Long gone are the days that being a General Manager in the NBA was all about finding talent. The NBA’s new Collective Bargaining Agreement (CBA) and all the nuances to it make it imperative for a GM to manage the salary cap of today, the talent of tomorrow, and…winning. It is quite the intellectual exercise.
You Can't Make This Up - Funny & Bizarre Stories from 20 Years at Deloitte
The “Hamburgler”
In my first year, one person’s lunch was repeatedly stolen out of the lunch room refrigerator. I think the person had complained about it happening no less than 10 times. They finally ‘caught’ the culprit - it was a Manager who just felt like not buying lunch and decided to steal the same person’s lunch brought from home. I overheard the HR conversation with this ‘stealer’ and it was hilariously shocking. The person complained about the food not being cooked to his exact liking. In his own words, “sometimes there is not enough meat and too much mayo on the sandwiches”. The person was not fired, but it was pretty darn bizarre.
The “If I did it” CFO
When I was in Forensic Accounting, we would have to do these “Fraud Risk Assessments” for certain clients. Part of these assessments included interviewing the CFO. There was a standard list of questions that we had to ask and one of them was, “Have you or anyone you supervise ever committed fraud?” Usually, someone of this level just says something to the effect of “absolutely not” and you move on.
Well, not this guy. He got very offended and then proceeded to tell us all the ways he would commit fraud if he wanted to. And when I say a list, he rattled off at least 10 critical controls he could override, how he would cover his tracks, who he would include in on it, etc. It was the strangest and one of the most concerning things I ever heard in a line-of-work that is all about fraud and shady business people. It reminded me of that horrific tv interview OJ once did after his acquittal (think he actually wrote a book about it as well) called “If I did it” with chilling and very specific details.
It just goes to show that some Harvard MBAs often take great pride in telling you how smart they are without always thinking about the context in which they are showcasing their perceived self-intellect. After all, Mr. Skilling from Enron was a….Harvard MBA.
The guy who was 2 years away….for 6 years
Deloitte was somewhat notorious for telling people at the Senior Manager level (level right before partner) that they were 2 years away from being put into the partner process. There was a senior manager who would tell me (and everyone) that he was 2 years away. This wouldn’t have been remarkable if he did not tell all of this “2-year business” every year for about 6 years. I honestly felt bad for him because he genuinely believed he was 2 years away every time he told us. He never was put in the partner process and eventually left the firm. I learned over the years that “2 years away” messaging has some legitimate exploitative legitimacy - it is close enough for people to stay, but not close enough to actually take any action as the partner process is 1 year. So he was not the only duped by the “2-years away” scheme but he was the only one I knew that truly believed it for 6 years.
The girl who “mastered” vlookups
For anyone that knows excel, vlookups are generally frowned upon as an excel formula because there can be a lot of issues with it. The general purpose of it is to find matches that you define between 2 different data sets. In the formula, the very last component requires you to put “True” or “False”. If you put “True”, it will give you exact matches, plus “close matches”. False will ONLY give you exact matches, which is generally what you want. So this girl learns how to use a vlookup formula and proceeds to tell me that she completed what I asked her to do. I started looking at the output and there were a lot of “mismatches”. I asked her if she knew what the “true / false” meant in the formula at which point she told me, “oh, does that matter?”. As I often say, there is nothing more dangerous in excel than someone’s use of formulas without a full understanding of the pitfalls.
You might need your laptop
I once was on a travel project with a guy (maybe a year less in tenure than I had at the time). We were both out of the LA office and would usually take the same flight on Monday mornings to the city where the client was. One Monday morning, we board our flight and he casually tells me, “I think I accidentally left my laptop in one of the bins at the TSA checkpoint.” Instead of panic, he basically acted like it was like leaving his AirPods in the bin. So we took off and his laptop stayed with TSA. We get to the client and he tells the partner that he can’t do any of his work because he forgot his laptop and proceeded to sit around for the entire day. It was “strange” to say the least.
Who’s going to tell him?
We would occasionally have people from international offices do rotations in the US. There was one guy who was rotating through and from the first moment he stepped foot in the office, EVERYONE could smell that his ‘personal hygiene’ was not up to the standards that we have in the US. It permeated throughout the whole floor - just brutal. But, nobody wanted to be the one (or really knew how to phrase it) to tell him that he needed to ‘change his ways’. HR would not even do it. So this went on for a few days until finally someone had a ‘talk with him’ and it got somewhat better before he went to another group on another floor. I guess that is how ‘soft’ and ‘touchy feely’ it was - people were willing to work through a horrific smell for a few days rather than tell him to take a shower, get some new clothes and put on some deodorant.
“My kids have no drive - I don’t understand”
I often felt bad for these really “successful” people at Deloitte who could not understand why their children (who were given everything on a silver platter) did not have the drive they had. They would always talk about hiring SAT tutors, college admissions coaches, etc. and how disappointed they were that all that money spent on these people weren’t translating to any meaningful ambition or drive. It certainly was not everyone - some had kids with incredible drive and ambition, but there were far more that could never understand why giving their kids everything created a mindset of not wanting to work for anything. It is only funny to me because of how obvious it was and how they could not see it (or rather, did not want to admit it).
“That looks like a really big number - is your math right?”
I was once on a project where we were dealing with different currencies - mainly USD and Japanese Yen. We were calculating a number for something (don’t remember what for). I do remember that the client was antsy to get a ballpark estimate. .So the partner (a very detail-oriented guy) asks if we had an approximate amount yet. We sure did - it was 18.5 BILLION DOLLARS. The only problem was she forgot to convert yen back to dollars. The USD equivalent was about $120 million.
“At least it wasn’t my cars”
Before the days of Uber / ridesharing, we would always rent cars on out-of-town projects. On one project, this guy on the team totaled two rental cars in about a 10-day period. Luckily, he wasn’t hurt and did not hurt others, but his nonchalance about the whole thing was a little concerning.
The weirdest part was after the second time he totaled his rental car, I told him would give him a ride back to the hotel. He asked me (with a straight face) if he I wanted him to drive because he didn’t mind. I looked at him and didn’t say a word.
The Manager who pulled “Double Time”
There was a manager (I’ll call him Greg - that wasn’t his real name) in our office who I must admit, was odd - there was something about him that just did not add up. Well, he went on a “extended vacation” to take care of a health situation - totally understandable. This vacation kept being extended. One day, somebody in our office said he saw Greg across the street at a lunch spot. As it turns out, Greg had taken a job with another Big 4. That is not uncommon. What is uncommon is that he was on Deloitte’s payroll the whole time that he was supposedly taking care of this health issue. Needless to say, he was fired.
The girl who quit and had FedEx tell the firm
There was a junior associate that had been with Deloitte for less than a year. I did not know her well and there was honestly nothing remarkable about her. She was social, did her work and from all looks of it, was progressing well in her first year. However, one day she didn’t show up….which then spanned a week - no communication from her where she was - I’m sure there was a wellness check done, etc. One day a FedEx package arrived and in it was her laptop - I guess that was her way of giving notice.
I had to explain and document what my Diversity, Equity & Inclusion (DEI) goals were
Uhhh…I’m Asian and plan to be for the foreseeable future. I will also make 2 new Asian friends this year.
Remember all goals must be Specific, Measurable, etc.
If you are senior enough and don’t want to work, rest assured that a new title is in the works
When many senior partners (definitely not all) get to a certain level at Deloitte, it becomes obvious that they have ‘put in their dues’ and as a shareholder, can do as little or as much as they want. If some of these people had to do the "interview with the Bob’s” from Office Space, it would be hilarious…”So what is it…you would say you do here?”. Well instead of actually re-tooling, these people are allowed to “re-title”. Some of the titles are so funny that you wonder if someone used ChatGPT to create them using a prompt such as “give me a title for someone that doesn’t do much of anything”. I am the “Western Region Leader of Empowering Diversity in Manufacturing”. I am all for diversity in manufacturing, but it seems odd that someone could make a crazy amount of money doing just that. Furthermore, what would that role exactly consist of? It is a made-up example, but I assure you that there are outrageous titles that people hold that allows them to maintain power, travel around so people can act impressed, and wait until they can collect on their pensions.
My extremely charitable coachee & the Occupy Movement
At Deloitte, you are assigned a Coach from day-1 and you have one (not necessarily the same one) for the rest of time at the firm. Well as luck would have it, around 2010 / 2011, I was assigned to coach - a junior associate with a reputation for not being very qualified and lacking direction, but so be it…One day somebody asks me, “hey did you see your coachee in the news?” I said, “no, but that can’t be good”. It was not.
It turns out that he was on a project in NYC for one of the bulge-bracket banks and it was during the heart of the “OCCUPY” movement. So he gets approached by a friendly woman who turns out to be a reporter outside his W Hotel (wearing a Deloitte t-shirt of course). She asks him a bunch of what seem like “benign” questions and then publishes an article about how a Deloitte consultant was attending Occupy Wall Street protests in the park and allowing other protestors to shower in his expensive W Hotel room.
I didn’t even know what to say to him - it was the type of situation where there were no words to try and comprehend how someone who is billing hours to a huge banking client is attending protests against those very banks and providing hospitality to other protesters. It was truly a SMH moment if there ever was one.
Be careful when you suggest a lunch recommendation
There was an intern on a project I was on who seemed a little off from the beginning. That was only validated days later when the partner on the project asked if anyone had any lunch recommendations because he wanted to take the team out. So never the shy one, this intern thought it was a good idea to recommend a local strip club for its buffet. Needless to say, it was clear where he went (likely every night) after everyone else went back to the hotel.
You would “think” the CEO would care
Working in turnaround / restructuring, I cannot tell you how many CEOs I have worked with on company-side distressed engagements who would never stay past 5PM, would take vacations and continue to expense things as they deprived their employees of things like coffee…all while his company was running out-of-money. If it was my company. I hope I would ask like the situation as it was….dire. There is more on the line than just pride - peoples’ jobs, etc.
But the more I thought about how common this bizarre behavior was, the more I realized that CEOs that truly care about being the chief steward of their businesses don’t often get themselves into situations where their companies are on the bring of extinction.
The guy whose parting gift to the firm was to destroy all the financial models he created
There was a guy who believed he should be put up for partner and unfortunately for him, he wasn’t. Well, he figured that he needed to leave the firm in a loud way. So, he went on the shared drive where all the financial models he built were stored and hardcoded all of them - for those of you that don’t know what that means - it turns a model into a spreadsheet - it removes all functionality. It was quite the move and quite the headache - he was a business valuation guy and many clients paid for these models to be simply updated each year. So some poor soul had to rebuild each one and I guarantee that the clients were not willing to pay all of the hours it took to rebuild these models due to one guy’s bitterness.
The insecurity of success
The most outlandish thing I saw were people wildly successful and smart at one thing but were obsessed with pretending they were somebody else. Case-in-point, there is some weird fascination with Private Equity. I cannot tell you how many really successful people at Deloitte will tell you they work in Private Equity. It is the strangest thing. Deloitte does a lot of accounting due-diligence for private equity firms doing deals and these “accountants” leading the work will tell you with a straight-face that they are a private equity person. Just because I do Devin Booker’s taxes does not mean I’m an NBA player. I always found this type of behavior odd and came to the conclusion that it’s just not sexy to say that you make a million dollars as a CPA so you must say you are somebody else. But I do understand that having a 30 year-old actual Private Equity guy making $3M / year telling you what to do creates a level of insecurity that is hard to reconcile.
Tips for dealing with these types:
Reinforce the idea that they are indeed “Private Equity people”
If “value chain” comes up, reinforce that they are at the top - ahead of the bankers, lawyers, etc.
Only talk about deals - make everything transactional
When they start acting like the dudes from the movie “Boiler Room”….play along as if you think it’s really cool.
NEVER mention they are accountants - they are Private Equity advisors
Talk about golf at any possible opening for the subject….even if you don’t play and know little about the sport
Use terms like “fresh powder”, “IRR”, “carried interest”, “exit strategy”, “recycling assets”.
When talking about company valuations, ONLY use high-level concepts like “multiples”
Ask if they will be attending Allen & Co’s Sun Valley conference
Don’t ever mention what Warren Buffett thinks about Private Equity - he is old and knows nothing about investing in businesses as far as you’re concerned
Don’t ever ask why they did not actually go work for a Private Equity firm - remember Private Equity firms look to them for advice.
Ask how many deals their work has killed - this reinforces importance and influence
Ignore the fact that they might be making up for their college experience 20 - 30 years later - it does not matter even if it is true.
Never talk about money - they always have more and it should be obvious because they are Private Equity people.
Even if a guy like David Tepper or the Gores brothers are your close relatives, they know them better, so best not to mention it.
Don’t talk politics unless it’s about Mitt Romney (Bain Capital), David McCormick, etc.
The Senior Partner who believed her own bull$hit
There are a number of senior partners at Deloitte who are extremely smart, substantive and impressive. There are also some who are not but others will go to no end to gaslight you - these type don’t understand that their bull$hit is so transparent and all they do is hustle around like they’re doing good things to change the world. It is the type that is always on the phone talking to G*d knows who frenetically acting as if they’re determining monetary policy for the Fed.
I listened to this one senior partner who was one of the most arrogant I have ever met - so many people would eat it up, which made it all-the-more annoying. One day, she starts talking about how she has all these ideas to revolutionize the most popular ridesharing company in the world. After all, the people that invent revolutionary companies need some consultant to lecture them on how to revolutionize it. The funny thing was….she legitimately believed she had good ideas that this company would buy into. Sadly, she also thought the people she was testing these ideas out on were actually impressed by them (so impressed that they were scrolling through Twitter the entire time).
But then again, I guess when you never see your kids, travel non-stop, and tie your entire identity to people acting impressed by your ideas, you have to find some way to believe it was worth it.
Tips for dealing with these types:
Always say, “wow, I bet they never thought of this”
Always give them credit for things they had nothing to do with because they’re going to take it anyways.
Act like you really admire them and want to be just as ‘successful’ as they are
NEVER ask about their personal life or outside interests - it’s a dead-end
Continually reinforce how much influence they have on other people
Ask about their trip to Davos and who they met with - “met” = sent a cold-call email to.
Inquire about which company board seats they are eyeing once they retire
Don’t ever ask why they like hanging out at “Deloitte University” so much - act like that place is the center of the business universe
Weave in AI as much and wherever possible. Another good topic is the “the future of ______” and other concepts such as “smart cities” (even if we can’t handle homelessness right now).
The expert who gave a deposition and made the attorneys very happy - too bad it was the wrong side’s lawyers.
I did a lot of expert witness litigation work early in my career - commercial disputes over trademark / patent infringement, economic damages, etc. In any case, I was supporting one of our Senior Managers on a small dispute involving patent infringement - we were engaged by attorneys to help the defendant ( a company) minimize the amount of damages they owed after having been found guilty of infringing on a patent. This senior manager submitted an expert report which outlined all the reasons why the damages asserted were outlandish and overstated. He was deposed one morning by the plaintiff’s attorneys and I saw him later on and he said it went “very well and the attorneys were very pleased with how it went”. A couple days later, I reviewed his deposition transcript and he basically could not have been a better expert for the other side. He made statements that contradicted everything in our report and fell into every trap that the opposing attorneys set. So he was not wrong - the attorneys were very pleased….it was just the wrong side’s attorneys.
“If you work anywhere for 20 years, you’re going to have plenty of stories and encounter plenty of people that you had to continually reinforce - that’s called experience & corporate politics. The annoyance of yesterday is the humor of today.
Don’t take yourself too seriously...and don’t steal lunches.”
Ranking my run through German cars
Starting in 2013, I migrated away from an entry run with Lexus and switched to German engineering. What I have learned over the past 7-years is that not all German cars are created equal, and it has taken a number of cars to finally help me understand what really matters in a car. For contextual purposes, I do not drive very much and have not put over 5,000 miles on a car in any year since switching to German cars.
1a) Porsche 997.2 911 Carrera (Current)
About two months before my Audi S5 lease ran out (which I could not wait for btw), I did the natural thing and ordered a Tesla Model 3 Performance - the version of the Model 3 that does 0 - 60 mph in 3.1 seconds. However, Tesla kept pushing the delivery date back and I also noticed something else. Here in Scottsdale, EVERYBODY has a Tesla - it’s beyond ridiculous. My parents have one and driving that car truly is an amazing experience, but I started to question whether it was amazing because of the technology or the actual experience. If I drive 5K miles per year, I want to actually ‘drive’, and as great as a Tesla is, the fact is that 1) it’s far more suited for daily commuters; and, 2) whether self-driving mode or not, the car drives you….you do not drive the car. So, I went from the ‘practicality’ of a Model 3 to the exact opposite end of the spectrum - a Porsche 911. It is about as analog as a car gets these days - you really feel the road, you have to pay attention, and you’re going to spend time at gas stations no matter how much you drive. I looked around for a while and talked to a number of Porsche aficionados, of which there is a diehard following unmatched by any other car - it is only rivaled by BMW M3 fans. In the end, I settled with a 997.2 with the PDK transmission and could not be happier. There are a lot of used Porsches on the market with over 100,000 miles on them and that tells me one thing - people love to drive them…and now I know why. The engines are workhorses and while it will not beat a Corvette or even a Tesla in a straight line 0-60 drag race, the precision that you get when cornering and doing more technical driving (especially when you take off traction control) is unmatched. It’s a RWD 3.6L 6-cylinder ‘Naturally Aspirated’ engine that pushes 345 horsepower - meaning, it’s a real engine - none of this crap with taking a 2.5L, strapping 2 turbochargers on it and pushing it up to 450 hp. Naturally aspirated engines are unfortunately at the end of their time as emissions laws kick in and we start to see more hybrid or pure electric performance. While cars are never investments, I do believe that you should buy something that ‘stores value’ and I believe well maintained Porsche 911s will hold value (much better than a Tesla battery maintaining its charge) over time. If there was ever a time for me to buy a completely unpractical car as a ‘daily driver’, it was now…so I did.
1b) Mercedes Benz C63 AMG Edition 507
Ummm yeah - this car may look practical, but when you drop a naturally aspirated 6.2L V8 engine in it that pushes 507 horsepower, it quickly becomes a beast. I loved this car and selling it is probably my biggest regret - I bought it pre-owned from the owner of a Mercedes Benz dealership in the DFW area and it only had 14,000 miles on it. It was in pristine condition and it had the Edition 507 package on it, which remains very rare. It was completely spec’d out. I loved driving this thing and probably is the one car that I ever felt ‘scared’ when driving. I’m just not sure C-Series sedans were ever meant to have 6.2L V8 engines in them. AMG is the pride of Mercedes Benz performance and this car reminded me of that every time I drove it. I will also say that I probably filled up every time I drove it as it got about 8 - 10 miles per gallon. If I could buy this car back, I would do it in a heartbeat - this 6.2L V8 is a highly-coveted engine - I would not use it as a daily driver, but it is a car that I believe will only go up in value as you cannot get these hand-assembled (and hand-signed btw) engines anymore. The valet drivers at my condo loved parking this car and the sound that it made when you would start it up was one that cannot be replicated by AMG anymore.
2) Audi S4 Sedan Supercharged
Ayrton Senna remains one of my all-time favorite drivers and it was always fascinating to me that a guy that knew car performance at the highest of levels had 2 favorite cars that he drove off the track: 1) the original Honda NSX (which he helped design and calibrate into an absolute legend); and, 2) an Audi S4 Quattro. This Audi S4 was unique in the long line of Audi “S” lineage - it was a 3.0L supercharged V6 engine - Audi had a 2 -3 year model run where they moved from turbochargers to superchargers. Without knowing or getting into the mechanics of it, a supercharger is ‘always-on’ and does not have the ‘lag’ that a turbo experiences as it relies on airflow to kick-in. This car was probably the perfect balance of “practical performance” - it put out 330 horsepower and you could have fun with it without feeling like you were going to kill yourself. Had it not been for ‘stumbling on’ the C63 AMG Edition 507, I likely would have kept this car for a while (which is about 2 - 3 years for me). It was a great looking car, and even had the rims re-finished in a gunmetal gloss - something that I rarely do on a car.
3) Audi S5 Coupe Turbocharged
Yeah - it looked nice. That is about all I have to say about this car. I regret getting this car AND I regret leasing it because I had to wait 3 years to get out of it. By 2018, Audi had gone back to turbochargers (due to the high cost of the supercharger) and while this S5 was tuned up to 354 HP, it was clear real fast to me that Audi was no longer about selling performance; it had become about selling its MMI in-car electronics. The funny thing is that this car also was the first year that Audi enabled Apple CarPlay. So once you connected your iPhone, it basically made all of those fancy in-car entertainment features useless. Yeah, it had the Bang & Olufsen sound system, but it never had the performance of the lower horsepower, yet supercharged S4 sedan. This car is the last Audi I will ever drive because it is stuck somewhere between trying to be a Tesla with none of the performance or electric power. I never had fun driving this car and always felt like it was driving me. I put 16,000 miles on it in 3 years, so I did drive it a bit more than my usual 5,000 miles per year, so I guess it was actually decently practical.
BUYER BEWARE: The Audi Turbo engine has really annoying turbo-lag.
4) Audi A5 Coupe - Prestige Plus (2.0)
Yeah - I don’t even have a picture of this one, but it looked almost exactly like my S5 - same Daytona Gray color too. The problem with this car was it was way underpowered. In 2013, the VW group (Audi included) was using a 2.0L across a number of platforms with some modifications - for example, the A7 (sportback sedan) used a supercharged 2.0L. However, the A5 2.0L was not supercharged and therefore, was underpowered. Audi’s are AWD, which makes them heavy and the coupe versions, which you would think are lighter than the A4 sedans, are actually heavier. So when you combine an underpowered engine with an all-wheel drive sport coupe, you end up with a cool looking slow car. I could not deal with it and traded it in up to the aforementioned S4 with <5,000 miles on it.
Where from here?
I’m not sure what’s next for me - I do think I’ll keep the Porsche, but am very intrigued by the high-performance sport sedan segment again - the BMW M3 F80 sedan is a pretty amazing platform and they are starting to come down in price now that the G80 platform has replaced it. They aren’t cheap, especially one with low miles and the CS package, but would be a nice complement to something that has absolutely no cargo space whatsoever. I’ve been looking and if there’s a good deal to be had, you never know…As far as Tesla’s go, I would wait until the highly-anticipated 4680 battery that Tesla is supposed to democratize at some point. Solid State Batteries are being developed but the technology still seems a ways away.
High-End Fitness
High-end fitness clubs have always been around. Most of them are small regional clubs. One could certainly argue that Equinox was the first mainstream high-end, luxury fitness chain.Over the past five years, there has been a proliferation of fitness clubs that have gained popularity via social media and other communication channels that have expanded from regional chains to nationwide, and in some cases, worldwide operations. Additionally, Millennials place a high value on health and fitness, and many no longer feel like the standard $29/month 24 Hour Fitness membership is good enough. Additionally, these high-end concepts have done an exceptional job of selling their products as much more than fitness; they've marketed them as "lifestyle" plays where you somehow feel more elite and refreshed by a high-priced workout vs. a low-priced workout - it's absolutely brilliant if you ask me.
But...like most high-end discretionary spend, it will be interesting whether these concepts have the stickiness with customers to withstand some type of economic downturn. On one hand, my guess is 'yes', given that the clientele that these concepts have are less affected during downturns. On the other hand, fitness concepts tend to be very fickle and people always want to try something new, which is why ClassPass is a very interesting and likely sustainable concept (it offers tons of variety). In any case, it will be interesting to see what discretionary spend items Millennials start cutting in a potential economic downturn. Here is a sense of some of the prices of a few of these fitness concepts:
Equinox: Think W Hotels meet Fitness Club. Sometimes more a 'place to be seen' than a place to work out. There's a funny saying that "people work out at lower tiered gyms before they feel comfortable joining Equinox." Membership prices range from $160/month to $175/month for single club access, and $195/month to $250/month for global access. There is also an initiation fee of $200 - $300 based on membership access.
SoulCycle: A 'revolutionary' approach to the traditional spinning class. SoulCycle has spawned a number of similar concepts - all are pricey at around $35 per session. SoulCycle actually filed an S-1 (the regulatory filing with the SEC to go public)…it never did.
ClassPass: A very unique concept that offers a network of different independent health 'studios' that encompass a number of different types of exercise (dance, yoga, Pilates, etc.) It is a membership-based structure and the price in NYC is $125 per month. You can visit the same studio up to 3 times per month.
Pure Barre: One of the hottest new concepts. Pure Barre utilizes the ballet barre to perform small isometric movements set to music - a total body workout that lifts your seat, tones your thighs, abs, and arms, and burns fat in record- breaking time. Prices range from $25 - $35 per session.
Barry's Bootcamp: Bootcamp style workouts gone high-end. $30 - $40 per session.
Crunch: Another general fitness club (like Equinox) that brings an upscale atmosphere with the amenities to match to the normal gym concept. Membership prices range, but are on average, $100 per month.
Pure Yoga: High-end yoga studio in select cities around the world (almost exclusively in Asia). Their only studios in the U.S are in NYC where they have two locations. Monthly memberships range from $155 to $280 per month (there is a $15 premium to access both NYC studios).
As you can see, the individual sessions can add up in cost quite fast. If one were to do two SoulCycle classes per-week, that's $280 per month. One SoulCycle class in-itself is more expensive than a monthly membership at a lower-class gym like 24 Hour Fitness or LA Fitness.
Want immediate gains with A.I., just change your company's name
COMPANIES THAT HAVE NO INTEREST OR INVOLVEMENT IN #AI ARE SEEING ~10% (ON AVERAGE) INCREASES IN SALES BY JUST ADDING "A.I." TO THEIR BUSINESSES' NAMES.
Here's the ironic part - these companies who are using the #AI phenomenon as a branding play will likely see as much benefit (if not more) than a vast majority of those who are throwing billions into the technology now. The capital costs of AI (personnel, servers, power consumption, graphics cards, opportunity cost) are massive so it is not crazy to think that a simple name change may yield a better return. And when the technology is mature, the cost curve of integration and democratization of agents will enable others to simply borrow it at a low price.
Think about mobile - the investment in mobile was really borne by a small group of massive companies (at the time). Yet today, it benefits everybody...most of whom never invested a penny. #Nokia #Blackberry #Nortel (among others) invested a ton in mobile and what were they rewarded with...irrelevance. Some might say the same about #IBM and #Intel in the PC world - pioneers then who are fighting for their corporate lives today.
- #JoeRogan did not invent nor have the first podcast
- #Apple did not develop the first smartphone, tablet or mp3 player
- #Tesla did not invent the first electric car
- #MySpace was once king of social media
- #Flipcam came way before #GoPro
- #Flickr was basically the same concept as #Instagram
- #Zima once ruled the world of 'alcoholic coolers'
- #TomBrady was not the first to deflate footballs
- #BernieMadoff was late to the Ponzi scheme game
Back to the branding idea. In 2020, companies with no involvement in #blockchain or #crypto saw similar gains (roughly 15% increase in revenue) by just changing their names to make the public believe they were on the cutting edge of a buzzword.
Big 4 firms trap people in a virtuous circle of need, ambition and dependence
So let me start off with three incontrovertible facts to preemptively ‘kabash’ any theories about what this post is about.
I left Deloitte on my own accord as a Managing Director in its Advisory - M&A (Turnaround & Restructuring) practice in Jan-2024 after 19+ years at the firm.
Deloitte was extremely good to me - it provided me with personal and professional growth, great friends, and a wealth of experience to leverage elsewhere.
I left out of FEAR - there was tremendous fear of becoming the many people I saw who deep-down probably wanted to leave but had no freedom to leave (financial stability, etc.) - it is a sad sad sight to see people at the end of their careers groveling for relevance wondering ‘what could have been’.
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Ok…now that I have that out of the way - on with it. The Big 4 (like many professional services firms) makes its money off of people billing hours - it is shocking (I know). Those hours could be solving complex problems to help companies improve their business performance (worthy task)…or they could be spent doing the following (just a handful of examples):
Project management (aka PMO’ing)
Sifting through data that didn't make sense when you started, didn’t make sense when you finished, and didn’t create any useful insights…it is useless in making decisions.
“Pitch-booking” generic analyses that no sophisticated buyer of services is going to take stock in. If you want a conversation starter, pick up the phone.
Hypothesizing grand thoughts that look amazing on PowerPoint slides but somehow never make it past the slides part.
Helping companies solve problems that are so elementary it makes you wonder how they remain in business.
The list of tasks that are billable to clients but virtually clerical in the ‘real world goes on-and-on…
You are paid to bill hours…if you pick up useful skills along the way, it is residual (not designed) benefit
The Big 4 experience (minus traditional audit and tax) has become greatly devalued outside the Big 4 since I started with Deloitte in 2004. Why? Read the bullet points above. People will leave the Big 4 after years and will have done nothing that the ‘outside world’ finds differentiated value worth paying a premium for. Sure, you might get hired to ‘project manage’ something, but guess what….you are now overhead - that line on a P&L called SG&A that CFOs just hate explaining the ‘puts and takes’ on quarterly earnings calls. At the Big 4, your time is a profit center, which allows you to be paid like one.
And the word is out. There was a time when 4 - 5 years at a Big 4 firm was ‘no questions asked’ experience - you were assumed to be smart, hard working, and possessing relevant skills. Those days are over because people know how much irrelevant and non-transferable work consultants are billing clients for. I kid you not - there are too many people who spend years at a Big 4 and cannot adequately analyze financial statements (in their most elementary form) when they leave. It is not just absurd…it is downright scary. But it’s not shocking. The “higher ups” (in-general) are happy with people doing whatever work they can bill for regardless of impact to the people doing it - it is called revenue and it makes their world go round.
People unknowingly seek ‘the trap’
How can this be? Easy. What does every employee want? A higher position and as a result, more money. Well, let a few years (or ten) go by and you might get married and start a family. And then people fall into this trap of dependence and comfort - they end up dependent on that higher salary to pay for the mortgage, the vacations, the kids….
In effect, all that has changed is the better title and more money. The skills did not change - you may be managing people now but you’re only overseeing people who are doing the very same non-transferable skills that you grew up doing. Take a good hard look at where the jobs are being shed in Corporate America today - “middle management” - facilitators who do nothing more than push paper, ‘oversee’ people, create layers, and take credit for other peoples’ work.
Enter 2025. You have a lot of people at these firms who have no intellectual curiosity, no ability to learn new things (it is a use-it-or-lose-it muscle), no transferrable skills, and no way out - THE VERY MONEY THEY YEARNED FOR IS NOW THE VERY DEPENDENCE THAT KEEPS THEM STAGNANT.
Did I avoid this depressing trap?
I am by no means perfect in anything - I have made many mistakes in the first half of my career - luckily I still have a second half. That being said, I do have freedom. In any case, I do think of how I spent my 19+ years and how I ‘tried’ not to fall into the trap of irrelevance:
I changed my career WITHOUT leaving my company:
I started with Deloitte in 2004 as a Forensic Accountant. I got my CPA and did a number of projects investigating fraud, dealing with SEC matters and helping with complex commercial litigation disputes. A lot of it was interesting and stimulating. However, one day it dawned on me…what can a forensic accountant do outside of Deloitte? I did not want to work for the FBI. So I was left with the same answers then as I have now, which is none.
As luck would have it, this revelation struck me in late-2008 just as Lehman fell and we entered the Great Financial Recession. Luck struck twice for me - there just so happened to be a new project to advise a struggling (already bankrupt) chain of RV dealerships in my hometown of Tucson, AZ. I jumped on that and learned the in’s-and-out’s of elementary restructuring - 13-week cash flow modeling, reporting to lenders, the rules of Chapter 11 bankruptcy, and getting a Plan of Reorganization confirmed. And in that experience, I learned that restructuring might be the most practical and applicable finance paradigm out there because when everything is broken it forces you to learn an entire business in the most elementary form - cash-in and cash-out…there’s more to it, but in the end it’s all about the liquidity needed to survive (or thrive).I took advantage of firm programs and used them as intended.
6-Month Paid Sabbatical:
In 2010, I applied-for and was granted a 6-month paid sabbatical to continue building a nonprofit I had started with some other Deloitte colleagues a few years earlier. Crazy enough, I actually worked really hard at that - I learned what it meant to build a business; I learned what it takes to be a leader and try to get others to follow a vision. And yes, I failed in many ways…but the experience of building a business was invaluable - I could have never done that without that sabbatical.
2.5 Year Industry Rotation (MDP):
By mid-2014, I was burned out - I had worked crazy hours on the AMR (American Airlines) restructuring - they filed for Chapter 11 bankruptcy in November-2011 and emerged as American Airlines Group (concurrent with the US Airways merger) in December-2013. During that time, I lived in a hotel in Dallas (no joke). So, I found this industry rotation in Travel, Hospitality and Leisure (THL). I got to effectively be the ‘Chief of Staff’ for the industry sector leader (a good friend now) and travel around the country and the world learning about the sector and how Deloitte could better position itself with key industry players. I loved it because I got to learn how all of these businesses in this travel ecosystem worked and why some worked better than others. Once again, I would have NEVER been able to do that billing hours day-in-and-day-out. Clients don’t pay Deloitte for their people to explore personal intellectual curiosity. Luckily, Deloitte paid me for it.
I spent 4 - 5 weeks at a time each year in Hawaii:
I did not hold back in using my PTO in chunks. Many will question why or how that was valuable to a career. I found a lot of value in getting away. I ran a successful now-defunct blog (I actually enjoy writing) and just got to decompress. If nothing else, I got to clear my mind outside the day-to-day grind of conference calls, status updates, deliverables, and people asking, ‘how’s your bandwidth?’. Try it sometime - you might be surprised that ”being in the wilderness” allows you the clarity to ask the tough questions and hear the true answers.
Seek out opportunities that feed your curiosity and foster the lightness of mental clarity. It is one of the best parts of being at a Big 4 firm. Challenge yourself to do things less ordinary and seek ‘perspective from your mentors’ for ways to grow. When someone tells you ‘no’, is it because it is not good for them -or- is it truly not good for you (?)
Deloitte is now in my past and I am very grateful for those 19+ years. I did not do everything right, but I am confident that I did not get trapped into a narrow path that made money for the firm at the expense of my professional development. I encourage everybody at any of these firms to step back and ask themselves a simple question:
“If I want to leave, will the marketplace buy what my skills and desire for meaning is selling?”
It is not a cynical question - it is a fair challenge that you owe yourself. Nobody is going to tell you to stop making ‘them’ money at the expense of your stagnancy. The ownership resides with you.
**Please note there are a lot of generalizations in this post - it is not an indictment; it is merely 20 years of observations where I saw so many talented people never ask themselves the tough questions and ended up disheartened when they finally heard the answers from the market - it was the wasted time that they could not reconcile.**