Tom Gayner: Investing Lessons From Jerry Seinfeld And The Downhill Luge

During his recent interview on the RWH Podcast, Tom Gayner discussed investing lessons from Jerry Seinfeld and the downhill luge. Here’s an excerpt from the interview:

Gayner: Well, I think that’s true, and in fact the comedian Jerry Seinfeld has a great routine about the involuntary luge and just like go watch the luge competition, and these people are wearing these micro… micrometer level clothing.

And they’ve trained their muscles, and they have this sharpened blade to go down the luge and you get to the bottom of the luge at a certain speed, and that it’s going to be hundreds of a second that determined the difference between the gold medal winner and the fourth-place person who’s going away from the Olympics with nothing.

Well, Jerry Seinfeld has this comedy machine, and I can’t do it justice here. He said, what would be the result? How far behind would be the person that they just sort of grab out of the spectator line and chuck him down the luge?

You know, it’s not going to win the gold medal, but I think you’ll find that the time, as long as you don’t get hurled from the luge track, is not going to be massively different than the person who is trained to be a great Olympic caliber luge athlete.

And you think about that in terms of investment in those things you just talked about. of costs and trading and taxes being such a huge bit of that.

So the investment world in and of itself, and you think about the compounding that takes place within businesses that are successful in earning good returns on capital.

That is giving you a downhill luge tube to ride in. You know, when you start investing in major companies and in, you know, publicly traded companies, you’re not trying to go downhill in an uphill luge.

Just give yourself permission to take advantage of the force that’s already there. So then what separates the true amateur or the person who’s going to, who’s going to die doing this, from the person who ends up posting a pretty good time. It’s the ability to minimize friction as much as possible and not get in those curves where the forces overtake you and throw you out of the luge track.

So by maintaining this discipline, I’m just trying to ride down that luge track that is there in the context of businesses that are successful at serving their customers and taking care of people. And, you know, always going back to that notion of a company that makes a positive difference and helps their customers out.

You’re in a downhill luge. Just stay in the luge and don’t get hurled out of it and don’t operate it in such a way that you increase the friction that’s there or not.

You can listen to the entire discussion here: