23. The hardest laps are outside the pool Part 2: Grant Hackett

Mistakes. We all have. We all have.

Yeah. Yeah. Yeah.

Oh, don't get married twice. That's always a tough one. [laughter] Boys, did you get that one?

Look, in all seriousness, probably where, you know, mistakes is where we learn the most. And I think we're seeing this right now with AI, but the dot-com bubble. So, you know, that sort of burst around 2000-01, so it was 2001. And I remember investing in a lot of companies. I really wasn't doing the work on a lot of them. They were just kind of like...

There was probably a net one in there for sure. And look, you know, I'd done really well before that actually, from probably '97 to 2000. I thought, I'm getting this. You know, I'd invested in a lot of good mining stocks and I'd had a pretty good run. And then that happened and I vaporized a fair bit of cash through that and learned.

Yeah. For me, I really learned if I can't understand a company or its product or its customer base or what it does and really sort of unravel that to understand it in a little bit more detail, I don't invest in it. And that's kind of my rule of thumb from now on.

Well, I think that's, I just think we're in the AI bubble right now. I mean, if you probably look back five or six years ago, there was probably just a, you know, a few businesses around the world seriously doing it, generating revenue off the back of AI. Now you look at it and, you know, you're seeing valuations of businesses that don't even have products in the billions of dollars. So it is...

It's crazy. A lot of...

Yeah, exactly. And so when you see that sort of stuff, and this is, you know, I learned that lesson through there where I, you know, didn't understand these businesses. When I look back on them, they weren't, you know, delivering much revenue if any. They weren't profitable. A lot of cash was going into them. There were a lot of good ideas, but very, very poor execution. And there'll be a lot of businesses like that in AI. And there'll be a few winners and it'll probably be a lot of those bigger firms that you see over in, you know, the likes of San Francisco that will do this really well and dominate that space. But there's going to be a lot of losers as well because, you know, it takes a lot of technology, a lot of power, a lot of intellectual grunt with the individuals who are going to develop these tools that we're all going to use over the next few years. So yeah, I kind of see that as the next bubble, but there'll also be some fantastic ones as well. But it's very, very difficult to pick who are going to be the winners and losers in this space. I can't remember if it was Zuckerberg or Sam Altman, one of those guys that just said, 'We are spending probably double the amount of money into AI that we need to, but we can't afford not to.'

Yeah, and well they know the cost of not doing enough is going to be much greater and probably completely vaporize their business rather than spending too much and making at least we're...

So yeah, they're spending enormous amounts of capital and no one really knows where it's going to end up. You know, I listen to a lot of podcasts and read a lot. And, you know, getting to that sort of AI superintelligence is still a bit of time away. I don't think we're going to get there in the next kind of 12 months. I think over the next five years, it'll be quite interesting, that AI journey. But yeah, a lot of these big tech juggernauts, you know, when you look across the Microsofts, the Apples, the Metas of the world, you know, Sam Altman obviously with OpenAI, it'll be interesting to see, you know, Elon with, you know, the likes of Grok and his businesses that he has. It'll be interesting to see who the winner is and who's really going to take the dominant market.

They're all game. It's all happening.

With my kids? Several different ways. So they all get pocket money for their chores and they save that up. They can determine if they want to spend it, if they want to invest it. So I've got investments for each of them. I take them through those investments and how they work. I mean, don't get me wrong, the five-year-old's not that into it, but we're into the discipline of saving and making sure that you value money and you respect money. It doesn't matter how much you have. If you make a million dollars a year and you spend a million dollars a year, you still end up, you know, back at zero. So I think the discipline and understanding how money works, and even talking to my 16-year-old, I remember taking him through tax last year. I mean, they don't go through tax at school, and just how all of that works, and it sort of blew his mind how much money actually goes back to the government. But to your point, Ziggy, like it just isn't taught, it's not at the forefront of their mind, and these are some of the most important aspects of life. This is where a lot of people go wrong. It's where it compromises a lot of relationships, causes a lot of stress and anxiety, and it's something that we're not doing enough around teaching. I mean, you know, you look at school, there might be some business subjects and that might teach you how to read a cash flow statement or a P&L or a balance sheet, but we're not teaching about how does the credit card work, the mortgage, how's your tax...

You know, how does your income profile look over time, what's the cost of living? Like my kids would have no clue of the amount of money. Like even going to Coles now, if you go in there with a $50 note, you barely fill up one bag. Like it's come out with money. It's incredible these days. So having those life skills around your financials is absolutely critical and, you know, it's up to you as a parent to be able to help and guide that.

Exactly.

Yeah.

Yeah. No, it's incredible once you really deep dive into something like that. How the financial profile of the business looks because of the discipline around it, like the cost discipline, selling, how you're paying your people, how you're incentivizing them, how you're getting alignment throughout your whole business and your staff and your distribution, your product, are you continually investing and improving it? And I often think of this running a business today. When I look at, you know, what we do each day around our disciplines, it just reminds me of sport because as soon as you're not investing or you're not focused, you're falling behind. And it's the same in your personal finances. It takes budgeting. It takes discipline. It takes understanding. It takes firm goal setting. And every now and then it takes, you know, you've got to sort of throw the dice and challenge yourself a bit. I don't think it's bad sometimes to have a bit of debt, not stretch yourself too far where you've got to cause yourself knots in your stomach and not be able to sleep or eat, but at the same time, it's good to stretch yourself a little bit and challenge yourself and have some big goals and really go after it. Sometimes it's, I don't know, I'm a bit of a believer when your back's up against the wall and you've got no options and you've just got to fight. That builds you up and builds your character and I think sometimes with your finances, you've got to do that to yourself to grow and to move forward as well, but not to the point where you've got to compromise. But if you want to have your kids in private schools or you've got ambitions around that, you've got to take some risk on board, but make sure you've got the right support around you when you do that.

Yeah, I think a little bit of pain's healthy. You know, a little bit of stress, a little bit of anxiety to an extent, a little bit of, you know, even when you're doing stuff and you're being successful, it's healthy to be a bit paranoid. Like we sometimes look at stress and pressure as negative things, but, you know, you'll hear many analogies about this. You don't get, you know, fit at the gym without a bit of stress. You've got to stress the body. You've got to stress the mind, but you've also got to recover. You mean, bit like me.

Like I want to grow up. When I grow up, I want to look like you. [laughter] All right. The moment it's...

Come and spend... [laughter] No, it's not weird. Come and spend three months with me in Greece and I'll change you.

But no, look, I just think, you know, scratching and challenging yourself, that is, you know, whether it's in sport, whether it's in business, whether it's in school, I just think it's healthy. That doesn't, like people look at pressure as such a negative word, but sometimes you need a bit of pressure to grow. And I think, you know, and what's the worst thing that can happen? Sometimes you just got to ask yourself that honest question and get a bit of perspective on a situation. And I think, you know, I'm not going to say kids these days or anything like that, but I think it's a really important value. Like I work really hard and I do long hours, but I also at the same time I think it's good that my kids see my work ethic. I think I got a really strong work ethic off my mom and dad. I don't think I ever saw my dad take a sick day. I cannot literally remember one. And he was a detective for 41 years in the Queensland Police Force. So he had a pretty stressful job. So yeah, for me there are certain attributes that, you know, probably not as valued as much as they should be and we're probably a little bit scared of some of those which I don't think we need to be. I think they grow character.

Yeah. Correct. To me, it's something that's probably leaving a lot of people deflated in their life right now because they probably want to be really successful. And if you want to be really successful in a field that's relatively competitive, and you've got a lot of work to do to get to a certain point, there's a certain amount of experience to get to that level of success. There's always going to be an imbalance in life. If you're going to commit to something a little bit more than everything else, there's going to be an imbalance towards that. And as soon as you come to terms with that, then I think it just makes it much easier from a, you know, psychological point of view, mentally, if you know that, hey, I'm going to commit to this, it means I'm not going to do this, it means I'm not going to do this, and it means I'm going to have to have early nights, I'm going to have to have some discipline in my life. That's not giving up. Like for me, and we were having this conversation down the cafe, I gave up drinking a few years ago and, you know, I feel like I wanted to make sure that my health and my fitness were great, but I also love it because I go to work and then I come home and I spend time with my kids and my family and that's it. That's it. And I'm happy doing that. My social life probably isn't much at the moment because I do have young kids. But that's okay. And I think this whole kind of world that we're living in at the moment says you've got to get a bit of balance over here, a bit of balance over here and here and here. Don't get me wrong, I think recovery is really important. I define that as something completely different. But this whole trying to get constant balance, I think if you're trying to chase that, it could leave you feeling worse than where you started.

And look, you could work very little but still not be present in your own household. And it's so easy these days with the amount of distractions that we have with phones and online and, you know, obviously all of the various social platforms that we all engage with. So yeah, I think it's really important that, you know, yes, I've got very much family values and that's always first for me and nothing will compromise that, but at the same time, I do think it's important to be a role model for your kids and work ethic is something I really value. If you want to do well in life and you want to have a crack, and I think having a deep sense of purpose and building character through the adversity that comes with that level of commitment towards something, I think is healthy. And that's just my value set. Not everyone will agree with that, but that's my approach towards life.

Started in the '90s though.

Yes, I would. I would. I don't think I would change too much around that. I probably would have got, you know, when I look at it now and I understand the financial world very well, is maybe a little bit more debt in there, a bit of deductible debt in there. A lot of the time with my dad, we were just paying for stuff. Um, cash. Yeah, [laughter] exactly.

He is. He must be Greek. But he was a very conservative character. So everything we did, I think I got some bank debt to buy this property and we'd paid it off within 30 or 60 days. Like it was... So there's probably a few things like that I would do differently. But in terms of the discipline around money and not going crazy with, you know, every dollar that came into the account doing something flamboyant or silly or, you know, just investing in something that was a completely depreciative asset and, you know, buying five cars or, you know, something along those lines that you would see probably in some American sports, you know, garage. For me, you know, just having that allocation of capital go towards the three distinct things that were important, you know, like is there a mortgage, is there a bill, is there, you know, a financial commitment that you've made towards something. So, okay, that comes first. The next one is, okay, then I've got to invest. And then the third one is fun. Yes.

And a lot of the time we get that, you know, in reverse. We often do the fun thing first and then we'll, you know, often scratch ourselves so much there that the things that we're committed to become really, really stressful and we don't do that and then we're not investing anything at all. So, for me that discipline was good and I still look at it like that today. And in fact, I think as you get older, I'm 45 now, I think material stuff has less currency. You don't really care. You care about time and you care about having your independence and having choice more than you do, you know, getting something flashy.

It's coming.