It has been almost two years since Alex Rodriguez, “A-Rod,” ended his career as one of Major League Baseball’s (MLB) greatest players. He has since been establishing himself as a leader off the field, and he has successfully launched ventures in business and investment management. How did he do it? He used lessons from Warren Buffett and Bill Belichick, and joined “the dark side” to become a media announcer.
Rodriguez spoke at the Wall Street Journal’s Future of Everything Festival on May 8 about investment strategies and building a business off the field.
He is a former World Series champion and MLB all-star. He played 22 seasons with the Seattle Mariners, Texas Rangers and New York Yankees. He won several awards throughout his career, and his last game was in August 2016.
Rodriguez is the CEO and founder of A-Rod Corp, a diversified investment firm with a fully-integrated real estate development company and holdings in an array of ventures. He has launched a career in the media, appearing regularly on several television networks.
Asked about his core tenets in the business world, he discussed his investment and management strategies. Here are a few lessons financial advisors can learn from his comments:
1. Fail like A-Rod and remember tough times
Rodriguez revealed himself to be modest and humbly acknowledged his weaknesses.
“When people talk about my career highlights, they often go to the 2009 world championship with the Yankees,” Rodriguez said.
“Sometimes they’ll say 2,000 RBIs or 2,000 runs scored,” he said. “Or almost 700 homeruns,” he added with a bitter tone, jokingly referencing the fact that he ended his career with 696 home runs.
“But what they forget to tell you is that I'm fifth all time in strikeouts,” he said.
“That means I have a Ph.D. in failing.”
He joked that the number one leader in strikeouts is his good friend Reggie Jackson.
“What I remember is that I had really tough times,” he said, “I remember that it is all about discipline.”
2. Manage by focusing like Buffett and Belichick
“When you're a CEO, you essentially a firefighter,” he said, “you have to go fix things all of the time.”
“But you don't want to spend 90% of your time on fixing headaches,” he said.
He said you should spend that much time on what's gives you the best ROI over life, focusing on your family. “When you overstretch, you're cleaning up all of the time.”
“Buffett always says the difference between a good businessperson and a great one, is the great one says ‘no’ 99.9% of the time,” Rodriguez said.
He offers the same advice to young entrepreneurs and young players, “don't go so wide and shallow – go narrow and really deep.”
“People do not understand that the greatest coach of the time is Bill Belichick,” Rodriguez said. “Bill Belichick gets to the office at 4:30 in the morning every day and leaves at midnight, 365 days a year.”
He said that is the commitment he would want if he was going to manage a professional sports team.
Focus and hiring a team you can delegate to effectively is key to successfully leading a business, according to A-Rod.
3. Hire people who are smarter than you
“Every time I hire someone, they're way smarter than me,” he said. Rodriguez explained that he and many business leaders share the view that hiring a team of individuals who excel in areas where he is not knowledgeable is essential to business success. “I want to be the dumbest person in the room,” he said.
Rodriguez used his weaknesses in technology as an example. “I'm a little bit of a dinosaur, I walk into my office and the computers shut down automatically,” he joked. “I just got rid of my Blackberry a few months ago,” he added.
Yet Rodriguez feels confident investing in the technology space. “My biggest three holdings are Amazon, Google, and Facebook,” he said.
Rodriguez relies heavily on his team to help him implement technology in both his practice and his portfolio. With their input, he feels confident that the firm is making informed practice management and asset allocation decisions in this space.
“As a leader of a team, you want to get the smartest people around you,” he said. “I want an advisory board that is completely diversified in age, gender and experience.”
“I collect information and I ask tons of questions, prepare and then I make a final call,” he said.
4. Holistic and long-term investment selection
“Remember you plan for the worst, hope for the best,” he said.
Rodriguez said he uses a 30-year investment horizon to generate risk-adjusted returns. They allocate to a variety of asset classes, ranging from domestic stocks to private equity investments.
“I look at a business and ask myself what it is going to do when my daughter's running it,” he said. “Or someone who's married to my daughter, though I’m losing sleep just thinking about that,” he said jokingly.
Rodriguez works closely with a team of analysts during the investment selection process. He advocates for the use of a holistic forecasting model that considers analytics from both a micro and macro perspective.
To explain this approach, he used investments in sports as an example. “I am very bullish on sports in general, I'm certainly very bullish on baseball,” he said. “I don't look at a single data point,” he said, “I try to put together an accurate view of the whole business.”
“I would never look at the sales of a brick-and-mortar retailer without looking at their e-commerce site,” Rodriguez said. Similarly, he explained, “I don't look at [sports industry] TV ratings without looking at digital ratings, social ratings and the fandom as a whole.”
Rodriguez believes this strategy allows his firm to be successful, but only because it is executed by a diversified team of strategists.
5. Learn to articulate comments like you’re a sports analyst on TV
Rodriguez said he recently transitioned to what he called the “dark side” – a career in the media.
He regularly appears on FOX, ESPN, ABC and CNBC, on programs as diverse as “Shark Tank” and “Sunday Night Baseball.”
Asked what the biggest challenge has been with this new phase of his career, A-Rod explained that he has had to improve his communication skills.
“Knowing something really well, understanding it, being passionate about it – you can always learn how to deliver it,” he said. “I had to learn how to do that in the medium of television.”
He said he worked to get his analysis down to 10 seconds or shorter. “I can take a complex formula, and break it down.”
“I know that if I make it digestible and [viewers] can understand it better, then maybe they can tune in for an extra 10 minutes – that’s what I want.”
Marianne Brunet is a financial markets analyst at Advisor Perspectives.
Read more articles by Marianne Brunet
It has been almost two years since Alex Rodriguez, “A-Rod,” ended his career as one of Major League Baseball’s (MLB) greatest players. He has since been establishing himself as a leader off the field, and he has successfully launched ventures in business and investment management. How did he do it? He used lessons from Warren Buffett and Bill Belichick, and joined “the dark side” to become a media announcer.
