Graham Duncan — Talent Is The Best Asset Class (#362)

Photo by Heidi Gutman/CNBC

“Everyone’s genius is right next to their dysfunction.” Graham Duncan

Graham Duncan (@GrahamDuncanNYC) is the co-founder of East Rock Capital, a multi-family office investment firm that manages $2 billion for a small number of families and their charitable foundations.

Before starting East Rock 14 years ago, Graham worked at two other investment firms and started his career by co-founding an independent Wall Street research firm. Graham graduated from Yale with a B.A. in ethics, politics, and economics. He is a member of the Council on Foreign Relations and serves as co-chair of the SOHN Conference Foundation, which funds pediatric cancer research.

Josh Waitzkin, the chess prodigy who served as the basis for the book and movie Searching for Bobby Fischer, calls Graham “the tip of the spear in the realms of talent tracking and judgment of human potential in high stakes mental arenas.”

Listen to the episode on Apple Podcasts, Spotify, Stitcher, Overcast, or on your favorite podcast platform.

#362: Graham Duncan — Talent Is The Best Asset Class


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Would you like to hear another episode with an investor who understands the value of quality time? — Check out my conversation with Peter Mallouk, in which we discuss illiquidity as a feature rather than a bug, when the risk of being out of the market is greater than the risk of being in, and much more. (Stream below or right-click here to download.):

#356: Peter Mallouk — Exploring the Worlds of Investing, Assets, and Quality of Life

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QUESTION(S) OF THE DAY: What was your favorite quote or lesson from this episode? Please let me know in the comments.

Scroll below for links and show notes…

SELECTED LINKS FROM THE EPISODE

  • Connect with Graham Duncan:

Website | Twitter | East Rock Capital

SHOW NOTES

  • I think of Graham as far more than an investor. How does he describe what he does? [05:35]
  • Absent the systems and frameworks he’s honed over time, what made Graham a good talent hunter at the tender age of 24? [10:12]
  • What constitutes taste when Graham is scouting for talent these days? [13:05]
  • Upon meeting someone, how does Graham stress-test whether or not someone is “commercial” in the way they balance aggression and integrity? [15:57]
  • One high-signal question Graham has found particularly useful when trying to determine the quality of anyone from a trader to an OB/GYN. [19:12]
  • When interviewing a potential candidate, how does Graham vet their given references? [22:00]
  • On approaching the reference process with curiosity rather than an attempt to catch anyone with a “gotcha.” [25:32]
  • Why does mutual friend Josh Waitzkin call Graham The Wild Gardener? [29:41]
  • How does Graham deal with contradictory perspectives — when the data is telling him one thing and his gut is telling him another? [31:30]
  • What does Graham do to familiarize himself with the way people underwrite their mental models (besides nearly beheading them)? [33:52]
  • Graham talks about his role as an investment coach, of sorts, and how he picks the best “players” for the game at hand. [35:17]
  • What other patterns has Graham noticed in the successful talent he’s ended up selecting? [36:47]
  • In what way have others helped Graham surface his hidden assumptions, and how might a coach do the same for others? [41:34]
  • An example of when Graham’s “grip” has been a bit too tight around his own beliefs. [44:38]
  • What Byron Katie has taught us about articulating the opposite of such beliefs — and having a mindful lunch. [46:14]
  • When evaluating a team, how does Graham think about each person developing the ability to look at the opposite versus hiring to end up at that optimal mixture? [50:45]
  • How might someone train to more clearly see disconfirming evidence — and roll with the punches when their instincts lead them toward regrettable decisions? [54:04]
  • What books does Graham gift to others most often? [58:56]
  • An aside about Wim Hof and Josh Waitzkin embracing “the other side of pain” to get the most out of life. [1:02:31]
  • How does James Carse’s distinction of finite and infinite games apply to finance, and how would Graham test a potential teammate for compatible sensibility? [1:06:12]
  • How likely would it be for Graham to invest in a Jocko Willink project? [1:10:45]
  • Different people have different ways of sniffing around direct questions. Here are a few examples. [1:11:43]
  • Graham explains what this Kwame Appiah quote means to him: “In life the challenge is not so much to figure out how best to play the game; the challenge is to figure out what game you’re playing.” [1:13:42]
  • Going by David Foster Wallace’s famous commencement speech, what’s your water? Podcasting helps me see mine. [1:16:17]
  • Graham’s take on Greg McKeown’s Essentialism. [1:17:50]
  • How Graham sees careers as a river (with a nod of thanks to neuroscientists Dan Siegel and Tina Payne Bryson’s model of well-being). [1:18:57]
  • Toward which bank do the top one percent in any given field swim? What if that field is financial markets? What if that field is writing fiction novels? [1:21:54]
  • The differences between millionaires, billionaires, cultural billionaires, and time billionaires. [1:26:25]
  • An idea for how Tim Urban might allow for personalization of his 90-year-life calendar. [1:28:55]
  • Are you more concerned about the length of your life or its width? [1:30:10]
  • Life changes Graham and I have both made as a direct result of reading Tim Urban’s “The Long Tail” piece at Wait But Why. [1:31:05]
  • How does Graham try to appreciate the width of his life? [1:32:43]
  • Aside from the aforementioned Kwame Appiah quote, what might Graham put on his billboard? [1:36:12]
  • The power to be found in treating negative feelings like welcome party guests. [1:37:07]
  • Parting thoughts from Mark Twain and Graham. [1:39:09]

PEOPLE MENTIONED