Andy Swan » Wheelhouse Investing

Wheelhouse Investing

June 19, 2009 – 1:34 am

Investing, especially privately, is very differnet from trading (which is more of a sport or game than anything)

When you invest, you are adding value to a company by providing it with the capital it needs to execute its plan.

This normally doesn’t work out. Money for the sake of money helps, but I think it’s rarely enough to “take things to the next level”, as morons might say. (Note to morons, there are no levels.)

On the other hand, if you can invest in a company where your money helps, but your involvement is beneficial as well…..then you’re really onto something. You’re paying yourself for your expertise, because your investment has appreciated the moment you sign the papers, due to your own involvement in the company.

Not insignificantly, it’s also an amazing way to allow others to profit from your expertise and experience in ways that you would have never thought of on your own.

It’s wheelhouse investing instead of wheelhouse entrepreneurship, and it’s the only way I’ll invest anymore.

sayemislam

Love this post, Andy, just like the one about wheelhouse entrepreneurship. Activist investing seems like the way to go - it's what Buffett and Carlos Slim do whenever they get involved in a company.

Also interesting to see how the best investors are often the most entrepreneurial ones too - like you mention here. They don't just sit back and relax, they're involved and making small bets with the entrepreneur each step of the way too.