Chapter 1: Reflecting on Financial Blunders

Recently, while journaling, I reflected on my three most significant financial blunders. This exercise prompted me to recognize the lessons learned from my errors, transforming them from mere regrets into valuable insights.

"Making all your mistakes at once can lead to growth."

Over the years, I've made numerous questionable financial choices—from investing in cannabis despite my reservations to delaying home purchases in Toronto, believing the market would eventually cool down. One of the most impactful series of choices occurred in the spring of 2021.

In 2019, I began investing in psychedelics, recognizing their potential to revolutionize mental health treatment. Having experienced personal benefits from psilocybin, I was convinced this was a groundbreaking opportunity. With over 80 investments under my belt, mostly through my venture fund, 500 Startups Canada, I was well-versed in startup investments.

I allocated $1.5 million to an early-stage investment in Field Trip Health, which went public in 2020. By early 2021, I had profited $6 million! After recouping my initial investment, I allowed the remainder to ride, a decision I now regard as my last prudent financial move in the psychedelic sector.

In tandem, I connected with an advisor at ATAI Life Sciences, a prominent player in the psychedelic industry known for its robust drug pipeline and exceptional leadership. While I wasn’t a fan of drug development, the prospect of pre-IPO shares was enticing.

Despite my usual hesitance to invest in public companies, I felt compelled to participate due to my reputation as a supporter of psychedelic research through the Nikean Foundation. This connection granted me access to unique investment opportunities.

After deliberation, I committed to investing $1 million in ATAI through a specially arranged vehicle. I believed in Field Trip's clinic model, as investing in meaningful ventures often softens the blow of financial losses. However, when Field Trip eventually faltered, I empathized with the staff and the lost potential but didn't regret my decision, convinced that mental health clinics utilizing psychedelics are integral to our future. I still hold investments in firms like Holos and Beond, which fortunately remain private.

During the process of acquiring ATAI shares, I was asked how much of the pre-IPO allocation I desired. Anticipating a reduction, I requested $3 million, hoping to secure $1 million. However, when informed that increasing my request to $5 million would guarantee full allocation, I naively agreed.

Upon receiving confirmation for the entire $5 million investment, I was struck with panic—this amount was beyond my available funds. Yet, the IPO was imminent, and I convinced myself it was a safe bet, justifying the decision as a calculated risk.

Let’s outline why this was a poor choice:

• I was heavily invested in the psychedelics sector, lacking diversification.
• I had no clarity on the IPO timeline, and as an insider, I would be unable to sell at IPO, facing a lock-up of at least three months.
• I was committing more capital than intended and more than I could afford to lose.
• By borrowing against my other investments, including Field Trip, I risked a financial debacle if the psychedelic industry faced a downturn.

Ultimately, driven by ego and fear of missing out, I confirmed my investment. The organizers assured me I could liquidate half my shares shortly after the IPO. Unfortunately, they were mistaken. I found myself locked in for 6-12 months.

ATAI went public in June 2021, with my pre-IPO purchase price around $12. The stock peaked at nearly $23 the following day, presenting an opportunity I could have seized on the open market. Instead, I remained tethered to my shares as the market fluctuated.

On the day my lock-up expired, the share price had plummeted to $2.70, resulting in a $4 million loss. I liquidated half my holdings, but the remaining shares hovered around $1.60. When the psychedelic sector crashed in November 2021, I faced additional losses, compelled to sell off valuable investments and real estate to cover a margin call.

Six months ago, I experienced significant anxiety, but through meditation and IFS therapy, I’ve managed to regain my composure. Although my finances are still recovering, I no longer feel anxious.

Among my many errors, the decision to invest $5 million instead of $1 million stands out as particularly egregious. My ego and greed led to this miscalculation, leaving me with a shattered financial outlook. Despite this, I hope my experience serves as a cautionary tale for others.

Fortunately, I've continued to make smaller investments in tech startups, some of which have yielded impressive returns. While my liquidity is currently limited, I find solace in the lessons learned from my journaling process.

A crucial takeaway from my 80 investments, resulting in over $100 million in gains, is that predicting winners is futile—no matter how experienced you are. The best strategy is to invest consistently and double down on your early successes.

Looking ahead, I am optimistic about AI therapy, with or without the integration of psychedelics. If you know of any promising startups in this space, I am eager to explore new opportunities.

Chapter 2: Learning from Mistakes

In the first video, titled "What's the biggest financial mistake you've ever made?", various individuals share their experiences and insights on financial missteps, offering valuable lessons on avoiding similar pitfalls.

The second video, "This Was My Biggest Financial Mistake," provides a personal account of a significant financial error, emphasizing the importance of learning from our mistakes in investment decisions.