business-man-reading-newspaper YOUNG LOAN OFFICER TELLS ME HE’S GOING TO BUY JVM

About a year ago, a young loan officer/branch manager asked one of our business development officers if he could visit our office to meet me and the team.

He seemed like a nice guy, he said he was doing well, and I always like to find out what the competition is up to, so I said yes.

When he showed up at our office, we chatted briefly before he very clearly explained to me how successful he was at flipping houses and expanding his mortgage business.

He then told me exactly how much money he made the last two years before telling me he was going to buy JVM Lending, even though we weren’t for sale. :)

Anyway – he was a young guy with a lot of hubris who caught a super-hot market, and who has never experienced a down cycle.

I’ve seen dozens of guys just like him over the years.

They catch hot markets, attribute their success entirely to their own genius, often over-extend or burn bridges, and usually crash and burn at some point.


I thought of all these guys when I read this fascinating WSJ article: Theranos Inc’s Partners In Blood.

Theranos is the company that recently flamed out, after being valued for billions, b/c they blatantly lied about their ability to test blood with a tiny pin-prick sample.

Most of the focus has been on the young founder, Elizabeth Holmes, who is now facing criminal charges.

But – this article is about her ex-boyfriend, Ramesh Balwani, who aided in the fraud and who seems like the ultimate example of someone who got extremely lucky, but somehow avoided crashing and burning (until now).

Ramesh made $40 million in the dotcom era by selling stock in a company that was mostly smoke and mirrors (according to my tech buddies) right before the dotcom bubble burst in 2000.

He met Ms. Holmes in 2002 when he was the only adult among a bunch of Stanford students on a trip to Beijing for a Mandarin program. Ramesh was 37, and Ms. Holmes was a teenager who had not yet started college.

They became an item shortly after the trip when Ms. Holmes dropped out of Stanford.

Ms. Holmes started to work on her Theranos vision in 2004, with Ramesh directing traffic behind the scenes. In 2009, he showed up at Theranos all of a sudden as the “2nd in command.”

According to the article, he was “a brash figure among the scientists and engineers, wearing white designer shirts with puffy sleeves and the top three buttons open, acid-washed jeans and blue Gucci loafers, along with pungent cologne.”

He dressed down employees in public, and randomly and frequently fired them as well. He also flashed his wealth, showing up to work in a Lamborghini and a Porsche 911.

And unlike Ms. Holmes, he didn’t understand the company’s chemistry or engineering concepts, which was comical for someone managing a company so mired in chemistry and engineering.

I could go on, but my point is that Ramesh seems to epitomize a “get lucky genius.” There is no real point beyond that other than me looking for an excuse to share a really interesting and amusing article (email me if you’d like us to send key excerpts).

Lastly – there are a lot of “get lucky geniuses” prowling the streets right now, so beware. :)

Jay Voorhees at (925) 855-4491
Real Estate Broker, CA Bureau of Real Estate, BRE# 01524255, NMLS# 335646

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