Hairpin corner at Circuit de Spa Racing Course, Belgium

The COVID-19 pandemic is the third recession of my adult life. I graduated from Morehouse College directly into the tech bust. I graduated from MIT’s real estate program into the Global Financial Crisis (ironically initiated by a real estate bubble). This time around, I’m not graduating from school, but for the past year and a half, I’ve been working on launching a startup real estate fund. Which means I again find myself staring into the breach at the beginning of an economic disaster with no employer, no guaranteed revenue, and no rising tide to lift my boat.Kind of Like a man that woke up to a war going on but realizing he’s naked. It’s starting to feel like I have some unique knack for going into explosive crises outnumbered and outgunned.

There’s a part of me that takes great comfort in having been at this precipice before. It’s tempting to stand at the edge and stare into the abyss, chest out and jaw strutting, and proclaim how unafraid I am. How we’ve been through this before and we’ll get through it again. Stiff upper lip and all that. Part of that is very true and authentic. Life, like economics, is cyclical. One minute you’re on top of the world, the next you’re in a debt crisis. Rinse, repeat. Hard times don’t last but hard motherfuckers do. And I fancy myself a reasonably hard motherfucker.

Hard as I may fancy myself, there is another part of me that is legitmately terrified. This particular crisis hits different because it’s not just me anymore. I have a child that depends on me now. I have mortgages. Health insurance. Health concerns. Retirement staring over the horizon. To be honest, I ask myself “Do I really want to start over?” A better question is probably “Do I have a choice?”

I was talking to Mandela Schumacher Hodge Dixon from Founder Gym the other day and I used the phrase “braking into a corner” to describe kind of where I was mentally. If you’ve ever watched car racing or raced cars yourself, you know the race isn’t usually won by who goes fastest on the straightaways, it’s won in the corners. Anyone can jam the accelerator and go fast in a straight line. That’s easy. The past decade has basically been a straightaway in my industry, and maybe yours too. All you had to do was point your business in one way and hit the gas. While we knew it would end at some point, there was no real reason to expect we’d run into a sharp curve this fast.

The thing about corners is knowing when you have to start slowing down, the angle you take going into the corner, the line through the corner, and when to get back on the gas pedal. All that while taking into account bumps, changes in grade, and other cars. That’s really hard to do even when you know the course like the back of your hand and you’ve done it a million times. It’s why Lewis Hamilton is the tenth highest paid athlete of the last decade. That shit is hard. Now imagine doing that at night. On a course you’ve never raced before. With a busted headlight. That’s kind of where we are now. The corner could be a hairpin, or a sweeper. Or an S-curve. Double apex maybe. I don’t know. We’re racing blind.

I’m no Lewis Hamilton. I may not even be Cal Noughton Jr. But I have been around a track a few times, and I’ve learned some things, albeit the hard way sometimes. I’m also immensely blessed that figuratively speaking, I at least have a car. I have a business, some assets, a world class education, and an amazing network of people in my orbit to help guide me. So here’s how I’m taking it.

I’m slamming on the brakes. I’ve stopped dong some of the things that I did before on the stragtaway. Most notably, spending money. The thing I want to avoid more than anything is crashing into a wall. I’m stopping projects that aren’t mission critical or that take my focus off the road ahead. That isn’t as easy as it sounds, because I don’t have a perfect line of sight into the future. I may be stopping an activity or a spend that actually pulls me out of the curve faster. That said, in these times, its a lot more palatable to restart a subscription or pick something up you’ve dropped then to let a longshot bleed you dry. I’ve shored up my relationships with my lenders, gotten my documentation and financial statements in order, and am making sure my tenants and partners are safe and healthy, both physically and economically.

I’m remembering the last race. Yes, this course will be different. They all are. But the thing about race courses is that they’re all race courses. Daytona, Spa, Le Mans, Nurburgring, they’re all just combinations of straightaways, corners, and yes, walls. Just in different order. That said, there are parralels that can help you find the racing line. The angle of the curb, the distance to the wall, the tire markings that look familiar. Distinguishing between noise and signal is really different, but some patterns are almost certain to emerge that can shed some light in the dark. My graduate thesis looked at a lot of data from the S&L crisis and applied it to the GFC to see what could be learned. This time around, we have to look not at just economic crises of the past, but health crises. Basically Black Monday and the dot-com bust, plus the Spanish Flu pandemic and the Plague. The good thing is that we have better data analysis tools than ever before so while we don’t know what’s going to happen, we can game out as many possible scenarios as the nerds at MIT can input into their supercomputers. Or this guy:

I’m watching what better drivers are doing. Which isn’t the same as doing the same thing they’re doing. They’re racing just as blind as I am. But the people that have consistently done well at a thing in trying times usually have some method or insight that can serve the rest of us. I may follow them into the turn, I may not. But I’m definitely looking at their brake lights and their tire angle for clues.

I’m assuming this is a compound corner. Everything I’ve seen to this point suggests this crisis will have starts and stops. Whether it’s social distancing rules, opening and closing of essential and non-essential businesses, or government funding, it will be inconsistent, it will have false signals, and it will be unpredictable. I’m building a lot of flexibility and willingness to pivot into my behavior. Garth Stein has a great quote here:

“This is a rule of racing: No race has ever been won in the first corner; many have been lost there.”

This will be a multi-corner race. If you take nothing else form this article, that’s it.

I’m relying on my crew. I went through the last two downturns effectively by myself. Those were both extremely impactful to my fortunes, for better or worse. My old boss, Bo Menkiti, often used the old African proverb “If you want to go fast, go alone. If you want to go far, go together.” I think I’d like to use this shift to really make a change in how I engage the world. We’re all in this shitstorm together. None of us will come out of this without some scratches. At least. Some of us won’t come out of it. I’m writing this during a week where people I know have had close friends and family die from COVID-19. It’s never felt more real and more visceral for me than it has today.

What that means is I’m looking to team up with institutions and people to help each other get through this and come out of the corner faster and stronger. That’s a two way street. There are people I’ll be asking for help and there are people I’ll be tasked with helping. As the Founder Gym team used to say “We all go up together.” I’m looking forward to reconnecting over the next few weeks and getting this car around the track together.