From Burnout to Clarity: A Founder’s Journey Beyond the Exit (Colin O'Farrell)

You're essentially at the top of the world, looking over the cliff, about to knock it out of the park, and you're kind of back to zero.

Silicon Valley. That's the best Russ Handering quote of all time. Did I lose a B? Damn near. But I bet I gained 2B in wisdom. Colin O'Farrell is an oil and gas entrepreneur with deep roots in the Permian Basin. He started at Pioneer Natural Resources and later co-founded Pecor, a private equity-backed E&P firm that delivered a 3x return in under 2 years. Now leading Four Pines Exploration.

There you are on the verge of private island money and things fall apart.

My, my own equity is getting restructured down, right? So massive doses of stress are not good for your lumbar. My last day of employment, I was face down on the operating table having a large lower back surgery. I had a piece of my disc come out and crush the nerve that innervates my left ankle, so my foot was dragging along the floor. It didn't have to be that way.

If you could go back 10 years, what advice would you give yourself at that point? Welcome to Money Stories, where we have conversations with founders about money, meaning, and what makes a truly rich life. Today I am joined by my friend Colin O'Farrell. We have a sort of a shared history. We kind of came up in the oil and gas industry in the Permian Basin around the same time, and his journey mirrors mine in so many ways. I'm really excited for this conversation. Started your career at a publicly traded company, served a lot of roles there, and then spun out into a private equity-backed oil and gas exploration company, Pecor. Built, exited, scaled, and now out on your own doing your own thing. And yeah, can't wait to dive in. Colin, welcome to the show.

Hey, thanks for having me.

So let's start from the beginning. How did you grow up with money and how did that drive you to become an entrepreneur?

So grew up in an academic household. My dad was a college professor, so very much like very comfortable, you know, nice town outside of Boston, but not much of a focus on finance, right? Or personal or otherwise. And I've recently realized my dad has a very robust pension, and I think that may actually be part of it because there never needed to really be any planning, right? Because it was just going to be there. And so Yeah, spent a lot of time chasing more schooling, more degrees, was right on the cusp of doing a PhD or going into industry and really glad I went into industry. That did actually cause some rifts in my household. The view was that I was underselling my talent by not getting a terminal academic degree. And I think academia, the, the supply and demand of academic labor is such that I'm quite glad I did not go down that road. But, but yeah, not really much of a focus on, on talking about money in the household. That said, I grew up, as I said, outside of Boston, one town over from where the Mayflower landed. So I knew a lot of people whose families had been in this country for hundreds and hundreds of years, and everyone just seemed in that, in those family trees to be successful. So I, I knew there was some code, right? Or some dinner table conversation that was happening in those households. I just didn't know what it was. So it sort of drove me on a voyage of discovery to, to understand more about personal finance.

Yeah. So is there a time, like, was, was there a gap that was highlighted? Is there a specific time or memory when you kind of realized they're having a conversation that I'm not having? Like, when was that realization for you?

You know, I think it was a couple of different friends of mine, actually a lot of folks I went to college with. Some from my little, you know, county and zip code and what have you. It was realizing that all of their uncles and cousins had gone to Harvard or Princeton or Yale or Dartmouth or whatever. Like, and it was like, hmm, genetic drift being what it is, these are, they're probably not all like truly academically gifted that, you know, across that diverse of a family tree, but there's something going on there probably beyond like cooking the books and legacy admissions, right? Of a playbook that was being deployed to where everybody was just doing really well.

Yeah. And, and when, when you think about growing up in your household with an academic kind of lens, is it, was the message more, you know, money doesn't matter to be happy and you should pursue, you know, an academic thing? Or is it like, we ignore money, we don't even have this conversation. What was the flavor?

It was, it was follow your passion, everything, money will come. And just so long as your passion happens to be highly academic in nature, right? And this is getting into like, we could get into the, the arc of this country and the culture wars and this, you know, my own experience fits into that pretty handily, right? You know, you've got Vietnam protest era left-leaning people who go settle in a, you know, very academic echo chamber, right? Yeah. And, and also too, I mean, there was so much fat to be cut in the, in the boomer economy, right? That you really could just— and of course a lot of it is only— I'm not just— I'm not trying to get into a millennial versus boomer extra debate here, but, but hindsight being 20/20, but there was so much fat in the system that you could kind of just go follow your bliss and it was gonna kind of work out. Yeah. I would submit that our generation has to be a little more a mercenary in our approach.

Yeah, definitely. I mean, it's, it's sort of, you know, in that timeframe there was a bit more luxury to follow your passion. If you just look at, you know, home prices versus inflation, right? Things are a little bit different now. And when, when did you start to have that realization that, okay, what worked out for my parents may not work out for me?

So I, the other sort of leg of my stool between money, academics is sport, right? So pretty avid skier and was pretty into ski mountaineering for a long time and I was climbing all that. I was immediately after grad school, I spent 2 years living in Jackson Hole where I live now again, but I was working in consulting civil engineering and which is a really low rent, low margin industry and was helping to build and at the time Jackson was expensive, but not like today. Right. But I basically realized that if I wanted to live anywhere with any kind of natural beauty, whether it be coastal or mountainous or what have you, I had to really earn because I was working on these huge mega projects, building these huge homes. And it was the realization that, okay, like, we really need to put this engine in gear just to be able to go skiing.

Yeah, totally. So you're, you're getting, you're getting a taste of, you know, what real wealth and, and, you know, what's possible. On that side and you go, I think I want a piece of this for myself.

Well, and I should say too, I mean, God bless my parents. I mean, they pumped— I'm an only child, so they pumped tons of resources into me, right? Went to a real nice private high school, you know, two Ivy League degrees, right? Like, not a nickel came out of my own pocket for that. And, and so I felt like, okay, like, I have, you know, to whom much is given, much is owed, right? Like, I had sort of that mindset of, I better take all this that's been put into me and do something with it.

Yeah. I think that's kind of the, the other side of privilege, right? Like we, like we can recognize that not everyone had those resources pumped into 'em, but on, on, on the dark side of that coin, like, oh man, I have a responsibility now. Like, look, there's plenty of people who, who will not take that that mantle or that responsibility. But, but, you know, same, like growing up in a middle-class household and having my parents pour resources into me, it was like, oh man, I better make something of myself. So what does that transition into oil and gas look like for you? Like what was your early career like?

So I was sitting on that fencepost of I had been accepted to do a PhD in a particular— an interesting but fairly academic subspecialty of geology where I would have been doing field research in the Himalayas. With a bunch of, basically there was a huge cadre of MIT professors that left and went to Arizona State. So, was going to go study with them at ASU. And at the same time, I had this letter from Pioneer, NYSE PXD, the publica that you mentioned. And it was, I got an apartment in Tempe, right? And I had this job offer in Denver. So, I did a, and ended up going to work for Pioneer. They're an incredible training ground. They looked after me so well. They had the scale, they had the scale of like a Shell or an Exxon or Chevron to where they had wonderful training programs for young people, but they were small and nimble enough at about a $30 billion market cap to where there was a real focus on the bottom line and you were pretty close to the tip of the spear, kind of like a Hillcorp today, you know? So it was a great training ground. I spent 3 years in Denver, 3 years in Anchorage, and then like a bookend year either side in Dallas.

And what was the decision point to, you know, what were you kind of weighing when you were thinking about either this academic, go study obscure knowledge versus I want to go be at the tip of the spear?

The challenge in— and again, this is not true for all academia. This was like my— the subspecialty of geoscience that I was chasing. You're gonna go, 'cause I had published some peer-reviewed research both out of undergrad and out of master's. And I mean, this stuff goes into a journal and 20 people read it. So it's that struggle for relevance, right? It becomes, it can become a bit of an ego game between the major publishers in the field or the major researchers, labs. And unlike in like a biotech or something or or, you know, technology research where you could actually really change the world, I was going to go devote my life to this like narrow corridor that likely wasn't going to move the needle for anything other than filling up bookshelves. Yeah. So, so, so on the other side of that, to feel like, oh, okay, I mean, say what you want about the liberation of fossil hydrocarbons from the ground. That's not everybody's cup of tea, right? But, you know, it was the opportunity to go work at a domestic company, to participate in the shale revolution, which You know, just for the layperson, it's like as we talk about inflation today, I mean, our industry handed low inflation to this country for a decade, right, through low energy prices, completely remade the geopolitical map, right, in terms of reliance on foreign oil versus, you know, domestically produced. So to be able to participate in something that was really playing out on the global stage just felt more relevant.

Yeah. And the oil and gas industry certainly gets a lot of popular— it's a, it's a, it's a hateable industry, right? It's, it's easy. To take potshots. And the reality is most people want to ignore the impact that cheap domestic energy has on the economy. And that's their prerogative, right? They have the luxury of not having to know in their air-conditioned Escalade. Yeah, 100%. Right. But, but what I'm really hearing, though, is that, okay, there was a deep academic interest in this subject. And what you're overlaying is an opportunity to go rather than just this narrow research that's not really affecting anything, I can go be at the forefront of, of something that's, that's really impactful domestically, even if not everybody likes it.

And there's also the interdisciplinary angle, right? I mean, my, my technical background's in geoscience.

I was—

I think I told you I was up fishing with a bunch of oil and gas guys last 2 days. And as I like to say, guys, I used to be a geologist, so listen to me as I talk about all this. I'm not one anymore, right? But this industry, it takes so many different kinds of people to get anything done. And if you're bored, that means that you're probably lazy or intellectually not curious, right? The amount of growth in legal, in engineering, in finance, right? You can always be learning something new. And so that really, that fit kind of the intellectual curiosity side of things.

So you're getting this boots on the ground education at, at Pioneer, um, and What's the impetus to maybe start thinking about your own thing? How does that go?

I was really fortunate. One of the first roles I had at Pioneer was in their business development group. So I had, I was, you know, in Pioneer, but looking over the fence at potential acquisition targets and seeing what it took to put a prospect together or put a small operating company together. So I had, I really, I knew about that business model from the outset. And so the intention had always been like, okay, I mean, this is a, don't get me wrong, great salary. Great stock grants, you know, all the benefits, all that. But wouldn't it be exciting to go try to be the, the acquisition target, right, for one of these, you know, deep-pocketed companies? And then, you know, you were— we were living parallel lives, right? So you remember, gosh, you started hearing about private equity companies getting acquired by public companies and, you know, greater fish, like, let's go be the minnow to sell to the smallmouth bass to, you know, ultimately sell to the the tuna or what have you. And so I was aware of that business model and had been starting to think about it. I was very lucky. Shout out to Pat Donovan, who's a good friend of mine from high school, who he had been an energy portfolio manager at Citadel and was, you know, keeping— he'd covered a lot of these companies. Right. And so I'm up in Alaska and he said, hey, Colin, you really need to come look at this Wolfcamp play. It's really got some legs. And I had basically seen I had participated in the land rush in the Niobrara. I had seen the land rush in South Texas, also in the Williston. Right. And it was like, okay, here's the— maybe not the last one, ended up being the biggest one. Right. So, I mean, I kind of knew what that arc looked like. We need to get in and start assembling things that we own in order to make real money. Yeah. And, and just as another footnote, not even a footnote, a main bullet. You know, all credit to my co-founder Mark. You know, he and I worked very heavily on the divestiture of the Alaskan assets to Apollo. We were in the trenches together up in Anchorage for a long time, and he had been chatting with some of these private equity sponsors and had some interest. And we were office down the hall from each other. He said, hey, would you— it was, I think it was, gosh, it was like Christmas time of 2013. It was like, hey, have you ever thought about I'm like, yes, yes, I have.

What strikes me as interesting is, is a lot of the, the founders on this show, you know, have, have this almost innate entrepreneurial, like they're, they're slinging, you know, Jolly Ranchers at recess.

That was a good one. Yeah.

Right. And you know, there, there's still a decision point. Like you had a very comfortable job and, and life, and it sounds like you were learning a lot. Like, How, what drove you to take the leap in entrepreneurship? Because there's a lot of risk in, in trying to—

I had some family background there on my mom's side. So my, my grandparents, you know, typical post-war story, right? Like she was in the Women's Naval Auxiliary. He was in Honolulu and they built a very successful post-war travel business back when travel agents were a thing, right? You forget now, but I mean, they, they probably could have stuck on another decade, but they exited in like the early '80s. And then kept the building for the rents and like they did really well. So I had seen a bit of what that looked like through that lens. And then, you know, kind of back to my own life, you know, God bless Scott Sheffield and his whole age cohort, but they founded that company and they finished that company, right? It was a, there was not a smooth, if you will, sort of conveyor belt towards upper management. There was a big block of of the management committee, they had been together working for decades. And so I was never going to be able, you know, even assuming my own talents were sufficient, right? Like it would never have been possible to pierce that ceiling, if that makes sense. So it's like if you want to be a principal, you got to leave.

Yeah. So almost you saw the writing on the wall that this career was limited in upside at some point.

You could rise to a very nice middle to upper middle management role, but you weren't ever going to get your true hand on the steering wheel.

Yeah. And so, and I mean, in West Texas, in the Permian at that time, you know, 2013 was such an exciting time. There was, there was so much unlocking. And I mean, it felt like a gold rush. I mean, in many ways it was.

It's a—

yeah, a modern gold rush. And, and that, you know, mirrors my experience at the same time. I mean, it just everywhere you looked, companies were springing up and it was a wild time to be alive for sure. What were those early days like?

I joke to this day, the early days at Picor were 50/50 Silicon Valley and Billions. Those two, which I think are, well, one's HBO and one's like Cinemax, but whatever. You know, we had $100 million of equity backing, so, you know, not John and Cody level, but still a fair war chest to deploy. And it was like the writers of Silicon Valley were hiding in our closet. We went through every bit of it, right? I think I mentioned our, our ultimate name was a result of a name change, right? Which they go through on that show as well. But it was really gratifying. I mean, we, Mark, again, to his credit, like had, he had optioned an initial asset base of about, I think like 1,800 acres. And then we crafted the game plan of how to block that up, block that up into, you know, something saleable, more like 5,000 or 6,000. But yeah, I mean, I, I had to build all of the IT systems and all the servers. And, you know, Billy, our first hire, had to, you know, deal with all the insurance. And I mean, we, we just had to birth a company out of nothing, and it was super exciting. It start— it was, it was 4 and then 5 guys working on, you know, Kmart picking tables. Well, first it was coffee shop, right? And then it was picking tables in, you know, in an office building, which eventually got built out into proper offices. And, you know, incredibly exciting.

And I, I happen to know that, that while it's all exciting, it's great to be a part of a gold rush, it's also pretty stressful. What, what, what was the, the downside? What was the, what were the hard times?

I mean, just constant brushfires, right? I mean, you're playing whack-a-mole. That's just what it is in startup, right? Even if you're a well-funded startup. So it's like, okay, are we gonna be able to get this lease? Like, if we, if we don't get this you know, keystone piece, then that's not a drillable unit, right? And it's like, okay, then we have this whole stranded— and just for everybody else, right? I mean, all it is is really, it's really a chessboard or even just a checkerboard, right? We're just trying to put together fragmented pieces of land into things that we can lay wells across. And so, you know, are we going to be able to drill that? Do like, ooh, do we have, did we really perfect the title to that horizon, right? What does that mean relative to, you know, what we can, what wells we can lay.

Yeah, I would say even more so is kind of trying to get Tetris pieces to fit together.

Yeah, that's better said.

That's better, right? But, but, you know, the, the scary part is you may invest in a whole bunch of stuff and then miss that last piece and it's all kind of worthless. I mean, not zero, but, but now not as worthwhile for sure. Yeah. Now, now you have to kind of scrap your strategy and start over again, right? And you can't possibly predict how those pieces are going to come together.

And as you know, I mean, this is kind of how we both made our bread, right? This is not parsable data, right? This is very, very arcane, dusty courthouse records. Debt severances are very complicated. So yeah, just the, are we going to assemble enough land to meet our objective was probably the core like commercial risk.

And for people listening who have never had a $100 million mandate, how stressful is that to be beholden to investors and know that you've been entrusted with this, with this, you know, massive amount of capital, certainly more money than you or I had ever seen at that point?

Correct.

What is that like?

I mean, it's a sacred trust. It really is, right? And the PE aggregator, does a good job of reminding you of that, right? It's like such and such county fire department, right? Or such and such teachers union is depending on you boys, right? Because that's where a lot of their LPs come from. And so yeah, it definitely led to some, I'd say the cortisol levels were probably higher than average. But I mean, that's what can lead to success as well, right? Because you're just firing on all cylinders at all times. Trying to mind everything.

Yeah, we, high performers tend to do our best with our backs against the wall.

Yep. And, and that deal went great, right? I mean, we tripled, we 3.2x in 17 months.

How did that feel?

I had never, I mean, just absolute walk on sunshine. I mean, I had, I had, my piece of that was probably more money than I, it was definitely more money than I ever seen. Probably more than my folks had ever seen, which of course leads into the next act of this conversation. It was pure bliss. It was incredible. Yeah.

So let's, let's start to, to unpack this. So you, you have this smashing success by, by all external factors. You get a nice chunk of life-changing money for you, but it's not enough to never work again. Like, this is, this is still—

so it would be enough. So, you know, you fire— if you follow this like FIRE community, these folks, right?

Yeah.

It's like and I think a lot of them are in this area, right?

Totally. Mr. Money Mustache. Yeah.

Okay. Yeah. So there's like a Mile High Five. Anyway, all these folks, that's a race to sort of passive income to the tune of $80,000 a year is kind of, I think, where a lot of those things, you know, spec out. I was well beyond that. Yeah. But that would have been out of step with the burn rate I had, you know, established up until that point and so forth.

Yeah. So you're— I mean, yes, at some level, never work again. But really, I mean, your eye is still on the long ball.

Oh, for sure. At this point. Yeah. Well, and then, you know, so, so I was 34, right? Had like a mid-seven-figure exit. And, and again, we— it was 120% blended IRR because of the deployment schedule, right? Was heavily back-end weighted. So I was like, well, we just did this. So now, like, now the goal number is what does it take to get into the Goldman Private Bank? Yeah. Right. And that number classically, maybe pre-inflation was about 30.

Yeah.

So that became the target.

Yeah, totally. And again, this, this, it's, it's so fun to unpack this story because it, it, you know, really does mirror my own so well. Is, I mean, by all means, by all accounts, right, for normal people, we were rich, right? I mean, hanging out with guys that were richer. Totally. And I think it's, it's so easy to, A, just miss that, that thing. And then also, for me at least, there were no great examples for me. There was no, there was nobody in my ear saying like, hey, play this safe. Like, like take, take, you know, some, some chips off the table. It was like, look at all of these examples we have. Let's go like this. This is our ante. Now let's go big.

If that was your experience, that's like 100% parallel to my own. Right.

It was.

And again, this kind of gets back to like, I'm, you know, I'm a Yankee. I'm from New England. I'm not from Texas. Right. The whole like everything's bigger in Texas. Like, isn't it badass that T. Boone worked his way back up after zeroing out, right? Like that's like celebrated. Totally. Right. But that was, I was like, okay, this is how you play the game, right?

Yeah. And this is, I think, I think, you know, I think it's easy for people, you know, outside of this particular game to be like, you know, how did those, how did those guys, you know, miss the safety piece? Again, they're like, it wasn't like a decision point. It's not like I weighed the two options. Should I, should I go all in again or should I be— I didn't know any other way. There was no other example. Sure.

Well, at least in my case, you know, like the— what's the pantheon of voices in your ear, right? Well, your sponsor wants you to put as much in as possible because they want to have you, right? Your partners are putting a bunch in. And then, and then your private, your, your primary equity allocation now starts to run through the math of your incentive equity calculation. So you've got to bow up and protect your position in the cap table, right? And you know what that means. Maybe not everybody else does, but basically like your, your waterfall cut starts to be influenced by how much you put in.

I mean, it's truly the epitome of it takes money to make money, right?

Except that like, except that you're backed by a multibillion-dollar fund that doesn't actually need your couple $10 million.

No, but they really want you to be incentivized. Yes, sir. To go knock it out of the park.

Correct.

Correct. Right. And there are, you know, some, some shadow misaligned incentives here, right? I mean, because really, if— and it's not any one specific partner, right?

But it really—

if this industry had the best interest of a 35-year-old kid at heart, they may not push them to go all in on the next deal, but they're looking for performance, right?

And the— not even illusion, I mean, it really is alignment, right? But, you know, we had at one point they called us and they're like, hey, can we do smaller but bigger capital calls? Because this is just a lot to manage, right, with all the different IRR clocks. Yeah. And it's like, the reason we had so many small capital calls is we were all trying to mind our like we were so all in that we were trying to manage our own cash, you know? Yeah.

So, so I mean, it sounds like, okay, you, you hit this again by, by normal people's, uh, litmus, you hit a home run, but almost without even looking up, you just redeploy and, and go again.

Yeah. For me it was, I haven't done the exact math, but it's probably about 60% of my net went back in the pot. Yeah.

And you're right back in the stressful situation.

What was that like? It was right back in it. We actually, we didn't— this isn't meant to be like a hindcasting exercise, right? But I think, I mean, the view was, and you were in it, was like, okay, like this play is moving a million miles an hour, right? We need to get right back to it.

Yeah.

So we were, I always remember I was up, I was, I took a couple of my buddies heliskiing in BC. And I was like stepping out of the beacon drill to take phone calls from the lawyer on the operating agreement. And I think we would've done— I understand why commercially it was like, okay, like every minute that we're not pounding the county courthouse and acquiring acreage is a minute that somebody else is getting that acreage, right? So it made rational sense. I think we might've done better to have taken a month, right? Go spend 2 weeks with the family, do one week of an offsite. Let's all go to Cabo or pick a spot, right? Let's sit around the pool and just talk. Right.

But instead you're right back in.

Right back in.

And how hard were you working at that point?

Oh, I don't know, like 50 to 70 a week, something like that. Yeah. All in. Oh yeah, for sure.

And, and you know, there is, I mean, so sort of culturally, A, it is a real gold rush. So, so there is a, yeah, the, the clock is ticking. The clock is ticking, but also there's a glorification of, of hustling. Yeah. What, what did that look like for you?

I think for me it was, so we, we had 4 co-founders in the first deal. One of the fellas didn't come back for number 2, so I absorbed his role. I absorbed his entire vertical. Right? So I was doing all my core vertical stuff, plus like I had the IT hobby, which is actually not insignificant when you're supporting a team of like 12 or 15 people. Right? And then I had his vertical and it was just trying to be all things to all people. Right? And just getting spread way too thin. I also ended up in the later innings, I actually absorbed all the operations. So I had all the petroleum engineers reporting to me as well. And it was doing, trying to be all things to all people, doing too many things. And as a consequence of that, potentially missing small bits and pieces. Yeah.

And like, and, and just gimme a sense of like, what, what does that look like from like a, uh, stress on your personal life perspective? I mean, is it, it's kind of all work all the time is what I'm hearing.

It's either work or it's late nights with the work guys. Right. So I remember it's funny, I was dating a, uh, I was dating an ER nurse for a while and it was during Nate and she was trying to call me and I'm like, hey, I'm working. Like, please like understand. And she said, well, it's 11:30.

Where are you?

I'm like at the Four Seasons bar. Well, that doesn't sound a lot like work. It's like, okay, well you work a very, like your framing of work is very shift-based and like codified. For me, it's all-consuming, right? It's like you're, you're doing breakfast with vendors, right? You're at the office, you know, whatever, 8 to 5 or 8 to 6, and then it's dinner with other people at other companies or with your own guys, right? Probably a couple scotches along the way, right? A couple, 3 espressos in the morning, and it's just like repeat, repeat. And actually, and I should say, I definitely neglected my health. Definitely affected my relationships because the view was, okay, if I just make another J-curve investment here in time and in capital, I could have the rest of my life free.

I'll just be happy when. I'll put all this on hold.

Yeah. And the only yardstick we had was like, okay. Oh, and by the way, our equity commitment went from $100 to $200 in the second vehicle. So you run, you run that waterfall math and you're like, okay, if this goes anything like that goes, I'm a client of Goldman and I'm good. And I'm 36 or 37 at that point.

Yeah. And I mean, you know, having, having played this game and lived this life right there, again, there's, there's— this is like the only path that, that anybody is taking. I mean, there are no examples even available to you. It's like, this is, this is what you do. You neglect your health, neglect your family, you go all in, you knock it out of the park, and then you live your life later.

Totally. Well, and I should say too, I mean, the, the, the skill sets that you develop in our industry, it's still my industry. Maybe you probably, you still have a foot in it. Maybe they're not super transferable, right? Certainly if you're on the technical side, right? Petroleum engineering, geoscience. Certain elements of oil and gas finance are very unique to the business. And so it's like, no, you need to double and triple down on this because you can't really lateral into anything else.

Yeah. And so, so how does that, how does that second round unfold?

2A was great. We actually, you know, we doubled our money there. It was a smaller deployment, but same, we stuck to our knitting. Midland Basin, right, which is the sort of legacy home of Pioneer. It was a legacy home of our our skill sets and knowledge. And yeah, so doubled our money there. And then on our third outing, which was still under the same umbrella, same equity commitment, you know, candidly, again, not getting into a hindcasting exercise, but we went from aggregating small bits and pieces in basically zero-risk rock in the core of the Midland Basin to— and there were good reasons for this because we saw what other people were doing, right, to going over the hill into the Delaware Basin, Delaware Subbasin, the overall Permian, which none of us had any legacy experience in and which is fiendishly much more complicated. So definitional thesis drift, right? Went from aggregating postage stamps in our, our backyard to trying to make an acreage map that looked really cool, right? So we assembled like 25,000 acres.

Yeah, I mean, it's the kind of the definition of shiny object syndrome.

Oh yeah, for sure. And we knew, and to be clear, like we knew we had done the technical work, like where, you know, we knew we wanted to be at state line, right? The Texas-New Mexico border. We made a decision like, ah, you know, our legal and regulatory guys, New Mexico's got its nuances, right? That are different from Texas. So like, let's not play in New Mexico because it doesn't fit our—

It's like an educated guess. And yet a completely different ballgame. Right.

And of course, you know, state line area was totally bound up and there was no opportunity. And so we kind of drifted south and yeah, so it was, we put together a very big position and, and you know, the reality is, is like we came this close to making it work. I mean, we were, we were dancing with a SPAC that they failed. So in a SPAC transaction, right, you've gotta have the pipe at the end to make it all work. They failed to get their pipe done, but we wouldn't be having this conversation. I'd be sitting on an island somewhere at this point because we came this close to actually like pulling it off. And that would've been a 2 or 3 bagger on a very large deployment. And, you know, Bob's your uncle. That said, the macro shifted, right? So a lot of what you and I did was aggregating pieces of drillable lands and moving them up to bigger entities, right? That whole conveyor belt got gummed up when Saudi opened the taps and kept them open for years, right? And the capital markets would no longer support that kind of activity.

So, I mean, fundamentally the landscape changed under your feet at the 9th hour.

Yeah. I mean, and we were pursuing, like you think of Nassim Taleb, right? Land aggregation for flip-out is definitionally a fragile business, right? Because you have not founded the business on its organic cash flows. You founded the business on needing to find someone to exit to. I mean, it's, it's really a venture business model in many cases.

It's gambling at the, with, with a, a fancier suit.

Yeah. But I mean, but like a lot of venture-backed companies, right? They just burn cash until they get bought. And, and this was kind of a similar similar model. It's just that all the suitors disappeared because the macro moved.

Yeah. And so, so there you are on the verge of private island money and things fall apart. What did that look like for you personally?

That was tough.

Uh-huh. So tell me more.

So our sponsor and the prior year we were going to receive one of our brother's toys, right? So another portfolio mate, they were going to smash those assets into us. When this all sort of came to roost, they decided to take those assets and our assets and smash them into yet another sibling. So I got to know this group out of Colorado, wonderful bunch of guys, got to know them under very awkward circumstances and And yeah, so essentially the way it worked was, you know, in order to hand, we wanted to obviously give those guys the best shot to run those assets, right? Because it was the best for our own capital and, and so on and so on. So I spent like 2 months in and out of Golden handing those assets over to them because I was the one that knew the most about all of them right now. Other guys in my group didn't really have anything to work on, so they started they went off and started new businesses.

Yeah.

Right? And I was still trying to like take care of the legacy one. I have a particularly bad lumbar spine and it turns out that like massive doses of stress are not good for your lumbar. So, I was actually, my last day of employment, I was face down on the operating table having a large lower back surgery. I had a piece of my disc come out and crush the nerve that innervates my left ankle. So my foot was dragging along the floor. So yeah, so like—

And you would put that on stress?

I would put it on bad genetics. Yeah, I would put it on a ski accident I had when I was 31, right? But like the fact that it chose to pop out that exact moment, you know, it seems more, you know, more than coincidental. Yeah. So it was pretty tough. It was pretty bad.

And not only now are you watching Private Island Money slip through your fingers?

My, my own equity is getting restructured down, right? So I started running the models and I was like, oh, okay. Like there's new, there's new common coming in abo— you know, above, well, it's preferred to me, right? And then there's new equity incentive coming in above me, right? So I'm getting crammed down. I'm basically getting, I'm for all intents and purposes getting zeroed out. Right. So there's the, I guess in sort of rank-ordered terms from like cherry on top to the base of the sundae, right? It's like, yeah, the private island, that's gone.

Right.

The money you did have, that's also gone. You're going to let your left leg drag on the floor for the next 2 years while the nerve regrows. That was really rather unpleasant. Um, and then, you know, like we managed to keep together a portion of the team. But like the ability to go do this again is considerably reduced, right? We did actually get a couple term sheets and we were kind of moving forward with those and then COVID hit, right? So those got pulled. So yeah, it was, it was a, and, and, and I had, I had created a fragile position for myself through that. That rolling of, and that's why when you and I first got to talking and, and you sort of laid out your core tenets, I was like, oh, I like this guy. Right? Because that, it didn't have to be that way. Right, right. I could have, it wouldn't have been hard to just say, okay, great. So we have 2 years of guaranteed, uh, run rate G&A coverage. My salary is X, you know, adjust for tax. That's my, that's what, that's my equity contribution. So even in a scorched earth case, I'm net, net flat, right? That would've been probably a better way to think about it. And it's so funny, I remember like I had started, I knew I, that I needed some like sounding boards beyond my immediate. So I like, I brought a corporate coach in to talk to. These guys all worked in consumer goods and like, you know, they didn't understand like financial game theory. They were like, delight your customer. That was the, it's like, well, we don't have a customer. I can't delight the pipeline company.

Right.

You know? So yeah, I mean, this all sort of is like 8, 10 years gone now at this point. Maybe.

Yeah.

And definitely 6.

I mean, I, I love, uh, you, you put it so matter-of-factly, but I mean, you were essentially at the top of the world looking over the cliff about to knock it out of the park and you're kind of back to zero from all intents and purposes, right?

Yeah.

You've got some great lessons learned. Sure.

Well, it's again, Silicon Valley. Yeah. What's the most, what's the best Russ Handler quote of all time? Did I lose a B? Damn near, but I bet I gained 2B in wisdom.

Yeah.

Right. And you kind of have to, and to be clear, like I kept enough back to where I'm definitely ahead of where I had been if I'd stayed run rate, you know, at PXD.

Yeah, right.

So like, no, and, and net positive, net positive. All the skill sets, all the tools now allow me to build another business in a way I couldn't have if I'd stayed in-house at a big company, right? So it's all for the good, but it could have been, had I been a little more thoughtful, you know, I could have maintained access to a ton of upside. While much, much limiting my downside compared to what I actually experienced.

Yeah. And I think that's the story that, that really is so interesting here. Right. You know, for all the people listening who have no idea what this oil and gas jargon even looks like, I mean, the arc is your first venture was a home run, right? And the model, the examples that we both had is push all of that back in the middle because you don't just want a home run, you want a grand slam and a World Series win.

Yes, sir.

And that's essentially what you did. And you got within one out of winning the World Series.

But it's like a Ricky Bobby thing, right? It's like, right? You know, if you're not risking it all to go to the moon, then what are you even doing playing the game, right? Yeah. And I think it, and honestly, The fact that it's oil and gas is sort of not even germane to the conversation, right? Like this could be anything, but if you, it's that it's taking the time to like really game it out when you're at these critical inflection nodes, right? And you know, some people can do this intuitively, right? Like some people need a piece of graph paper, but do an expected net present value calculation, right? Get, get your marker out and start making decision trees. And put weighting factors on them. And that's a really helpful little chalkboard exercise to go through as to how to proceed. Like, you know, for example, I'm helping my parents sell their house right now, right? And, you know, the Q1 was like— Q1, Q2 is a little wonky in the real estate market, right? Ton of supply hit, like, whatever. And my mom's like, well, like, they live on like on the water and, you know, Kipcott area. And it's like, well, what if we like did a summer rental thing and then like, you know, assess the market? Did it? I'm like, okay, mom, so what's the monthly rental rate? Okay, so we're gonna like make, I don't know, $25,000 or something like that. And, and, and what, and, and that just gets us right back to where we started.

What's the cost?

You've got the carrying cost along the way. And so like, so basically like net, net we're getting, I don't know, call it 17.5. And all we're doing is kicking the can down the road. So again, just like a lot of people that I, in the private equity space, in the VC space that I know can just do these things very intuitively, others of us kind of have to talk it out. But again, if I had employed a little bit more of that practice at that critical juncture, I'd be sitting here saying, oh yeah, well, like whatever, I lost 2 years of salary, but, uh, you know what, I also received 2 years of salary, so who cares?

Yeah, I mean, it's really thinking through, and when we think about our fundamental drivers, right? Like fundamentally we're risk takers. We wouldn't be in this business, you know, if we aren't. And there are, I mean, I can look back at my own career and see just these monumental inflection points where if just, one person or somebody had said, hey, like, just tap you on the shoulder, just tap me on the shoulder and said, why don't you slow down a little bit, right? My outcome could have been dramatically different, but I just kept pushing all in and pushing all in and pushing all in. And, and again, you know, I can have compassion on myself. I didn't know to stop and, and take that step back and go, wait a minute, because there, again, there's just, there's no examples of that. And I think what's, you know, why it's important for me to tell this story is like, I hope someone listening, you know, who has maybe had that first exit and thinking about swinging for the fences again and go, hey, wait a minute, let's rig this game so we can't lose.

And that's the— so, and that's like, that's exactly right. And my motivation's the same as yours. Like I told you, I've had some pretty bad lumbar issues. Any friend of mine that I hear is having back pain, I sit them down and I'm like, you don't want to be me. Okay, here are the things you have to start doing right now so you don't end up where I'm at. And it's the same thing on this. Like, cool. Like, this is kind of a, it's kind of a funny story. It's like, oh, like you crushed it and then you got crushed, right? But if, but if anybody can take, it's like if we can help one guy or gal, right? Not go through this again, then we gotta tell the story.

So if you could go back 10 years, what advice would you give yourself at that point?

Again, because my background is technical, that's where a lot of my horsepower went, was like making the maps, picking the locations, all that kind of stuff. It's like, hey, just remember that there's other people in the room whose sole focus is on getting advantage over people like you, right? So like, just kind of look out for yourself on that. Be your own advocate. And also be antifragile, right? I mean, that was a lot of what came out of '08, right? Was take that antifragile mindset and apply it to your own life. Take, whenever you have an opportunity to carve some risk off the table, carve it off.

Totally. And that's the, you know, that's the thing is that, you know, what I teach people is fundamentally we all start as accumulators of wealth, but at some point you have to shift your mindset to being a defender of wealth.

And again, I don't even know when— I don't know, I got Instagram, what, like 4 years ago because some snowmobiling brand wanted to feature me and I didn't have— they're like, what's your tag? I'm like, well, I don't have one, so I've got to get one, right? I don't know when Ray Dalio spooled up his account, right? I'll tell you right now, 10 years ago, you know, I was not following Ray Dalio on Instagram and it's the old like, don't lose money, right? Because if you lose half, then what do you have to do? You've got to double it to get back to par, right? And just like little aphorisms like that. And I guarantee, so it's interesting, a friend of mine from high school, I mentioned like this, like Mayflower concept, right? A friend of mine from high school, she blew through and stayed with me last year and she was like, Colin, like Like, you know, my family's like really rich, right? I was like, yeah, well, like, you know, this was the '90s.

It was high school.

I couldn't really look you up. Like, I kind of figured, you know, like your last name was on a building at Harvard and also at our high school. Okay. Like, I kind of figured, and, you know, come to find out. Yeah. Like, yeah, I'm not going to point them out, but really rich, really rich. Like, like Yeah. And she just talked about how they do it. She's like, yep. You know, at 27 you get invited behind the curtain. I mean, it's like Rockefeller type stuff, not the Rockefellers, but similar, right? At 27 you get invited behind the curtain, you get your piece, right? Your principal's not yours to play with. The proceeds are, and you get a vote.

Yeah.

And, and I guarantee like a lot of these, you know, just probably a bullet list of a dozen aphorisms. Like the Ray Dalio Don't Lose Money, right? That's in many ways like that playbook, just that dozen bullets, I think would elevate people so much in some of these instances we're talking about. Doesn't need to be a full-blown MBA. Doesn't need to be a, you know, a book this thick, but just 10 or 12 guidepost points I think would go a long way.

Yeah, totally. I mean, the, the don't lose money is one of my fundamental lessons. You know, for, for exactly that, that math, that, that pesky math problem you just talked about, right? Is if you, if you lose half now, you have to double to get back there. And, you know, I, I think especially because you and I both came up in a gold rush, there is a tendency to believe that the good times are never going to end. And, and there was a couple of, you know, quick price crashes and stuff in there, but I mean, it was almost just a pure gold rush for, for nearly a decade.

And so the, the GFC actually, do you listen to this guy Arjun Murthy at all?

Mm-hmm.

Great dude. He's a, he's at Veritown. He used to be at Goldman. Did a bunch of great work on like V-shape versus U-shape price recovery. Right. And it was like, all right, great financial crisis. The contagion came from the mortgage market. Right. So I mean, oil went from over 100, like 147 to 40 and back to 110 in 5 months. Right, right. Blink of an eye.

Yeah.

You know, then, you know, the Black Thanksgiving of '14, right? Like that was contagion within our industry. It lasted for a long time. COVID, snip snap, right? Came from without. So yeah, you had a bunch of these instances of like, sure, you had price excursion, but you had very rapid price recovery.

Almost can't lose. I mean, there in, in, in many cases, printing money and, you know, so, so sure, hindsight's 20/20. Like we, we almost couldn't have forecasted the writing on the wall because it's, I mean, it was almost like you can't lose.

Well, we talked about like Northeastern liberal academic echo chamber earlier.

Yeah.

Right. We were all living in like Texas shale bro echo chamber. Right. Which is probably not too different from, you know, Palo Alto tech bro echo, echo chamber. Right. Right. Everyone's making so much money. I mean, there were a, I was skiing with a buddy of mine who was sort of roughly in the Silicon Valley Bank ecosystem the day that they failed. Yeah. Right. And I think for a lot of these people in tech, you know, they had never, when interest rates started going up and all of a sudden their future cash flows were worth less and so their valuations deflected down, these guys were like, what do we do? Yeah, right. That's a fragile— that's also— that's a fragile business model. So just, I think, being deeply interrogating what you're doing and stress testing it in your own mind and doing it in a way that puts a floor under the outcome. It's not sexy, it's not fun, it's not bro-y, right? You're not talking about that at the bar at 2 AM about like, look at my allocation to muni bonds. Right, right. But But it's pretty cool to be sitting on a lake when you're 50, right?

Yeah. And that's it. And that's, you know, when I look at some of my worst investment decisions, if I had, you know, a peer advisory board and I went and laid out my net worth and the decisions I was making, they would've laughed me out of the room.

Sure.

And if I really think about it, right, if I get quiet with myself, I knew, like I knew that I was writing checks that were outsized, but I couldn't stop, dude.

I had a, I had a mid, you know, mid to upper mid 7-figure net worth. Okay. And I had a 60% allocation to alts, not, not just alts, but one alt, right? Right. Like that wouldn't pass muster with anybody.

Totally. Um, and And right, and like there is, for me at least, there was like a voice in the back of my head saying this probably isn't it. And I didn't justify my decision to anybody, right? We operate in a vacuum and you know, we're not supposed to talk about money. So I didn't go to anybody and lay out my portfolio because it's almost like, you know, being naked in front of someone. Oh, it's not, it's not something that we discuss. And man, like if I could just go back and go, If I gathered, you know, 3 guys that were smarter than me in the room and said, hey, this is what I'm thinking about doing. Does this make sense to you? That one inflection point would've changed my life. Like, I hate to, I hate to do public math here, you know, but I, I went through with a wealth manager friend of mine and like, if I had just made a few better decisions, like I'd be sitting on $50 million liquid now. Newsflash for anybody listening, I'm not right.

Right.

And, and there's, there's like 2 or 3 key decision points. This is not a wildly different—

Oh yeah.

Path. We're—

I'm 44. You're also—

Yeah, I'm also 44.

Okay. I don't know if it's being in my 40s or if it's just being in the year 2025. I can't separate the 2 variables, you know, it feels like my buddies are a lot more open to talking about their losses, personal, financial, emotional, all that, right? And to like starting to, starting to do that peer advisory board kind of process, informally over a cup of coffee or whatever. But I don't know, are you seeing something similar?

Yeah. I mean, this is, I mean, this is what I do. This is why I started.

But has, has there been a cultural sea change or is it just because I'm, I'm coming into that time of life where people have enough scars, they're willing to talk about them?

Yeah. I mean, I think, you know, my, one of my core values is vulnerability and, you know, there's always an opportunity to go first, right? And so, so my thought is like, if I share my story and if I tell people about, you know, look, it's, it's way more interesting to hear about the time that I lost $1.5 million than it is, you know, no one cares how much money we made, right? Ultimately, I, I think there is something so sacred about sharing those scars, it invites other people to open up. And I do think there, there has been sort of a cultural shift with shows like this one. And, and, you know, you know, if I, I mean, kind of like we said earlier, if I can help one person, don't just be like, hey man, you know, I, I can't guarantee that, you know, you'll skip all of the pain, but hopefully we can shorten that learning curve just a little bit.

Sure. Right.

So But, you know, I do think there is a trend toward, number one, I think, I think 10, 15 years ago, at least my perception when I was starting out was everyone else has it all figured out and I'm, and I'm learning as it turns out, you know, the more I meet guys like you, not everybody has it figured out.

In fact, most of us, and that's true in their family lives, true in their professional lives as well.

Totally.

Yeah.

Right. And so I think it's just really, for me, really comforting to know like, oh man, here's a guy I just met a year ago. We came up in the same path and our stories look really similar. Sure. Cool. Turns out there's a lot of us, right? And the more entrepreneurs I talk to, the more folks I realize like we're kind of all the same. And the first time I shared my story was a few years ago on a stage at Baby Bathwater. And like 25 people lined up and were like, oh my God, me too. I've been, I've been rich and broke so many times and I've never told anyone.

Right.

And so I do think there's a cultural shift.

Yeah. And I think if you can, you know, if we're talking rich, broke, if you just think of a sine curve, right? If we can just truncate the bottom of the sine curve, right? You know, like sure, maybe you're still going to have losses, but they're not going to go as deep.

Totally. So final question, you know, now having been through this, right, having stood on the, on the top of the mountain and watching it slip through your fingers, what does wealth mean to you now? And how do you think about that moving forward?

It's really, I mean, it's not because he said it, but I think he said it really nicely. I mean, it's the Scott Galloway definition, right? It's the, your asset, does the yield from your assets cover your burn? And I was talking with a dear friend of mine over coffee the other day. He's one of my biggest investors as well. And you know, his sort of mythical number's bigger than mine because he's got wife and kids and bigger ecosystem to deal with. But it's, it's, can we start working on things for their intellectual stimulation rather than for a need to plug a financial hole? Yeah.

And what a gift.

Cool.

It's an amazing place to operate from. Colin, this has been such a pleasure. Thanks for sharing your story. I know it's not easy, but I know it's going to help a lot of people. So I really appreciate you being here.

Thank you for having me. And yeah, really enjoy it.

Cool, man.

All right.

Cheers.

Thank you, sir.