I enjoyed reading Ken Hersh’s “The Fastest Tortoise,” in which he shares some of the lessons from his career and life. Hersh co-founded the private equity fund Natural Gas Partners (NGP) in 1988 as an energy fund focused on the oil and gas industry. Under his leadership of the firm through 2016, NGP invested more than US$12bn and earned a 30% annualized rate of return over 27 years.

In a recent podcast with the Bush Center (where Hersh currently serves as CEO), Hersh said the book started out as a story by him talking to his future self. He wanted to write something so that he would later know what he did. Over the course of many conversations with his partner/editor Steve Fiffer, he would keep throwing out what Steve called “Ken-isms” and so they decided to structure the book around those principles, using stories to bring them to life.

In case of interest, some other notes from the podcast are below (these are for personal reference only and any mistakes in transcription are my own):

One of his Ken-isms is that “yellow lights don’t turn green.” This is reflective of both successes and failures. If you think about the things that worked out, sometimes you knew the moment you saw or felt it. It could be a relationship, idea, project etc. Then there are other things that didn’t work out and you look back and think there was that little ingredient or sign, and if you just paid attention to that, rather than wishing it away or thinking it was no big deal. To him, those were the yellow lights. In the investment business, they would often talk about green lights and red lights in the context of evaluating deals. But there is a whole lot of “maybe” and those are the yellow lights. To him, there are yellow lights that are on their way to red and that is where the traffic light analogy comes from.

He think it resonates because human beings are generally optimists and want something to work, especially if you have thought about it and selected it already. Otherwise, you are admitting your mistake. So we tend to minimize those little warning signals and overinflate the good stuff. As an investor and leader, he tries to constantly be vigilant and ask is there something that is a small warning sign that, if we heed it today, it won’t balloon into something much more dangerous, or hard to change, or much more costly. This is a little bit different to when people say to follow your gut. That is true, but he would say follow your hypothesis, because we are all smarter than that and can put in a little more time and thought. We are all a culmination of all the experiences and learnings that we have had, so don’t discount those things that didn’t work. They are as valuable as the things that do work. If you are gleaning something that says that was not the right choice, listen to it.

On the importance of people skills – over the course of his career, he found himself using the material from his business school classes that he rolled his eyes at the most. He always thought this HR, organizational behavior stuff – just pay people, make sure they work and you will be fine. That is not true as he quickly found out. He is a people person and that was a reason for his success, because he ended up working in industries and roles he didn’t know anything about. So he had to listen, read a lot, learn from people and be humble. But you can still lead even if you don’t know everything about an industry, just like you can be a great coach even if you can’t play every position. That was the confidence he had and it comes from learning from the people he is working with, distilling the key drivers and empowering people to make their best decision and move on. The gift he had was the ability to pull the trigger and say yes, let’s do this. Then people would do what they were going to do anyway and he was just the guy saying go for it! But you would be surprised how many times that is really the glue that people need to come together and then go off and achieve great things.

On the benefits of raising your hand – his feeling is that you are only able to get hit by a bus if you are in the traffic. So you got to get in the traffic. And the only way to get in the traffic is to raise your hand and say I will take a stab at that. It requires a bit of confidence and an acceptance you may fail but nothing ventured, nothing gained. Too many people want to see every possible scenario laid out and played out before they decide they are going to do something. He looks at it and says this looks like it has more upside than downside, let’s go for it. If somebody needs something, he has enough confidence that he can figure it out, so he tends to raise his hand. It could be something small, but sometimes those small things become the building blocks for a relationship or the confidence that someone has in you.

In the book, he tells a story about when he was a young analyst at Morgan Stanley. His job at that age was to generate numbers on spreadsheets, get them produced into books and then get them ready for presentations. One weekend in the office, he could hear one of the partners putzing around near his cubicle. He got up from his desk and asked if he could help him with anything. It turned out that the copy machine was out of toner and the partner didn’t know where they kept the toner. The partner wasn’t his boss or even in his group, but he helped him take care of it. The whole thing took him maybe 15 minutes. 6 months later, there was a project in this partner’s group that involved an energy question and he came around to his desk and said I want you to work on this. It is just a silly example, but the point is you never know what is going to happen if you just raise your hand.

On writing a letter to Richard Rainwater asking for a job – that story is as reflective of Richard as it is of him. The only thing they had in common was Stanford GSB, but they were 20 years apart. Richard was the kind of person who didn’t sit back and say let’s just see who comes my way. He was proactive and called him when he got the letter. Later, he found out that Richard did almost the same thing to many other people. But all of them had one thing in common. Richard had simply said to all of them why don’t you come down to Fort Worth? None of them asked will you pay my expenses, will you send me a ticket etc. They just said yes and showed up. They were resourceful and figured it out. He had to find another person to pay for his trip because he didn’t have the money for the plane ticket. One of his challenges today is to pay that forward.

On the role he thinks the Bush Center can play over the next decade – there is a new problem in the US and that is polarization. We have always had differences, but we seem to have now heightened those differences into adversarial positions. When they spoke to people from all walks of life about what they are most concerned about in terms of the future of the country, it was amazing how many people said the threat to our own democracy. We have really transitioned somewhere along the line to thinking just because I have different opinions from somebody else, they are also my enemy. We need to break that down. That is the line of work around strengthening our democracy, being a standard bearer for civility and chipping away at the polarization. The Bush Center is looking to be a positive force here, because it is an area they think they can really move the needle.

On career pivots – for him, coming to work in the non-profit space (at the Bush Center) was definitely a pivot. It wasn’t something intentional, but again, he just raised his hand. He is not doing it for any other reason other than he thinks it is intellectually interesting and a place that matters, with quality people who are mission-driven. But that is what happens in life. You get to a point where you do start thinking about what does it all mean, what do I mean and what do I stand for, is this all there is for me? He got to a point where he had started asking himself those questions and then one thing led to another. He wasn’t necessarily searching out an opportunity like this, but it presented itself.

On his e-sports investments – he had followed the business press around sports for a long time because of his investment in the Texas Rangers. A few years ago, he noticed an emergence of articles on the topics of e-sports and gaming. This is an emerging industry built around communities of people playing and watching people play video games. Hundreds of millions of people globally are playing these games, interacting, chatting, competing etc. It is a whole ecosystem. When you look at the demographics, the average age was late 20s to early 30s, 70% male and 30% female, 90% who are gainfully employed or enrolled as students. He said in 20 years this community will not be taking their 10 year old son or daughter to a baseball game. Viewership was growing 15-20% a year, revenue was growing 30% a year. In the US, this industry has now surpassed every major organized sport except NFL in terms of viewership on annual basis.