Leveling the Playing Field

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In mid-January, I received a pitch to invest in the buyout of a Ligue 1 European soccer club. It promised positive cash flow, growth opportunities and the chance to sit in the owner’s box.

It’s the kind of alternative investment that until recently would have been limited to the wealthiest of investors. And yet, here it was, a chance for my own version of Welcome to Wrexham.

The offer didn’t come from JPMorgan, Morgan Stanley, Goldman Sachs, Deutsche Bank, Barclays or UBS. In fact, it didn’t come from any traditional financial institution.

It arrived via email from the eponymous manager of Litquidity, an Instagram account that has garnered 800,000 followers posting irreverent memes on financial markets.

Litquidity was in the news last week because of a big article in the Financial Times in which he revealed his real name, which is Hank Medina. For the previous seven years he went by “Lit.”

I had breakfast with Hank last October when he was still anonymous. During a two-hour meal, I learned most everything you’d want to know about his life and business except his name.

Hank told me Business Insider was trying to dox him. As a former journalist, I told him that sooner or later his identity would come out. He had gotten too big.

Instead of waiting, Hank took the story to the Financial Times. The FT filled in biographical details: Hank graduated from Cornell. He worked at CIT Group, Jefferies, Wexford Capital and Deutsche Bank before leaving in 2020 to work on Litquidity full time.

The unmasking made for good press, but underplayed a larger and more dramatic story: how is it even possible in a world of financial titans that someone with an Instagram account can syndicate deals for everything from seed startups to European soccer clubs?

According to the FT, Hank has made more than 30 investments in early stage start-ups. He has deployed more than $4 million of equity capital through a syndicate in which he serves as general partner. The investments are made via special purpose vehicles.

He said his social media presence attracts deals. The companies see the value of both his go-to-market and community building expertise, as well as a network of potential investors.

It’s obviously not the same as managing an IPO for Reddit, but the main difference is scale.

The mechanics of attracting companies that need capital and a pool of investors is similar.

Hank’s not the only one tapping into community. Andrew Yeung, the former Google product lead who throws tech parties, circulates investment opportunities to his list and Brett Perlmutter does something similar with his newsletter Bulletpitch.

In the past, investment banking stars like Ken Moelis, Bruce Wasserstein, Frank Quattrone and Paul Taubman broke away from big shops to form boutiques.

Hank, Andrew and Brett are coming from the other direction, starting with an audience that trusts their judgment and then building boutique businesses.

It’s a reminder of how social media can level the financial playing field.

Even when the field involves European soccer teams.

BRIEF OBSERVATIONS

ABBEY ROAD: There is usually a backstory to every story and the album cover for Abbey Road is no exception. I find it delightful.

WHAT A TIME TO BE ALIVE: Gluten free. Dairy Free. Nut Free. Soy Free.

THE MATRIX: The lead role of Neo in the Matrix was passed over by Johnny Depp, Leo DiCaprio, Brad Pitt and Lou Diamond Phillips.

THE CULTURE TUTOR: The Twitter account The Culture Tutor is a phenomenon. It’s written by Sheehan Quirke who started the account in 2022 when he was working at McDonalds. He has accumulated 1.5 million followers in 18 months.

MANHATTAN GARAGE: There is a garage in Manhattan in which the attendants track vehicles on a piece of grid paper pegged to a clip board.