Saturday, November 28, 2015

Gordo Byrn's blog

Views on training

I've been doing quite a bit of training over the last three weeks. While my actual hours committed are only slightly higher than normal, the energy output has been increased. In my spare time, I have been focusing on Monica, my clients and my recovery. That hasn't left any motivation for writing (or reading).

However... as I swim, bike and run in the Desert Southwest, there is ample time to think! It is just that those thoughts don't seem to get much past my mind.

As an aside, my mental conditioning coach likes to ask "where do your thoughts go when they leave your mind"? My two cents is that they go straight into our bodies. Part of the role of exercise in my life is releasing thoughts from my body.

So this blog will sum up a few thoughts that keep coming back to me. By writing them down here, I hope to set them free!


The photo that opens this week's letter is the Grand Canyon. Jonas and I thought that it would be a fun challenge to run to the river (and back) in a day. The canyon is a very powerful place and I highly recommend that you experience it for yourself. The number of eco-systems in a single place makes it very special. Totally by chance, we rolled through when there were different flowers blooming with every 1000 feet of elevation change. Fantastic!

The canyon had a strong effect on more than just my calves... in the days that followed, I felt a lot of emotions about that run. The canyon drove home my mortality in a different way than passing semi-trailers. Inside the canyon are many separate worlds that have been rolling along for thousands of years -- separate from any credit crisis, mortgage default or profit sharing agreement.

I can't promise that you'll have a similar experience but, regardless, it's worth the trip. If you come with me then I'll buy you a patch at Phantom Ranch. Big J asked why he was getting his patch at the bottom, but thought about it for a bit and smiled at me.

The only way is UP!

Jonas has been with me for the last three weeks as we travel around the desert with Kelly, our uber-support lady. Below we are the back of the monsterwagon (as he likes to call it).

In a few ways, the big guy is more gordo that gordo... it is strange when you are spending a lot of time with someone that shares your idiosyncrasies. The people that know both of us will probably be smiling because our greatest similarities are often the things that can irritate (but only slightly, naturally) those around us. Rather than dwell on how J & G maximize their "take" from the world around us... I'll share some observations about how Jonas approaches life.

By any definition, he is one of the most _successful_ athletes that I know. He's been fast for 15 years and supports his life by using his athletics to build his personal brand. He is living well and positioning himself for a healthy, sustainable future.

Nutrition -- he eats very, very well. The main differences that I noticed from what I write about is a large helping of good fats with every single meal. When my volume is high, I tend to pour olive oil on most meals (other than fruit). Big J uses olive oil, nuts and avocados. He eats a ton of fruit. Despite massive energy output when training (his average training speed is high) his %age of calories from processed foods is lower than nearly every one I know.

People tend to think that fast athletes never get tired. In fact, fast people get VERY tired. What separates elite ultraendurance athletes is: (a) how they cope with fatigue; and (b) their capacity to recover from stress/fatigue. The longer the event, the more important this becomes.

Jonas is super experienced and very successful over a long period of time. He has the confidence to walk, or grab a van ride, when he thinks it is required. He jokes that he might have been more successful if he had simply been a little tougher. There is a real humility that surrounds him.

As for success... with a VO2-max of 6.9L per minute you can do a tremendous amount of damage to yourself. I can't imagine having that sort of horsepower. While J's peaks may have been greater from a sustained all-or-nothing approach; I very much doubt that his life success would have been improved. He has achieved a remarkable position in his life -- he is an elite triathlete that has a strong personal brand, a business that works outside of race performance, and the personal flexibility to come train with his Canadian buddy in the spring!

His method of achievement isn't anything fancy -- relentless work. He is on his computer 4-8 hours per DAY answering emails, talking to client and blogging (in Swedish) about his trip.

While his inherent ability helps his race performance, his life success has been created by a drive for personal excellence and consistent work over the last 15 years.

A good guy for me to hang around.


Justin Daerr is the Camp Director for our Endurance Corner camps -- that's him above. The guy just LIVES for sag... ;-)

Justin gave the campers two great pieces of advice that I wanted to pass along. You will find them useful in your athletics, and your lives, if you apply them.

When training with people that are stronger than you... don't look for work. When you are undertaking a challenging task (a race, a training camp, a project) that requires uncommon stamina then pace your workout, your day, your week...

The successful athlete can't afford to max-out in any single training session because he needs to get back out there the next day. The day, the race, the week will get hard eventually -- sometimes not until your are back at home in private!

JD's other observation is that there are three approaches/aspects to the endurance lifestyle: Racing, Training and Touring. If your goal is performance then you need to spend the bulk of your time Training (not racing or touring).

Probably the most common training error is low-level racing in training. While this approach can work (especially if you are stronger than your buddies) -- eventually, it is self-limiting. Athletes that are plateaued and chronically injured are likely racing all the time. Long training camps (and how we cope in the weeks after) are great for helping us learn an appropriate training load. The skill lies not in the overload, rather the tough part is knowing how far is "far enough".

Something that we all deal with when deeply fatigued is "touring". Chronic "tourists" are generally married to the volume figures that they place in their training logs and have 50% (or more) of their weekly volume in their "easy" training zone. Being a tourist is a lot of fun and there is a time of year (and week) for easy training. Something that JD reminded us about is understanding when training has become touring. Maximizing our training program usually means cutting back on touring.

I found myself touring for a while yesterday and took today easy so that I could get back to training.

Great reminders from Justin

On Break

Blogging is on break. Please check back mid-April.


Tucson Training

Above you have Mat Steinmetz, Mike Alvarez, Sean Fenner and Mark Cook -- my ride buddies from yesterday's 50 mile effort.

I have been in the desert for the last week attending our Endurance Corner Spring Camp in Tucson, Arizona. The camp has been a reminder of a few topics that I will cover in this week's letter.

What's possible // Everyone here is a real athlete, but not everyone realizes it. Justin and I were commenting to each other that everyone is strong, durable and able to log the miles. It is tough to be one of the slower athletes in a group as high powered as this one. Interestingly, I have found that the slower athletes are the least likely to experience mental stress at a camp. Camp is challenging and they expected that!

Attitude & Fatigue // Similar to Epic Camp (where everyone is a bad ass "back home"), the faster agegroup athletes are used to being able to dominate in training _and_ dictate the nature of their training. Most specifically, swim volume and peak power required when group riding. JD warned us all pre-camp... "Don't go looking for work, let the work come to you". That is good advice when riding with a couple of Ultraman Champs. Fortunately, Jonas and I have been feeling gentlemanly -- I did big ring Gates Pass on Tuesday but Mat made me (and the rest of the ride) pay later.

Something that I have noticed across the years is that athletes that are unable to adjust self-expectations in the face of high powered competition are the ones that have the greatest gap between actual, and potential, performance.

Specifically, they convince themselves that they are training easier than reality. Training camps, long races, and descending main sets, are an effective way to benchmark one's reality. It's why I love Epic Camp for my own training -- not that I always listen to what the group is 'telling' me!

Setting one's mind // We've seen some stand out performances this week. Personally, I have been most impressed by the swim training that the campers have done. Scott taught me that (most) athletes will rise to the expectations of their peer group. We have been putting up a "real" swim workout most days. I have been sharing some of the workouts that Monica used to turn me into a low-50s IMer.

Limits // Today at lunch Sean Fenner told me that he wished that he could really hit it a few days and see what's possible. I passed along my experience that even when you think you are holding back... you are likely hitting it quite hard! The camp environment takes us far beyond where we could get ourselves. I probably would have taken a light day yesterday if I was at home. Instead... 10K steady run, 5500 yard solid swim and 50 mile aerobic maintenance bike. Jonas spent the early part of the camp trying to get us to sleep in // then gave up and started training! Even the fastest guy at the camp benefits from the group dynamic.

Ultra Speed // The differentiator between good and great ultradistance athletes is NOT their 20-60 minute power. At a camp like this, you don't see the best from the fittest athletes -- they have tons in reserve. What we do see (but might not realize) is the difference between an elite athlete's easy/steady pace and an agegrouper's mod-hard/threshold pace. Look at Sindballe's heart data BEFORE you look at the power. How many people racing 2-5 hours LONGER than him are able to ride that "easy" in an Ironman Distance race? Thorbjorn held off Tim deBoom -- one of the greatest runners in the history of Hawaii -- he did that on the marathon.

We did a test set within our 5500 yard swim...
5x500 then 4x400 with one goal -- faster each 400, leave 10s after the person in front of you (non-drafting). This is a tough swim for an athlete to get "right" in a group situation. Most people swim them as mod-hard; threshold; threshold; very hard with the last three swims within 6-8s of each other.

In case you are wondering... I went something like 5:10/4:58/4:51/4:41 and tried quite hard on the last one -- my 400 yard PB is 4:20 so I have some work to do! We were leaving on 5:45. Big J dropped a 4:08 on the last one. Bit of a gap.. that's why he's The Man.

The inability to descend is a result of lack of practice (and confidence), not lack of potential. Lacking this critical ability means that the athlete is likely training one intensity zone higher than they think -- all-the-time. Within most AG programs this doesn't show as excessive fatigue -- it tends to show as: (a) late race fading; (b) stagnant aerobic development (especially around AeT); and (c) an inability to really hit the toughest sessions.

Same deal on the bike -- in a group situation, you can pretty much always count on a highly motivated athlete to come to the front and start riding "easy to steady" by siting on their Half Ironman wattage. I comfort myself that the draft is outstanding and it will only be a half hour or so before the pace slows down. Even with the advent of powermeters, most athletes cannot wait to show their strength.

Finishing strong is a very satisfying form of delayed gratification.

We will race the way we train.

Choose wisely,

Teachers and Students

The Endurance Corner team is in Tucson, Arizona this week for our first of two spring training camps. I love the desert -- no bugs, cool at night and plenty of sunshine.

Coach KP and I were swapping ideas about learning and teaching this past week. We shared a few observations that came from thinking about how open (or closed) I have been to new ideas across my triathlon career.

Being open to new ideas, means being open to change. Change is uncomfortable. As an adviser, most of my clients come to me seeking reassurance that there is no need for change (a lot of time that motivates me as well). We are open to guidance, so long as it consists of digging deeper into our existing patterns.

How often do we say to a teacher, "I hope you are not trying to tell me there is a problem."

Most often we see the need to change as a problem when it is an opportunity for success.


A few years back, I read that Tiger Woods decided to change his golf swing. At the time he was the best golfer on the circuit, yet he saw the need to change. I know very few experts that would be willing to completely learn a skill that is fundamental to their identity. The true master's commitment is to excellence, not the current way of doing things.

It is the rare expert that is open to change -- not only did Tiger see the need to change but he had the self-awareness to figure this out on his own. Most of us require stress, failure or some other external input to indicate that change might be required.

The trap of expert knowledge. Of being smart enough, good enough, fast enough -- it can be useful (but painful) to get outside of the familiar from time to time.

Here at our Tucson camp, the group environment takes all of us outside of the familiar, it can be uncomfortable at times. At our first dinner KP spoke of his experience at being the strongest athlete at a camp, as well as, the weakest athlete at a camp. He says that it can be emotionally uncomfortable when we are out-gunned. However, in getting through those situations, we can emerge stronger.


Early in my career, I remember thinking that simplicity was a sign of ignorance -- and -- having a strong desire to constantly demonstrate my complex knowledge to my teachers and the world at large. My coaches found my intensity entertaining -- I was fortunate for their patience!

The master teachers that I have worked with make the complex simple -- they help their students focus on the key elements. As the student becomes an expert, he sees more and more complexity. One of my drivers for simplification is to make sense of all the options that are available. Another is seeing that there are a few themes that underpin the wide range of protocols that are applied by successful people.


History tells me that I know less than I think
We each need to live our own experience
Remain open so my students can remind me what I don't know
Remember that my goal is to help my students not live for them


This blog is a few days late (we've been training) so that is enough for now.

Until next week,

Happy As Stu

A little over ten years ago, my good friend Stuart was run over after a big night on the town. This past week, a friend of mine (Kristy Gough) was killed while enjoying a Sunday morning bike ride.

When I heard that Kristy had died, my thoughts turned to three people: my buddy Clas, my dead pal Stuart and my wife Monica. At some level, I realized that I ought to be thinking about Kristy but that didn’t happen. Instead, my first thought was for the survivors, most specifically, my friend Clas. Kristy was the first young person close to Clas that died unexpectedly. Stuart was the first young person close to me that died.

I was able to speak with Clas this week and he reminded me that it is wise to live _every_ day. Clas noted that it is often tempting to live for a future day (world championships, a key race, or even retirement). The death of someone close to us can be a trigger for considering a wider view of personal success.

I think about death a lot – some days when I am riding, I wonder about each truck that rolls up behind me. Out on my run last Tuesday, I reflected on Stuart’s death and asked if I had been wise with my extra time – 127 months and counting… I wondered if I had any obligation to Stuart, or Kristy, and what they would have wanted for me, for us. If anything good comes from a death then it is likely the fact that the survivors take a moment to consider the daily choices we make. Stuart’s death didn’t trigger any changes in my attitude (my divorce had a more powerful effect) but reflecting on his death (weekly/monthly) helps me focus on my limited time.

Ten years on, I am certain about two things: we got Stuart’s funeral right and my extra time was well spent.

As I ran in the rain last Tuesday, I said a prayer that Kristy’s spirit, and the people around her, find peace in the weeks to come. I tapped my prayer into the road and felt the vibration in my heart.

Thanks for the memories.


Gates Investing

Over the last few months, I have started asking myself the opposite of the answer I am seeking. Sample questions:

What do I know won’t work right now?

What options are clearly the wrong decisions?

What would I do if money was no object?

In my SnowFarm notes (published below a few weeks ago) – you will see that Renzie talks about a disaster cascade – to locate our self-defeating patterns write a list of every action required to turn a situation into a total disaster. Then search for the actions/patterns that you undertake within that list.

In these uncertain financial times, I ask myself the question, “What if capital wasn’t a constraint?” By removing financial return criteria, I find it easier to understand the underlying need that I am seeking to fulfill. Vacation homes, automobiles, property investments, share purchases, clothes… I spend time considering the “why” behind my motivations.

I often catch myself justifying purchases on the grounds that they are “investments”. If you look carefully inside most marketing pitches you will see the underlying message that you are “investing” in something. The rationalization of investment (in fitness, in health, in property, in stocks, in IRAs, in peace-of-mind…) can be alluring.

It is often a trap… the salesman nearly always enjoys more benefit than the purchaser.


Stepping Up

Various ideas on commitment from people that have helped others achieve success:

Joe Friel talks about athletic success arising from the smallest dose of the most specific training required to achieve the goal.

Dick Jochums reflects that people will do the minimum to achieve their goals.

My dad shared his personal investment strategy of the smallest investment required to maximize his personal return from a situation.

We share a common bias to underestimate our workload and overestimate our work capacity.

In private, many of my “successful” friends note that most people don’t seem to work very hard. While some may be lazy, I think that work-drive has a mix of generic and environmental influences. Probably the greatest thing that we can do is surround ourselves with people that are good at what we want to achieve – if we lack ability, or drive, then it will quickly become clear as our peers leave us behind. At this stage, many people will move into denial -- seeking a change in protocol, or coach.

With my aspiring clients, we spend significant time identifying patterns/habits that limit work capacity – it is not until the circle of success is established that we concern ourselves with the workload. In my view, this approach maximizes the achievement each client will achieve relative to themselves.

The other approach is to lay out the training required to be a champion and invite people to “step up”. Our sport is littered with coaches that ruined themselves, and others, with this philosophy.

I wonder if one champion is worth dozens of carcasses.


Shorting Europe

I’m bearish on Europe relative to the US. Having spent two weeks on the far side of the Atlantic, I can not see justification for the relative value differentials between the regions. London, in particular, strikes me as a place that will take a lot of pain as global liquidity unwinds.

I think that we are in the early stages of the liquidity effects that we are going to see over the next three years. The sectors that most benefited from leverage are still in denial.


How Companies Die

Within our property development business, we have not seen any distressed deal flow since the liquidity crisis began last summer. My business partner takes this as a sign of the strength of the prime sector. He could be right. However, I had the opportunity to bend the ear of a senior banker last week with this scenario…

Summer 2007 – Credit crisis hits and the weak companies run into trouble. However, hardly anybody realizes that they are in trouble – things have been too good for too long.

Winter 2007/Spring 2008 – Management can normally hide a poor portfolio for at least a year. They have a strong incentive (their jobs and equity investment) to keep the situation private for as long as possible. Lenders are concerned but the full extent of the trouble within their loan portfolios isn’t apparent to them. All their clients continue to report “business as usual”.

Spring/Summer 2008 – Smart lenders and savvy equity investors notice that they could be in trouble – stakeholders start internal investigations while praying for market conditions to improve.

Summer/Fall 2008 – Crunch time. Weak companies have security called, shareholders in negative equity positions are washed out.

Fall/Winter 2008 – Reality sinks in, prices shift downward to market clearing levels, transaction volume rises.

I am unlikely to have the timing right but that was the pattern that I witnessed in the early 90s.

Only hedge funds and investment banks die fast – in the real economy, companies die slowly.


Right now, I am looking out my window to fresh snow in Boulder, Colorado! Next week I will be writing you from (hopefully) sunny Tucson.

Our triathlon training camp runs March 22-30, we have one slot left and it could be you enjoying the sun alongside us! If you are interested then please drop me a line or send an email to mat @ endurancecorner dot com.

Battening down the financial hatches,

US PPP, UK Property and Sports Knowledge

Check out that photo... Makes me want to ride! In three months time Epic Camp is heading to Italy. Johno and Ian are perfecting the logistics for how we will get up the Stelvio Pass (pictured). If you would like to join us (June 8th to 15th) then drop me a line with your triathlon CV.


Visiting Europe & UK Property
I am currently mid-way through a European business trip and tapping on my computer in Edinburgh, Scotland. The UK is certainly expensive for the dollar-based visitor -- Yesterday I went through $100 and that only included a visit to a health club and some breakfast. Out of all the countries that I visit in the world, the US appears to be offering the best value right now. I have been considering how to take advantage of that point but haven't come up with much (other than telling my European business contacts to diversify away from Euro-based assets).

A few years ago no one in my peer group wanted to hold Euro assets. Now, many talk as if the dollar is heading for a permanent slide. My simple purchasing-power-parity (PPP) analysis from my global journeys is telling me something different.

Here in Scotland, I am the director of a firm that specializes in prime residential development. I work in the Scottish part of the company's portfolio -- they also have projects in London, Boston, New York and Dubai. Generally, the company follows a buy-build-hold strategy but we do sell a portion of the portfolio each year. The sales enable us to 'prove' our valuations to bankers/shareholders and manage the overall composition of the portfolio.

For those of you interested in residential property prices here is what we are seeing -- the prime Scottish sector grew 5% last year and has been flat in the early part of 2008. This is against a backdrop of 10-20% falls in the UK's new build and 'investment' sector.

Up-and-coming market segments and secondary locations are under extreme pressure -- investors, and firms, that bought heavily into the new build sector are going to have a very tough time.

Given our financing strength, we had been hoping to make distressed purchases. We aren't seeing many of these and good deals remain competitively priced. One favorable change is that development margins have expanded back to 2004 levels. Of course, that might be the result of our sales assumptions being more rosy that our competition. UK home buyer sentiment is as bad as I've seen it in the last 15 years but prime prices are stable (paradox #1). It will be interesting to watch how the market moves over the next 12 months.

The credit markets are tight but we have been approached by lenders that are keen to build their loan books in prime residential (paradox #2). While the credit markets are poor (in general), we are being offered loans at attractive prices. Similar to the property markets, there is a lot of variation within the credit markets.

Within our key financial relationships, liquidity is more of an issue than credit -- banks want to do more deals than they can fund with their balance sheet. They are limited by the short-term funding capacity of their balance sheets, not the quality of their deal flow. (Paradox #3) We remain the other way around -- high quality prime property deals are in shorter supply than capital.


Who Controls Knowledge?
Scientific research costs money, takes time and is very difficult to control. Have you ever wondered wondered who funds the research that we take for granted? Have you ever considered if the population studied is an accurate representation of your current position?

I ask these questions because (in ultraendurance) the best athletes appear to do impossible feats -- coping with excessive hydration, dealing with material dehydration, superior fat oxidization, superior carbohydrate metabolism... it can seem that everywhere I look in ultradistance triathlon, there are outliers that don't fit the data.

By definition, the highest athletic performers are outliers but I wonder if industry-funded research on collegiate men (or sedentary adults) is the most accurate representation of my peer group. I'm also aware that, in a market with limited funding, the established players have a vested interest in maintaining the status quo, and their position.

Specifically, I've been thinking about how I perform...

***my capacity to process food (huge)
***my performance when dehydrated (just fine, mostly)
***my ability to remove fluids from my gut (massive)
***my capacity to oxidize fat for fuel and/or my ultraeconomy (unable to explain via the literature)
***my power/pace profile when fit (far below average reduction from VO2 down to AeT)

How much of the above is genetic, how much was trained, how much is due to the 'norms' being inaccurate? We may never know for sure and worrying about our profile is likely a waste of time. Focus on enjoying the training and see what happens.

There is a lot of silent evidence that is lost when people that aren't suited to ultradistance athletics retire from the sport. Each year, a BIG segment of long distance triathletes disappear. In most fields, people that underperform relative to effort (low inherent ability) fade into the background. Evidence from people that outperform relative to effort (high inherent ability) is what we cling to. The mind wants to believe that there might be an easy way... if only we had the magic protocol... [motivation, inherent ability, opportunity, time, luck].

One benefit that we have within our Boulder team is a wide range of physiological baselines. Alan is the most science-savvy team member and he faces the greatest physiological hurdles for going long. If you read his blog then you'll see that (physically) he performs best at 10-30 minute efforts -- one of the toughest zones for me to perform in. Triathlon is the only sport where a sprint takes 60-90 minutes!

Alan and I were talking about motivation for athletics -- performance vs enjoyment. Understanding our motivation is important because it relates to the satisfaction that we receive from our sport.

For example, I am an enjoyment-oriented athlete (that happens to have high inherent ability for ultra-distance triathlon). The least satisfying periods of my athletic 'career' have been when I focused on performance benchmarks. Working within a team, or with a coach, that is highly performance driven totally drains me. Interestingly it took me NINE years to figure this out!

That said, performance-oriented coaches have helped me breakthrough with my racing. Sometimes this was enjoyable, sometimes not!

Knowing what drives you, and your clients, is an important consideration in ALL advisory fields (finance, business, academics, athletics). To be effective teachers, we need to understand the values of our clients, and ourselves.

Coaches can't create motivation but we can certainly kill it.

Back next week,

Vision Questing

Our photo this week is Robbie Ventura, one of the most genuine people I have met. We were descending Figueroa on Day Two and he started taking pictures of me at over 30 mph -- suffice to say his bike skills are far, far superior to mine. Robbie is the founder of VisionQuest Coaching. You might have seen him on the Versus Tour coverage the last couple of summers.

Robbie has a really special gift -- when he talks to you, you feel like you are the most important person in the world. Sounds kind of irrational but all you want to do is agree and help him out. There is a special vibe around him (and the VQ Coaches) that leaves you happy. It is a powerful kind of charisma.

Robbie and his team at VisionQuest Coaching were hosting a Solvang Spring Camp and the Boulder team (Mat, Alan, Justin) came across for the experience. This week I will share ideas that flowed out of five days of hammering with the roadies.

First a few announcements:

Spring Employment -- I am doing a personal training camp from April 3rd to 14th (start Tucson, end Santa Fe). We'll drop by the Grand Canyon en route. I need a couple (or two pals) to run sag/support/logistics. Please drop me a line if you are interested in helping out. This is a working, rather than training, position. Pay based on experience -- more if one of the duo has a massage qualification.

eMail -- I am now officially buried. My hopes of taming my inbox faded this week. I'll keep chipping away. Thanks for your patience.
Tucson Camps -- one of our campers noticed that the first weekend of our March 22-30 camp is Easter. As a result, we have an opening for March. Drop me a line if you are interested in joining us. As a reminder, you'll want to be in 13-hour IM shape, or quicker. Both camps have a range of people signed up.
Solvang is beautiful! Great riding, a decent swimming pool at the local "Y" and nice country roads for running (there could be trails, I haven't gone exploring). A wide range of riding terrain from flats, to rollers, to 'beyond category' climbs.
More than the location, what makes the VQ camp special is the VQ team. Robbie has assembled a unique group of folks around himself -- (coaches, staff, mechanics, athletes). Most everyone has a positive, open vibe. Even the cagey, roadie-types are friendly -- they run you off the road with a smile (joking... kinda).
If you are interested in what we've been doing then you can have a look at Petro-World or JD's Blog. Both Mark and Justin have been writing daily updates. As you will see, there has been a period of all-out effort at some stage of EVERY day at the camp. As an athlete, I don't come to a roadie-focused camp and expect anything else.
One of the VQ-Vets (Jim Sauls) took us for a ride the day before the camp. Jim's legs were glowing (they were that white). Jim let me know that the Chicago-based athletes had been off-the-roads for weeks prior to the camp. Sitting on their trainers, waiting to be unleashed in Southern California. Similar to Epic, Robbie started the camp with a TT to enable the stronger athletes to blow off a little steam. See if you spot the difference...
VQ TT Day -- 10 mile warm-up; 5 mile TT with uphill finish then two hour (very) solid group ride // rest up to hammer the tri guys tomorrow.
Epic TT Day -- 50 min run; 3K swim includes 2K TT; ride 140K with 2 KOMs; 43K dead-flat TT with 10K upwind finish -- limp back to motel wondering about tomorrow.
The strong VQ riders had plenty left for Day Two -- a monster climb that felt a bit like a cyclocross course at times. We rode the back side of Figueroa. The road was washed out in sections and my front fork filled with mud. Felt like I had my brakes on! I have had my TT bike in some unique places; that climb makes the Top 10, for sure.

In the early days of the camp, the roadies thought that we were nuts to place ourselves at such a disadvantage by using our TT bikes. By the end of the camp, some may have changed their minds -- more about that in the Petro-Blog.

Mental Fatigue -- an interesting thing that I noticed with the bike camp is that my desire to "go hard" was fading faster than my physical ability. All the cycling intensity seems to wear down my immune system and my drive -- much more than my body.

Average Workout Watts -- with the entire camp on power, we were able to compare wattage throughout the camp. It was a reminder that you can't tell much by averages (even normalised) -- there was huge variation in the people that rode around me as well as people that went out the back while holding the same average watts as me. Remember that power is most useful to track yourself against yourself.

Lab Testing -- Alan's most recent piece was about the difference between two lab tests. Camper-of-the-week would have to go to Mat Steinmetz (one of the tests analyzed). Mat's lab tests, background and pre-camp performance gave ZERO indication that he was about to ride out of his skin (literally on Day Five). The guy was drilling me on Mt Fig and took over Molina's normal role in my life. Mat's performance was a clear reminder that we only get a snapshot with physiological testing (and tests don't always track the most important aspects of performance).

Benchmarking -- the structure of the camp rides // 5M TT; 1Hr Uphill KOM; Century Ride; 45K Handicap Race // that gave each of us ample opportunity to benchmark our power (and pace) against a wide range of campers. My only regret was a malfunctioning SRM on Gardie Jackson's bike. Gardie is the most complete athlete (body, mind, spirit) that I have met in a long, long while. If you ask me what I aspire to in my athletics then it is the physical power resident in Gardie.

The guys say that a large element of bike racing is leadership -- when I am riding with athletes like Robbie and Gardie, I would gladly toss my entire week away to help them get the job done. True leaders and genuine guys -- very inspirational stuff. It was strange to be in a group of elite athletes that fostered a selfless feeling within myself (not something that anyone close to me would recognize).

As the camp progresses, and we all get tired, it is normal to wonder... "is it optimal to be smashing ourselves day-in day-out for a week?" The triathletes, especially, wonder if it is "OK" to be doing all of the threshold and VO2 efforts. My advice has been to have fun and train lots.

While you don't want to fill your entire program up with high intensity sessions, taking a week in March and really challenging yourself can be useful -- especially, when you've been chained to your trainer for the last few months.
When the campers get home, I recommended an easy week (to absorb/recover) the returning to their normal (sane) program -- hopefully you return at a higher level. The mental challenge that follows camps is not continuing to smash yourself. With the memories of all the hard training fresh in your mind, it can be tempting to pass-along some hurt to your training buddies. In my experience, that is a mistake and will leave you flat when you would rather be fast.
With my own fitness regime... I will be coasting for the next three weeks. I am working in Europe for a fortnight then returning to Boulder. This camp was very, very tough and I need to settle down for a while. Having coached a few athletes that consistently peak in March, I am choosing to lose a bit of fitness to protect myself from myself. I will start to ramp back up beginning with our first Tucson training camp.
One final thought, I think that a lot of triathletes give roadies a bad time because they don't like the way that strong cyclists deal out punishment on the bike. When the VQ-lads are laying down the hurt I remind myself that it is business, nothing personal. There is no way that I could this sort of bike training on my own and really appreciate how they have welcomed us into their world. I would like to offer a special word of thanks to my buddy, Mark Pietrofesa. Mark got the absolute best out of me this week.
Road cycling has a lots of lessons for life -- you can be having your best day and still get spat out the back. Acceptance and non-resistance are worth extra power in that environment -- the Zen of self-shelling.

Lately I have been giving thanks every morning for the chance to enjoy another day. Sitting here on Sunday afternoon, this has been a very special week in my life. Not just for the training -- the full story can wait for another day.

My Southern Retreat

I have been off-the-grid for the last two weeks and staying up at Snow Farm in New Zealand. I am happy to report that the world didn't end and I wasn't fired by my clients. In fact, everything seems exactly the same as when I left the world of connectivity. Makes me wonder how long I could pull the plug before something material happened. I bet one month.

Aside from the President, I can't think of many occupations where we have to be in constant contact. In fact, there are a few (banker, accountant, CFO, CEO) where best practice forces you to leave for two weeks in a row. A two week holiday reduces our ability to perpetrate a fraud on our employers.

This piece is a recollection of thoughts that I had across the retreat, when the stimuli of constant outside influences was removed.

The first thing that I noticed was my mind calmed very quickly. Within 24-hours I was grateful that I had made the fortnight's commitment to stay off-line. Monica offered to clean my email server but I was worried that she might see something and mention it to me. So we waited. The grand total of spam, and real, messages was 8,500 when I 'mailwashed' the server last Thursday. If you are waiting for a reply then I'll need a bit more time... I'm making good progress, should be back to you by the 1st of March.

The next thing that I noticed was my sleep improved in all areas. The speed that I fell asleep was faster, the number of times that I woke up during the night was reduced and my ability to wake up (refreshed) before my alarm increased. All this while living at altitude and undertaking challenging training with elite short course athletes.

Pretty much everything improved. So I wonder... does technology and the media serve us? Or do we serve it?


When I stop writing, I miss the release, and learning. Even on retreat, I kept my writing going. You will find my complete Snow Farm Daily Diary below, all 14 pages of it. Worth a read if you are interested in athletic performance -- we had excellent speakers.

So I miss writing but I don't miss TV, movies, newspapers, email... one of my goals for the next 12 months will be to do a better job at restricting my input (even more) and see if I can outsource a few more of the items that clutter my mind.

What about clients? Over the last three years, I have been shifting to a model that is based on high value interaction with my clients. I noticed that I am most effective when I work shoulder-to-shoulder with clients -- our Tucson Camps are an experiment with "doing more" of that work.

I am effective remotely but that sort of work doesn't appear to build me up. Instead, it clutters my inbox with low-value chatter than doesn't address the key issues facing the client. Email can be useful but, overall, it is low value communication.

To get to the core of performance requires trust -- and trust requires spending time with people. Another paradox is that a large impact, need not require a large amount of time. Spending a few days with John Hellemans reminded me of that. More than anyone I've met, his life is an example of the impact one man's high standards can have on the world around him. PodCast Here -- sound is mixed in terms of quality.

We were talking about Tibet and John noted that it was difficult for one man to make a difference. I shared an observation that one man can make a huge difference and that his work in NZ has made a massive difference in the lives of thousands of people. He started triathlon at the same age as I did (30). John's life shows what combining passion, talent and work ethic over 25 years can achieve -- a lot!

Up there at Snow Farm, I asked myself a few questions:

  • What am I good at?
  • What do I enjoy doing?
  • Where do I spend my time?

I do a decent job at spending my time at things that I am both good at, and enjoy doing. However, I have identified a few items where I am spending time, not enjoying it and not being particularly effective. I also sense that I've placed a few of my team members in situations where they aren't particularly good and aren't enjoying it. There could be a way to make those around me more effective. I'll need to ask them when we are together.


So that's the Big Picture items that came into my head. Here are a few detailed items from the specific of the camp, and my time with Hellemans.

Choices -- most of us will reach a point in our lives when performance deteriorates, or ceases to improve. At that stage, we have a choice to make: Quit, Change or Hang On. Most people Quit or grind themselves into the ground by Hanging On. Only the select few learn to manage themselves through continuous change.

Tightness -- tight muscles are weak muscles. Rehabilitate your personal weak spots by trigger point release, muscle activation and strengthening. If the muscles are small then they need small exercises, done gently.

Authenticity -- I read a book by the title of this bullet point. Perhaps that is the attraction of the South Island. It's weather, wind, people and topography are deeply authentic. Not always comfortable, but real and full of power.

Kiwi Real Estate -- With gross yields at 3% and mortgage finance at 10%, I'm bearish on the Kiwi property market. I don't see the room for yields to come up and I see speculative buying in many markets. However, given interest rates, the liquidity position of the local economy looks like it will stay buoyant (unlike most other markets). My personal rent-or-buy decision would be rent.

Wanaka vs. Queenstown -- Comparing these two towns, I can see why the internationals like QT but Wanaka has better weather, more sunlight and cheaper housing. Long term, I expect Wanaka to outperform.

PPP -- In US dollar terms, New Zealand real estate is 400% more expensive than seven years ago (22% p.a.). Petrol has shown a similar increase and food is up 17% p.a. in USD terms. New Zealand isn't expensive but it is not cheap any more. For what the visitor gets, it offers fair value. The days of US$110,000, five bedroom houses are long gone!

My final realization was that New Zealand is one of the few things in the world that I miss when it is not in my life. Monica was the first person that I ever placed on that list. Now I have two things.

By "New Zealand", I mean Molina, Hellemans, the wind, the mountains, the weather and the people.

  • Molina because he is a bit nuts, accepts himself and gets on with his life.
  • Hellemans because he is successful by putting others ahead of himself (keep hope alive).
  • The wind because it is so ridiculous that you just have to laugh.
  • The mountains because of their beauty.
  • The weather because you can get snow, hail, heat, cold, rain and wind... all in 24 hours.
  • The people because they work their butts off and have realistic expectations -- they are also loyal and friendly.

You Kiwis have a good thing going down there.

Hope to be back soon,


In case you are wondering, Marty and Ben are in a Kiwi Ice Bath in the photo. Chillin' at 5300 feet...

Word File of My SnowFarm Daily Diary

Snow Farming

Our photo this week is a post workout shot of Ben Pattle. Ben lives in the Gold Coast and is over in New Zealand for a training camp put on by John Hellemans.

A few months ago, John asked me if I would be interested in giving an evening talk to a U23 Elite Triathlon Camp that he was organizing. I jumped at the opportunity and signed on to attend the camp for two weeks. I am not sure that John realized that he had invited me to attend the camp -- he kept emailing me to confirm my dates and eventually pointed out that there wasn't any funding available for 39-year-old, Canadian, Ironman Athletes at his U23 Short Course Camp...
Lucky for me, we managed to work things out by treating me as a solo athlete that was operating in parallel to the Tri NZ Camp. I have been doing my best to keep my head down, stay out of the way and support the session goals. Good practice for me!
In the first couple of days of the camp, three athletes asked me (separately), "why would you come train with us"? The main reasons: (a) my respect for John Hellemans; and (b) I was sure that I would learn something from spending two weeks with coaches/athletes/experts that differ from my peer group.
Probably the first thing that stands out is the training, nutrition and physiology of the athletes is very "textbook" in nature. Everything about this camp fits what I read in the literature. In this world, sport science and real-world experience operate in harmony.
I suppose that living in a world where the median competitor will be racing for 13 hours tends to skew my perception of what athletes require. As well, the athletes here are a unique population with half the camp coming from a distance swimming background. The former swimmers talk about consistent 70-100,000 meter weeks (plus dry land). That level of volume is simply the 'standard' load to be reasonable. Training camps took some of them up to 120,000 meters per week.
So how does a 20-24 year old elite triathlete train? Pretty much like most people think that they "ought" to train.
  • Something 'hard' six out of seven days -- you and I would find it hard, for them it is mostly moderately-hard (in HR and lactate terms). When they go "very hard" it is off the charts for you and me -- most of us can't get there (and those that do tend to take the rest of the week off or get sick).
  • The faster swimmers turn crimson when they swim at threshold -- their capacity to 'work' in the water is impressive. Capacity to (and enjoyment of) work remains a differentiator between athletes.
  • Limited steady training -- endurance sessions start easy/recovery and finish mod-hard (textbook roadie training). Similar to the eskimos having 12 words for snow -- Ironman Athletes have many ways to describe "steady". In this world, they call it boring!
  • Lots of power spikes on the bike, their event does not require excellence in TT ability. They train to tolerate the demands of their bike leg. Big gaps between average and normalized power. Jumps, bridges, burning matches... all normal and expected.
  • No-nonsense swim sessions, swimming in the 'slow' lane yesterday, I was lapped at the 125m mark of a 200. The fast swimmers could hold 1:15/100 meter pace for close to two hours.
  • 90% of the weekly training volume has a clear purpose and structure.
The implications are what you'd expect -- they swim great, can handle a ton of pace changes (all sports) and perform very well in training sessions that are under 3 hours. In short, they are solid draft-legal short course triathletes (guess that's why they are on the team!).
FWIW, after seeing these athletes up-close for a week, I think distance swimming (idealy mixed with a couple years of 400 IM training) is the ideal background for a triathlete. The fitness from distance swimming can be seen in the outstanding recovery in-workout and between-workouts. The stronger athletes have heart rates that drop like stones when the pace backs off.
Nutritionally, due to their age and training intensity zones, their diet is very carb-focused when compared to my own. Just like Epic Camp, some of the folks are experiencing digestive distress when intensity combines with a fair amount of bread/cereal. That said, the food that is offered enables each athlete to choose their own 'style' and it has been easy for me to eat the way I like and maintain high nutritional quality. There is salad and veggies with lunch/dinner and I've been having my scrambled eggs each morning.
We have an experienced sports science team that have been monitoring the athletes inside, and outside, of their training sessions. For the first time in years, I have been formally tracking my morning data (mood, sleep, training, muscle soreness, MRHR, SpO2, weight). The objective data is useful as a crosscheck against subjective perception. Fortunately, my body seems to be working in harmony with the training schedule. Being able to opt-out of sessions and train by myself has probably helped. I'd be pretty smoked if I did the full week that the team completed. The "mod-hard" bike work and "endurance" swim sessions have seen me working quite hard.

As a long course athlete, I wonder if there is upside in addressing their relatively undertrained steady zones on the bike. Here in the Southern Hemisphere, the athletes are in their specific preparation phase for Elite Nationals in three weeks. So, now isn't the time to worry about that. However, at some stage, I expect that improving their steady-state bike/run fitness might benefit their late-race performance.

One of the guest speakers made an interesting point -- there are things that you have to do if you want to be the best. His tone was that these things are non-negotiable, they simply "are". If an athlete chooses not to do them then they will not reach their maximum personal potential. That really rang true to me. How often do we catch ourselves settling for being good enough.

During my talk, I shared KP's advice that the true enemy of great is good. Everyone here is good. Looking around, I expect that a few might become great. Out of the great athletes, one might make the commitment to seek their fullest personal potential. It will be fun to watch the athletes develop and become part of a growing Kiwi tradition of Triathlon Excellence.


If you click the title of this post then you'll go through to the Snow Farm website. We are over 5,000 feet here, high enough to get an altitude effect (my O-sats have been in the low 90s every morning for a week).

Road bike training requires a 13K drive down to the main road. From Wanaka (45 mins away) there are five different routes available -- all decent.

The run training is excellent due to the nordic ski tracks. As well, you can get close to 7,000 feet by running up the nearby mountains (the campers did just that this week).

Wanaka has pool and open water swimming. The lodge does an all-inclusive deal and has a mix of accommodation standards. I am staying in a nice room with an en suite. Our host (Steve) even gave me the green light to help myself to the industrial espresso machine.

The living is good!



PS -- I am half way through a two week cyber-retreat so won't be back on-line until the end of next week. It's been a fantastic break and is providing me a chance to reflect on a number of items.

Every time I pull-the-plug, I am amazed at how my recovery speeds up. There is speed in simplicity.

Word File of my SnowFarm Daily Diary

PowerPoint Presentation to Young Athletes

Reflections on Overtraining

Our photo this week is Team MonGo at Ben Lomond Saddle above Queenstown, New Zealand. Monica and I went for a hike last week and were treated to some amazing views. Our “hike” turned into a pretty solid workout and I managed to convince my training partner to take the gondola down to save my legs. At the top of the Gondola, we ran into Epic Vet Eliot as well as his dad. They were on their way up as we were finishing. Eliot’s mohawk makes him pretty easy to spot from a distance.


An Epic Camp provides plenty of opportunity for self-reflection. My hour long final podcast is a reflection of my internal dialogue when logging big miles. As you can probably tell from the podcast, I am comfortable spending time alone and find my idiosyncrasies amusing. Molina thinks that this is a characteristic that long-term ultra junkies share. We are the funniest guys we know but aware that we probably overestimate our amusement value to others.

This past trip, I had Scott chat me through his career – starting from 100 mile run weeks (at 15) through to his athletic peak (at 25) then winning Ironman Hawaii (at 28) then retiring (at 33). Homeboy is one durable athlete to hit it hard for 18 years. Suffice to say, he is comfortable being tired.

The Terminator needed an overhaul when he retired and he spent five years working as a personal trainer and lifting weights. That takes us to 38 and I arrived in his life at 40. The “fastest” that I have seen him was Epic Colorado in 2003 when he was 43 years old – he was fast across all three disciplines and could hang with Clas/me (no sweat). Clas had the fastest run at Zofingen and I ran 2:49 at IMC that year; we were in Podium IM shape.

The rough timeline is important for some of the points I will make later. I may not have got it exactly right but my listening is improving.


The closer you get to your ultimate physical potential; the greater the “payback” that will be required when you exceed your body’s ability to recover. As you approach your maximal race fitness, there is a divergence between athletic success and physical well-being/longevity.

Fitness is a very powerful drug that programs deep athletic memories. Almost by definition, athletes with the ability to take themselves beyond reasonable levels of training/fatigue are at risk for overtraining. In fact, some successful elites may even tell you that overtraining is essential for success.

I’m not sure those words are what the champions mean. Here’s my shot at it:

  • Completing a lot of work is a requirement for success in any field.
  • The closer we get to our maximum capacity to “do” work, the closer we are to completely ruining our ability to “absorb” work.
  • As a species, we are poor at seeing much further than the current moment – especially with a stack of endorphins coursing through our veins.
  • Take all of these together – mistakes are to be expected and overtraining is a “normal” hazard for the endurance athlete.

Scott had more success than pretty much anyone in the history of our sport – he’d make anyone’s top ten list for race victories.

His payback period was five to ten years. I am nearing my third anniversary of hitting the wall and I wonder…

  • Have I paid back enough?
  • Have I learned my lessons?
  • When will the Old G re-appear?


Five years until he got back to triathlon training and ten years until he was really rippin’ it up again.

Years… not seasons… not months… not weeks.

This struck me because I had five months off in 2005 (April to August) then eased back into hour-per-day training for a few months before starting back with structured triathlon training in December 2005. Across 2006, it was touch-and-go with quite a bit of residual fear in my body. If you have ever had an injury then you’ve likely experienced the fear of re-injury. Overtraining is a spiritual and immune system “injury” with a similar psychology.

All across 2006, I was looking for a sign that I was “healed” and that soon I would be able to get back to the training that I remembered.

An important note – the training that we remember is our lifetime best performances blurred by the passage of time. A long term training log is a wonderful tool for a reality check. I use it often with my most headstrong athletes (and myself). Lifetime bests have the deepest chemical signatures – check the facts before making assumptions about how you “used to be”.

In 2006, my training was erratic and I used the cushion of working in my business to hide from reality. Perhaps I was past it, perhaps I was still tired, perhaps I was cured of my desire for mega-miles.

Long time readers will know what happened next, I went to Mark and Brant for some help putting myself back together – both physically and spiritually. I re-established my connection with nature and saw some of the patterns that caused my fatigue.

I thought I was healed – more accurately… I hoped that I was healed. On many levels I was healed. Without a doubt, Mark’s training protocol gave me my health back – I highly recommend his method if you are seeking to break a cycle of fatigue, injury or overtraining. The combo of Mark and Brant is an amazing duo – I have no idea how, or why, it works but (for me) it was really something special.

…but the fear remained, along with an emotional component of fatigue. Each time I would become fatigued, I was waiting to fall into exhaustion.

In life, we most often get what we expect and this probably held me back. My fears also prevented me from following my heart with the sort of training approach that I enjoy and have found effective. There were a lot of self-rationalizations that went on in my head but, in reality, I was scared.

If you read my Ironman Canada 2007 race report then you know what happened next… total public meltdown and my worst race performance relative to fitness in five years.

That was followed by four months of depression that culminated in three weeks in the tropical paradise of Noosa where I struggled to get out of bed. A few things got me moving:

Commitments – last October I made a commitment to Monica that I would do at least one hour of activity every single day for the rest of our life together (walking counts!). As an athlete, or an athletic spouse, you either understand why that is important, or you don’t. As my love for, and understanding of, Monica grows; I see how lucky I am to have a life partner that understands me better than I understand myself.

Personal Responsibility – nobody “made” my situation, it was the direct result of choices I made. I did my best to take small concrete actions that moved me back towards the life I want to live. Getting out of bed each morning is the most important thing that I do. If I can get that done then 89 out of 90 days, everything flows from there.

Acceptance – with most of my recovery challenges, my healing progresses most rapidly once I accept that I might never get better. By ceasing to resist my fatigue, my mood, my challenges – I start to improve. I don’t think that we ever “overcome” or “conquer” our fundamental challenges in life – we learn the patterns, habits and strategies that are effective to keep us moving forward.

All of these thoughts occurred to me because last week, training felt different to me. Epic made me tired but it didn’t make me scared. I commented about my improved form to Molina and he said that he didn’t notice any difference (or anything impressive). On reflection, that made sense because the change was on the inside.

It was a lot of fun to have my health back and enjoy training with the guys. I need to remember that as the memories of Epic return to me while training.


I suppose my point is one that Mark shared with me. The factors that lead to breakdown accumulate across many years (often in parallel to increased athletic performance). Any improvement, from rock bottom, will feel like healing.

The greater your success leading up to the breakdown, the longer your recovery will likely take. Be patient in the early stages – my impatience through the early years of overtraining is what led to hitting the wall.

The stages, for me, were:

  • Breakdown;
  • Total rest;
  • Resumption of light activity – this is where health and biomechanical issues can be addressed;
  • Resumption of unstructured triathlon training – address patterns/habits that lead to breakdown;
  • Resumption of triathlon training balanced with equal periods of scheduled recovery (this step is very rarely done – it was the key to a rapid return to fitness in 2006); and
  • Resumption of elite triathlon training that is balanced with extended transition and early season training.

Adult athletes should remember that stress and fatigue that builds up outside of sport can often manifest itself as athletic overtraining.

I’ll keep you posted.


Epic Updates

Hi All,

Just a short note this week.

A few short podcasts are on Endurance Corner Radio as well as daily updates on IronmanTalk at iTunes (they haven't updated their website but the podcasts are daily updates).

Blogs are at the Epic Site as well as the Planet-X triathlon Site.

Back to blogging next week. 27 hours of training in the first four days -- at least half of it was at a very solid pace.

Cheers from sunny Wanaka,

Sweet Home New Zealand

This week, I am going to share some observations about what makes New Zealand a special place. But first a few items.


There will be at least a ten day gap before my next letter due to Epic Camp New Zealand -- you should find an pre-epic blog over on the Planet-X site next Monday. I have started Epic podcasts on Endurance Corner Radio and hope to continue across the camp.


A reader sent in a question regarding my curtailing the booze. Here's what I wrote back:

Clarity of thought // I saw this pretty quickly. Once I stopped drinking my mind became a lot more clear. I spotted that in about two weeks.

Emotional hangovers // at some level, I always knew that booze, sugar, toast, cereal, etc... didn't 'work' for me. Not sure if this makes sense but all the changes that you read in my interview -- those are driven by the fact that once I "see" a bad habit, the joy of doing it tends to drain out.

Productivity // I was losing a good chunk of my personal productivity -- I prefer to apply my time productively and enjoy working.

There is a health benefit but that doesn't seem to carry as much weight in my mind. Perhaps because it is too obvious and I do a lot of other healthy things. I am likely rationalizing that I am "healthy enough".

A friend taught me that the true enemy of "great" is "good". When we see ourselves as good people, we can give ourselves excuses that prevent us from being great. If we see ourselves as "bad" people then our self-destructive tendencies can be tougher to modify -- I would seek help if that was the case.

Heavy drinking (binge eating, fast food, nutrition, etc...) -- all are lifestyle choices -- not much different than being an athlete. Once any of these items become inconsistent with the life that I want to lead, they have to go // OR // I had to accept that I wasn't going to be the man that I was capable of being. The worst sort of "settling".

If you eliminate the booze then you will have a huge amount of time and energy. Time and energy are two of the most valuable things a person can have. Combining them gives us tremendous personal freedom. Freedom and personal responsibility are scary . It is normal to prefer self-imprisonment, or self-medication.

There is a transition required from one life, to another. I'm fortunate to have a supportive wife and great friends -- if you don't have the personal infrastructure then there are plenty of sources of support/assistance/help. It takes unique courage to ask for help in a culture where men struggle to ask for directions!


Reader feedback on start-up investing...

Things that run counter to our investment instincts:

  • Not doing transactions (buying or selling);
  • Sitting on cash;
  • Declining to accept capital when the climate isn't right for investment; and
  • Returning capital to investors.

Things to remember about start-ups:

  • Starting a small business limits personal freedom;
  • Consider what happens if your staff quit, steal from, or compete with you. All are likely to happen at some stage; and
  • Consider if you have a sustainable competitive advantage -- specifically, what drives your economics and how that might change over time.


The picture below is Lake Tekapo -- 245KM from our start point on Day Two of Epic. A worthy destination!

Mark Allen taught me the importance of establishing a connection with where we live. As an athlete, Mark felt a connection with both Hawaii and Boulder -- two places where he expended tremendous physical energy. After Scott Molina won the Ironman in 1988, Mark came down to the South Island for a training camp. Mark had a pretty solid 1989.

It has been two years since I spent any material time in New Zealand and, returning, I realized how much I missed the place.

The picture at the top of this letter is Akaroa Harbour, our turnaround point for Day One of Epic Camp. From the hill top you are looking into a volcanic cater that opens to the sea. Along the top of the crater, you will find trails, tracks and roads that enable some seriously challenging training. If you make it to Akaroa then return via Long Bay Road, pack your climbing gears.

In 2005, I sold my house and left New Zealand to take on a substantial consulting assignment. Returning in 2008, it feels like I have new eyes.

Last weekend, Scott and I were riding towards Gebbies Pass (far end of the shot below). We were getting completely drilled by the wind but, for some reason, I am always relaxed on Gebbies Pass Road (had more than a few Zen moments there). Grinding away in my 55-21, I remembered Mark's lesson about the benefits of having a connection with a place. I feel very connected to this part of the World.

Why are there so many great athletes down here? For triathlon, I think it is a combination of factors.

Attitude -- Kiwis expect to work hard, for limited financial reward, for their entire lives. This stands apart from my experience in Canada and the US.

In Canada, there is an expectation that the government's role is to take care of its citizens. Down here, you take care of yourself (for the most part).

An aspect of the American Way is an expectation that there will be wealth differences but these are tolerable because upward mobility is available to all. In many ways the Kiwi's are the exact opposite. For successful people to remain popular, one needs to be sincerely humble. Not a lot of "show me the money" happening down here.

Terrain -- The hills are short & steep, the road surface is slow and the wind can be relentless. From the bottom of the island, your next landfall is Antarctica and you can feel that when the wind comes from the South! It is so challenging that I probably couldn't hack it for a Southern Winter.

Expectations -- The swim squad that I train with here is a good example of Kiwi realism. The triathletes that want to improve expect to swim 4-5 times per week 4,000 to 5,500 meters per session. Those are agegroupers, not pros. They do swim squad in the morning, work all day and train again in the evening. They do this every single week, for years.

You will never hear about them because they rarely travel and don't post on the internet. While we debate the finer points of human physiology, they plug away at 1,000 hour training years.

It's good to be back.

The photo above is Karekare Beach in the North Island. I'll be speaking with the Epic Vets to see if there is interest in riding the length of the North Island in January 2009.

Self Awareness and Facilitation

Our photo this week is Monica’s Buddy Andrea (MBA). MBA has an M.B.A. from Harvard. She came over to Australia to visit us and I have been receiving free personal consulting.

When we discussed my piece on Start-Ups, Andrea noted that hardly anyone takes the first step of creating self-awareness. At HBS, they had an entire course on the subject. Most of us can’t go to Harvard but we can review the article and consider its best points.

Here goes!

Drucker’s article notes that it is extremely tough for us to figure out ‘where we belong’. He suggests that we should start by noting where we don’t belong as well as the situations that don’t suit our strengths.

He counsels that we enhance our strengths while working to eliminate our bad habits (rather than our weaknesses). There is much greater return from supporting top performers than “fixing” mediocre players.

Focus on being polite, trim the bad habits and place ourselves in situations where we can use our strengths.

He points out that we all have intellectual arrogance that limits our success. I spent two hours thinking about the areas where I am intellectually arrogant. I really had to think. I am far from perfect but everyone else’s limiters came to me first!

Probably my #1 arrogance is advisers that have never “done it” – I place a huge emphasis on learning-by-doing. When I see a man promoting himself as “the world’s greatest” adviser on a subject that he has never personally experienced, I have to work (very hard) to give any credibility to his experience. That’s a shame because some of these advisers have spent countless years studying the best performers. They probably know a thing, or two!

To know, but not to do, is not to know.

I surround myself with do’ers. There is an important role for the academics – those of us that have “done” are biased by our experience – combine us with people that are biased by their textbooks and we might breakthrough together.

If you look closely at the Endurance Corner consulting team then you will see my efforts at diversity. Still, we are a bit young and too male. We are working on it.

In my youth, my greatest limiter was a core belief that tact was a sign of weakness. In my 20s, all that mattered was performance. Now, if you are a high performer then you can get away with that for a while. However, we pay a high price in terms of ultimate success and effectiveness. I was fortunate that my first boss was a lot like me and found my flaws entertaining.


Values – we tend to think of values and ethics as being crystal clear – black/white or right/wrong. Drucker makes the point that, in life, we can find ourselves in a situation where conflicting values are both “right”. I will give you an example with a list of my business values.

This is what Gordo Incorporated stands for:

  • Low leverage
  • Full disclosure
  • Focused, specialized personal excellence
  • Clear instructions
  • Return on capital employed focus
  • Long term achievement trumps short term gains

Consider the opposite of the above points – Snazzy Company Limited values:

  • Maximum leverage
  • Necessary disclosure
  • General, personal excellence
  • Accepts that life is imperfect with changing information
  • Growth focus
  • Consistent short term gains

In one job, I would be happy – in the other… a disaster. It is important for me to remember that the other company isn’t a “bad” company, just different.

Armed with your strengths and personal values you can decide if an opportunity makes sense for you. Before signing on, use your self-awareness to lay out what is required for you to succeed.


The other interesting part of the article is a description of the different ways that people communicate, learn and work. It probably won’t surprise you to learn that I work/learn by writing. At McGill, my class notes were the Gold Standard. The “listeners” used to photocopy them for subsequent review.

I have had two successful business relationships with extreme examples of listeners/talkers. Until I figured these guys out, I used to bang my head because they “never read what I write”. The way to crack the code is to call them on the telephone – I used to call these guys from 30 feet away!

If you are working with people with a different style then acknowledge it. We are paid to be effective, not right. Andrea's tip here is to remember that, more than changing your style, respect and adapt to the styles of our co-workers.

More in the article – with great examples.


Feedback analysis – Drucker’s feedback tips are HIGHLY valuable. Each time you make a key decision – write down what you think is going to happen and revisit it 9-12 months later. I have eight years of personal business plans and learn a lot from them.

Some things that I noticed:

  • When I get nervous about a situation there is usually a reason
  • My goals are challenging, I (mostly) achieve them but rarely exceed by a large margin
  • Other people are better at judging character than me
  • I need people with excellent people skills around me
  • I would benefit from pausing after my greatest successes
  • Painful personal feedback from the people closest to me is normally correct – I listen but, typically, at least two years after I am told. This could indicate that I am stubborn…
  • I could be far more effective by taking a greater personal interest in the people around me.

There is much more in the article. It’s only ten pages. A small investment of time to get an edge on ourselves!


Phew, running long again! I will be short on facilitation.

The best thing that Andrea pointed out to me was that in any situation there is the person acting and the person facilitating.

As an adviser, many clients come to me for the professional OK to continue with their bad habits. At one level they want success but, at another level, they want acceptance/love and the OK to keep rolling just as they are. So we start by acknowledging what is working and good in their lives.

Without a basis of trust, we can get fired when we refuse to facilitate. When we fail to surround these difficult conversations with manners and tact, they often fall on deaf ears. With my inner circle, I often have to wait a year, or more, for an opening to share feedback. As a bonus, waiting saves me when a rush-to-action is inappropriate.

My second thought was to consider the people, and firms, that I facilitate. Whether we like it or not, our actions have a multitude of direct/indirect impacts. Questions that I considered:

  • Do the companies that I support back the best people?
  • Do the websites that I visit share my values?
  • Would I be friends with a person that had a personality like my favorite sites?
  • Do the blogs that I read bring out my best emotions? Do they lift me up?
  • With the people/firms that don’t share my ethics, how are they linked to me? Am I facilitating them?
  • Would direct action strengthen, or weaken, my adversaries?

Andrea’s final tip was “Stay on message and stay positive” – with that in mind, I won’t share my answers. One of the things that I am working on is my need to “be right” all the time.

Until next week,


Financial Start-Ups

Our photo this week is from our first Epic Camp in January 2003. Many speedy people in that shot -- some of them didn't even know it at the time!

Endurance Corner is accepting applications for 2 to 4 month internships. For more details contact mat at endurancecorner dot com. Prior experience is useful but not necessary.

Endurance Corner is looking for an MD, PA or Nurse Practitioner for its medical consultancy practice. The position would, initially, be part-time and ideal for a parent looking to re-enter the workforce. Please contact gordon at endurancecorner dot com if interested.

Endurance Corner is based in Boulder, CO.

We start this week with some feedback from Europe.
D.D. Observes:
A couple of things that come to mind regarding your recent piece on "motivation":

Interesting how "achievers" are usually - not always - driven by primarily selfish goals. No judging here, just observing.

CAREFUL! I know a lot of people who place themselves amongst (relative) "losers" just to look good. Those guys ARE NOT the top achievers. "You are as good as the expectations of your peer group." At least in the long run. IMHO

Selfish Goals -- I am not so sure that high achievers in 'self-less' vocations are more purely motivated than high achievers that work for themselves. As well, there may be a lot of selfish people that don't achieve -- it may not be a defining characteristic.

Peer Group -- this is a very good observation and why I advised 'periods' of out-performance. My podcast with Chris McDonald was interesting in this regard. Chris moves between towns where he is 'normal' and a 'star'. He stays in Boulder until he can't handle it anymore then heads back to Aussie and pounds his mates. Like I tell Mat, Fast in Indiana isn't always fast.

One last point, most people are not working towards maximizing their personal achievement. Their daily choices and actions are inconsistent with achievement -- the true goal is something else.

We can have very fulfilling lives while being clueless. I have enjoyed my periods of unconscious incompetence! High achievers are some of the most tortured people I know.

Alan wrote an outstanding article on what limits achievement. Understanding the process he outlines is a requirement for breakthrough performance.

And now... this week's letter.

I received an interesting email. If this letter triggers any ideas then please send them in. This topic is one of my favorites and I have been considering a few start-up opportunities myself.

A.R. writes:
I come from an entrepreneurial background and started with my current mentor and boss in real estate development XX years ago. With the current market and industry conditions my mentor has decided that 2008 will be a very safe year where we will not be looking to acquire or develop any more properties but just finish out the few condo conversions that we are doing and manage the apartment buildings currently in the portfolio...

I will be in the position to either find a new job in RE development or take the plunge (sooner than expected) of going on my own.

As I do some job searches I find positions that are interesting but that would be developing, raising capital, or acquiring properties for another organization and my thought is why do that for another company when I could be doing that on my own. The thought of going on my own excites me and what I want to do, however I only have about a 2 months capital reserve currently in the bank without liquidating anything and so I would be looking at going into some sort of debt.

If I go to another company I feel like it will be demoralizing and that I will not have the passion and work ethic that I would if I was on my own; however it would give me more time to gain experience and save more equity for a better time to go solo. I do have a couple projects that would provide a strong foundation if I go solo- raising capital for a distressed homebuilders fund, multiple client kitchen/bath renovations, development of 10-20 single family lots that a partner of mine owns which we are planning to develop, and 1 or 2 other opportunities but will not bring in cash flow for at least a few months. I also feel that I would miss out on these opportunities if I join another company as in that case I will not be able to commit the necessary time for these independent projects.

When I receive these emails, I get a little bit nervous because I fear that you might actually take my advice! So the first thing to remember is that there are no 'right' or 'wrong' answers. Odds are, you are going to be just fine going down any path.

That said, "trust your heart" can prove to be expensive when leverage is involved.

I would spend time on your Personal Plan before shifting to your Start-Up Business Plan (which you should write out in full and share with a respected adviser). Our society has romantic ideas about entrepreneurship that are far removed from the reality of owning your own business.

The first thing to do is read The E-Myth. That book helped me understand the roles required for entrepreneurial success as well as what often kills a business. Step back from the 'franchise' discussion and consider the broad strategic issues of simply achieving your business goals. Remember that a business exists to serve the aims of its owner. Do you know your aims?

That will help you frame the second thing... Do you know what you are good at? (Drucker summary and full article as well as more resources) Then consider if you enjoy doing what you are good at.

My Answer: I work as a consultant because I am good at project management, financial analysis, deal execution and strategic planning. My best skill is taking all of those components and expressing them in a clear written plan that is attractive to key decision makers. I spent the 90's doing that 50-80 hours per week.

Working solely on work was slowly killing me. I completely lost touch with my physical self (weak nutrition, no fitness, plenty of booze) and was disconnected to my spiritual side (never close to nature).

The solution was a position where I can alternate very intense periods of effort with recharging phases. However, this means that (absent change) I cannot be the CEO of a new company.

If you are talking about setting up a business then you are looking at a sustained, full-time total commitment. It is no different than what I write about elite athletics. The best CEOs that I know have tiny off-seasons and build their lives completely around the success of their businesses. World champion obsession.


In Private Equity, we break the business into three pieces: Deals; People; and Money.

Deals -- do you have access to attractive investment opportunities? Many markets are characterized by a magic circle of established players that have access to proprietary deal flow. The property market is characterized by incomplete information and many conflicts of interest. Good deals often succeed by using superior information. How good is your information?

People -- do you have the skills to capitalize on the investment opportunities? I was fortunate to have been taught by one of the best Private Equity teams in the world. Even today, I haven't met a group of people that comes close to the team that trained me. I was the lowest paid person (in the building!) when I joined but it was one of the happiest and fulfilling periods of my life. Being part of a winning team can be more fun than struggling in your own business.

Money -- do you have access to capital? On what terms? How do those terms compare to your competition? Established players have a big advantage here -- it is tough to be the new guy.

With the investment business that I co-founded, it took us five years before we were successful raising institutional equity -- we relied on individual equity. Over that five year period, I was cash flow negative every single year. All the while, we were ahead of our business plan.


Further thoughts to consider...

For more than a decade, investors would have had to do something stupid not to make a great return on any property investment. A sustained bull run leaves all players convinced of their deal selection 'skill'. We can't help but be influenced by this bias. As markets revert to the mean, most of us will find out that asset inflation, rather than investment smarts, drove our returns.

Do you know how to manage the capital that you have? Look at your personal track record with your own capital -- a two month personal reserve seems small at your age (but is not uncommon). People with the skills to be long term managers of funds demonstrate those skills (first) with their own capital. A great story from Asia...

Investment Banker Pitching Rich Local Man:
'So Mr. Lee, I think that this fund is an excellent opportunity for you.'

Mr. Lee to IB:
'Tell me, how much are you worth?'

IB: 'I'm worth over a million dollars.'

Mr. Lee: 'I'm worth over a hundred million. Why don't you give me your money and I'll see if I can do better for you.'

The best investors take care of their own money -- and -- treat their investors' money as if it was their own.

Market Timing -- most the reports that I am reading these days are talking about property inventory being clogged through to early 2009. These are huge generalizations and you need to consider your local situation. It is very tough for a small scale developer to make money in a flat market. Our early development deals only made money from asset appreciation -- frankly, we probably lost money on the development while we learned the ropes. Even today, we aren't experts. What we do is team up with experts and align our financial interests. There are a lot of ways to be ripped off in construction.

Against the current market background, building personal capital; broadening your skills base and studying under a smart investor -- could be time well-spent.

Family Capital -- if you can't raise start-up capital from sophisticated third parties then my advice would be don't do the deal. People will cite exceptions to this rule -- they exist but are exceedingly rare. If the market won't back you then there is information in their refusal. We have always been able to get our best ventures funded.

Missing Out -- Don't worry about that. This market will get cheaper, inventory will build and deal flow will increase. Your worst case scenario is that pricing will stay the same. Always be willing to lose a deal.

Cash Flow -- Make sure your can hold for at least a three years. One of my strategic goals for this year is to arrange funding through 2012 for my main client. Being able to hold through the bottom of the cycle is fundamental for long term returns.

Liquidating -- Twice in my career I have "sold everything" to invest in a new venture. It was good discipline to consider the new 'position' relative to my existing holding.

If you decide to go for a position with an existing team then consider people that are strongest in your weakest area -- when we go into business, we often partner with people that we've worked with before.

Hope this helps,

Beyond Achievement

We have a family tradition of buying pajamas for Christmas. This year, I modified it by purchasing Monica a red bikini. However, my editorial board has instituted a new policy regarding bikini photos --"Clavicle Up". I managed to get this one past my publisher, it is one of my favorites.

Alternative Perspectives has an new piece by Clas on Damage Control. The photo he sent is a keeper. Bike skills work, Swedish Style.


What are you going to do after you win IMC?
-- Monica, October 2007

In the Northern Hemisphere the mixture of long nights, weak December nutrition and overall holiday stress can leave us with the need to “take action”. Armed with a burning desire “to do something” we often sit down and write out our New Year’s Resolutions.

I consider my life on a quarterly basis. Monica, jokes that if she doesn’t like my personal plan then she only needs to wait a week and we will have another one. She’s quite patient and doesn’t voice objections until it looks like I might actually do something.

This week’s letter isn’t about the right action to take – I’ll leave that to you. What I am going to do is share my experience on what has driven me towards the actions that I have taken in the past.

Scott wrote a great piece about how he motivates himself. This letter is about what is motivating me.

Did you get the distinction there?

There are tricks, tactics, habits and strategies that we can employ to do the work necessary to achieve our goals. That’s Molina’s piece.

There is the psychological profile that underlies the selection of our goals in the first place. That’s this piece.

Some common goals:

  • Lose X pounds by Y date
  • Walk X minutes Y times per week
  • Save $X per Y
  • Qualify for X
  • Break X hours for Y event
  • Get my NAV to $X

Various goals of mine:

  • Finish an Ironman
  • Train at least 25 hours per week as many weeks as possible
  • Win Keauhou Kona Triathlon, Ultraman Hawaii, IM Canada or IM New Zealand
  • Qualify for Ironman Hawaii
  • Swim the English Channel or Rottnest Channel.
  • Swim sub-6 400 IM or sub-20 1500 LCM free
  • Swim, bike, run across America
  • Reach one person, one thousand people, or one million people
  • NAV equal to five/ten/twenty years of personal expenses (indexed/not indexed)
  • Own a house/flat/cottage anywhere, in Boulder, in New Zealand, in San Francisco, in Arizona, in the mountains, in Noosa, in Paris or in Scotland
  • Raise $5 million, $50 million, $250 million, or $1 billion for a client
  • Write a book about Ironman Training, Personal Excellence or my life
  • Climb Mt Kilimanjaro, Denali, Mt Cook, Mont Blanc, Mt Tasman, Cho Oyu, Mt Vinson or Aconcagua
  • Run the Leadville 100, Run Boulder to Vail, Run the Hong Kong Trailwalker
  • Sail to France, to Antigua or around the World

Goals are items that we are actively working towards – everything else is dreams or personal legends.

When we combine moderate talent with extreme work ethic then we will achieve results in most areas. If we stumble into a field where we have some real aptitude then results can be amazing -- especially with the tailwind of favorable conditions (and a bit of luck).

Do you notice a theme across my list?


One of the greatest motivators in my life has been the pursuit of “things other people don't do”.

My friend, Kevin Purcell, once marveled at my ability to leave a goal after I achieve it. Finish one job and move along to my next task. It was an honest complement on non-attachment. However, I was deeply attached to my true motivator – self-affirmation through relative performance.

If you share this trait then be wary of placing yourself in a position where you are surrounded by people that are superior achievers of your goals. For personal satisfaction, you will need to spend time in an environment where you are able to exhibit relative out-performance.

“In a team, it is important for everyone to get a chance to be strong”. That’s a tip from Scott Molina – a guy that seems to get along with just about everyone.

“Envy, not greed, makes the world go ‘round”. That one is Warren Buffet, a man with a lot of first hand experience on what motivates people.


Six years ago I can remember feeling the absolute healthiest of my life. I have memories of lying in bed and enjoying breath after breath of cool, calm air. I had completed 12 weeks of intensive yoga and freed many restrictions.

This “health” memory came to me in early December when I realized that I was, once again, lying in bed felling very good. For the first time in six years I was free of soreness and deep fatigue. There are two constants in the life of an elite athlete – fatigue and soreness. Learning to cope with this fact is a large part of the mental game of ultra endurance sport.

In December 2001, a sport psychologist asked me “why do you want to do triathlon”? I answered without doubt, “because it is what I was born to do”.

What I meant was triathlon is work and I was born to work – therefore – I was born for triathlon.

That is the second great motivating force in my life. Some people have a high capacity to complete/absorb/enjoy work. When you mix excellent process management skills, moderate talent and inherent work ethic – you get results.

The purest form of motivation is an enjoyment of work. People, situations, habits and choices that impair our work ethic are extremely hazardous to a life with meaning.

The back-story is that having got my health back, I am not sure if I want to spend another year really tired and sore!


Remember five years ago and consider the events that stand out in your mind.

When I think back to 2002 the key aspects are:

  • Totally frying myself in an attempt to win KKT
  • Taking two months off as a result of being grossly overtrained
  • Co-founding a property investment company
  • Training four weeks for IMC then repeating my time from the previous year
  • Winning Ultraman Hawaii

Which of these are “good” and which are “bad”? That depends on your point of view.

Every item in that list is a requirement to get to the end, winning Ultraman Hawaii. At the time, winning Ultraman was a great event for me. As a result of winning in 2002, I went back in 2003… …and nearly died.

Not so great!

But then again… the forced rest may have been the difference between success and failure in 2004.


Pulling it all together…

  • In setting goals, consider the motivating factors behind your list.
  • If you are motivated by relative performance then schedule periods where you can shine.
  • For goals that require sustained effort over time: focus on areas that you deeply enjoy; and remove people/attitudes/perceptions/habits that are barriers to the work necessary to achieve.

If you are fortunate enough to experience high level achievement then your vocation will likely become your identity. I have experienced this in a few fields. Examples:

  • Scott Tinley was Triathlon -- solid article
  • Tom Dolan was Swimming -- that guy could train
  • Key founders are their businesses -- remember this when you negotiate
  • Great champions are their sports
  • World-class achievers are their goals
  • Addicts are their habits

If a recession, divorce, injury, or the passage of time removes an expression of identity then it is painful. Alternative interests are personal insurance policies, even Lance had his foundation.

The Tinley interview discusses a champion coming to terms with his sport. My personal experience is life-transitions (divorce, illness, injury, career change) force me to come to terms with myself. Specifically, I am forced to cope with the death of an identity.

Die a few times and it becomes easier to cope.


What lies beyond achievement?


Peace has a lot of different names and levels of experience. Some other names... The Zone, Flow, Exhaustion, Satisfaction, The Pump, Whole Body Experience, Zen, Endorphins, Open, Harmony, Relaxation, Well Being, Health...

The chemical signature of achievement feels a lot like peace.

Rather than sloth, peace is my counterbalance to work. The quest for peace driving my 'pure' motivation. Seems a bit crazy to spend one's life chasing peace... I don't know. If that's what is really driving me then it takes a lot of the burden off -- the list above is daunting.

I have often confused silence (or nothing) with peace. Many of my self-destructive habits/patterns stem from this confusion. Anger, fear, intoxication -- the far side of each of these feel close to peace, but isn't. I suspect that Big Pharma uses this pathway to create a perception of well being in its users. I lump all these 'nothings' into the category of False Gods -- the list changes over time -- perhaps because the truest addiction is to that peaceful vibe.

Artists, comedians, writers, CEOs, investment bankers, endurance athletes -- peace is where we get to. Part of the process of "getting there" is the drive to "get it out" of us. At times our gifts can feel like curses.

That's enough for today. Running a bit long!


Here’s my January 2008 list:

  • Successful marriage based on kindness and respect
  • Peaceful Listening
  • Retreats with Nature
  • Wake-up Early
  • Ethical life with meaning

Where is the relative achievement? Could be lurking in #5, not sure.

To know others, intelligence
To know yourself, wisdom
-- Lao Tsu

Effective communication is about getting a person to listen (first) then think (second). Monica is a very effective communicator.

Still searching,

Endurance Training Protocols

Our photo this week is Team MonGo doing wheat-grass shots at the Noosa Farmer's Market -- don't mind our goofy hats but the UV was 13 and we were trying to save our skin!

I was going to write about “mood management” (aka depression) but that doesn’t strike me as very festive – and, besides, I’m feeling better… …so we will pick that topic up in the new year.

Before we kick off a brief update on our Tucson Camps. We are doing two camps – March 22-30 (five spots left) and April 19-27 (three spots left). The camps will have a bike focus and are appropriate for athletes that are in 13-hour Ironman shape and faster. Looking around the internet, you have a lot of choices for 2008 camps. Here’s a bit on how we differentiate ourselves.

What makes us unique is our people. Our coaching/support team is a mixture of elite and highly successful agegroup athletes. We can tell you “what it takes” and also give you an objective view on “what’s realistic” within your life.

Risks and Returns

That's Monica on Sunshine Beach, Sunshine Coast, Queensland, Australia. That's the real name of the place! While I'm not much of a beach guy, the scenery has been worthwhile.

This week I'm talking about finance and company valuation. If you would prefer a solid endurance article then Coach KP writes about Ironman Pacing on Alternative Perspectives.

This week's announcements run a bit long. I'll update on our Tucson camp next week -- we still have a couple of spaces.


Brad Kearns has a project called Running School (aka Running's Cool). The idea is to educate elementary and middle school kids/teachers/parents about nutrition and exercise. The program touches on a lot of things that we believe in. Brad started at his kids' school and is planning on branching out to other schools. You can clickthrough to find out how to help him with the worthwhile cause. We are sponsoring a school in 2008.

A reader sent in this speech by the former Chairman of Bankers Trust (good stuff, thanks for thinking of me). The fourth paradox (about moderation and extremism) rang most true. It is worth a read.

There are other speeches by Sanford on that site -- his defense of Financial Services puts forward a good case. Reality lies between Business School speeches and books like The Game, Liars Poker, Barbarians at the Gate and The Smartest Guys in the Room.

I'm surprised this didn't get more comment... getting paid tens of millions to run a business which writes $10 billion off then walking with $162 million for failing to see it coming. This is not an isolated incident -- only the scale makes it noteworthy.

In hedge funds, trading and investment banking, there is a massive incentive to game the system. Given the amount of leverage available to these companies, there should be clear disclosure and firm regulation. When it really hits the fan, taxpayers are the ones that ultimately foot the bill.


This past weekend, I read a book on the Enron collapse, The Smartest Guys In The Room. When I arrived at the end of the book I was left with two impressions. First, it is terrifying how fast a highly leveraged vehicle can unwind. Second, I have read that story before.

The problems, and financial techniques, that are part of the Enron story aren’t unique. They have been used, and abused, prior to Enron (computer leasing, software maintenance) and after Enron (sub-prime crisis).



In addition to giving me the advice to “save 10% of what you earn”, my Dad also told me to “never have more than 10% of your net worth in a company you don’t directly control”. The people most hurt by the Enron collapse violated this key tenet of investment strategy.

Even if you are an insider, be wary of monster bets. There have been stages in my investment career where I had more than 100% of my net worth riding on a single company (but it was "my" company). While this ensures “focus”, I feel that I am more effective with a significant, rather than total financial commitment.


The Deal You Don't Do

If you are in a leadership position then you must foster a culture where it is OK to make a little less money. This helps maintain business, and personal, ethics. Senior management must empower, and support, team leaders that walk, rather than compromise company values. This is _extremely_ hard to do when large amounts of money are on the table. I have seen private equity partners eat hundreds of thousands of dollars in dead deal costs.


Return on Capital Employed (ROCE)

Towards the end of the Enron book, the topic of the company’s return on investment comes up. A figure of 7% per annum is quoted. The basis of measurement isn’t clear from the text. Here’s how I define it…

Cash Flow Before Interest and Taxes


Capital Investment Required to Sustain That Cash Flow

Take that and divide by “Net Debt Plus Shareholders Funds”

Tracking this figure back ten years for a business, and its peer group, can tell you quite a bit. Can’t go back ten years? Then place a discount on the quality of those earnings.

A lot of people use “Depreciation & Amortization” instead of “Capital Investment Required…”. If you choose that method then know that your number can be skewed by the recent capital investment history of the firm (and industry) you are evaluating. Age, and capacity, of capital employed should be considered.

Other folks like to use “Earnings” rather than “Cash Flow”. I prefer cash flow because generating cash is the financial purpose of business.

Attractive businesses have a high ROCE and good management teams know their ROCE.

If you meet a company without a clear focus on ROCE then a red flag should go up. It isn’t the only metric but (for businesses with more than just human capital) it is an important figure to track.


Profit Recognition and Asset Valuation

Inside the book, there is a clear explanation of Mark-to-Market vs. Historical Cost accounting. They are two different methods used to achieve the same goal – a true and fair picture of a company’s financial position. Enron went wrong in its application of its valuation methods as well as its employee rewards structure.

The questions to ask:

Does the business have any contracts/transactions/projects that extend greater than one year? What is the recognition basis for revenue, income and capital uplift on these projects? Describe the nature of historical revenue/cost/value revisions on these contracts. What are the key assumptions that underpin profit recognition and project valuation?

How does employee compensation relate to the assumptions used on the above transactions? Specifically, who benefits and how do they benefit?

Rapidly growing businesses with a material part of their income statement (or balance sheet) linked to management judgment are risky with lower quality earnings. They can still make good investment targets.

If management fails to give clear, immediate answers on the above questions – red flag should go up.


Off-Balance Sheet Financing

This one often gets companies (and people) into trouble. The main reason to use off-balance sheet financing is to raise debt over-and-above a prudent level. There can be times when these techniques make economic sense.

These structures bite when a company (or person) hits hard times. In particular, financial and performance guarantees can create large, and sudden, liabilities. A business with weak internal controls can have large hidden contingent liabilities.

Some questions to consider:

Have you used any of the company’s shares, assets, or guarantees to support (formally, or informally) projects outside of the company’s balance sheet? Has any outside entity guaranteed (formally, or informally) any aspect of the company’s operations?

Have any members of the management team issued personal guarantees (for any reason) to any financial institution connected to, or separate from, the company? If yes then please supply the specifics.

In the mid-90s, we would go as far as having key management warranty their NAV statements. You can learn a lot about a senior management team by the way they manage their personal finances. In the recent era of covenant-lite financing and non-doc loans, I expect this practice may have fallen away.

If there is a lot going on, or if you can’t figure out why things are going on, then don’t touch the business, or the manager. It’s not worth it.


Bottom Line

The senior person leading the transaction should ask the CEO these questions. As well, ask employees in accounts, sales/origination and operations/fulfillment. Remember that large frauds start as small frauds – always be willing to walk away.

People want to do the right thing but often feel trapped by their situations. For this reason, you need to ask the questions, a lot of questions. You will save capital (and time) by talking to management before investing.

As personal investors, we rarely have the ability to check these questions with large companies. That is why I don’t invest in the stock market. If you feel that you must have stock market exposure then I recommend a low-cost, broad index fund.

Good luck,


Health & Athletic Longevity

“If I don’t race for the rest of my life then I might be able to repair the damage that I did to myself”
-- Mark Allen, 6-time Ironman World Champion

There have been times where I have lost sight of the long term health benefits from physical activity. As a result, I have fried myself (over doing it) or not bothered to do anything at all (not doing it). These two errors arise from a mental disconnect between fitness and health.


Alan’s blog has a good piece on early season training. He lays out the choices that face an athlete. Stepping back to the larger issue of personal health, they represent phases of our athletic lives.

Phase One – one hour of activity per day
For most people this would consist of walking for an hour (five days a week) and strength training (two days a week). This is achievable by nearly everyone and will maximize longevity when applied on a lifetime basis.

Invest a single hour a day to extend, and enhance, the quality of your life. Our photo this week is me and "my rock". From our condo in Noosa, I takes me 35 minutes to get to the rock. No matter how tired/sore I am feeling... I gotta make it to the rock.

Choosing _not_ to apply this level of activity will impair your quality of life, the only question is when.

Most people wait until heart disease, cancer or death of their parents spurs them to action.

If you find that an hour of daily activity isn’t “enough” to manage your body composition then you are using exercise to continue dysfunctional eating habits. I have spent years using exercise to avoid adjusting my eating patterns.

Phase Two – Standard Basic Week
An outline for triathlon is included below – this program represents achievable athletic excellence within a life that includes family; friends; and business success.

The program is an outline for the athletic component required for (one definition of) personal excellence. It is well above the minimum for personal health.

Only a minority will choose this level of commitment. As a result, you can perform better than most your peers when you use it consistently. Relative to the general population, athletes at this level are very high achievers – many will not think so because they fixate on Phase Three athletes.

You need some genetic gifts to support this level of training across a lifetime – it involves a lot of mileage! The gifts are not in terms of VO2max (maximum aerobic capacity) rather, they are gifts of superior immune system function; excellent biomechanics and above average connective tissue durability.

Phase Three – Advanced Basic Week
If you want to achieve the absolute maximum out of your body then trying this phase makes sense. However, not everyone improves at this level of training, some people get slower and will optimize their athletic performance by sticking at Phase Two.

That last point is worth repeating. For every athlete, there is a point where additional training load will lead to reduced athletic performance. I know a number of excellent athletes that have failed to sustain early success when they “got serious” and upped training stress.

I also know a (very) few gifted freaks that can soak up training stress far, far above the normal population. These athletes do very well at ultradistance events.

The success of the training freaks skews what you think is reasonable.

Only a small minority of the population (perhaps only the gifted freaks) handle this level of training over the long term. Even the people that appear to handle the training… check back with them twenty years after their athletic peaks, there are a lot of knee surgeries and hip replacements that don’t make the headlines.

What we handle over the short term and what we handle over the long term are often different.

I used to believe that anyone could handle this level of training with enough rest, nutrition and recovery. With the benefit of hindsight, I see that capacity to absorb training is as personal as VO2max.

Most people can’t train like you think I train – even me.

Phase Management
Given the choice between maximizing annual fitness (short term) and quality/length of life (long term); it is natural to gravitate towards short-term payoffs.

By definition, it takes a long time to see a long term payoff. Over an eighteen-year career in finance, I have had two years of “harvest”. All the rest were “investment”. This doesn’t come naturally. Interestingly, in my two harvest years, people thought I was nuts.

Even if an athlete can handle a ton of Phase Three training, lifetime athletic performance will be optimized by mixing the three approaches. For most of my elite career, my mixing has been forced due to overtraining – likely not an optimal strategy!

Overtraining is what happens when an athlete’s quest for fitness strays too far from personal health. On Alternative Perspectives this week, we have Part Two of Clas’ experience with overtraining. Very few athletes take the time to write out their experience. It takes courage to share our self-destructive tendencies. As an 8:15 Ironman athlete, Clas has lived more athletic achievement than most of us will ever experience.

Dr. John Hellemans has been speedy in his 20s, 30s, 40s and 50s. I am going to be spending a fortnight with him (and the Kiwi elite team) in February. I have my mobile podcasting equipment with me and will be recording interviews for Endurance Corner Radio.

Rapid Progress
A desire for rapid progress is a by-product of our consumer culture.
Advertising and traditional media feed discontent with our self-image.
Acknowledging these influences is important.

When you are starting out, focus on what you can do – get moving for an hour every day. You are doing what it takes. That is enough.

If your athletics are flattening you with illness; stress fractures; secret binging; disrupted sleep; night sweats; persistent muscle soreness; mood swings; low energy; extended sleeps… then you are moving away from athletic performance and personal health. You are not on a path of personal excellence.

From within a cycle of over-reaching and fatigue – it is very difficult to see the pattern that we have created for ourselves. Beware of coaches, mentors and colleagues that stoke your self-destructive tendencies.

Beware of survivor bias – chronically injured and overtrained athletes disappear from our collective consciousness. Many highly motivated athletes fry themselves by focusing on what the surviving minority do.

I chose the quote above because Mark is one of the few older World Champions that I know who hasn’t had orthopedic surgery.

The quality of our lives (today) has very little to do with the achievements of yesterday.

Choose wisely,


Basic Week Document

Responsibility & Legacy

Alternative Perspectives is back with Part One of a two part series on over training.


The media forms an essential counterbalance to those in power, certainly those in government. However, judging from my inbox, the reporting on the riots in Paris is probably being over-done (globally). We have been enjoying the symphony, the Louvre Museum and the Eiffel Tower. The trouble is confined to the periphery.

That said... we did bump into a lawyer's strike yesterday at Place Vendome -- completely shut the neighborhood down! The French do appear to enjoy a good strike. Notwithstanding a little labour unrest, France is a fantastic place and we truly enjoyed ourselves.

As I hit the "publish" button on this piece, we're off to the airport to begin our journey to Hong Kong and onward to Australia. Next week I will be writing you from Noosa, Queensland.


Two weeks ago, I sorted out my will. At its essence, I see a will as being about motivation. A reflection of how I motivate myself; how I seek to motivate those around me; and the impact that I will have on the motivation of future generations.

When I think back over my adult life, the person that I would have been most worried about inheriting capital is "myself". The shakiness of my personal motivation from 17 to 32, was hidden from everyone other than myself -- I have managed to get quite a bit done over the years but it easily could have gone far, far differently. A benevolent chunk of cash at just the 'right' time could have had seriously 'wrong' consequences.

Further, knowing that I wasn't solely reliant on my own resources would have reduced my desire, and need, to take care of myself.

Our ability to responsibly allocate capital is a direct result of our experience with learning how to accumulate it. It is challenging to teach prudent financial management to people that have never had to manage finances.


A Valuable Legacy
I've been considering:
***What drives personal ethics?
***What drives self-worth?
***What drives the achievement of a life with meaning?

Ethics, self-worth and a life with meaning -- if I had to choose three things to wish for my kids then those are a good starting point. None of these points require a trust fund.

The most powerful success factors in my life have come from education, social networks and life experiences. A legacy with meaning is one that shares the lessons of my life.

What does this have to do with motivation?

***Achievement is linked to maximizing our capacity to work, then working.

***Self-worth is linked to favorable outcomes from work done ethically.

***Wealth is linked to favorable financial outcomes from capital invested wisely. True wealth is a function of personal freedom, not merely financial assets.

***Happiness correlates reasonably well to personal freedom -- especially, when that freedom is used for ethical work.

I haven't seen a direct correlation between wealth and personal ethics. Going further -- unearned wealth severely challenges both personal ethics and our sense of self-worth. I often ask myself what I did to deserve such a wonderful life and have tendencies to make my life more difficult (for no appreciable reason).

In our society, wealth provides a shield from being confronted by the effects of weak personal ethics. The frequency that we make poor choices is linked to our ability to tolerate poor outcomes. An example relevant to my early career, getting drunk and being unproductive at the office fails to be an option if our lack of productivity gets us fired. Inherent ability masks a lot of counterproductive behavior -- as Scott Molina notes... "you can justify an awful lot when you are winning".

Most of us will do the minimum to achieve our personal goals -- it is for this reason that challenging goals prove so useful for many of us.

My legacy?

Here's what I'm working towards:
***A clear example of the benefits of consistent ethical work over time;
***a useful library; and
***the authorship of one very useful book.

Off to the Southern Hemisphere,


It has been a fascinating week over here in Scotland. As I've been writing about athletics for the last few weeks, I will turn to a few finance oriented topics that may interest.

For most of us "credit conditions" lie invisible until we need a personal loan or a mortgage. However, in my various lines of work (private equity, finance, property development and asset management) we are nearly always in the credit markets. I had a very interesting conversation with a senior banker this week.

By way of background, we founded our Scottish property development business in 2005 and have been assembling property deals since the mid-90s. We are a material, but not massive, relationship for our bankers.

With property development transactions, our company makes money from the value of finished projects being more than the development cost. By way of example, if it costs $80,000 to build an apartment which is worth $88,000 on completion then the "capital uplift" is said to be 10%.

Financially, our business "works" for our shareholders because we are able to refinance their equity investment by borrowing against the "capital uplift" at completion. This lets the company move its share capital along to the next investment -- this drives our return on equity.

I spend most of our board meetings listening, thinking and taking minutes. It is good practice for my 2008 goal of listening more. None of what follows was explicitly said in the meeting, I simply noted it and will share some conclusions later in this letter.

Capital uplift (our company's profit margin) -- after two years of declining margins on new deals -- we were suddenly presented with a large opportunity (>$50 million) that had a projected capital uplift of 25%. The deal popped up because (we believe) the buyer was having financing trouble.

As part of our year-end review, our bankers asked us to provide them with additional comfort on our portfolio valuations (easy for us to do as we operate in a specific geography with transparent market pricing).

Our bankers mentioned that the syndication markets were closed. Debt syndication markets are how banks share and diversify risk for their largest loans. They noted that when the markets came back on-line only the best deals would be taken up. Valuation verification is an important step towards ensuring we will be at the front of the queue when the debt markets re-open.

As for new debt, we have heard from our bankers, as well as others in our sector, that new money will be tight for the next six months. That's a polite way of saying that many banks are presently closed for new business. It's not a case of asking for their money back, rather it is a case of not being in a position to fund new deals -- regardless of how attractive they look. I feel sorry for any business that is operating below par in this market.

Bankers are talking about balance sheet decisions, rather than investment decisions. There is a very clear focus on the balance sheet, rather than the quality of new business. Personally, I take this as an excellent development. In a challenging credit environment, we want to be with an institution that has a keen eye on its own balance sheet. The sooner a bank gets comfort on its own credit position, that faster it will be able to start lending again.

However, the fact that senior bankers are more focused on balance sheet strength than new business is a powerful statement in itself. The credit contraction that is happening in the major financial centers is not visible to Main Street at present. If your business (or your personal life) relies on new finance over the next twelve months then I would start the refinancing process early and make sure that you tick-the-box in every conceivable way. Once the credit markets re-open, lenders are going to choose the highest quality credits first.

The days of covenant-lite and non-doc loans are gone. For the better, too.

I attended a presentation from an executive that works at the Bank of Scotland's treasury department. He had many excellent slides and I've scanned three that are relevant to this letter (and my life).

Here's the first one. I noted the date that we bought our first flat in the UK. To say we had good timing is an understatement.
This next one shows the dislocation between base rate (set by the government) and LIBOR (what people like us actually pay for our loans). What killed some mortgage institutions is that they pay LIBOR but lend to their clients at base. This mismatch is highly costly when the markets move out-of-whack.
Those dotted lines show that the forward markets think that things will return to "normal". However, people are pretty jumpy and when I hear bankers noting that "liquidity and confidence are illusions" I fasten my seatbelt.

The last chart is a neat one that we certainly didn't realize at the time.
What I did on this one was draw in the point where we negotiated the initial portfolio of deals that formed our property development business. Once again, we were fortunate in our timing.

I don't have confidence in my ability to make predictions, however, I think that it is fair to say that the following are happening:

***a large credit contraction is underway in the UK and US (perhaps elsewhere, I can't really comment)

***a high degree of uncertainty (bordering on distrust) exists within the international banking community (reflected in interbank rates)

***due to the lag between liquidity and pricing; there is a dislocation between asset pricing and credit availability -- many sellers don't realize the lack of funding available their potential buyers

What does this mean?

From a business point of view, we are going to focus on keeping our credit providers informed and confident in our company. In this environment you want to make sure your capital providers know exactly what's happening in your business.

If your business, or your main customer, relies on credit, then you've likely seen the impact of the credit contraction already. However, if you are a few steps removed from the credit markets then you might not fully grasp what is heading our way. There are hundreds of billions of debt capacity being removed due to the equity write-offs within our financial system.

Over the next few months, keep a keen eye on accounts receivable as well as your key customers/distributors. If you have any clients who's demise would bury your firm then see if you can get credit insurance (it can be a cost effective way to reduce your exposure). In the early 90s, I watched a number of firms go down as credit tightened and the economy slowed. If you are conservative and cautious then you'll be able to navigate your way through. I have seen "services" recessions in Asia but never really witnessed them in Europe or the US.

From a personal point of view, I'm bearish on asset pricing, especially in the property markets. Liquidity is going to be highly valuable in 2008.

Sitting over here in Europe, the US offers outstanding value right now on a Purchasing Power Parity basis. It's crazy expensive over here in Europe. Seems like dollar-for-pound in the UK. My British friends talk about shopping trips to New York (a town that seems expensive to me). People are flying to New York for a weekend of Christmas shopping. If you are in the US then run the numbers on that same weekend to London or Paris!

Off to Paris next week -- we won't be doing much shopping and I hear that there is an excellent multi-day museum ticket.

Happy Thanksgiving to my American readers,

The Aging Athlete

The man above is Ron Ottaway -- a very special guy.

In 2002, Ron broke the M65-69 Ironman Hawaii record with an 11:57. One catch... Marcos Alegre went 11:53 that day so Ron finished second. Imagine working your entire life to win, to be #1... then going out and breaking the course record... to finish second.

Ron worked five more years towards one single goal -- win Ironman Hawaii. A few weeks ago he went 13:05 (at 70 years old) and won his agegroup by over an hour.

I've been fortunate to advise Ron for the last six years. Ron's personal excellence has helped make me a better person. Ron was an outstanding athlete many years before we met -- my role is more of an objective cheerleader than a project manager.

Everyone that knows Ron has stories about him... one of my favorites is completing the Western States Endurance Run when he was 54. Another is sending me workout details before heading to the hospital to get stitches from falling off his bike -- I recommended that he get the stitches first next time.

Lest you think that he's one dimensional -- he worked full-time until this year and is a key part of a huge family (both older and younger than him).

What follows are lessons that we've learned together -- I've made some good calls and some poor calls over the years. The benefit of working with a world class athlete is that the bad recommendations get covered up by Ron's competitive spirit.

In 2003, I cost him a podium finish at World Champs -- he only made it on stage due to his strength of will. You can't train like a crazed 35 year old when you are 66. Ron stuck with me despite my errors.

This year, I was _right there_ when he took the lead at Mile One of the marathon. While I missed the Awards, I had a very warm feeling when I flew home from Kona this year. To play a part in another person's ultimate success is one of the "highs" of coaching.

While no coach can "succeed", an effective plan can be difference between success and failure. Together Ron and I have learned a lot over the years.


Now that we've figured out (mostly) what works -- and more clearly, what doesn't work -- we tend to approach most years in a similar fashion. From Kona to the end of the year we don't talk to each other much. Ron has a 15+ year running streak so he runs each day. Some days just a short one but EVERY day.

In November/December, Ron does easy training. I provide support for going easy and resting -- it doesn't come naturally to a competitor at his level. Even when training "easy" Ron is doing around ten sessions per week (3-4 swims; 1-2 yoga; 0-2 spins; 7 runs; 1-2 strength). The guy is super consistent.

Ron swims and does strength training -- year round. While some sports scientists believe that strength training doesn't improve performance, you must remember that growing old is about retaining performance not improving it. Watching Ron, his "strength" work (sport specific and in the gym) appears to have had a beneficial effect on retaining bike power.

For most of the population, long term quality of life is about retaining mobility, much more than improving athletic fitness. One of the drags about growing old (for some) is their world slowly shrinks as favorite activities are given up.

Considering the mobility point, Ron started yoga five years ago and this improved his swimming and overall range of motion. If a 65 year old man can improve his flexibility (and therefore his swim times) then I really have no excuse. I've been slack on the flexibility work lately.

OK in terms of the lessons for most of us. That's it.

For high quality of life, long term, focus on:

Consistency -- little something every day
Flexibility -- retain your range of motion, especially if you are a runner
Strength Training -- hold onto lean body mass & retain strength to survive falls/accidents


Starting in January Ron gets back to structured training -- the "advanced week" at the bottom of this note is the week that I use as his template. Ron does all the stuff in square brackets. There is very little change in the structure of the week. What changes is the overall focus of the sessions themselves. However, even that doesn't change a whole lot. We keep it really simple.

Taking each component:

Swimming -- keep the frequency high; long course as much as possible; watch that swim fatigue doesn't compromise other session quality.

Cycling -- build overall endurance; retain FT power; wide range of variable cadence main sets; and challenge maximal aerobic capacity in a biomechanically safe environment.

Running -- super consistent; wary of any small injuries that could reduce consistency; little bit of uphill running to tax aerobic system; very careful with overall run volume and intensity. Informed risks with volume, frequency and intensity.

Strength -- consistency trumps intensity // we go hard sometimes but only on leg press. Really watch the back with the squats due to flexibility limiters.

Flexibility -- yoga 2x per week; again watch back; helps with overall balance.

Biomechanics -- as you can tell from that photo // outstanding. Ron's built well for endurance. He has a smaller frame, good feet, compact running style and excellent ankle/knee/hip alignment. There is a low wear & tear "cost" to every mile that he runs -- and he has run a lot of miles.

Luck -- the unknown factor // in six years only minor soft tissue damage from his cycling accidents. To be fast in your 60s/70s/80s -- there is a component of fortune.

Mental -- the only 70 year old that can do Ron's program is Ron. The guy has more motivation than anyone that I've ever met. He passed out cold in the massage tent with his family around -- his daughter was super worried because he wanted the title so bad. Low blood pressure, thankfully. He was up and around in about an hour.

He's heading back next year to defend his title.

Ron's a winner at a very deep level.


Some quick Qs on last week's posting.

Q1 -- Black Swan Book link?
A1 -- Find it HERE

Q2 -- Did I record my Personal Planning talk?
A2 -- Not yet. If your company, or club, wants to bring me in to give a talk then drop me a line.

Q3 -- You wrote: "it is easy for me to see that there is a risk that we neglect our larger potential when we seek our athletic potential". I've thought *very* similar things in the past when I was playing competitive golf at university (ie: 'do I pursue golf 100% or devote more to personal/academic/extracurricular pursuits?' I wonder if you could expand on your sentence a bit, and if you have any thoughts on how to "figure out" what is the best route to take?

A3 -- I asked Monica what she thought. She felt that pursuing my athletic potential had never impaired achieving my personal potential. Seeing as she is the most important person in my inner circle -- the only person, other than myself, to whom I have a covenant -- I suppose that's enough. However, there has been something more in my head.

I took her support to mean that she never feels neglected when I am living a life of personal excellence. However, what I was writing about was my internal view on my personal ultimate potential. Given that my self view is limited (to date I can always achieve more over 5-10 years than I see in the present); there was more to my pondering than, "am I being a good husband".

Ultimately, the question that I have been asking myself is what would I do if I "knew" that I would never again race Ironman in 8:29 -- or -- if my window to win Ironman Canada was permanently closed. Would I be OK with that? How would I want to live? The question is valid because at some stage, either I will win, or I won't win. Either way, "I" will be the same guy thereafter.

For now, I keep thinking and make daily choices that are consistent with keeping my options open.


PS -- the actions that clearly impair my personal potential have nothing to do with "what" I do and everything to do with "how" I do them.


Here's the link to the Basic Week that I use with pretty much everyone that I advise. As you'll see, I don't add much value in terms of writing schedules and/or data entry.


Business Clinic Notes

The photo above contains more of "me" that most photos of me but, maybe, that's just the way I like to see it. You can pretend that I'm the candle...

"Keep in mind that your role with these athletes is, ultimately, to give them the confidence to stop."

-- Bobby McGee

I learned a lot this past weekend at the Business of Coaching Clinic. That quote above was a salient reminder that often we have the greatest positive impact on clients by giving them the confidence to chose a more positive path than the one that they are on.

Over the last fourteen years, I have used endurance athletics to avoid dealing with important issues in my life.

Some of my greatest successes as an adviser have been helping clients choose an alternative path for their lives.


Bobby challenged us to pick one thing from the clinic and apply it on Monday, noting that "people that go to conferences often collect information without applying it". The same applies with self-help books -- Mike Ricci noted that the most successful people that he sees are the ones that manage to apply 5% of the good ideas they come up with.

What did I apply? I decided to apply Mike's advice about considering, specifically, to whom your company is selling.

Since last year, the target Endurance Corner customer has been shifting in my thinking. This week, I sat down with Alan/Mat and we reviewed what everyone _really_ likes to do. As the lead adviser to the business, I thought about what I really don't like to do as well as what I do best.

We're still working on it but we've made a decision that we are going to be about selling value-added advice, and services, that are a product of our unique mix of skills (strong technical knowledge mixed with very deep real-world experience and access to the best minds/protocols/facilities in our sport).

Running a coaching business... other people (such as D3, CPC, CF, CTS, Ultrafit, VQ...) are able to do that better than us -- so we'll focus on supporting them, and their athletes, and their potential customers.

We will do a limited amount coaching to make sure that we remain practical in our application of our experience and continue to learn. It's essential that we walk-the-walk and follow our own best protocols.

That's a start.


There was a lot of talk about "what coaching clients buy." Many thought that clients are buying "results." While clients are attracted to results, what I see is people buying...

...access to excellence (exemplified by the coach);
...compassion, listening, understanding (our society subtly tells many people that they have no worth);
...camaraderie (social networking, teams, community, sense of belonging);
...time management assistance (established high performers); and/or skills assistance (young high performers).

Coaching is as an aspirational purchase for many people -- if you aim to position your self (your firm) at the top end of the market then you must ensure that your personal positioning is consistent with your target market.

Why do former Marines make excellent coaches? They have been trained in excellence -- it becomes who they are and apparent to their customers -- honor, ethics, excellence.

As Bobby said, you don't need to be an excellent athlete relative to others -- you need to be an excellent person relative to yourself.


Mike challenged us to consider our differentiation as well as the areas where we can be world-leaders.

Two areas came to mind for me:
#1 -- personal transformations using athletics as a catalyst; and
#2 -- critical success factors for ultraendurance athletic competition, specifically Ironman triathlon.


In listening to Mike, I wondered how many of us spend our time on what the client truly values.

Do we know what our clients most value?

How often do I make myself more busy, rather than more successful? Early in my coaching career the answer was... most of the time.

Bobby/Mike/me -- we acknowledged that every single thing that we do reflects on our brand, ourselves, our company -- every single act is a form of marketing.

We also shared our experience that we under-valued ourselves early in our careers. Bobby encouraged us to make the case that ours is a legitimate profession.


Linda mentioned that we have 100,000 USAT members // with the correct business structure, a market share of 0.01% is enough to provide most coaches with a satisfactory income. This is a wide open industry. Even the established players have small market shares with clients that are easily persuaded to change.

Mike commented that one of his advisors cautioned against being in a non-scalable business... I highly recommend a copy of The Black Swan to that adviser.

Donovan noted that there are over 1,000 coaches on TrainingPeaks. What that tells me is that running, cycling and triathlon coaching are rapidly growing industries with highly fragmented and inexperienced competition -- ripe for standardization and consolidation // This is an opportunity for someone else -- we have made a strategic decision not to attempt to sort the market out.

There is tremendous value in the coach (or company) that creates a system for generating referrals and client inquiries. There is also value added in the coach (or company) that structures appropriate contracts, payment terms, legal protections and administrative assistance. But... how do you control quality? how do you retain your best performers?

The coaching industry will become more professional -- I expect that companies like TrainingPeaks will grow ever more sophisticated each year. The bottom end of the market will access their systems via web/iPhone. The top end of the market (companies like D3) will sell value-added services that go far beyond building training plans. The (current) middle market will get squeezed.

The key financial metric (to me) is revenue per relationship. This is different than "per client" -- you could have a low revenue client that generates a ton of referral and associate business. That is a high value relationship -- look beyond the dollars when you assess the key people in your network. Also look to the non-monetary benefits that accrue when you take on an assignment.


Bobby challenged us to consider what we want to leave as our coaching legacy. The normal way to do this is to do an exercise where we write down our eulogy.

I don't need to pretend that I am dying to be honest with myself (although it does help). Daily, I consider my legacy as a person up to this point -- my flaws and failings providing fertile ground for self-improvement!

Some explicit tips that I wrote down from Bobby's presentation:
***Do graduate work after you have direct experience in your field;
***Teach kids to learn how to teach anyone;
***Leadership trumps protocol;
***Take formal instruction on your greatest limiters;
***Work only with people that you trust;
***Focus on what you do best;
***Develop passive streams of income;


Bobby noted that he's not sure that training protocol makes much of a difference for Ironman triathlon -- he did this by contrasting with marathoning. Molina/Hellemans have said, essentially, a similar thing.

As a coach (or successful athlete)... if you think that your training protocol is essential for success remember that you are extremely biased by two effects:

(a) survivor bias -- you survived it; and

(b) silent evidence -- we are (mostly) unaware of the athletes that the protocol destroyed along the way.

More on the way we fool ourselves with "evidence" in The Black Swan.

Boil it down...
Talent, motivation, opportunity, direction -- those come from Daniels.
A ton of training -- that comes from Lydiard.


One of the last talks of the weekend was my presentation on Personal Planning. I love giving this talk to groups of people and had been looking forward to giving the talk for WEEKS.

It is my favorite topic in the world because I passionately believe in the method that I have developed over the years.

I need to constantly work on my #1 point for 2008 which is listening. In the Q&A, I really struggled to shut myself up enough for us to learn from the other panelists.

During my planning presentation... I was in full flow -- really fired up...

I gave myself the mental combination of contrasting my love for Monica and the disappointment of failing to win IMC. What wasn't apparent, or explained, was the link between IMC and an expression of our love for each other.

Monica gave me total dedication this past year so that I could give 100% towards my goal. IMC is the only thing in my entire life that I have _truly_ worked towards yet failed to achieve (most my other successes are due to a combination of chance and natural ability).

I was wide open and had to pause because I was about to meltdown in front of 40 people (!)... it was a "good room" and they got me back on track. However, it took me days to 'recover' from being that open. Powerful stuff.

Monica likes to tease her Dad because he is known to get fired up; blow his circuit breakers; and cry -- all the while being wide open to the person he's talking with.

She may have married the same sort of guy...


Files for Endurance Corner Radio

Alan's Talk on Zones -- Part One is on Alan's Blog -- Part Two is the PDF below, look at Page One of the scan... that is how many ways there are to say the same thing... just on Alan's desk!

Will's Talk on Training -- his test results and my recent lactate test.


“Mate, you should get the families on board when you are doing athlete planning. I have seen far too many relationships screwed up by this sport.”

-- Greg Bennett, World Champion Husband


I had a T-Rex in my kitchen this past Halloween... Mat went to CostCo and bought 300 pieces of candy and 30 "full bars" (for special costumes). We live in a cul-de-sac and hardly any kids came! Dave had sixty kids over to his place and he was giving away breath mints... next year, I am going to ramp up my marketing.

As a personal reminder... we did quarterly evaluations this week at Endurance Corner. It was recommended that I work on three things:

(a) remember that my mood has a direct impact on the team's productivity (the leader needs to lead);

(b) reduce interruptions when the lads are working on tasks that require sustained thought; and

(c) when I start to focus on being "right" rather than my objective... stop talking and take a break.


My dad describes a blog as… “a collection of ideas, given away for free, that you would normally spend more time developing and seek publication”. I suppose that is a polite way of saying that these letters read a little choppy sometimes.

I am going to share some ideas that came out of the Endurance Corner advisory meeting last weekend as well as recent discussions that I’ve had with some very smart people. We’ll see how this turns out – lots of snippets, hopefully, they make sense.

Before we kick off, Robbie Ventura is going to drop into the last four days of our April Tucson camp. As you may have heard on IronmanTalk, he is preparing to race Ironman Canada and I’m sharing a few tips with him. We have a bit in common, in 1998, I signed up for IMC when my only triathlon experience was a sprint tri. He’s in a similar boat, especially with his swimming.

In Tucson, we will get the chance to share Robbie’s first super-long triathlon training day (the day before we will SBR Mt. Lemmon). If you’d care to join us at the camp then drop me an email for details. We have a few spaces left for the March/April camps.

The March camp will be set-up to fit with athletes preparing for IM Arizona as well as those looking to jump start early season fitness.


A few months ago, I asked a friend if he thought that he was operating at his maximum potential. I have been thinking about that question as it relates to my own life. In reading Dead Certain, I was struck by the thought that President Bush has certainly achieved close to his personal potential. Quite separate from his popularity, the man has achieved close to his maximum potential. It is an interesting case study that has me looking inwards.

In my mulling over of this topic, I see a distinction from achieving greatness and achieving honor. A great person need not be honorable – and an honorable person need not be great.

When I speak with my grandmother, I note that she takes comfort in doing her best to have chosen an honorable path. I haven’t had honest conversations with any people that achieved greatness without honor – I imagine that their later years are filled with regret. Something for all of us to consider when we are tempted by the easy way. For this reason alone, be wary of situations (and people) that tempt you to cut corners.

I am kicking all this around because I know that my potential as a “person” is far greater than my potential as an athlete. I sense that when I seek one, I let go of the other. I was talking about this point with Graham Fraser – a guy that has witnessed his share of holding on, and letting go. He didn’t offer any specifics, merely the catalyst of placing the thought on my radar screen.

Why this is so interesting to me is that it is easy for me to see that there is a risk that we neglect our larger potential when we seek our athletic potential. Monica thinks that I do a pretty good job of balancing things – however – that’s because she is on-my-list when I’m hitting triathlon hard.

Still thinking that over while I consider a business opportunity that offers me the chance to do something “great”. When business deals look very attractive, history tells me that I am probably tired.



I have been talking with a few business owners about ownership. The same topics keep repeating:

***Equity ownership should only be shared with people that provide capital essential for business growth – human capital counts, probably more than any other type.

***My preference is to share equity capital with individuals that are essential to the development of the goals of the business founder and increase both the size, and likelihood, of success.

***Within the management team, my preference is to share equity capital with individuals that are fit for leadership. Does someone improve the CEO’s ability to lead and improve the quality of that leadership?

***I’m not keen on 50:50 partnerships as someone needs to be in charge and contributions are never equal. In that situation, I prefer 67:33. This is a neat number as: (a) the two founders can sell 24% of new equity to a third partner; (b) the founders can still control 76% of the company, post issue; (c) the smaller founder retains a veto over special resolutions that require 75% approval; and (d) the larger founder controls >50% of the equity, post issue.

***If you create a business that is a wild success then you should not feel obligated to deal out a stack of money to everyone around you – you’ll screw them up and you have done plenty for your team by creating the business. Even more likely is that you are best person around to allocate and manage capital. During your lifetime, consider if you dilute the power of your money to do “good” by spreading it into the public at large. After your lifetime is a topic for another time – I have an article in my head about inheritance and motivation.

***Remember that equity and bonuses are most appreciated at the time of allocation. Frequent cash incentives are much more appreciated than single long-term allotments.

***If you are the founder of a small business then consider who is truly necessary for the business to operate. When you stand back and take an honest look – you often see that you are the only person holding things together. In that case, it doesn’t make sense to deal people in as shareholders.

***People that increase your personal freedom; require limited management; and work towards your goals – are highly valuable. Do what it takes to retain them – frequent cash incentives based on their performance and skills in managing other people – that is what I prefer.

***Ideally, the individual that is most fit for leadership should control the equity capital of the firm. If you are the founder, and best decision maker, then be wary of diluting your ability to steer the direction of the firm – far easier to place key employees on generous profit sharing. If you are in a human capital intensive business then this doesn’t always work. Still, try to keep control vested in a small group of individuals – the best partnerships are run by a core group of senior partners.

***As a counterweight to the above point, if you have the ability to greatly improve the value of a firm and/or increase the likelihood of success… then be sure to negotiate a deal that rewards you for the value you create. There is often a balance between paying your dues and achieving market value for your services. The best and brightest can be underpaid until they test their market value – be very polite to your senior partners if you plan on playing this game. If you over-estimate your market value then you are exposed to having your bluff called.

***Always remember that bigger isn’t better and that you’ll cut your best deals when you are willing to lose them. Keep a steady focus on what you want from your business. It is very easy to get caught up in growth, for growth’s sake.

***Always consider if a new opportunity will give you more satisfaction – or merely more work. Know your personal goals and seek to align them with your work goals.

Two final thoughts:

1 – always be willing to make a little less money to maintain high personal standards

2 – remember that your most important brand is yourself – invest in that brand



Files referenced on Endurance Corner Radio

Bike Efficiency PDF File

Recreational Athlete Treadmill Protocol

Kona 2007

I spent the last weekend with Robbie Ventura in Chicago and that photo above is my new TT position. Just in case you don't believe it... that really is me, Robbie says that I don't even look like a triathlete -- high praise. Even Monica couldn't recognize me when I sent over the shots -- said the leg looked "too big". ha ha

I will share my thoughts on his operation when I give my talk on coaching business models at the November Coaches Clinic. It was a fun weekend observing a successful businessman (and business) up close. It's impressive what the Vision Quest team have built. I've nicknamed the CEO... "Hurricane Robbie".

Thanks to Jim Sauls, you will find more velodrome photos HERE.

Once I get the data I'll pass it along to Planet-X for them to post up. You can read my 2008 plan over there now.


Kona 2007
I learn something each time I come to Hawaii and, this past trip, I had a few insights that I’ll pass along.

The island is an extreme place and the thought of racing here again is frightening for me. The only other course that generates a similar level of anxiety is Lake Placid. What these courses share is the fact that any pacing errors will be punished. In Kona, you get punished both severely and publicly. Of course, learning to cope with that is a useful skill, even if you never really ‘overcome’ a situation.


Bike Workouts

I’ll share a couple of workouts that I picked up. These are supplemental to the ones that I outlined in my Power Presentation that goes with my podcast on EC-Radio (right margin).

Non-technical readers may wish to skip ahead...

12/3s – typically, I do these as 15 minute continuous cycles of 12 min steady then 3 min mod-hard. Bob Korock was nice enough to share one that he uses that is done as 12 min mod-hard (Half IM avg watts) then 3 min easy. This is specific preparation workout, rather than general endurance. Most people would see the Tempo 12s as superior to the Steady 12s. That depends on your needs and the time of the season. Even in Kona, steady state stamina and a superior endurance physiology at the metabolic level are fundamental limiters that I see in the field.

For a few years I’ve suspected that certain strong (and large) athletes have the aerobic capacity to perform at a work rate that exceeds their metabolic capacity. Put another way, the athlete’s fitness across an event duration exceeds their capacity for fueling. Post race analysis of power/pace data shows that the athlete “should have” been able to tolerate the efforts.

Watching, and talking to, athletes in Kona – it appears that there is a risk that we spend too much time developing our threshold performance and neglect to maximize our metabolic efficiency both in terms of output and input. I have seen some speedy Ironman performances done off the back of throwing a ton of volume at an athlete. I wonder about the stickiness of training that maximizes the ability to process carbs and oxidize fat. I also expect that there are genetic, nutritional and training factors that influence these limiters to performance.

The persistence of metabolic efficiency adaptations is an important consideration because it might explain why I’ve done some ripping IMs fatigued with sub-optimal threshold training/performance. Perhaps I maximized my real constraint which is metabolic in nature. We’ve got a lot to learn about what’s really happening in 8-17 hour events. Robbie talked about RAAM-pace // the speed that results from your maximal rate of glycogen synthesis. After two days all RAAM athletes are running on empty -- we have seen RAAM speed in athletes that tried to lose weight at Epic Camp. In ironman terms I call it POLAR (Pace Of LAst Resort).

Anyhow, my second workout tip for you is one that Joe Friel shared with me. The mainset is a doozey… four hours at goal IM wattage within a race simulation workout that is done on a flat course. If you get more than a 5% heart rate deviation (at the end) from the steady-state heart rate achieve (in the middle) then you are either… (a) aiming too high in terms of wattage; or (b) lack the ‘depth’ of fitness required. Either way, you must lower your wattage target. I think that this is an excellent session because (if you use the data) you greatly increase your probability of running well.

FYI, these sessions are late-season workouts. I won’t be trying them anytime soon.

Some swim tips that I picked up from super-swimmer Karlyn Pipes-Nielsen… I will share them without a lot of explanation. Remember that you simply need to enter down and pull straight back. Most people overthink swimming.

She’s teaching straight-arm recovery, too avoid crisscross and overshooting on entry she instructs outside edge of hand entry (I tend to go pinky).

In starting the stroke, engage the outside edge of the hand and the base of the palm, rather than fingertips. This should engage the lat rather than firing just the deltoid.

I’m a deltoid dominant swimmer and felt the difference immediately.



Every year, the race in Hawaii gets more and more competitive in all categories. It was impressive to see how fast the over 50s (men and women) race. If you are in your 30s, then consider what's going to happen when all the 35-39 elites age-up. Look at the ages in the Top-30 // how fast will this guy go at 45 or 50? What a race!

In a few years, we will see guys like Ken Glah and Greg Fraine racing in the 50+ category. It will be fun to see what’s possible. As for me... I don't plan on denying you the chance to take me down in my 40s... ;-)

I received a great quote from Jo Lawn right after the race… “to win here you can’t have a bad _minute_ let alone bad day. The girls are going for it the whole way”.

Even if the fields are getting more competitive, there remains a lot of room for performance through superior pacing. Powermeters are going to become standard for most athletes -- as a coach, you need to be building your experience with power. There are a lot of smart people sharing tips on maximizing Ironman performance ('s ideas on power output bike vs. run). The sports scientists are catching up on what really drives IM performance.

Less than 5% of the athletes I watched climbing Palani used their powermeters. That’s a lot of ammo to use in the first twenty miles of the bike. I'm speaking from recent personal experience here... you gotta trust me!

I’ve been fortunate to work with Ron Ottaway (winner of the 70-74 agegroup) for the last six years. I will share my thoughts on The Aging Athlete in an up-coming letter. For what it’s worth, Ron was fast when he came to me (five times on stage in Kona). However, he did win his agegroup by over an hour so I feel qualified to comment on what works (at least for him).

Ron was 20-minutes down at Hawi and started the run right beside 1st place (probably his best bike pacing, ever, in an Ironman). I’m looking forward to reviewing his power file. The challenges that face the ageing (speedy) athlete are unique as hanging onto developed fitness is a lot easier than building it up.

The fastest elite times may be similar to what Mark and Dave put up but the depth of the field is greatly increasing. Track the Top 10/20/30 (M/F) overall times to prove it to yourself. Top Ten used to be a reasonable dream for me... now I'm not so sure!


Dr. J
Some neat posts from Dr. J over on his blog – he lays out (what I believe is) the most effective way for an athlete to improve their run performance.

Most people that do run camps target an average pace/intensity FAR too high. This time of year I am running 8-9 min per mile with my heart rate <145 style="font-weight: bold; font-style: italic;">


Lab Work, Career Beginnings and Entitlement

I was in Kona last week and the artist of the above print (Mike Field) took me out on his sailing canoe. Heck of a good time.

A Reader Asked... question to you is what one book (or if that is too tough) what several books have had the most impact on your beliefs, thoughts, views, etc. I feel like I am in a significant transition point in my life where I have achieved a lot but still feel like I’m not sure where I’m heading

I Replied...
The book -- that's easy for me -- The Artist's Way by Julia Cameron -- I read the book (and did the program) the first summer that I spent in Boulder (2000).

Seven years later, every single thing that I wrote on my Top Ten list had come true. I thought that some of the items were a bit of a long shot as well. The interesting thing about that book (and the program) is that it is a tool to unlock whatever is lurking inside of us. It's a powerful program -- it seemed pretty goofy at the start but seeing it through changed my life.

FWIW, I would have described my life in 2000 EXACTLY as you laid out in your question.


Lab Work
We have been playing in the lab this past week. I did four tests (bike lactate step with fuel; max aerobic run; resting metabolic rate; and a brick where I held AeT wattage for 80 minutes). So far, no ground breaking insights and I appear to be pretty normal.

Running the fuel test in tandem with the lactate test is very interesting (to me at least). In some athletes we are seeing material divergence between their lactate profile (AeT/FT) and their met-cart profile (AeT/VT1/FT). Often times the lactate test indicates that the athlete ought to be training more intensely than the fuel test. The fuel test has given us an insight into why using top end performance to determine endurance training zones is prone to error. We'd kill Alan if we used a 20 min max effort test to set his endurance zones on the bike -- he can really rip when there's plenty of glycogen available. I'm sure that he'll write more after we arm him with a bit more data. For what it's worth, this is where in-the-field experience is invaluable -- the testing provided us with a metabolic reason for him being so whipped all the time.

Given that nearly every athlete wants to know the pace/power/intensity at which their fat burning is maximized we're putting together a progressive test to determine that point for recreational athletes. My sister-in-law runs daily on her treadmill so she's the perfect candidate to test our protocol. In an up-coming letter I will share ideas on burning more fat, and storing less.

Visiting various labs and speaking with a range of PhDs, it is surprising to us that every lab (and just about every sports scientist) has a unique protocol for VO2 max testing. We've arrived at our own consensus and will be running it past a few personal contacts. A few more weeks and we will publish where we ended up. Seems that there is a fair amount of "art" in the testing science.

Drop mat "at" a line if you are interested in some testing.


Career Beginnings
I read pmarca's blog from time-to-time and came across an interesting piece on where to work. Thinking back to my own path, it is excellent advice.

I stumbled into Private Equity in 1990 -- I was hand-trained by a founder of the British venture capital industry (Jon Moulton). I think that Jon would say that the article I linked up is reasonable -- the amount of cash that flows into all segments of the finance industry is unbelievable. Many of the players within the game believe that they actually deserve it, others stay quiet and earn their money below the radar. Jon comes out and says what many of us have been thinking for years.

Jon plays a game at which he is a world-class player -- it's fun to do things when you are better than most your competition. I think that he's the only person in the world that's built two leading private equity firms from scratch. He makes a lot of money but could make even more if he felt like pushing things. His business serves his desire to work with great people and play the game -- financially, he's had more than he needed for the last twenty years.

He knows a lot lot about money and I hope that he sits down and writes out his thoughts one day -- that's a book I'd love to help write. We have access to Warren Buffet's annual reports but there's a ton of great stuff that's scattered amongst the memories of Jon's employees, partners and managers.

Here's a bit on how I met him... against the advice of the senior partner that interviewed me, Jon decided to hire me straight out of university. These days, nobody really gets that chance -- the industry players are, for the most part, established players and it is VERY tough to get a seat at the golden table.

Back in 1990, I was cheap, graduated with first-class honors (Econ/Finance) and Jon knew my Dad. The first two points were a key part of his buying decision -- Jon likes to hire smart people. He figures that if you can score well at a good school then you should be "useful for something". Knowing my Dad limited his downside because he could recoup his investment via satire.

From the early days, I was fortunate in that he found most of my flaws entertaining (there were many). Jon likes to be entertained. His wit is so fast that it took me six months until I was able to understand what he was saying. His partners used to translate for me and, even today, I probably miss many of his jokes. He's operating at a pretty high level.

My starting pay was less than the cleaners and my desk was the only one in the firm that Jon could see from his own. That made for interesting times as he would lean forward and shout "Byrn! Heel!" when he had a task for me. I'd drop everything and come running. Whenever I was given a task by Jon, I'd work non-stop until it was done. One management team nicknamed me "the rottweiler", I had a lot to learn about people skills.

Jon's done more for diversity in the financial services industry than any other person I've met in my career -- I'm surprised that no one ever talks about that. Hand ups, rather than handouts. To see this, you would need to look to the man's actions rather than his words -- Jon would probably tell you that he only hires the best people and doesn't give a stuff about backgrounds. That's true but doesn't explain the texture of most of his competitors.

I worked in London at a time when capital under management was benefiting from rapid portfolio growth and a shift in asset allocation. We knew that the industry fundamentals were good but we failed to grasp just how fast our world was changing. We were lucky to have some very bright Harvard MBAs on the team that provided strategic background -- Jon was at his best adding value to the firm by doing good deals, rather than strategic oversight.

The American players were the Big Boys (with their private jets and stretch limos) but we held our own in terms of net returns. The concepts of portfolio management and net returns were in their infancy. I was one of the first people to build a full-fledged model of a private equity fund, Jon's idea, not mine! Because our returns were great, we were in a position to educate our investors without risking our P&L, rare in financial services!

Another great idea Jon had was to calculate the equity IRR from doing a buy-out of the FTSE index and rolling all interest (after dividends) for five years. He loved it when my calculation (looking back five years) showed an equity IRR of 30% per annum. This was 1992 and the parallels to today's hedge fund industry are clear -- making money from leverage rather than sound investment judgment.

I worked internationally, first in London then in Hong Kong. When I'd plateaued in terms of personal development, I headed out on my own and have been involved in founding start-ups since then (property investment, property development, consulting, human performance, tourism).

Operations aren't my forte. As you might guess from reading my stuff -- what I do best is take a range of ideas; assemble them in the language of finance; and structure a deal/company so that good people get involved in supporting the plan. I do the easy bit -- the people that execute daily do the tough stuff.

As I emphasize to Alan and Mat, make the most of your learning opportunities. Boulder, 2007, human performance, alongside an experienced coach/investor/athlete. I didn't realize how unique my situation was until years after working for Jon.

Similar to my piece on the future of the coaching industry; I have a piece in my head on the future of Human Performance consulting. I'll write that up because there is an opportunity to create a world-class business in Boulder and I need help with the day-to-day.


Health Warning
I'm being pretty direct below and when I re-read it... I sound a little negative on "living the dream". I suppose that is because most of the elites that I meet are a bit clueless on what they are heading for as well as the long term implications of their decisions. Still, poverty isn't fatal and athletics is a lot of fun.

My decision to seek to maximize my athletic potential in 2000 was an outstanding life decision -- in a sense, I saved my life. However, the financial benefits that one forgoes in following an athletic path are material. Nobody (coaches, athletes, race directors) goes into triathlon for the money.

If you think that you are too "poor" to afford health insurance then I recommend that you reconsider. I have many friends in our sport that have sustained medical bills in excess of $10,000 within the last five years. The highest that I know about is more than $100,000. If something happens to you then it's going to be pretty major -- a high deductible insurance policy costs very little relative to the financial impact of most cycling accidents (Alan/Mat pay ~$150 per month for a PPO plan that includes dental).

Taking $2,500 or $5,000 on the chin is nothing compared to a six figure bill landing in your lap. For my family, I self-insure the small to moderate stuff with a gold standard plan that backs me up for anything major.

When deciding what constitutes major; consider it as a percentage of your personal Net Asset Value.


Entitlement In Sports

A listener observed:

It continues to amaze me how difficult it is to be a pro triathlete and the sacrifices you have to make. Perhaps in the future you could discuss what needs to change in our sport in order for elites to make a fair wage?

So many ideas come to my head when I read the above observation. Please know that I am speaking generally rather than replying directly to you. Your question touches on the fundamental issue that many people have with entitlement.

What do we truly deserve? Start here for ideas on that!

Fair wages – elite athletes are volunteers and no one has an inherent ‘right’ to train all day in the sun // I recommend a trip through rural China and India for anyone that believes otherwise. Elites are free at any time to get themselves a job in the traditional workforce – most “pros” in all sports have at least a part-time “real” job.

We all are susceptible to a feeling of entitlement in our lives – I feel it in myself. An early dose of random misfortune can often be a blessing.

The national associations (like New Zealand) that make it “hard” on their elites are doing them (and their taxpayers) a favour. If an athlete’s prospects are poor then we certainly don’t want to make it easier for them to hang on – a trip back to the traditional workforce can be educational and do wonders to motivate those on the edge.

If you want to make a living as a world-class athlete then you’d better be a world-class athlete. Most elites aren’t world-class, they are proficient and hard working.

Making It – you don’t “make it” as an elite triathlete – with a few 1-in-1,000 exceptions you make a bit of money for a few years then you retire (often with a beat up body and a smoked immune system). Winning a few races isn’t like making partner in a law firm – you will be heading back into the workforce (probably with short notice and before you want).

For most elites (and fast AGers), fast racing is great marketing, rather than income earning. The athletic "class" that make the greatest return from their racing are the “athlete coaches” that place consistently in their divisions. They represent achievable success in their local markets and share their experience with increasing life satisfaction from racing. As a "class", elite triathletes make nothing. My lifetime prize money is equivalent to two months current expenses (maybe less, I'm probably overestimating).

If the goal is to make a decent living then channeling the energy spent on athletic excellence into just about any other field will result in superior financial returns.

However, it is the challenges that make the pay-off so rewarding – whether competing for money, a Kona slot or simply to finish. Most of us would do it for free – actually most of us pay to do it!

Rewards – as a society, we place a tremendous value on physical beauty and athletic power. We have been conditioned for our entire lives than a lean, fit body is the ultimate achievement. As I age, I take comfort in having a better body in my 30s than I did in my 20s. I expect that the “reward” that many elites receive stems from the way we perceive an elite athlete.

Change – I’m not sure than anything needs to change in the sport of triathlon. If the athletes were to organize themselves and take charge of race promotion then they might be able to capture a larger share of the sport’s revenues. However, I see this as unlikely for a few reasons:

***lack of skills // as a class, elites are great athletes, not great businessfolk. The federations and race organizations have a massive edge and strong financial incentives to maintain the status quo. As a practical point, even if an athlete had the skills – why does it make sense to put a lot of effort into helping a group of second tier pros make more money? Pretty low return for your personal charity investment and, I expect, that you would get a lot more bang for your buck in other fields.

As an aside, my personal experience with Bradventures, NA Sports and HFP Racing is that they get money to athletes that support their company vision and add value to their businesses. Graham Fraser has done a tremendous amount for elites (as well as others) but we don’t hear a lot about it. He’s probably learned that critics exist to criticize.

Many young pros focus on explaining why they should be given money – a far better proposition is to demonstrate how you can add value to the company by being an ambassador of their brand mission. I had ten years of investment experience when I came to triathlon and it took me years to figure this out. One thing I did figure out was that using my skills to beg for free bike shorts was a low return activity.

***the events are bigger than the athletes // There are very few athletes that can benefit a race director by their presence.

Life Lessons – the lessons that we learn with a personal quest for our maximum potential are highly valuable and the training is a lot of fun. At some stage of our lives, I think that everyone should spend a couple of years trying to be their absolute best at something. The lessons are independent of outcome.

Remember that sport (and a meaningful life) is challenging – that’s the point!

As Ms Rand noted... China, Russia and others have tried a system that tried to be fair to everyone -- it had all the wrong incentives.

More next week,


Network Effects

Here's a shot of the Coffees of Hawaii sailing canoe in Kona. We were dealing out hot/cold espresso as well as water/sports drink during Ironman Hawaii race week. I'll be sharing more thoughts on Kona in the next few weeks.

Before this week's letter. A few bits and pieces...

A.R. Asked...
Sorry to bother you – a while ago (2 weeks?) – you interjected a short comment about what to look for in an ideal woman ( you mentioned something about high self esteem and a few other things? ). I am going through some decision making currently with regards to the opposite sex and I was hoping to find that bit of wisdom you imparted but I can’t seem to find it – do you remember what the few important things that you listed as important were?

Get yourself a copy of "Too Soon Old, Too Late Smart" -- there is a chapter on this exact subject. Gordon explains it much better than me.

For the cyclists that are looking for more information on training with power -- I recently read the Allen/Coggan book on Training with Power. There was a lot of interesting information and tips in there. If you apply their tips then remember that the physiologically optimal plan is the one that you can consistently apply across a number of seasons. Most athletes have a bias towards overwork and there is no better way to fatigue yourself (mentally/physically) than chasing watts in your training.

I've been giving some thoughts to my presentations for the November 2nd/3rd clinic on the Business of Coaching. We are going to be sharing the tools that I use to help coaches increase their revenues, and satisfaction, from coaching.

Finally...the City of Boulder is soliciting input for Valmont Park facilities. Please fill out the on-line comment form. In question 3 you might consider casting your vote for a 50M x 25M pool with separate dive tank and spectator seating. You can access the form HERE.

In the spirit of Aloha, Alternative Perspectives is a piece by Kevin Purcell -- Kona Blue. Only Kevin knows what it truly took to follow his vision of Hawaii.

Alan's blog has a piece on VO2 Max testing for Ironman athletes -- I expect that we'll learn a tremendous amount over the next few years. I used to be highly skeptical on the benefits. Now I am lining up -- Alan should have my 2008 benchmark results written up by the end of November. I need a few weeks to get moving again -- right now, I sense that the testing would be poor idea.


Network Effects

A friend was recently talking me through the cascade of impacts that occurred following the rape of a young lady. The disruptions to her family, the cost of starting the wheels of our justice system as well as the support that it will take the lady to heal from the experience. Overall, a huge level of disruption, pain and expense resulting from a single action.

It got me thinking...
...about the compound effects of a series of kind actions over an extended period of time
...about my own participation in the transmission of negative, and positive, acts
...about my personal responsibility for how I choose to think and act

Small actions of kindness -- opportunities for bold strokes of greatness in my life are rare. However, hook all of us up to an internet connection, support each other and, perhaps, one of us could do something truly special. Even more powerful would be getting thousands of people to undertake a series of small acts.

One of my habits is to pick up five pieces of trash every day. I don't hit it every day and I probably average 20 pieces of trash per week. Now 20 pieces of trash doesn't seem like much but last week Monica started picking up trash too. Strange hobby to share with your wife, eh?

So my 20 pieces could be up to 30, or 40, by the end of the year. If even five people reading this note decide to pick-up as well then we'd be well on our way to making a material impact on things.

This isn't about litter -- it is about accessing our collective power to shape the world around us.

Our role as a transmitters. In my inner circle, I tend to be the most adverse to traditional media. As part of my Personal Review this past September, I decided to chop some more media sources from my list of approved outlets (good-bye

We are impacted by every person, thought, action, image, sound and mood that comes into contact with us. It is tough enough for me to keep my head straight without all the consumption; faux-righteousness; violence; false imagery; etc... pumped out by the bulk of the media.

I can't always see the damage that is being done to me (and you) by the media. Our continued participation is what sustains these vehicles -- your eyes (and therefore your mind) is what they are seeking. Inactive participation isn't possible -- your anonymity isn't a factor for a force that, ultimately, seeks to control the masses.

What I can clearly see is that nearly all print, television and internet content fails to move me towards my goals. The "dead time" insight is easier to sell to myself then facing the reality that a website is poisoning my character (though listening to many of you talk about how certain forums make you feel it should be pretty obvious -- to your spouse, if not to you personally).

To achieve our goals we need to limit our time spent on achieving nothing. I've found that it is far better to "do nothing" than spend my time on junk food for the mind. I achieve a lot more insights when unplugged.

Once I have an insight that I may be holding myself back, it becomes increasingly difficult for me to sustain my current path. It's the main reason behind my incremental progress with my nutrition. I see the true impact of "treats" in my life. Binging loses (most of) its fun when I deeply understand its impact. There is no true satisfaction in being slack.

Those of you that read Mat's blog will see his take on this shortly. He gave me a preview and asked me if it made sense. I told him that he came pretty close to describing every September of mine from 2001 to 2006 -- and probably -- a few bonus months in between.

Small actions count,

Regret and Personal Power

Mat and I spent a couple of hours sorting through email and admin yesterday. I'm currently on my way back to Boulder for a night before heading to Kona in the morning. In Hawaii, I'll be working with Albert and the rest of the Coffees of Hawaii team. If you see me then come on up and say 'hi'.

The piece below was written in early September. It is more about how I feel than what I plan on doing. Mark and Brant didn't have any magic advice but the retreat (and the two weeks completely off-line that followed) provided the space for me to consider a bunch of different things. As the physiological peak from the summer waned, the magnitude of the last year's mental commitment became more clear. I'm still pretty tired!

I'll share more over the next little while. I also have a list of topics (not all about me!) that I'll be writing up.

Mat told me that the Planet-X site doesn't have my Power PodCast live any more. Give us a couple of days and you will be able to access Endurance Corner Radio by clicking -- HERE.

Also -- you'll be able to download my PowerPoint presentation (on Power) by clicking -- HERE. Should only take a couple of days for us to get live.


A man who has a vision is not able to use the power of it until after he has performed the vision on Earth for the people to see.

-- Black Elk

The above quote is from a book called Black Elks Speaks. It’s an interesting story about an Indian Shaman who lived through a turbulent time in American history. There is quite a bit going on in the book and, I’m guessing, that I will see something if I continue to read the book as I age.

Sitting here, at 38, and considering the lessons of the old man’s story. There are a few things that stand out…

***Within his circle he was a famous and powerful healer. Across his life he was able to help a great many of his people. However, as an old man, what he most regretted was his failure to do his best to follow a powerful vision that he had as a youth.

The parallel of this in my life is clear. The September that was filled with the most regret was 2005, when I didn’t race Ironman Canada. We receive far more personal peace from action than than not trying at all.

***Within his tradition, the power of visions/dreams can be diluted by sharing them widely. When Black Elk told his story to the author, it was the first time in his life that he shared his complete vision. Even then, there were elements that he wasn’t able to put into words and remained his alone.

Here I think my lesson could be to temper my desire to constantly, and publicly, prove my ability to achieve my goals. I’ll need to ask Mark and Brant about their thoughts here.

What I'm getting at here is immediately publishing my "best stuff" (spiritual/physical). Mark mentioned that I might want to absorb them for a bit before sending them along.

As a first hand account of “how the West was lost” – the book made for informative reading.


Throughout my life, I have had callings, often ignored, to go on a solo retreat in nature.

The last one that I did started on September 11th, 2001 – a personal retreat in Olympic National Park. That retreat had FAR too much exercise for immediately after an Ironman but was a great experience for me. The solitude on Day One had me hearing voices in my head that didn’t settle for hours. I thought that I was losing my mind!

Aside from Peaceful Listening, a goal for 2008 is to complete a series of retreats close to nature. I haven’t decided if these are going to be formal, informal, solo or group. Brant and Mark have a fair amount of experience here so I’ll ask them for guidance.

The recurring drive to get close to nature needs to be heeded. It is a big part of what led me into endurance sports.


So what’s next? Well, I’ve sorted out my goals of learning to listen and retreats.

Athletically, I’m not really sure. There are some things that I can improve. I have no idea whether I will enjoy, or be able to sustain, the work required to achieve them.

Will I head back to Penticton in August? I have no idea right now.

No regrets,


PS -- If you are looking for an interesting read on investment theory (much shorter than Rubin's book) then CLICK HERE. Thanks to JS for sending along to me. Interestingly, EV is one of the lessons that was hammered into me by the McGill finance faculty. It's also why I've sold out of successful (highly leveraged) investments -- I wasn't willing to live with the slight probability of a highly negative outcome. Borrowing from Taleb, even if you are playing Russian Roulette with a gun with 10,000 chambers -- losing remains a highly unattractive outcome.

On Holiday

Hi Gang,

I'm on holiday so won't be publishing for a bit longer.

In the meantime, we have published another article from Clas -- click through the Alternative Perspectives link to the right. This article explains his view on how he runs very, very fast in Ironman. I hope you enjoy.


Year End Review 2007

Shortly, I will be on the road to Santa Cruz. I am looking forward to the weekend with Brant and Mark. Questions, fears and a persistent desire to spend time alone in nature. I don't expect anything fancy from the guys but their calming presence is useful for clear thinking.

This is an interesting period for me because I have huge energy, both mental and physical, but... I sure get tired if I try to 'train'! On the mental side, I am ready for short bursts of activity (like blogging) but am struggling with getting much sustained work done, such as the second edition of my book.

Before this week's letter, a reminder that I'll be speaking at a USA-Triathlon Clinic, in Colorado Springs. First weekend of November. If you want to learn practical tools for making a living from sport (running, cycling, swimming, triathlon) then this is the clinic for you. The speakers have helped build many successful coaching business and will be sharing how they go about it.

Also, if you watch Mat's blog then he'll link up an interview that we did with Chris McDonald, Ironman Kentucky champion. Look there on Monday. The interview is great. Thanks to Chris and Marilyn for dropping by the studio.

Key things that I was reminded of:

***athletes that are going to do well at elite IM get to the top of the AG ranks quickly. There is a very rapid early performance progression -- then you have to start "training". Chris, Clas and I -- it took each of us two years to get into low 9-hour shape (mid-9s for me). Clearly some athletes have an edge getting down to that point (Kona Qualifier shape).

***for the men especially, a massive capacity to absorb (not merely do) work is a universal requirement. Chris' 2006 season is not for the faint hearted! Nearly all the top guys have done some large, sustained volume at some stage. Chris is unique in that he hasn't (yet) faced deep overtraining.

***there is value in taking yourself far, far beyond your comfort zone -- the pathway from which performance flows isn't clear to me -- mental and well as physical, perhaps

***expect extreme financial despair and hardship along the athletic path -- you are making a decision that will result in a permanent reduction in your financial stability // folks in their early 20s are not equipped to think this through to their 40s, 50s and beyond

***you will face bleak periods where you want to quit; you're also likely have some great days

***even as an Ironman Champion, your athletics (alone) will have you living below the poverty line. You'd better really enjoy training and actively/immediately develop alternative income sources.

It's worth a listen -- remember that Chris "made it" farther than most of us will achieve in our athletic careers. He is an 'outlier' and your mileage will vary -- the average elite retires broke (but fit and with a nice tan) when they can no longer cope with the financial stress.

Head to the Planet-X website on Monday. They should have an MP3 and PowerPoint presentation that I did on Training/Racing with Power. I went into a lot more depth than the IronmanTalk podcast. Many thanks to Mat/Alan/Brian/Rebecca for their help in creating this for you.


Since I left Hong Kong at the end of 2000, I’ve operated on a year that runs October to September. Most years, Ironman Canada sits as the center of my athletic universe and, at times, the center of my total universe. As a result, September is a time for reflection and planning.

When I fail to achieve a goal (such as winning Ironman Canada), there is a temptation to radically change things. Reading my writing from the first few days after IMC I can see this pattern. However, before one considers what didn’t work, it is worth considering what did work. So I have spent some time thinking about the following:

***What worked this year?

***What changes might enable things to work even better next year?

***What held me back this year?

***What changes are required for continued personal growth?

***Did I give my previous plan every chance to succeed?

***What do I enjoy doing?

Notwithstanding all that, there are deeper considerations to be made prior to tackling the issue of athletic success. To bring these issues into focus I’ve asked myself:

***What did I achieve in the last year? Specifically, what are the items that will have a long term beneficial impact on my life?

***If the next twelve months were similar to the last twelve months then would I be OK with that?

***What items need my focus to make personal progress over the next twelve months? More specifically, how do I want to focus my personal development activities over the next year?

Given my high level of effectiveness and satisfaction, there are a lot of things working in my life. In seeking to improve performance on a single day (August 24, 2008) – I don’t want to impair the quality of the other 364 days of my year.


I’m going to share my thoughts on the answers to the questions but, within this article, “my thoughts” are the least important aspect. Why? Because they are merely my answers.

I’d encourage you to seek, then ask, the right questions of yourself.

In my consultancy practice, my clients receive the greatest value when I ask the right questions -- not when I give the most forceful answers.

I need to constantly remind myself of the above point because giving answers soothes the ego. Of course, the uncertainty of the outcome of our own questions is what makes life fun.


My greatest success this year was making one lady feel loved. I was helped by the fact that she has a kind disposition, patience and high self-esteem (guys, look for these traits in a wife). I’ve greatly leveraged my ability to achieve by strengthening the person closest to me.

Once you have the right people around you, spend your time strengthening them and assisting with the achievement of their goals -- your efforts for others will multiply when they come back to you.

JK asked about learning to say "no" to folks. For me, success is about getting people around us to say "yes" to our goals, rather than telling them "no" to their desires.

How do we do that? #1 -- we focus our time on the highest return items for those in our inner circle. #2 -- we communicate our personal mission clearly and simply. #3 -- by supporting those close to us and communicating our goals // we give them a stake in our mission. Finally, we hold ourselves to the absolute highest standards possible -- we must be working harder (and happier) than anyone in our circle. If we want to lead then we must hold ourselves to a higher standard than our team.

Personal Health
Coming back to my own review. In terms of long term personal health, shelving the drinking worked well for me. Slate ran excerpts from the Bush biography, Dead Certain. The President’s views on drinking rang true. I miss certain aspects but I really enjoy the clarity of thought that comes with the absence of hangovers. I was surprised at how easy it was to stop -- I get cravings from time-to-time but a non-alcoholic beer seems to settle that down.

With two years of consistent training completed since my last overtraining bout, my physical confidence has increased. My fearless (and somewhat futile) bike ride in Penticton was a real breakthrough for me.

Mental Skills
The area where Brant most helped me was the confidence to see the goodness in my life. Like most of my best teachers, I’m not sure if he set-out to teach that lesson. However, he was the catalyst for a change in attitude.

There is irony in how following what makes me happy has such a positive impact on the world around me. The way we live could be more important than the specifics of how we live.

Living how we want with a closed heart -- selfish?

Living how we want with an open heart -- inspirational?

Our conditioning often tells us that in order to do “good” we need to deny ourselves. I deny nothing of my dreams, or spirit, and there are clear and persistent messengers that encourage me to follow my heart.

Personal Growth
There are a lot of areas that hold me back so, for 2008, I’m going to choose the one where the benefit to me is far larger than the effort required to change. Peaceful Listening. My personal development goal for 2008 is to make a habit of peaceful listening. To me, that means listening with a still heart. I will practice with a still heart – perhaps I can progress to an open heart for 2009!

Goal Setting
Did I give my plan a chance? Absolutely. However, if I am honest then there are aspects of the plan where I operated below my capacity. It could take me a few years get it right. Am I willing to put in the time? Is my inner circle willing (and able) to support me?

I was talking to Clas and he asked me if I thought that I had put too much emphasis on Ironman Canada race day. I had to think about it. The reality of my life is that I focus on most of my days. I have goals for nearly every day of my year. I’m to the point where I assess myself based on the time that I manage to get out of bed each morning. It’s weird but I love jet-lag because I’m out of bed by 3am local time!

When I miss my private goals, or when I don’t live up to my personal standards of excellence, it “hurts” at some level. The pain isn’t too bad because I have the next goal and, by and large, I meet my commitments to myself. The difference with Ironman Canada race day is that my goals are stated publicly and missing them is apparent to all.

What I see now is the tremendous amount of good that results regardless of my public performance on that day. Perhaps that will free my mind from the concern about letting down the people that are closest to me. Missing a swim workout in February certainly doesn’t generate the same level of goodwill!

Avoid regret for a man that has the freedom to follow his dreams, and does. Feel empathy for those who live under the illusion that they are trapped in prisons, and don’t.


PS -- Alternative Perspectives next Monday will have Dr. J's piece on doping. For perspective, the annual cost of proving that I am clean is equal to my gross prize money from my best year of racing (2004). This year my gross prize money was about $2,000. You don't get rich from any aspect of triathlon (coaching, writing, racing). In fact, you have to be very good at all three to survive on sport alone.

The Two Ms

Yesterday, Monica and I did a "dry run" for our late summer camping trip. In the photo, you can see the result of my campfire skills. Physically, I get tired these days so exercise is limited to easy trail walking.

Over on Alternative Perspectives, Clas shares his experiences from Epic Camp over the years. Coming up he will explain "How to run a 2:42 marathon off the bike" -- we'll get that live in a few weeks. It is an entertaining read.

I've been reading Ayn Rand -- (GV, I'll mail the book back soon). Ms. Rand is a fine writer and gets me excited about living up to my maximum potential. Her encouragement to reduce theory to basic truths interested me in relation to endurance sports -- I'll continue to think about that because I sense that with some effort it would be possible to create a straightforward model for endurance training. I've tried to do that with my Four Pillars article but there could be a clearer theory waiting out there.

In the meantime, as the summer winds down and the cyber surfing season heats up... two things kept coming back to be as I flipped the pages.

Equality -- the need to place personal responsibility for individual action as a high priority. This is even more important for those that seek to lead, or influence, others in the field of individual rights.

Intellectual Domination -- I watch media pundits (and cyber celebrities) claim to be guardians of the truth while engaging in satire and bullying. Their actions cloaked in humor and/or intellectual superiority while seeking to subdue any discussion that runs counter to their ideas. Spending one's talent bullying the students (we once were) strikes me as the path of a wasted life. There is a higher way available to us.


So, I'm back in Colorado following a few meetings in New York. In the Big Apple, I was fortunate to be able to stay with my Everest climbing, hedgefund’ing, Ironman’ing buddy, Greg "the kid" Vadasdi.

It is always fun to spend time with “The Kid”. Similar to my buddy, Ed McDevitt (I’m on to you, amigo), Greg is one of those intelligent guys that enhances his success by having the world underestimate him. I’m going to start working on that in 2008. Life can be easier when our competition under-rate us.

I received some follow-up on my piece on international financial markets. A few people asked what I thought was going to happen in various markets.

I have no clue!

Be suspicious of people that claim to have a clue!

When it comes to forecasting my experience is that it is totally impossible to predict short-term movements. We have no idea and the more certain the experts become, the greater the opportunity for an unexpected event to really shake things up.

My formal financial education is getting a touch dated (Class of ’90). At McGill, I was reasonably well schooled in the traditional drivers of markets as well as the technical theories that have been purported to drive financial markets. My academic and technical background is useful for reading the FT, or Wall Street Journal, but it doesn’t serve me well when I try to comprehend what I actually see in the world around me. In fact, it is probably a liability.

If you’ve been reading my stuff for the last couple of years then you will have seen my interest in learning from authors that immerse themselves in how things actually work (be they markets or people). The GordoWorld team is in the process of updating my website and one of the additions will be a section on my recommended reading list. Mat and I will trawl through my library and type-up what I liked, and why.

Fundamental analysis works well for estimating the likely long term path of an asset or investment opportunity. However, it falls short when asked to explain what actually happens in the short term. In other words, my academic (and real-world) training are useful for valuation but something else seems to drive pricing.

What is it?

For me, the two main drivers are:

(a) Mood; and

(b) Money.

Let’s take money first. How many people have the ability to purchase the asset, or make the investment? Most people will spend to the maximum limit of their ability to pay. As an aside, always find out your client’s budget before bidding on a project.

If we enhance ability to pay with low cost finance and easily obtained credit lines then you’ll bump up the demand for assets and, in most people, reduce price sensitivity. Many corporations (and CEOs) follow a similar path -- it very difficult for spending and investment decisions to be made free of the influence of capital available.

There is limited transparency on the true position of global liquidity – however, the careful observer can make educated guesses on the impact of global shocks on capital markets. Our recent experience with the credit contraction that followed the sub-prime shock is an example.

With mood I consider:

How do “I” feel about the opportunity?

How do people around me feel about the opportunity?

How does the broader public feel about the opportunity?

While I think that I’m an optimist when it comes to life, my conservative nature means that I’m a nervous seller. Where I’ve made mistakes on pricing is when I failed to take into account differences between my perception and the broader public. I’ve consistently sold early in my deals.

Interestingly, this tendency hasn’t cost me many investment opportunities. I’ve always had more deals available than personal appetite to fund them. In fact, our property development company started because we had a mismatch between good deals and available capital.

Why is it important to track these factors? It’s important because a change in either one can be a leading indicator of an approaching valuation swing. When these two factors change direction in tandem then we are going to see a shift in asset pricing.

So when people ask me what’s going to happen… I have to say that I have no idea. As an investor, what I look for is situations where my best guess is that my entry pricing is less than fundamental valuation. That creates the opportunity – reality is then dictated by the hard work of an ethical management team.

Investing is about: (a) solid fundamental analysis; (b) limiting the cost of your mistakes; (c) paying less than fundamental value at the front-end; (d) avoiding fraud; and (e) backing the efforts of outstanding people. Of these factors, the two deadly sins of Private Equity are overpaying and backing crooks -- very tough to recover from either of these. If your deal doesn't fit these parameters then you are speculating, rather than investing.

In terms of market timing, don’t expect to get that perfectly right other than by fluke. Watch for shifts in the two Ms. When a trend is established, consider the likelihood that this direction will be sustained. Invest only when you see a gap between price and valuation.

It sounds so easy. Reality is tougher but the basics will serve us well for as long as we temper our greedy instincts.

Stick with your winners; sell them only when concentration fears start to keep you up at night. Historically, that’s been my early warning system on both people and deals – if I’m thinking about you at midnight then we’ll probably be speaking shortly!

Always hold a portion of your portfolio in high quality cash equivalents – this will enable you to capitalize on unexpected opportunities and assist with the (near impossible) task of staying calm when everyone else is losing their cool. By definition, your best deals will be offered to you when everyone else is out of cash. As much as possible, be countercyclical in your fundraising and capital reserves.

Waiting and watching…


PS -- I'm off to Santa Cruz next week to see Brant and Mark. After that Monica and I will be camping for two weeks. I've set things up so that I should be able to keep publishing.