3 big ideas from 2019 - Reflections

The year 2019 has truly been a remarkable year for me. So let me summarize the top 3 ideas that changed my outlook in 2019 (for good):

1. Power of compounding
2. Our life expectancy rate is higher than expected
3. Don't measure yourself by outcomes

1. Power of compounding

I started angel investing in 2019 with my own hard-earned money. In 2019, I have done 5 seed-stage investments in some incredible entrepreneurs across education, healthcare, transportation, retail, and space-tech. Hopefully, in 2020, I will get to explore and learn about other sectors too (ps - I am on AngelList in case you've something exciting to discuss).

While I can't claim that I know more than an average joe about each of the above sectors, but I do feel that I can bring an entrepreneur's perspective and hopefully first-principle thinking to fellow founder(s) to make strategic and tactical decisions to build a lasting company.

The angel investments are over and above my other investments in primary capital markets which I started over a decade back as a novice. However, I feel 2019 was special since I finally boiled down my personal investing thesis depending on my preference and psychology to maximize returns. For this, I started reading tons of literature around different investing styles.

As I picked up more reading to learn how to invest effectively, reading became a habit. Around mid-2019, I started to make reading part of my daily routine. That led me to now read almost 4 books a month (for now, I mostly enjoy reading books on economics, psychology, finance, and history) - leading to this thread I started on twitter in Oct 2019.

Before 2019, I hardly had the attention span enough to finish a book. So, I simply turned the challenge into some math -- average book length is around 250 pages. Each page is around 250-300 words. My average reading speed is around 200 words a minute; so I was taking almost 1.5 minutes to finish reading every page.

That amounts to 6-7 hours to finish each book every week, which is around 1 hour of reading your favourite content every day (almost like watching a Netflix series).

Bottom-line - The biggest lesson for me in angel investing (illiquid) vs public investing (liquid) is that balance sheet supports P&L, not the other way round. And when you choose to do something incremental over a very long period of time (be it reading or investing), it compounds to give outsized returns.

2. Our life expectancy rate is higher than expected

I learnt somewhere, we will live 8 years more than the average life expectancy of our grand-parents. That means I will live way above 80 years (in short, I have another lifetime to live in front of me).

This is important since my living patterns until 2018 was well geared for me to live around 65. That means I've not accounted for another 15-20 years of my life in terms of health and financial independence. Now, that's something!!

So I tackled the biggest of the two problems mentioned above - health. While I led a very active lifestyle growing up (playing all kind of sports), post-college years I became a "computer hunch", leading to a sedentary lifestyle.

For that, I did picked-up a few sports. But my eating habits were a complete mess. So I tried a few eating styles - one that worked for me is 16-hour fasting aka intermittent fasting. Now I am regularly doing 16HF, and I am off sugar from most of my daily habits like coffee/tea etc.

Bottom line: I lost 5 kilos in the last 6 months. And going into 2020, I plan to reduce another 5 kilos (fingers crossed). The main idea being, want to be healthy in the later years.

3. Don't measure yourself by outcomes

There's a famous saying in poker - "your card doesn't know you won or lost the last hand". So don't let your own experience cloud your judgement to make decisions. But I am guilty of making the above mistakes. So in 2019, I tried to change that behaviour of mine.

That means I have given luck a certain probability score in my decision making. So when an outcome doesn't work in my favour, I simply don't let it bother me since I have stopped measuring myself by outcomes.

And that led to me to focus more on the process, than the outcome. Therefore, growth maintained for the longest period of time is superior to huge growth that can’t or won’t be sustained (that's one the key tenets at Instamojo as well).

In conclusion, I have set myself a few clear goals and have found a measure that will drive progress towards that goal -- hopefully leading me to a yet another inspiring 2020 and beyond.

A happy new year and hope you too have an inspiring 2020…