Into the Grind: My Second 2 Years in Business

For those who are wondering, the title is an attempt at continuity from the blog I wrote about my first 2-years in business.  With this follow-up post I dive into the detail of a perhaps less talked about period of starting up in business – i.e. getting past the getting off the ground phase, and getting on with getting on.

I write this blog partly for myself (i.e. just for the sake of posterity), partly just to let my followers and friends know what I’ve been up to, and partly to give an insight into what it’s really like running your own business.

I think this should be an interesting and timely look into what some might call an alternative career path or even alternative lifestyle… at a time where working remotely and working from home – alternative work setups in general - have suddenly become not a distant option or vague notion but a reality for a lot of people. But also, at a time where a worldwide life-altering *generational* event no doubt triggers pause for reflection.

What follows is a chronological order of what I’ve been up to since the last post, and a free flow of reflections as I go…

What do I actually even do?

For those who missed it or aren’t quite sure, it’s probably worth a quick couple of lines: in 2016 I left my corporate job as an investment strategist on the buyside and started Topdown Charts to develop and deliver independent, chart-driven, top-down insights across a global multi-asset universe. In short, I help portfolio managers and asset allocators by bringing them meaningful macro insights, investment ideas, risk management input, and giving them charts to use in their own reports/presentations.

It’s a report-based service (with extra help from me by email/call/zoom etc where called upon), and is aimed at institutional investors (my clients include fund managers, family offices, endowments, hedge funds, wealth managers, investment consultants ...and are located around the world).

I think that about covers it…  It’s quite a competitive space, but I’ve managed to carve out a niche and arm myself with the core business skills necessary to avoid ending up as the world’s best researcher that no one ever heard of. (FYI: this is not a retirement project, I’m still basically mid-career)

That should be enough context, so let’s look at the ups and downs of top down….

2018: the final stretch

2018 was a good year. I welcomed on board a dozen new institutional clients (FYI, that’s a good number for that type of client and for that stage of my business …the 2017 number was half that), including what remains my largest client to date. To top it off I also landed a consulting client …and subsequently swore off ever doing consulting again (too much of a distraction from the main thing, and poor economics given the swapping hours for dollars vs scalability aspect). 

Through a combination of emails, phone calls, and just getting on a plane and pounding the pavement, I was starting to get the hang of the whole idea of sales …remember no sales = no business. Ideas are great, but ideas are nothing without a whole lot of hard work and the will to see them through.

Naturally, when things start to go well you start to get a bit more confident. This confidence became physically expressed in a set of excel spreadsheets forecasting my future revenues… there was a point to this exercise: to hand them over to the account to rubber stamp and then off to the bank to get a loan approved.

I’m not sure if I mentioned last time, but our house in Queenstow (New Zealand) was on leased land and that lease was coming up for expiry. We made the call to leave Queenstown (which remains my favorite place in the world), opting to let our limited house buying budget stretch further. 

In the end we opted to go underweight on location and overweight on land/house size.

The “lifestyle” block

The house we ended up purchasing was on the edge of a tiny rural town down the bottom of the South Island of New Zealand [as far as I can tell I run the world's Southern-most independent investment research firm!]. It measured in at 244m2 (our Queenstown cabin was 60m2)… heck, the place had a shed measuring over 100m2 – we got the size upgrade we were looking for. 

We also went from basically no land to 1.5 acres. In short order we did the usual lifestyle block thing and started raising some ducks and chickens (a bit of fun for the kids and a nice flow of fresh eggs). I also got to learn about the little details around the equally material upsizing of upkeep, costs, and maintenance that come with a dream house!

We moved in late December 2018, so it was a good way to close off a good year.

2019: a hard year

I went into 2019 with confidence and grand plans. Having skimmed through the “The 4-Hour Workweek” (which is a good book, just poorly executed on my part as it turns out), I thought I had it all figured out: I would become a paragon of efficiency, I would set out to raise my income and drop my working hours. We were also expecting our third child. On paper, 2019 was going to be my year!

Man plans, god laughs.

Though it has nothing to do with business (but then again, it’s a thin line between business life and personal life, particularly when you’re a one-man band with no respite, no backup, and no time off), in the early months of 2019 my wife had a miscarriage. 

It’s always a tough thing to go through but we largely took it on the chin – you feel it of course, but when you already have two awesome healthy children the blow is a lot lighter. But it does confront you, and rattles your plans – your view of the world. Thinking positively, we decided that with this unwelcome change of plans, a new door opened: it had been my wife’s dream to take her increasingly elderly parents on a tour of Europe, "what better time than now?" we decided.

Naturally that meant two things for me: first of all, timing-wise I casually suggested we go late September (and yes Oktoberfest was everything I expected and absolutely exceeded my expectations! I also can’t wait to revisit it someday again in the future when we can travel again), second of all of course it would mean a week packed with meetings in London on the way there and Singapore on the way back (got to try pay for the trip somehow!). That's the thing, when you're in this kind of business/lifestyle not only *can* you mix business with leisure, but you basically *have to*!

For those who have kept up, yes: at this point I’m now paying a mortgage and paying for a round the world tour for 6 people (as well as data vendors, and the various other expenses and expected/unexpected overheads). So financially, the pressure started to mount as a fundamentally lumpy cash flow on the revenue side began to slip out of sync.

I brought my excel skills to bear and a weekly cashflow budget was whipped into shape. Back in control… Confidence returned. Now I knew exactly how much my crippling cash deficit would be!

As a point of reflection, here’s some advice: stare your problems right in the face, take full stock of them… firstly they may not be as large as you feared, secondly it empowers and enables you to begin taking informed action to get back on track.

Experiment, and if that doesn’t work experiment harder.

In 2019 I tried getting some interns, and ended up learning a lot (mostly about my short comings as a manager… ) Managing yourself is hard enough let alone someone else, so I pivoted my podcast menu towards leadership. I quickly learned from Jocko that as a leader, everything is my fault (you have to take extreme ownership). Again, as alluded to in my first 2 years blog: going into business means taking on a rigorous and revealing course of personal development.

Aside from that exercise, I flicked the switch on a project I had been thinking about anyway: charging a fee for the “Top 5 Charts of the Week” email – which had been a free email list that I had gradually built up: largely initially as a top-of-funnel marketing edifice. It was a breath of cash oxygen that helped green-up a couple of those red cells in my excel cash flow forecast model. 

On the road again

Having low-key sworn off travel after what could be called a failed marketing trip in late 2018 (i.e. my first marketing road trip with no sales), the Europe trip kicked off a flurry of travel. My thinking on the no-travel thing was that I could do just as well by social media, email, phone, etc… so why should I put myself through the distraction and drama of business travel. In practice I still think, even though my assertion is probably close to the truth, the action of physically going to the other side of the world says something about you – sends a signal, but also you pick up a lot of invisible stuff along the way (no not corona, that’s in the 2020 section!)

In hindsight I think the travel revival was also a combination of some good timing: in this business your macro/market calls sit within a cross-sectional continuum of being contrarian vs consensus and high conviction vs low conviction. And naturally and irrevocably you will circulate around the quadrants through the market cycle; partly dictated by the cycle itself and partly by your style/process.

In short, my London meetings in September (recall: it had been about a year since I last did any site visits) came at a time when my views were distinctly out of consensus and high conviction – the sweet spot (most of the time no one wants to waste their time listening to some guy spout off consensus calls or muddle around with low conviction views). In hindsight it turned out to be on the money too, which always helps.

Adding to that, I had also lifted my game in terms of the content, form, and overall style of my presentations, and of course just doing the reps helped refine my delivery. 

In the end, through that last part of 2019 I tallied up 5 marketing trips, which included 6 cities, 64 meetings, and 1 pointless plane ride to nowhere.

So thinking about the hard yards – the grind, the knock backs, the financial pressure, the figuring out the business as well as the markets, it was a hard year on many fronts, perhaps you could say a year where the personal growth far exceeded the financial growth. In that respect, this time I left the year feeling humble yet empowered: a more wise and measured but real level of confidence, and well – in hindsight thankfully, a high pain threshold going into 2020.

2020: an interesting year

Again, I went into 2020 with big plans. But as mentioned, perhaps a little wiser this time. I was going to go on a dozen trips to a dozen cities, start a conference, hire some helpers, upgrade the reports, expand my toolkit, get all systems cranking and really just getting ready and amped-up to charge into a new year.

As a side note, I also started keto and kept off the booze (the New Year's eve champers would be my last drink for a few months) – probably a bit of a contrarian move: leaving me sober through the lockdown, but keeping mental clarity at all-time highs.

An omen of a strange year: fire and floods

Early in the year, before the pandemic really kicked off, an eerie haze filled our skies. The catastrophic bushfires of Australia sent plumes of smoke and ash across the Tasman sea to fill our skies with a dull yellow glow -– as a weird extra detail our house is off the water grid: the smoke and ash clouds left a distinctive woodsmoke smell and taste in our drinking water supply.  On top of that, a couple of weeks later a deluge of rain in the headwaters saw the two rivers on either side of our town burst their banks bringing floodwaters close to our doorstep. Enough to keep us locked in the house, but aside from leaving the paddocks a little soggy, no factor. With great hindsight that was just a little taste of things to come!

Cue the pandemic. Being a lifestyle business family we had booked in to spend the month of April on the Gold Coast in Australia [FYI, I work from home/remote… as long as I have a decent internet connection I could theoretically work anywhere]. We held onto a remote if deluded hope that we might still make it, and began daily monitoring of headlines. In the end Airbnb were good enough to extend blanket refunds as the writing finally and firmly was on the wall. So we took the refunds and flight credits, and I cancelled all plans and hope of travel at all in 2020.

Barely a few days later New Zealand went into a nationwide lockdown.

Locked down, but not out.

And thus began a period where I was firing on all cylinders. I was going on the attack. My particular research process really shines in an environment like what we went through in global markets during the first half of the year. In addition to that I went through a process of upgrading and adjusting and restructuring my reports to be more coherent, insightful, and also featuring the introduction of an entirely new report. 

Another funny thing happened: people were more willing to take calls. Maybe it was because they were now much more familiar with services like zoom and teams, maybe it was because they needed a voice and a firm view in a tumultuous market, and maybe also they just wanted someone else to talk to as they figured their way around the new normal of lockdowns and working from home. Either way the confluence of happenings saw me onboard more clients in the first 6 months of the year than all of the previous year. 

It was a mixed bag though, as some prospective clients who were basically good to go – loved my work, understood me and my process, wanted to sign up …had their budgets placed into lockdown as well (becoming conversations for 2021).

But above all, to be perfectly clear, I *worked* in H1. A lot.  

There’s no such thing as work life balance…

There are work life choices, and you make them, and they have consequences. (credit to Jack Welch via Dan Pena). The lock ups and downs, despite my business progress, put a lot of strain on my marriage. Taking it close to the edge. See: running a business, especially solo, especially from home, especially with a wife and kids… is. Bloody. F**king. Hard. I definitely would not recommend it as a blanket thing to do – it’s not for everyone, and it’s probably not even for most people. You will find yourself in dark places, you will have your shortcomings revealed, any fantasy of the mythical creature called work life balance will be shattered into the diamond dust and rainbows where it came from.

But it can work, and it can’t be treated as anything other than a journey of radical self-improvement and transformation, and the hardest set of tests and challenges you will face. I’m not trying to talk you out of it by any means – this is just my story. So don’t not do it because I said so, but don’t take it lightly.

Back on the path, I’m still fine-tuning my work life choices.

Always a contrarian

One interesting development in 2020 was the leasing of an office. Another contrarian move! We had been thinking about home schooling our children, and as it happens the lockdown gave us a trial run, and we loved it. The flexibility, the jettisoning of the stressful morning rush, and greater engagement in their learning and development. For our work/life setup it seemed like a pretty straightforward step to take.

One downside… part of my “job” involves writing, and the enemy of writing is interruption. You can’t do good research with interruptions… the quality (and mental health) benefits of being able to run an extended period of uninterrupted, focused, concentration on a task that you fundamentally enjoy doing is valuable. So with that conclusion I rented some office space – nothing too fancy, an old building but the top floor, corner office (probably one of the best views in Invercargill). The main thing was it gave me a quiet uninterruptable space to go to and get stuff done.

Ungoing Solo

Mindful of my business ambitions, and continuing on with the uneasy task of navigating the cycle of my work-life choices -- and gazing around at the largely empty 40m2 office space I leased, you can guess where my mind started to wonder…

I’ve spent a lot of time going around in mental circles the last few months – do I want to go to the trouble of turning my business into a behemoth? Is bigger better? Or is better… better? I always reserve the right to change my mind of course, but for now I am focused on the thesis of better is better. 

The last couple of years have raised my conviction that I’m on the right path, I even recently went through a process of shutting down that Top 5 Charts service that I mentioned in the 2019 section: yes a short-term loss of revenue, but an affirmation of and doubling down on the main thing and attempt to streamline and shed distractions.

But back on the issue of better vs bigger, in some ways I’ve opted for a sort of compromise or maybe you could call it the next logical evolution: solopreneur >> with a support team. As I write I’m in the process of onboarding a research assistant, executive assistant, and a sales/relationship manager. My intention or certainly at least hope is that it means I can focus more on what I do best (research and marketing) and shift some of the other aspects like sales and admin/operations off to my support team.

It’s yet another expedition into uncharted waters for me, and no doubt yet another journey of radical self-development as I go from practitioner/operator to practitioner/operator/manager. I’m pretty sure it’s going to be challenging to stretch my mind to a new way of doing things and probably a new way of thinking. As far as I can guess, it’s probably just going to be another exercise of forming a vision, and willing that vision into existence through determined effort, experimentation, and systematic reflection.

Closing remarks

That’s about it for now... Probably the best way for me to sum up where I am at right now is to say that I am still enjoying the dual challenge of figuring out macro/markets – being useful to clients (the main thing), and at the same time figuring out how to run a business.

And above all, the relentless push forward on the never ending path of radical self-development and navigating the ongoing flow of work life choices. 

To paraphrase Dr Seuss ("Oh, The Places You'll Go!"): 

On I will go, though the weather be foul. On I will go, though my enemies prowl. On I will go, though the Hakken-Kraks howl. Onward up many a frightening creek, though my arms may get sore and my sneakers may leak. On and on I will hike, and I know I'll hike far and face up to my problems whatever they are.

Thanks for reading,

Callum Thomas