Careers are built by stacking as many good decisions as possible. And any good decision comes down to how we evaluate risk.
Frank Cava built Cava Companies into one of Richmond’s largest real estate businesses, one smart purchase at a time. Frank has a favorite saying, “Success leaves clues.” In his line of work, decisions are made without complete information.
Timing is critical in real estate, especially if you want to secure a deal at the right price. Frank’s team can’t walk every property. If Frank demanded a thorough walk-through before every acquisition, he wouldn’t do much business.
So Frank uses a rule of thumb to evaluate risk. For instance, Frank won’t purchase homes built before the 1930s unless they have a brick frame. Over time, his data shows that these investments are losers for a host of reasons.
His rule of thumb is a simple qualifier to help his company evaluate risk.
I nearly chose to leave my company in 2010 for an executive position with an industrial conglomerate. The most appealing aspect of the opportunity was the location, as it was an opportunity to move back to Chicago.
The person recruiting me was an individual I met years before during an interview process. I declined his offer, but we kept in touch. When he moved to a different company, he called me again with a more lucrative position.
But during the interview process, I felt that my contact wasn’t on the best terms with the CEO. Though they made an offer to me, nothing felt right about the interview process. There was a tension that I sensed under the surface; a power struggle.
Accepting an offer meant leaving a company with an exceptional executive team that treated me well. I had a strong internal network, reliable income, and much of my wealth was tied to the equity in a stock that was poised to grow over the next decade.
Choosing status quo meant staying in a house with a brick foundation.
Leaving meant joining a manager I had never worked for, who worked for a CEO who didn’t appreciate him, in a company filled with question markets. All so I could move back to Chicago?
In hindsight, this would have been an emotional, irrational move to trade a brick foundation for a termite-infested wood foundation. Thankfully, I chose brick, and it paid off big time.
This is one way of looking at a decision to leave a company. I also wrote about eight factors to help you decide on a potential career transition.
Success Leaves Clues
Experience offers the gift of an objective track record. We can look back at our decisions and grade our efficacy. If you invest in stocks, which choices led to gains and which lost money? Do you do better in certain industries? What about the timing of your decisions?
You can create your own rules of thumbs. Warren Buffet famously only buys companies with a “wide moat around the castle.” He looks for businesses that are difficult to disrupt and passes on high-growth businesses with shaky foundations.
How about your network? Do you surround yourself with people with solid foundations? We should evaluate the risk of investing our time with the wrong people. After all, our behaviors will mirror those of who we spend our time with..
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