What I learned from reading Risk Game: Self Portrait of an Entrepreneur by Francis Greenburger.

As soon as I took the phone call, I regretted it.

All of my authors had a lot of personality, but Jim was never happy about anything.

I just read about your latest real estate deal in the newspaper, he said.

I'm not sure how you can be doing your job for me when you're busy buying up this city.

I didn't appreciate Jim's questioning my competence as his agent when I not only worked hard on his behalf, but had also discovered him from the slush pile.

Not long after my father died, I had taken over the agency.

I put a small notice in the New York Times calling for authors to send in their work in an effort to drum up some new clients.

Accepting unsolicited manuscripts was very unconventional for an agent.

Most were not worthwhile, but I did find a good, highly stylized, fast-paced thriller built around a political assassination.

I liked the book and contacted the author to take on the challenge of selling his first novel.

I went through 27 rejections until I found an editor who didn't say no immediately.

If the author would rewrite it, the editor would consider publishing it.

Jim agreed and rewrote the book, which I resubmitted to the editor, who nonetheless declined it.

Most agents would have certainly given up at this point, but I can be extremely stubborn when I have a hunch about something.

On the 38th submission, not only did the editor buy it, he paid $10, 000.

A very generous advance for any first novel, and especially 1 that had been rejected 37 times.

Jim's first book, published in 1976, won the Edgar Award for Best First Mystery.

It was a nice little success story and a parable on the merit of dogged determination, but it hardly warranted him calling the shots in my career.

Look, he said, you have to decide whether you're buying buildings or you're selling books because I can't have an agent who does both.

If you want to keep me as a client, you have to give up your real estate business.

I didn't even need 2 seconds to think about my answer.

I wasn't gonna let any author, not even James Patterson, who would go on to sell over 350 million books, put an end to my real estate ventures.

That is an excerpt from the book that I'm gonna talk to you about today, which is Risk Game, a self-portrait of an entrepreneur and is the autobiography of Francis J.

So this book has been recommended to me probably 5 or 6 different times.

It's been sitting in a pile of unread books a few days ago My friend Mitchell recommended to me again, and I said okay There's a there's got to be a reason why so many different people have recommended reading this book Let me pick it up and see what's going on And I was less than halfway through the book When I realized this book is nuts and it's totally not what I expected When I picked it up and I'll expound on that idea as we move through the book.

I have no idea Where this podcast is gonna go you'll see what

And he doesn't try to hide that fact at all.

Let's go to the very beginning in the prologue.

He's talking about what it was like trying to build the largest project of his career.

This is this giant skyscraper in New York City in 2008.

And he says, I knew all too well that markets can turn on a dime.

And I had spent my career always looking over my shoulder for signs of trouble and keeping an ear to the ground for the sounds of crumbling economic conditions.

Even so, I completely missed the signs of this disaster that I experienced through the very expensive prism of 50 West.

And so this project was expected to cost him about 500 million, just 1 building, $500 million.

And it's just 1 part of his gigantic real estate empire.

So it says when in January of 2008, we began demolishing the 3 buildings on the site I was full of optimism.

Arranging the financing for the project had been a given.

It was only a question of which bank we would allow us we would allow to give us the money.

Then, on September 15th, Lehman Brothers filed for Chapter 11 in the largest bankruptcy in US history, and the world got really strange, really quickly.

I made the decision to shutter everything at 50 West.

As high as I had felt when I was surveying the plans for the skyscraper Was as low as I'd sunk while putting a stop to the building And so that is the books first mention of this euphoria and terror his emotional state the entrepreneurial emotional rollercoaster that Francis is gonna experience both personally and professionally over and over and over again.

He writes the book, he's almost 70 years old.

And these wild ups and downs never leave him.

think makes the book so interesting to read and why so many people have recommended it.

And something he talks about quite a bit is the fact that real estate is a business of human beings and he's quick to point out just how irrational and bizarre human beings are.

As soon as I halted construction, the bank with whom we had a $55 million loan balance sent us a letter stating that we were in default with ongoing construction as a stipulation of our loan agreement.

They were entitled to foreclose on the land.

He says that right here, money had once flowed freely, dried up overnight.

I had to sort this out while also resolving hundreds of millions of dollars of other development commitments that I was trying to undo.

And this was only 1 out of my 200 properties that I had to shepherd through an international financial collapse.

And just as you can imagine, just as the economy slips towards depression, so does his mind.

I had fallen off financial precipices before and survived them.

The emotional toll was greater than even I had realized at the time.

And I think later in the book he's going to talk more detail about that, I think at this point he had been 40 years deep into his real estate career.

As I fought daily to find solutions to an endless list of financial demands and crisis, I slipped into a depression.

And so some of the stuff I'm going to pull out today are just, he's got these like 1 line like maxim spread throughout the book that I really enjoyed.

3 of them just happen up here on this page.

I don't think they need many, like I don't need to explain them.

I always listen to other people's ideas because that is how you happen upon the good ones.

1 rule of real estate is that everyone renegotiates.

to give us overall advice on the real estate business.

This idea that he's going to describe to us right now, Rockefeller in the book Titan, also talks about.

So it says, 1 of the dangers of the real estate business is that often you are competing against people who have money but are not that knowledgeable.

Yet those with money, the only barrier to entry into the real estate market, but no experience in the buying and selling of property, drive up prices because they want to get in on the action.

If you pay a certain account simply because the guy next door has paid it, you will not survive this ruthless industry that has created far more bankruptcies than it has billionaires.

Saying no is the most important judgment that you make.

Rockefeller noticed the exact same thing and he said, oftentimes the most difficult competition comes not from the strong, the intelligent, the conservative competitor, but from the man who is holding on by the eyelids and is ignorant of his costs.

And then he ends the prologue with a description of himself these are my favorite people I don't give up easily not on people or properties and I wasn't ready to give up on 50 West not even after a global financial crisis made the land practically worthless And so that is the last time he talks about real estate for like 1 third of the book, which was really surprising because so his father, I'm going to get into the complicated relationship he had with both his father and his mother right now, but his father ran a literary agency in New York City.

I think Francis was in his early 20s, so he has to take over his father's agency.

And so he's working in that business along with the real estate business for most of his life.

But it is very, very clear from his writing which 1.

And so once he starts talking about real estate later in

the book, the literary agency kind of just disappears off the map until the very end of the book.

And so the way I think about Francis' relationship with his father is very similar to the relationship that the founder of Dunkin' Donuts had in that podcast I did on his autobiography.

That's episode 231 if you haven't listened to it, but the relationship that the founder of Dunkin' Donuts had with his dad, I think there was a great summary in their relationship when he said that sometimes the best lessons that you learn in life are from what you discover in the weaknesses of otherwise very good people.

That's how he described his relationship with his father.

I think it's very similar to the way Francis's approach, like Francis views the relationship he had with his dad.

And he says, I was the son of a cautious father who was sometimes hard to communicate with.

And just like the founder of Dunkin Donuts, his dad was very bad in business, caused the family a lot of turmoil because they were in a precarious financial position.

He was constantly settling for too little compensation and loaning money to his authors who were anything but good for it.

And so from a very young age, Francis is working in the agency with his father.

I'm going to take you to a conversation they're having.

They're talking about a difficult client.

So he says, look, you can't make money this way.

We're not a charity, but he's turning us into 1.

My father leaned back in his chair and gave me a look that was not easily discernible, part confusion and part dismay.

Sitting across from me at his desk, my father put his hands up into feet.

The contemplative nature that kept my father meandering through the vagaries of life bowed to my bolder American directness Okay, fine.

He said I'll call him and ask for an increase to $350 So the person was paying $300 a month.

His father says, No, okay, I'll call him and ask for $350.

A look of amusement sparked in my father's eyes.

He knew I was serious and that I understood things he didn't.

Remember that sentence for when I get to the punchline.

He knew I was serious and that I understood things that he didn't.

So Francis calls up the client and he says, after I showed the client the numbers, he was a man who unlike my father had some sense of what a business costs.

He agreed and we got an increase from $300 to $1, 500 a month here's the punchline that was 1962 I was 12 years old and so we've already seen 2 traits right from the very beginning of the book that he doesn't give up and that he's willing to be bold and you're going to see the next the third trait he's got a lot of confidence I was a prodigy and perfectly described my early aptitude for business.

It grounded me in this topsy-turvy world.

And so he's working full-time from a very young age.

So he's working for his father, doing whatever he can.

And he's been running businesses the entire time.

So By the time he writes the book, he's got almost a half a century of experience in business.

This book, what's interesting about the book, and again, why I think it's recommended by so many people, so many different people, is because he's not really writing the book to get you to like him.

And that'll make more sense as we move through.

Like there's stuff that he says, not only about his family, just about himself.

It's, he's just like I talked about with Francis Ford Coppola last week.

his autobiography, there's things that even I do that I can't explain why I do it.

And I think that's just something that everybody understands.

And when you kind of just lead with your flaws or with mistakes you made, I just think it resonates more.

Later in life, a therapist posited that I was insecure about my relationship with my mother There was certainly a lot to be insecure about so He's talking about this love affair that his mom had she was living in Germany This is when the Nazis take over she winds up leaving Germany with her 1 true love because she wasn't in agreement with what the Nazis were doing.

Her 1 true love is going to get killed and she never gets over that.

She essentially marries Francis's father for like convenience more than love.

So it says, their affair ended when Andre, that's her lover or boyfriend or whatever, was tragically killed right before the end of World War II.

Still, he remained the love of my mother's life and the father of her first child.

And this is where we get into some weird stuff, right?

The man remained a permanent shadow lurking around our house the entire time I was growing up.

My mother and father fought constantly with or over my brother.

So his older brother, his older half brother, He's also named Andre, whom she aptly called Andre, since he was in her eyes the reincarnation of her dead lover.

My brother was a difficult kid, acting out all the time.

But if my father tried to assert discipline in any way, my mother wouldn't have it.

He didn't mean it, was her constant refrain.

She'd just repeat that over and over again.

At the end of 1 weekend in the country, Andre, who was 13 at the time, didn't want to leave.

So he kept us captive by hiding the distributor cap of our car.

He didn't mean it, my mother said, as we sat hostage for hours, while Andre refused to return the necessary part.

What do you mean he didn't mean it my father shouted.

He could run us all over with the car and you'd still say oh he didn't mean it.

And then check out this like his interpretation of what's happening which again it's just really really unusual everyone knew what the fight was really about Andre was the only remnant of a doomed and noble love when my father attacked him it was like he was attacking her dead right resistance fighter And so he's got a lot of unresolved issues with his mother, even towards the end of the book when she passes away.

It's just, this resolution, this unhappiness that's coming from his childhood is never resolved.

If I intuitively understood that my mother married my father because when she came to America with a young child she didn't know anyone, but that she wound up feeling compromised by the bargain, then my suspicions were confirmed by a comment she made to me over the lunch table when I was 6.

Don't let some woman marry you for your money." And she continued, never have children.

And so he's raised in an unusual household with an unusual situation and his response is rather unusual.

And we kind of see the the determination to control his own life.

And something he talks about over and over again, it's just the necessity to have independent thinking.

It talks about a lot in business, but we see that he applies it

I was lying in bed 1 night when I made a decision to give up trying to be an emotional part of our family.

And if they wanna drive themselves even crazier, they're doing it without me.

And so he's like, I'm not gonna be an emotional part of the family, but I'm gonna still be part of, I'm gonna control the finances of the family.

Even from a young age, his parents let him do all the budgeting and everything, because he said they were just completely clueless.

And this is probably why he just has this relentless focus on getting extremely rich.

He said, my father was terrible with money.

His lack of mismanaging it, losing it, or not making it in

the first place was an incredible source of stress within our family.

Sounds exactly like the founder of Dunkin Donuts money was their second biggest source of argument the first 1 obviously is fighting over Andre the stepson and so Francis puts a line in the in the ground and he said this is what I'm going to this is the

No more Francis the peacekeeper or Francis the child.

Francis the worker was the role I much preferred and listen to how he describes it.

I hardly even showed up and I barely even handed in homework at all my move from the quiet sidelines of managing the finances to the middle of the action happened when I was 14 years old and why does he say that Because that's when he starts his first business.

So there's this thing in publishing where it's called remainder books, which are books that a publisher has an excess inventory of.

And so they usually sell off to retailers or like discount distributors.

So his father's selling books in the United States.

There's a lot of people that speak English in Germany at the time.

Why don't we sell these books that are in English to our German clients?

a year or 2 after books came out in the US to be translated and published in Germany.

That meant by the time they were out in Germany, the same books were going into paperback back in the United States.

And the hardcover publisher was remandering its excess inventory.

And so he calls up a publisher and tries to pitch him on this idea.

He says, look, I wanna take 5, 000 copies of hardcovers off your hands, but instead of 30 cents per book that the remainder guys pay I'm willing to offer 50 cents what's the catch to Germany.

This will get them out of your market so it's not going to compete with the paperback, which you're about to release anyways, right?

And I'm going to pay you almost double what the remainder dealers do." So he gets 5, 000 books.

So he's gonna get paid, his partner in Germany is gonna buy the books from him at $1.25.

He's gotta pay, he just said, I'm paying 50 cents per to the publisher, and then I have a cost of shipping for 25 cents.

So I'm getting $1.25, I have 75 cents of expenses, that's 50 cents a book that I'm making, right?

I just sold 5, 000 books and I get 50% profit for each 1.

And then this is just great, clear writing to summarize what's taking place in his life at this time.

It was the cost of a new car, 2 years of tuition at Harvard, or half the average annual American income.

And so now he's got a book business reselling books into other markets, right?

But he's talking about why this is so important.

Imagine coming through it from the like the family that he came from.

He said money was a security blanket, right?

Even at 15, success for me meant not having to worry.

My dream was never wild opulence, but rather the luxury of stability.

The constant question mark that was my parents' checkbook balance made a lasting impression." So then I'm reading while he starts other book businesses that are very similar I'm gonna get into how he stumbles upon real estate when he's 19 But I went through like I got to around page 40 or 50 and I left this note for myself I could not understand at this point why this book was recommended so much because this is what I wrote to myself.

I was like way way too much detail about his sex life that he's having as a teenager.

Little did I know that was only the beginning and a theme that's gonna continue throughout the entire book.

He winds up renting mansions, he's making so much money.

When he's in his 20s he talks about the crazy stuff people were doing in

the 70s, all the drugs and the group sex parties.

Again, this book is nuts and it's totally not what I expected when I picked it up.

I mean, for God's sakes, if you look at the blurb on the back, like 1 of

the blurbs is from Fred Wilson, which is like this well-known venture capitalist.

And he says, Francis is 1 of the most decisive people I know.

a commitment to invest in our first fund in a 5 minute cab that we shared 1 morning.

And it talks about his philanthropy and all this

other stuff on the back and then you open up the book and it's just like orgies, drugs, and alcohol.

And so at 19, he accidentally stumbles into the real estate business.

He's working at his dad's agency part-time.

He's running his, selling a bunch of, he's got 3 different book businesses, and he's also his own independent literary agent.

And he says, my first real estate deal, which happened purely by chance, was a complete success.

I found a new office that had been on the fence about the place because it had 2 rooms and I only needed 1.

And so the guy he's gonna rent from says, so find somebody else to sublet it to.

So he knew somebody from the book business who just happened to be looking for an office.

I paid $50 a month for each room and rented him 1 of the rooms for a hundred bucks.

So he was essentially paying for my office and his.

So he's doing all these different things and his father's trying to get him to commit, just run my business.

And he does something here that's really smart that everybody has to.

Like at some point, he's 19 years old, he's got to make his own decisions, you gotta control your own life.

And so he kind of puts his foot down again.

He just does not like people giving him ultimatums, right?

you've gotta decide what you're gonna do, he said.

Either you're gonna take over my business or you're gonna do other things.

People keep saying that same statement to him in that moment I was conflicted like most good kids it's comfortable to do what our parents want us to do Yet it was very clear in my mind that my father was asking me to commit to something I couldn't impose on myself.

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#243 Risk Game: Self Portrait of an Entrepreneur