Swinging for the fences to Value Investing

Swinging for the Fences to Value Investing

In this special episode of 'Leap to Empower: Stories that Light the Way,' host Shaila introduces the first male guest, Sadiq Dosani, an entrepreneur, investor, and community leader. Sadiq shares his journey from his early life as an immigrant to becoming a successful value investor inspired by Warren Buffet. He discusses transitioning from corporate jobs to opening his first sports bar, and eventually founding Securranty, an insurance company. Sadiq emphasizes the importance of value investing, family support, and community service. He also highlights the significance of financial literacy, the power of compounding, and maintaining integrity in investments. The conversation wraps up with insights on independence, the impact of personal loss, and the importance of choosing friends wisely.

01:21 Sadiq's Early Life and Career Beginnings

02:00 The Leap into Entrepreneurship

03:04 Founding Securranty and the Insurance Industry

04:14 Family Support and Tough Love

09:09 Value Investing Principles

13:25 Learning from Legendary Investors

18:56 Applying Value Investing in Life

22:47 Contrarian Investing and Warren Buffet's Approach

24:52 Understanding Value Investing

26:32 The Power of Compounding

31:04 Relationship with Money and Financial Wisdom

38:16 Community Service and Giving Back

40:15 Rapid Fire: Soul Sparks

42:44 Conclusion and Final Thoughts

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Transcript

Shaila 0:00

Hello Leapers and welcome to Leap to Empower Stories that light the way. Today's episode is a special one. For the first time we're hearing from a male guest whose story is rooted in both financial wisdom and soulful purpose. Meet Sadiq Dosani, an entrepreneur, investor, community leader, and devoted family man Since 2010, Sadiq has invested in early state startups and real estate projects, but now follows a value investing approach inspired by Warren Buffet and other notable value investors. He has been married for 30 years and has two children. From boardrooms to early stage startups and from value investing to heartfelt service, Sadiq has lived a life shaped by intentional choices and meaningful leaps. In this conversation, we explore what it means to truly invest, not just in markets, but in values, family, and legacy. Whether you're curious about money, purpose, or taking the leap into the unknown, this one's for you. So settle in and let's dive into Sadiqs journey of courage, clarity, and value driven living. Welcome, Sadiq. So nice to have you on the show today.

Sadiq 1:12

Thank you, Shaila. I'm excited that I'm the first male guest on your show.

Shaila 1:15

Yes, you should be. So let's get started with your story.

Sadiq 1:21

I'm not sure if my story is different from many others. I came here at the age of 13 as an immigrant. Went through school, college, got my, bachelor's in accounting, got my CPA license, working for a CPA firm for a couple of years. I couldn't keep a job for more than 18 months. I stayed at the CPA firm for two years, then I went to JP Morgan Chase worked as an analyst and, throughout this, and I eventually realized that I wasn't doing what I loved. Mm-hmm. I couldn't see myself just sitting at a desk mm-hmm. In a corporate building or an office. And then the lack of financial freedom working for somebody versus working for yourself. And that financial freedom that eventually made me take a leap into becoming an entrepreneur. Wow. And, believe it or not, it being an entrepreneur has been an interesting journey., With a financial background, I actually ended up, getting into a venture, starting a business from scratch. My wife kept her job, so she was my partner supporting me. She was working for Ernest and Young, so she kept, earning a paycheck so we could take a leap and risk getting into business. And I used to go to Slick Willie pool Hall. I used to love playing pool, so I said, why not something that is entertaining. And so I actually opened my first sports bar, I would call it really, uh, pool tables. And so I did that about for about eight to 10 years. Interesting profitable, lucrative to some extent, but I had a event in my life that actually made me change my direction and moved back into financial world. And That's where, about 15 years ago I founded Securranty, which is an insurance company.

Shaila 3:11

How did you find that avenue? What sparked in you to go towards that way?

Sadiq 3:17

Towards insurance? Mm-hmm. Um, two things. One, the industry that I was previously in, it didn't align with my values. Mm-hmm. It took me some time to realize that, so that was one of the reasons I changed direction and then coming across insurance, it's my financial background. Entrepreneur by nature, risk taker. So, in the process of trying to help my nephew, he had iPhone repair businesses and he was looking to expand and at that time, in the process of trying to help him or guide him towards growing his business, I learned that there is such a thing as warranties and insurance and so I just dived deep and did some research and I then I took again, a leap into starting a business from scratch.

Shaila 4:06

Wow. Into something unknown that you had no idea about.

Sadiq 4:10

We are all wired differently, and I am a bit of a risk taker. And then of course, when you have a life partner, speaking of my wife. That has, truly been supportive. Mm-hmm. And she said, go ahead, take the risk. At least even if you fail, you won't have a regret that you didn't try. So I think, I owe it to my wife Yeah. And for encouraging me to take that leap.

Shaila 4:31

She not only empowered herself, but empowered you all you today to where you are today. She's definitely a leader.

Sadiq 4:38

Oh, absolutely. She keeps me also grounded. She's a rock in my life. She tells me like it is. Yeah. Yeah. She keeps me grounded. And I will say that my daughter's the same way. She's, my daughter's just a bit more brutal when she gives me feedback. No, but no, I, I truly, whether it's my son, whether it's my daughter. And especially my wife, I do understand when they provide that feedback, things that others will not tell you. Right. Your loved ones will tell you it's called tough love. Yes. And you take that feedback, take it to heart and recognize that they mean well.

Shaila 5:12

That's amazing and that shows true value of a leader also is taking feedback and pivoting and doing what you can to improve. So you've done a lot of other value investments, real estate investments, you serve on some nonprofit boards. How did that journey come about for you?

Sadiq 5:32

Doing voluntary service, it's part of what I believe a strong ethic that everybody should strive towards, and I'm sure many do. And in process of giving back, sometimes we don't realize we are actually the one we're doing it to receive. We receive a lot more than we feel we are giving. So we are in essence, giving to ourselves. I will probably credit my father-in-law for sparking the fire in me because he has spent all his life, serving the community. He used to talk about and share with us his stories of service and it was that actually that sparked, in me, the desire to serve and give back, in whatever little way I can.

Shaila 6:21

Wow. How did you become an experience real estate investor and now into value investments. I reach out to you sometimes, right? We'll transition into value investments, but I wanna understand how you were into investments and then you moved into this, something that has just blown you, which is what you are in today. And I wanna get into that a little bit more but I wanna understand that transition.

Sadiq 6:47

Yeah. First of all, everybody has different levels of experiences. I've had my years of experience, however, I still consider myself a student, learning. I would not in any way imply that I know it all. I originally had started, invested in real estate, whether it's land, whether it's, a deal here and there that a friend of mine was pitching. And, some of those worked out well. Some of those did not work out well. I've invested in early stage FinTech companies, in other biotechnology VC funds. So I've done a lot of venture capital investing as well. But I have some scars from that and that also I think is an experience. That has taught me of what is a good investment, how to evaluate whether an investment is good, whether it's worth the risk, and money that we put in. In my case, I have a full-time job running a company. In general, we all strive to save and grow our wealth. And as part of that, I felt I should, let my money work hard while I'm working how hard in my day job. And so I started investing in real estate, some of which I was doing prior to, currently working at Securranty. And, the whole objective was simply to, save money and grow your wealth.

Shaila 8:18

Yeah, yeah, definitely. And, there were probably some ups and downs and challenges and good times as well, and you learn from the challenges.

Sadiq 8:26

Yes. Trust me, I have some scars from those investments. And I've learned Yeah. Generally speaking, even if you look at legendary investors like Warren Buffet and Charlie Munger and Mohnish Pabrai, they will actually tell you that about on average, even the best investors will have about 30 to 40% of their investment decisions be wrong. And wrong doesn't necessarily mean they lose money. Mm-hmm. Wrong, could be selling your investment, getting out of the investment earlier and leaving money on the table. But, we not being as great as they are have more scars of losses mm-hmm than leaving more money on the table.

Shaila 9:07

Right. So let's talk about value investments. What is value investments in simple terms?

Sadiq 9:15

Yeah, no, that's a that's a really great question. So, value investment, let me just say, is the father of value investing who, invented or initiated or innovated, valued investing is Benjamin Graham, who's written a great book called The Intelligent Investor. Okay. Warren Buffet considers that book as his bible. Really? Yeah. Oh, I'll definitely have to buy it for sure. I, would highly recommend anybody that's looking to invest, you'll find a lot of wisdom there. But going back to what value investing is, is basically as a value investor, when you are making an investment in a venture, in a company, in a business, or purchasing equity in a publicly traded market, the goal is to buy something that after you do the analysis, right, if you're gonna invest in the financials, right? With value investing, you are investing in companies that have at least a 10 years of eight to 10 years of track record. They have solid cash flow. Cash flow is the lifeblood of a business. Mm-hmm. They have earnings, they're profitable. And so the goal is to evaluate the financials, understand what the actual intrinsic value is, and if the value of the company is a dollar, the goal is to buy it with a margin of safety of say, 40 cents or 50 cents or 60 cents. So as a value investor. You are saying no to everything else unless you're getting a good deal with an upside. Mm-hmm. So you are with the margin of safety, what it does, it protects you from the downside, protect your losses. Right? So if you protect your losses, you automatically take care of the upside. Mm-hmm. The other core principles of value investing is only investing in what falls within your circle of competency. Okay. So if you don't understand a business pass. It's, really a interesting anecdote for that is, Warren Buffet, if you as God Google two hard pile Warren Buffet, if you Google that mm-hmm. It will actually show you a spot on his desk where he has a tray and it says two hard pile, literally anything he doesn't understand If it is too complicated or he feels he cannot foresee where the company will be 10, 20 years from now if he cannot evaluate. He literally puts it in two hard pile. Mm. And he says 99% of every deal he looks at goes there. Okay. So that's called circle of competency. So if you don't understand it, you don't do it. The other thing is moat, finding a business that has a competitive solid moat. A durable moat is, if you think about the olden days when there were castles, right? And they would have this, moat around the castle to keep somebody from coming and invading them. Mm-hmm. They would have waters and they would have crocodiles and stuff in the water. So enemies couldn't just penetrate the castle easily. Right? Right. So in the same way, businesses have to have some strong competitive moat, as Warren Buffet calls it, so that it is durable and it can stay competitive, or a dominant player in their industry for the long time to come. Let me share a couple other important, principles that I think are important to highlight. One is management integrity. One of the things that Warren Buffet, talks about is that if he cannot confirm even that they have integrity, he walks away from the deal. Mm-hmm. Doesn't matter how great everything else looks, how much money he can potentially make, he'll walk away. Hmm. That's one of his things. And then finally he talks about investing in companies. And in general in life, avoiding leverage. Mm-hmm. And then finally price. Price is what you pay. And these are Warren Buffet, his famous words, price is what you pay. Value is what you receive.

Shaila 13:18

Price is what you pay value is what you receive. Yes, sure. Of course. And that makes it a value investment. Honestly I didn't know anything about Mohnish Pabrai Off course I've heard of Warren Buffet and Charlie Munger. And then you sent me these links on Mohnish and then he sent me this book that we, that I read. It was called The Richer, wiser, happier. It was an amazing book. I still follow it. I feel like that is my bible because it's great stories of great leaders of how they started and what they are today. Their real stories, which is what I love and which is what this podcast is about. So I appreciate you sharing that. And I wanna know, how did you get into these? Something that you researched or somebody sparked that How, how did that come about?

Sadiq 14:06

So it was a combination of scars. I happened to be one day Googled investment or something. And then I came across this video of Mohnish Pabrai. Okay, now, for those who may not know, Mohnish Pabrai is a legendary investor who follows Warren Buffet and Charlie Munger's, value investment philosophy to the T. Mm-hmm. And once I heard his video and the reverence with which he spoke about Warren and Charlie, and then, oh my God, that was it. Mm-hmm. And I realized that till now, the investments I've been making I realized those have been, for lack of a better word, it was a foolish journey. Mm-hmm. Which left scars, but in some ways, I guess, it was good.

Shaila 14:51

There were definitely ups and downs and that's what led you here. Is the scars challenged you to look for something more.

Sadiq 14:57

Yeah. Not all your investment decisions work out yes. In the way you would expect, but the goal as an investor is what, to not lose money. The number one rule of investment is. Don't lose your money. Mm-hmm. And the number two rule is don't forget rule number one. And we as humans, we evolved over thousands of years and our brains are wired incorrectly with flaws. And so, you have to learn. And so I've learned a lot from them.

Shaila 15:33

It empowered you to look for more answers and it challenged you to learn and educate yourself more. I think you had mentioned that then you started to look into executive programs at, different schools like MIT and that those programs that you did end up taking, aligned with what you had Googled.

Sadiq 15:52

Well, let me make a confession. Yes. I took some executive education courses at Harvard, MIT, and Wharton. But in retrospect, those week long education courses, they look good on my LinkedIn profile. Maybe, boosted my ego, but in reality I learned so much more from listening to the talks of Mohnish Pabrai, Warren Buffet, Charlie Munger, Howard Marks, um, there are many Stanley Druckenmiller there are many legendary investors. I will tell you that, to continue my education, I think I'm gonna get myself a PhD just by going to buffet.cnbc.com. And Warren donated every single video recording of the annual Berkshire Hathaway meeting to CNBC. Mm-hmm. So I believe you can go back as back, far back as 1965. Wow. And Mohnish Pabrai, who's been a legendary investor for about, I think 25, 30 years he said he's listened to it twice. Wow. Right. And that's my next journey is to listen to those at least once and hopefully twice.

Shaila 17:07

Yes. It's very interesting. I was definitely inspired by Mohnish Pabrai story when I read that book you mentioned, oh my God. And it's also on YouTube. You can just YouTube Mohnish Pabrai and listen to his story, which is very inspiring. But the book Richer Wiser, Happier, also talked about his story. And every chapter in that book is actually amazing. And the real stories really inspire you to be like, wow, if they were nothing and where they are today, anybody is able to achieve anything that they want to.

Sadiq 17:40

I believe the author's name is William Green. The author did a great job interviewing I believe eight or 10 legendary investors. And, what really inspired me, and what I liked about this book was the fact that these legendary investors, it doesn't even just talk about how they invest, what their investment philosophy is or how they go about making investment decisions, but it gives us into a window of how each one of them lives a very ethical life. Yes. They give back. Like Mohnish Pabrai agreed. The Dakshana foundation where he takes the poorest of poorest children in India. Mm-hmm. And, and trains them for the IIT exam.

Shaila 18:25

Yes, I did read that. And that was very inspiring. Every chapter did talk about how these people are giving back and Absolutely. Whether it's a small way or in a big way, and, but in some way, yes. And, and that was one of their biggest, philosophies or, mandates of their life was to give back because of their journey. So how does one get practical and apply that? And where does one start?

Sadiq 18:48

As a value investor. Yeah. So that's a great question. It's very simple actually. And sometimes, the simple steps are the ones that we forget to take. Yes. And they're sometimes the most fundamental. I will tell you that once I came across value investing, I paused all of other investments. I have listened to every single, I believe YouTube video of Mohnish Pabrai. Highly recommend you will literally learn common sense decision making when it comes to investing. So for the past three years, I've been reading and learning and after 6 months ago roughly went into public equities following in their footsteps and their philosophy, made some equity investment decisions. You have to understand how our human brain is wired. Mm-hmm. Uh, we, we have this thing of fomo, whether it's these group investment deals mm-hmm. Or, or you see the stock ticker symbol going up and, stock market going up and you feel like, oh my god. Mm-hmm. So you gotta control that urge, be patient, learn. I would say learn, learn compound knowledge. Mm-hmm. And I think once you do that, you will feel that you're ready to actually start making decisions. So I wouldn't rush to make any decisions until you've learned enough and are truly following their recommendations of how to be a value investor.

Shaila 20:11

So you went through an educational process and you were empowered by all of these leaders financially to take some steps in your life that you feel comfortable with and you feel good about that you've learned and now you're applying it and you're hoping that you are gonna get some value investment out of that.

Sadiq 20:30

Absolutely. I experienced this firsthand for the first time in my life, I went to the last annual Berkshire Hathaway meeting when, uh, I made the pilgrimage to the mecca of value investing in Omaha. And I met a lot of people at the event. And the thing about this community is everybody is very open, very sharing, about the knowledge. Transparent. Very, very. And because they want to help others, there's no such thing as, oh no, I've got this information. I want to keep it to myself. Mm-hmm. Actually, there's a community out, whether it's on YouTube, whether it's Apple or Spotify. There's so many value investors out there that openly talk about their decisions, their mistakes, how they made 'em, and so that you don't make 'em. Mm-hmm. It's, it's truly a great community to be a part of. Yeah.

Shaila 21:21

It's basically applying it everywhere in your life, whether you're doing passive investments, whether you're doing your own company, whether you're doing an investment company or an active company of your own. It doesn't matter what kind of financial investment you're making. These values or the value investment, I guess mission can be followed in anything that you do in life.

Sadiq 21:42

Absolutely. One of the famous quotes of Warren Buffet is he says, I'm a better investor because I'm a businessman and I'm a better businessman because I'm an investor. The same left side of your brain that you use for investment is also used to run and operate a business if you're an entrepreneur. So if you are an entrepreneur, it's really easy to become an investor. For example, if we are going to go buy a $5,000 appliance. We do so much research. Yes. Okay. But when somebody emails us a deal or we come across a real estate opportunity, investment opportunity, we don't do that research. We are evolved over hundreds and thousands of years that we always wanna be part of the tribe. Right. We feel that sense of safety and security. But the ones that are successful investors are the contrarians. That think contrary, are opposite of what the crowd thinks does what the opposite of the crowd does. Mm-hmm. And contrarian thinking, contrarian investing is something that Warren Buffet talks about as well.

Shaila 22:50

Oh, very interesting. But then with the whole tribe thing, you can argue that even Warren Buffet and Charlie Munger, that itself could be a tribe, right?

Sadiq 23:01

So that's a great question. Yes, it can be a tribe, but one of the things that they talk about as part of value investing is independent thinking. All of these legendary investors that have funds, they're required to file a 13 F every quarter. God, Google has all that information. So you can look at that 13 f and see what investments that they have made in which companies, which stocks they bought, which one they sold. You see all of that activity now, Warren Buffet clearly says, look what we do, the stocks we buy, there's so many variables that go into our decision making, right? First of all, they're investing in billions, right? Warren Buffet bought this, Oxy Oxygen Petroleum stock, which recently, if you look at his 13 f over the past couple of years, he's been buying a lot of. Now you can look at that and say, okay, this stock has already been filtered through a great mind. Mm-hmm. Now let me do my own due diligence. See if I understand the business. If I understand the economics of this business and economics doesn't mean that, oh, it's, it's oil. You really have to be a mile deep, than be a mile wide. Mm-hmm. Right? Your competency and knowledge and understanding of that business has to be really a mile deep not a mile wide. And once you have done that, and then you understand it, then yes. You may then decide to make that investment, but just because Warren has bought a stock doesn't necessarily mean that you should.

Shaila 24:40

From a value investor, it doesn't matter what you do, your norm or your passive investment that you want to bring in that extra cash at home, that value investment can be applied.

Sadiq 24:49

Yeah. Look I just wanna be accurate in, what I understand Value investment to be. Value investment doesn't apply to VC investing Value investment doesn't apply to startup businesses. Those are entrepreneurial by nature. Value investment only focuses on businesses that actually have track record of operations of revenue, of substantial cash flow. Because cash flow is the life lifeblood of the business. And it's profitable or close to being profitable. So value investment only applies to those type of ventures. Now we see investing, real estate investing has its place. It may not be for everybody. It may be for those people that like swinging for the fences, as they say, right? Take an example of cricket or baseball, right? When you're thrown a ball, you're, when you're throwing a pitch or you get a ball, if you try to hit every one as a six or outta the park how successful are you gonna be? And therefore, that's why it's called swinging for the fences. Mm-hmm. When you're making those investments versus value investing is literally saying, I've got 10 years of history on this company. I've got 10 years of management, those investor calls that I can listen to or read.

Shaila 26:15

Got it. More clear clarity. Yeah. I provide clarity. Yeah. Yeah, that was great. So what does financial empowerment mean to you? And what kind of legacy do you wanna leave for your kids when it comes to financial empowerment?

Sadiq 26:29

I would probably say more than financial empowerment, it's financial independence. Mm-hmm. And, what do I mean when I say financial independence? Financial independence, I believe means you having the freedom to do what you love in life, right? So, for example. What I would say, what I've done for my children is a, I've paid for their college. They have no student loan or debt. And something that many people can do for their children is, put in, in invest money, set aside money when they're born. One of the, one of the things that I would want my children or and anybody to learn. In terms of financial literacy or legacy as you call it, is the power of compounding. Einstein has called compounding the eighth wonder of the world. And can you tell us what compounding is? Yeah, lemme tell you what compounding is. So there's a mathematical rule of 72. 72. Yeah. Yeah. So basically, you have three variables time and amount, dollar amount. And of course the number 72. So you take any number and it's about doubling, right? The third variable is the rate, right? So if you take, let's say you are getting a return of 10% on your money on an annual basis, right? So you divide 72 by 10, you get 7.2. 7.2 means that your money is going to double every seven years roughly. Let's, drop off the 0.2 for easy math. So the question is, how many doubles can you have in your life? I'll give you a quick anecdote, that Mohnish Pabrai shared in one of his talks, he was driving, home from picking up his daughter from college. She had earned her first $5,000 from a summer job. And he said did you know that if you invested money, the $5,000 right now you are 24 by the time you're 65, and I can probably get you about on average 15% return. Right? So that means every five year the money's going to D double. You divide 72 by 15 and you roughly get approximately five. And he said by the time you are 65, that money will compound. That 5,000 will turn into 5 million. Mm-hmm. So that's the power of compounding. Now, she's 24, let's round it to 25, 65, you've got 40 years. So in 40 years you've got eight doubles, right? So you take 40 divided by five, right? Because every five year the money's gonna double. Now you may say, wait a minute, the five turns to 10. So the first few doubles doesn't matter that much. You feel like it's not as fast, but this is where you have to be patient for the money to double and compound to 5 million. Mm-hmm. Number one. Number two, what you never want to do is interrupt compounding the power of compounding by you're saying, oh my God, now it's like 2 million. Maybe I should take out some and go take a vacation or buy a car. Don't interrupt the power of compounding. Mm-hmm. You want that 5,000. So when your child is born, you put $5,000 there. Maybe by the time they're 20, you may have four doubles but find the right avenue to invest wisely. I think financial literacy is extremely important. Power of compounding is probably the most important, thing that I think people should learn. And it's never too late to start the compounding. Oh, never too late. Yeah, never too late. Never too late. Just start today if you need to, but I feel like that definitely is something that's very important and everybody should understand the power compounding even if you are 50. Yeah. Do you know that Warren Buffet made 95 or 99%. I don't remember the exact stats of his wealth after the age of 50. So between 50 years of age, and I think his 94, 95 right now. Right. He had 45 years to compound. Now, obviously he had a larger chunk. But it doesn't have to be billions that you're compounding for. Right. It could be millions and that's okay. Yeah. Right. Yeah.

Shaila 30:50

Agreed. Agreed. Speaking of money, I always like to ask this fun question. What kind of relationship would you have with money if it came knocking on your door?

Sadiq 31:00

That's an interesting question. I wouldn't know if I, I don't know if I would have a relationship with money. Let me share a true story that somebody shared with me when I was on a plane. I'll make it very short. So this gentleman, who was captain of a ship and the CEO of Butterball Turkey in his yacht. Asked him, said, Hey, how come you're so successful? And the CEO of Butterball looked at him and smiled and said, you mean, how come I'm so rich? And the guy smiled and said that he realized that's what he meant because when we talk about success, we measure people by how wealthy they are. Right? So anyway, the CEO Butterball looks at him and responds by saying, I just try to be the best at what I do. It just so happens that money finds me and tackles me down. And that sounds like a great story. Yes. And when I heard it, it sounded great to me, but it took me a few years to really understand the wisdom behind it. And the wisdom is very simple. If you are driven by money or by just focusing on making money. You are more likely to be clouded in your judgment and decision making because that's called greed. So I wouldn't have a relationship with money, meaning money's just a means. There's nothing wrong with accumulating wealth. Don't misunderstand me, I'm all about that. Mm-hmm. Yeah. But let the money come tackle you down. Just do what you love to do. Be be the best at what you do, and let money just come and tackle you down. And it's okay. I invest so that I can grow my wealth, but for me, the objective of investing is not so I can make more money. I have learned from these legends, right. Let it be a game one that you enjoy. Yeah. Don't let it be about making money. So that's one of the thing that even Warren Buffet, I believe said that, Hey, if you enjoy the game, if you love the game, then you are more likely to be successful. Because what happens when you play a game? You learn you wanna get better and get better and get better. Mm-hmm. And that's what it's about. Right.

Shaila 33:04

And in this game, there's definitely failures, right? How do you pick yourself back up and start walking again?

Sadiq 33:11

We all experience failures in terms of investment decisions, or maybe some personal decisions, right? We may end up making not the best decision. And, one of my failures that has been scar that I've lived with and I cherish that scar where I lost some money. And the thing is look I still have plenty of life ahead of me to correct the mistake. So I can live and regret, or I can say, move on. Okay. I messed up. Had a bad decision and don't regret. Correct! Correct your mistake, right? That's all you need to do. And there's a saying this as a smart man learns from his own mistakes and a wise man learns from the mistakes of the others. So I've been smart so far and I'm trying to be wise now.

Shaila 34:04

We all wanna be wise in that sense. Right. But we have to go through some smart Yes. Smart failures to get to the wise ones for sure. Yes, yes. But at some point we want to stop being smart. Yes, no, I say that. I said that as somebody that's, uh. Well, I'm still young, but, you know, got some white hair. You're definitely more wise. Um, my children don't think so, but yes. So speaking of financials, what financial wisdom do you want to share with listeners?

Sadiq 34:36

That's very interesting. Let me share something that I heard Laura Templeton, I think the grand niece of Sir John Templeton. In one of her talks, she shares this psychology study that was done that talks about how we as humans, if we are not included as part of a group or we don't get to be part of a group. For us, the level of pain we feel in our brain is the same level of pain as breaking your arm and therefore we wanna be part of a tribe. And that goes to the contrarian investing or being willing to be a loner. And not necessarily be part of the group because our, we're just wired to be that way. So in lot of the investment decision making that I have seen, my friends and people that I know that have participated in various investments have made the investment because so and so did it, and they wanna be part of the group. One of the most important mental models that Charlie Munger talks about is inversion or inward. He says, always inward. So when you're looking at an investment opportunity, don't look at how much money you're gonna make. Look at how can you lose money on this deal or on this investment. So always in Inward, anytime you wanna solve a problem you can't solve. Always look at it upside down. We have no idea and knowledge when we make the investment decision, but they can randomly impact your ability for the business to survive. That's why. Warren Buffet talks about if you're gonna invest with somebody else, make sure they're skilled. One of the questions that was asked to Mohnish Pabrai was at what time when you invest with somebody that you can say that they have the skill and their success was not purely luck? Or now luck always plays a role. And so one of the things that Mohnish Pabrai said was, if an investor has a track record of at least 10, 15, 20 years, and then after that they're successful, then there's a strong chance it's based on scale, not luck. So if you're going to invest with somebody. They should have 10, 20 years of experience of investing their own money or, have gone through the, what's called the FFF round, which is friends, family, and fools. So if tomorrow my son decided to do a startup, it's my job to fund or support him in his venture. Maybe some of his friends. But the fools round, the fools of that FFF round. Are people that don't know that. And that's why they're called the fools because they're taking the risk on somebody they don't know has no track record history or success, right? So it's those fundamental things, and then fully, understanding the economics of the business and then coming to a conclusion independently and on your own, whether it makes sense.

Shaila 37:40

Yeah. No, that's great. So we talked about staying grounded and you are grounded by your family and so when things go sideways there is that emotional support that you already have through family support systems. Yep. And, uh, I do get a bit of from my children, Hey dad, I told you so. I think everybody gets that. I'm kidding. Yes. But. I do wanna spend a couple minutes talking about your community service. What sparked, I know you mentioned your father-in-law got you into it, but what drove you to still give back today?

Sadiq 38:15

One of the things, all throughout life I've grown up listening to, His Highness Prince Karim Aga Khan, and of course, in our community who has talked about service. It is the ethic of Islam giving back, right? So there's this happiness that you get out of giving. There's a great book, that Mohnish Pabrai talks about on his podcast is give and take, right? It talks about three types of people in this world, givers, takers, and matchers. So what you want to do is get the take the takers and matchers out of your life. Surround yourself with a giver and you yourself should be a giver. Once you become a giver, whether it's giving somebody a shoulder to lean on or whether it's giving back in terms of voluntary service, doing so, I believe the universe will conspire. Mm. And make sure that you experience happiness. And it feels like that's where you get your true happiness from, and fulfillment. Yeah. It's, fill your cup. Yeah. And of course in all of this, I don't want to forget the fact that when you are giving, you're making a difference in other people's lives. Right? Right. So part you are giving for that reason. But I focus on what we end up receiving in the process of giving.

Shaila 39:39

I couldn't agree more. It is a balance at the end of the day, giving and receiving, but the receiving is not expected. It naturally happens.

Sadiq 39:47

Oh, it's, yeah, absolutely. Yeah. You don't say, Hey, I want to give to receive. You give because you want to give. Mm-hmm. But again, the universe conspires to give back to you.

Shaila 39:57

And that's beautiful. I couldn't have put it in a better way. So now we'll wrap this up. And I love to do this section, I call it soul sparks, which is basically like a rapid fire round. And so whatever comes to your mind. So here we go. What does empowerment mean to you?

Sadiq 40:13

Independence, freedom.

Shaila 40:16

A mantra that grounds you.

Sadiq 40:19

A mantra that grounds me, be humble and give.

Shaila 40:24

A book person or moment that changed your life.

Sadiq 40:28

I would say a personal loss when I lost my 4-year-old daughter, changed my life for the much, for much better, I think got me thinking, and a book I would highly recommend is poor Charlie's Almanac. It should be a Bible of how to make decisions and how to avoid traps that are brains are wired incorrectly to make to fall into some traps with our biases and decision making. So highly recommend.

Shaila 40:57

One thing you'd tell your younger self before taking the leap.

Sadiq 41:01

One thing that I would tell my younger self is choose your friends wisely because you are who your friends are, so don't just make friends with the living. And the famous words of Charlie Munger make friends with the eminent dead as well.

Shaila 41:22

One value you live by.

Sadiq 41:24

Integrity.

Shaila 41:26

What do you hope your legacy will be?

Sadiq 41:30

Giver.

Shaila 41:31

One bold, empowering thought to leave our listeners with.

Sadiq 41:36

Again, I will quote the famous words of Charlie Munger. He says, compound knowledge and compound money. Wake up every day smarter than the day before. Otherwise, you are like a one-legged man. At an ass kicking contest.

Shaila 41:57

That's very interesting. Thank you so much for your time. It definitely has been educational and inspiration to have you here today. And, it seems like, just like you quote Charlie Munger and all these other leaders, maybe one day your kids or the younger generation may end up quoting you. You may become the next Mohnish Pabrai, who knows? And if you do, we'll definitely call you back.

Sadiq 42:21

Well, thank you. I've enjoyed it. I hope I was able to live up to the mission of the podcast.

Shaila 42:26

Yeah, definitely. It was a great time having you on the show today. Thank you for joining us on Leap to Empower. Sadiq's story reminds us that financial empowerment isn't just about numbers, it's about wisdom, alignment, and using our resources to uplift those around us If this conversation sparked something in you, share it with someone who needs it. And remember, your leap doesn't have to be perfect. It has to be yours. Your story is the light someone else is waiting for. Until next time, keep leaping. Keep believing in your magic.