Seymour Schulich is a billionaire whose career has spanned stock brokerage, investment counselling, mining and the oil industry. He is Canadian and is among the greatest living philanthropists and many universities has his name on buildings. He also awards 650 scholarships a year. He is in his 70’s and wrote a book to tell students about his life experiences and the book is called Get Smarter – Life and Business Lessons by Seymour Schulich published by Key Porter Books, Toronto, 2007.

Success Correlates to Exposure – Fortune really does favor the bold as well as the person who participates in many endeavors. For Mr. Schulich, things happened to him because he kept a hand in different ventures. It took a while before he found his magic formula with Franco-Nevada. What he means is throughout his career his edge or focus was on mining and oil and gas. He knew the businesses and when he tried other areas of the economy it did not work for him.

Handling Adversity: Life Lesson – It is easy enough to be cheerful when life flows along like a song. but the person who is worthwhile is the person with a smile when everything goes wrong.  Ella Wheeler Wilcox

90% of What You Worry About Never Happens – usually the negative things in life that befall you are things you have never thought about at all. The 10% of the worries that materialize are rarely as bad as your anxious mind envisioned.

Friends – Real relationships are built up over 20-30-40 year time periods. A real friend is someone who would loan you $100,000.

Be the Promoter, Not the Promotee (or Patsy) – it is said, in  a poker game,if you can not figure out who the weak player (patsies) are at the table with 30 minutes then you are it.

All promoters follow a few golden rules:

a) they never let the facts get in the way of a really good story.

b) the one-eyed man is king in the land of blind

c) even a blind squirrel finds an acorn now and then.

Selling – Sooner or later everybody has to sell something. You could be selling yourself, a product, a project, a charity. Some tools to help:

a) Once you have made a sale, stop selling.

b) Never bring bad news to clients – send them good news, when you call they will take it

c) do not point out hypocrisy

d) it is a fine line between being persistent and being a pest. Try to know when to back off

Never Give Out Free Options – option is the right to buy something at a specific price at some point in the future. If you are going to give an option charge a fee for it. A free option is a terrible thing to give up, but a wonderful thing to own. One of the best examples of a free option that turn gold was in basketball. The ABA was formed, it failed and some of the teams joined the NBA. The owners of the St. Louis franchise beside getting cash asked for something extra. A portion of the TV rights – TV brings in big money to sports. This agreement made the list of The Dumbest Moments in Business History complied by Business 2.0 magazine.

Don’t let Cash Burn a Hole in Your Pocket – It is amazing how cheap assets can become in a fire sale and how far their values can fall.

Never let cash burn a hole in your pocket. Do not pay excessively for anything just because you have the money. The biggest opportunities come to those who can write a cheque when assets go on sale at knockdown prices.

Track the Cash – When Mr. Schulich was young and taking his MBA and CFA, he asked his Dad about his business. You had no formal training, how do your monitor the business from a financial standpoint? His answer,  I get a statement of the cash on hand every two weeks. It is rising, I do not worry. If it is falling, I get concerned.

In every company, Mr. Schulich was an investor or principal the first metric he tracked was cash. If the cash was rising – positive things. Namely the receivables were being collected, not too much buildup in the inventories was occurring, and the business was generating free cash flow.  Always track  the cash levels.

Linking to dividend paying stocks, one of the reasons why they are worth investing it is they generate cash to make profits. As long as they are generating cash to make profits they are worth keeping. The all important metric of free flow cash is something all investors should monitor, when it fluctuates when it is not suppose to check out other alternatives.

There are more questions than answers, till the next time – to raising questions.