Verify Skin Before Following

A strategy for intelligently following others' investment and business decisions by verifying their true commitment and incentives.

Core Strategy Components

• Don't blindly follow advice - verify why people are giving recommendations
• Look for people who have "skin in the game" - actual money invested
• Find successful people who don't need anything from you
• Triangulate between multiple successful people's strategies
• Focus on those operating in spaces they deeply understand

How to Verify Credibility

• Check what percentage of their net worth they've invested
• Understand their risk tolerance vs yours
• Verify they don't have hidden incentives to sell you something
• Look for people already successful who don't need your money
• Partner with those playing at a higher level than you

Real World Example: Restaurant Location Strategy

• Instead of becoming location experts themselves
• Looked at where Chipotle was investing heavily in locations
• Piggybacked off Chipotle's billion-dollar research
• Similar to strategy used by Quiznos and Noodles & Company
• Follow those putting down real investment, not just giving advice

Smart vs Dumb Following

Smart Following:

• Understanding exact allocation percentages
• Verifying actual skin in the game
• Checking for hidden incentives
• Learning from those already successful

Dumb Following:

• Taking advice without understanding the source
• Not verifying portfolio allocations
• Following those with incentives to sell you something
• Not asking critical questions about motivations

The key is to accelerate learning by partnering with successful people while maintaining healthy skepticism about motivations and verifying real commitment through actions, not just words.