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WHY I QUIT INVESTMENT BANKING - Leaving J.P. Morgan, Investment Banking Salary, Personal Reflections - YouTube
Channel: rareliquid
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Hi everybody, if you're new to the
channel my name is Ben and I'm a former
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JP Morgan Investment Banking Analyst.
So normally I actually make videos about
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investing but today I wanted to actually
talk about why I left
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finance, and share a little bit of my
reflections on
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what I learned from leaving the industry.
Alight, so let's jump straight into it.
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Let me just start off by talking about
why I left. Now first off to provide a
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little bit of context I joined the
JP Morgan San Francisco Healthcare Team
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in 2015,
where I covered a lot of biotech,med
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tech, and digital health companies.
I worked there for a little more than
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two and a half years and although
investment banking has a pretty poor
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reputation,
I actually had a pretty positive
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experience. Now in banking,
it's often that you work 80 to 100 hours
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a week and so it's hard to have a really
good lifestyle,
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but I kind of went into the experience
thinking that I knew what I was signing
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myself up for. I knew I was going to be
working hard, and I felt like I was
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learning and growing a lot throughout my
two and a half years when I was working
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at JP Morgan I wasn't necessarily
interested
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in healthcare, but the group had a really
great culture
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and really strong deal flow and so
that's kind of why I decided to join
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that group. But back to the main topic
the reason I left banking
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involves a pretty personal reason and
story, but I don't mind sharing it
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publicly in the hopes that it eventually
helps someone,
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whoever you are that is watching this
video. So basically, in 2017
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my mom was diagnosed with ALS which is
the same disease that Stephen Hawking
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had and it's a terminal illness in which
all your muscles start to slowly
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deteriorate over time.
Now I won't go into this too much
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because I really don't want to make this
video like a sob
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story, but basically that diagnosis made
me rethink
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about my entire life and what was truly
important to me. When you work in banking
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or any kind of high paying job, it's
really easy to get lost in the mindset
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of thinking a lot about compensation and
getting used to a certain lifestyle. And
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I really fell into that whole mindset of
needing to make
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a lot of money and holding on to jobs;
not necessarily because I was super
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super passionate about them but just
because
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i was used to living a certain way. I
know this might be of interest to some
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of you guys watching
and so just to be totally transparent
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and
you know kind of give you guys some
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information that maybe most people
in banking wouldn't tell you. My second
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year out of banking, including some
investment gains
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I reported around 170,000 in my income.
So second year out of college, that was
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how much I was making,
and over the next few years I was
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thinking of joining either a private
equity firm or a hedge fund where the
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compensation can easily reach
the two to three hundred thousand
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dollars in annual income.
Joining one of those industries was
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really really tempting for me, but as I
said when my mom got sick,
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it made me really recalibrate and think
about what was important to me
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and I always had two really big life
long dreams that I wanted to pursue ever
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since I was young. The first one was
backpacking across the world,
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and then the second thing was to start
my own business. So in the beginning of
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2018, I quit my job and started a six
month journey where I was backpacking
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across South America,
Asia, and Australia, and throughout that
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time, I was also
kind of thinking about the next business
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that I wanted to start building. The
company I ended up starting was called
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Aesthetic Studio, and it was a fashion
brand
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where we partnered with artists pretty
much from all over the world.
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We had some artists from Russia, Chile,
the UK and the US.
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And our goal was to just create really
high quality garments with artists,
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kind of hoping to be like the nike for
creatives.
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I'll leave a link in the description
below. But to be completely transparent,
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you know I'm really not trying to push
any products, I'm not working on the
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brand anymore,
but if you want to check out what I
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worked on um just feel free to check it
out. So that's why I left investment
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banking, it was really to just
kind of pursue my own passions. I would
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say my experience is pretty abnormal
most of the
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analysts that I knew went into industry
jobs or
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the buy side, and like private equity or
hedge funds. Now in my opinion, there are
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three
normal quote unquote reasons why
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analysts leave their
jobs in investment banking, and the first
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one is that the lifestyle just gets
pretty unsustainable over a long period
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of time.
You know working 80 to 100 hours a week,
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that's bad in itself, but you also have
to factor in your
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oftentimes canceling plans with friends,
not able to spend a lot of time with
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family,
and you can't go on as many vacations as
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you want to or even when you do go
sometimes you do have to do a lot of
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work during those vacations.
Um so that lifestyle is just something
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that's really hard to keep
pushing through over a long period of
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time. The second reason
is that the work tends to get really
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repetitive over time,
if you're working 70 to 100 hours a week
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pretty much in anything in life, then
you'll start to get really good at it
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but it might start to get a little bit
boring, unless that's what you're like
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born to do.
And for most analysts, they're not born
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to just crank out financial models and
build presentations, right? Some people
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eventually
want to pursue other things in life. And
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so a big reason
that a lot of analysts leave is because
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once they become an associate,
you're still doing a lot of financial
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modeling and presentation building. A
little less so,
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you are starting to meet with clients a
lot more, and you're not doing all of the
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grunt work yourself, but banking tends to
be kind of the same thing,
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when you keep doing deal after deal. The
third and related reason to what I just
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kind of talked about is that
you eventually want to gain some more
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exposure to different industries or gain
a new set of skills. And so
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that's why a lot of analysts leave in
order to
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pursue an industry job or go into the
buy side, with that said, now that I've
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left banking for a few years
I've had a lot of time to reflect and I
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just wanted to share two really
important lessons that I kind of picked
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up.
The first one is pretty cliche, but it
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really is that money is not everything.
I grew up in a solid middle class family
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and my dad was an entrepreneur, and
there were times when business was going
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really well and
life was pretty good, but there are also
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times when the lights wouldn't turn on
because the electricity bill wasn't
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being paid.
And I remember back in 2008, when my
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dad's business
kind of crashed and burned, there was a
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guy who came in the middle of the night,
who took our car away because it wasn't
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being paid for.
I think all of this is what really kind
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of pushed and motivated me to work
really hard to land
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a really high paying job out of college.
And that's
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probably a big reason I chose investment
banking beyond me
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also kind of being interested in finance,
and financial modeling. And so when O was
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in banking,
I was making decent money buying a lot
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of things that I wanted,
living in a decent apartment in San
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Francisco,
and when I left, my life kind of did a
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huge 180, where I was losing a lot of
money, because I was investing in the
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business.
In addition to that, my lifestyle also
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changed pretty dramatically.
I went from being able to buy pretty
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much any meal I wanted when I was at
JP Morgan. For example,
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and as an entrepreneur, I had to save
money wherever I could, so I was eating
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like the same
Costco chicken and spinach meal for
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weeks on end.
Maybe varying it up a little bit here
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and there, and sometimes even when my
friends
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asked me if I wanted to hang out, you
know, sometimes I would say no
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because I didn't want to spend money
going out. I was also driving this really
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old
beat up 2002 Toyota minivan, which
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honestly was like kind of embarrassing
for me, even though
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I'm not really a materialistic guy. But
it was just so beat up and disgusting,
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but anyway, I think that's a part of
the whole entrepreneurial lifestyle, that
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looking back to
now, I think it's pretty hilarious and
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I enjoyed even kind of just going
through the struggle of that whole start
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of life.
And so I don't really have any regrets
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about any of that I think
I just think that a lot of times
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entrepreneurship life
tends to be or sound really glamorous,
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but
in actuality, there's a lot of like
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grinding and small details that
are not really shared, because you
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normally hear a lot about the success
and what's also really important to note
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is that I felt so
passionate about what I was working on.
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And each day for
two plus years, I really never felt like
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I was working
,quote unquote, on work. It really just
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felt like a fun project where I was
meeting with artists, talking to
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suppliers, negotiating costs,
just learning so much about a lot of
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things in business I
just could never have learned in banking
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or through my business degree.
It was such a valuable experience for me
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,and I really really
have zero regrets, even though it kind of
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set me back a little bit financially.
Okay, not a little bit, it set me back a
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lot. Now, I know I probably could have
stayed in finance, saved up for a little
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bit,
and maybe started a business when a
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little bit older, but
it just seems like for me, a lot of the
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people I speak to that are in their late
20s or 30s and 40s.
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You know, when I talk to them, it gets
harder and harder to actually just risk
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more because when you get to that age
you might have a family and kids. And at
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that point,
starting a business is really really
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difficult, and so that's why
I have no regrets for starting Aesthetic
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Studio,
and this kind of leads me to my second
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point. The second thing I reflected on a
lot was my perspective of short-term
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risk versus long-term risk.
Back when I was in banking and also in
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college, I feel like a lot of my
perspective was really focused on the
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short term. You know, in the next few
years,
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what do I need to do to get this job or
this promotion?
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and I kind of just left everything else
in my life beyond the next.
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Let's say two to five years, just in the
back of my head, thinking everything will
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eventually
work out and I'll eventually pursue all
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the dreams that O have
in my life. I also placed this really
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heavy emphasis
and value in the short-term risk
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of giving up what I had in finance.
Starting a business because of the
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potential opportunity cost,
and that really changed for me when,as I
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mentioned, my mom
was diagnosed, because I started doing
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this mental
thought experiment in my head where I
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was just thinking if I were in her shoes,
if I was 55 years old.
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Looking back in my life, would I regret
not starting my business
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or pursuing any of the dreams I had? And
that was the kind of mental exercise I
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kept thinking to myself.
As throughout the year of 2017, I was
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debating whether or not I should quit,
and so when I did this mental exercise,
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you know every time I thought of it, I
would just think
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if I was 55 or something like that,
sitting on a porch and
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reflecting on my life. If I had never
started business,
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I just felt like I would be filled with
so much regret and
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seeing my mom lose control of her limbs
one by one,
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all of it was just not only
heartbreaking but also just
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made me realize that life is super super
fragile.
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And the short term risks that I was
thinking about was not really as
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important as the long-term risk of never
doing something that I truly cared about
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and
feeling like iInever really followed my
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gut. Alright, so I feel like I kind of
rambled on, and I don't
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honestly know if any of you guys want to
hear about this stuff, but I
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hope it was helpful to some of you in
some way, and if there's
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some other kind of topics or questions
you guys have, that
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you feel like you want me to cover,
then feel free to leave it in the
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comments below. I also want to caveat
everything by saying that I don't
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actually advocate for
everyone just quitting and pursuing
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whatever they want without a plan,
or really thinking things through in
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some way, but I really do think that if
deep deep down in your gut something is
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telling you that you need to do
something,
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then I think it's really important to
focus on listening in on
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what that little voice in your head is
telling you and making some moves in
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order to pursue whatever that is.
But of course, I'll leave that decision
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to you, I'm just a random guy on youtube
and so you
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don't have to take any of my advice.
But that's just something,
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or this all is just something I wanted
to share. So thanks so much for
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tuning in, and as usual, I'll catch you
next time. Thanks so much for
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watching, peace.
[Music]
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