and writing.
The dealmaker approached him for an afternoon coffee and asked him, “How long did you take to raise the capital thus far?”
“Only a little while.”
The dealmaker was caught off guard by this response. He saw something special in the investment manager, and wanted to help.
“Why don’t you raise more capital faster, so you can make more money?”
The investment manager shrugged and explained to his new friend that he had all he needed.
“Each day, I sleep well, I exercise, I eat well, I read, think and write a lot about investing, business, and life. From time to time, I meet good people whom I can chat with for hours. In the evening, I spend time with my beautiful wife with whom I take stunning sunset evening walks, I cook dinner with her. I rest, I read, I meditate, I sleep.”
The dealmaker was puzzled. He wanted to help his new friend, who he recognized was clearly confused.
The dealmaker had helped link many such investment managers prior to capital allocators, and had fancy credentials to his name.
So he laid out a plan for the investment manager….
“First, you spending more time “investing”, so you can raise more capital and make more fees. You can use the fees to hire an investment analyst, a salesperson to raise capital, which allows you to raise more capital and earn even more fees.”
The investment manager listened intently, his face calm. But the dealmaker was just getting started…
“Then you hire more portfolio managers. You hire a team. You vertically integrate. You hire an operations head, a legal and compliance head, and a CFO. As CEO of a large investment firm, you can have a nice swanky office in the city. You can raise even more capital, and make millions and much more! You get to manage many people who will do the investing for you.”
The investment manager looked confused, but smiled.
"And then what?" he asked.
The dealmaker was shocked.
“Well, then you could retire to a quiet suburb. You can sleep well, continue to exercise and eat well. You can read, think, and write as much as you want. You can focus on investing your capital and for others if you like. You can have great conversations with people whom you want, when you want. In the evening, you can spend time with your beautiful wife and take stunning sunset evening walks, you can cook dinner with her, you can rest, you can read, you can meditate, you can sleep.”
Not realizing the irony, the dealmaker stood silent, waiting for the investment manager to express excitement with his proposed plan.
The investment manager smiled broadly, thanked his new friend for the advice, and wandered off slowly into the warm afternoon sun.
**Note the above is fully fictitious and does not reflect any real-life characters (or not).**
25 December 2024 | Eugene Ng | Vision Capital Fund | eugene.ng@visioncapitalfund.co
Find out more about Vision Capital Fund.
You can read my prior Annual Letters for Vision Capital here. If you like to learn more about my new journey with Vision Capital Fund, please reach out.
Follow me on Twitter/X @EugeneNg_VCap
Check out our book on Investing, “Vision Investing: How We Beat Wall Street & You Can, Too”. We truly believe the individual investor can beat the market over the long run. The book chronicles our entire investment approach. It explains why we invest the way we do, how we invest, what we look out for in the companies, where we find them, and when we invest in them. It is available for purchase via Amazon, currently available in two formats: Paperback and eBook.
Join my email list for more investing insights. Note that it tends to be ad hoc and infrequent, as we aim to write timeless, not timely, content.
There is something to be said for being content. Congratulations on doing what makes you happy. Eugene.