Inside Journey: Meet the Investor Turning $100k into $1 Million

Yegor, the mind behind the $100k-to-$1 million Substack, opens up about his journey, investment approach, and lessons for beginner investors.

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👋🏼 everyone,

Three years ago, while browsing the internet, I came across Yegor’s newsletter titled "From $100K to $1M" & More. It was about a guy who set out to turn a $100k investment into $1 million within a few years.

Honestly, my first reaction was to roll my eyes.

I even brought it up when Yegor and I sat down for a chat, and he laughed, saying, “I get it – some random guy chasing $1 million. I knew I had to establish credibility.”

Despite my initial skepticism, I found myself checking his portfolio updates every few weeks, curious to see how his journey was progressing. And, as it turned out, his portfolio was performing impressively well.

Just shy of four full years, Yegor’s portfolio has grown to $338k - quite the feat. It's no wonder that hedge fund managers have started paying attention and subscribing to his substack.

Eager to learn more about the person behind the writing, I reached out, and we chatted about all things investing (and swapped stories about our hybrid accents!). It also seemed like the perfect opportunity to follow up my recent beginner's investment strategy series with a real-life investment journey.

Talking with Yegor was a delight, and I hope you find as much insight in our conversation as I did.

As always, if you enjoyed today’s edition, hit the like ❤️ button below and if you want more than the newsletter, Finbrain members get access to courses, alternative assets and more.

Jason

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Yegor’s October 2024 Portfolio Update

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(Quick) takeaways from Yegor 🗒️:

1. Just start, any amount is worth it: getting your feet wet with investing as early as you can, even if it’s just a little bit. Contribute weekly, bi-weekly, or monthly, just keep that money flowing.

2. Think like a business owner: treat stock buying like you’re buying a whole business. This mindset helps you stay calm during those wild market swings because you knows the underlying company is still doing its thing, no matter what the stock price is doing.

3. Five-year rule: Yegor has a solid rule: he only invests in companies that have been publicly traded for at least five years. He believes this track record shows they’re stable and likely to keep growing.

4. Founder-led is best: he also has a preference for companies that are led by their founders or have management with a solid stake (at least 10%). It’s all about having “skin in the game,” which means their interests are aligned with those of the shareholders.

5. Tune out the noise: Yegor realized he was getting too wrapped up in the daily market ups and downs, so he took a simple yet effective step: he made his trading app grayscale. This way, he doesn’t get emotionally impacted by those red and green numbers flashing on the screen. It’s a little trick but helps.

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Here’s the full conversation - enjoy!

Tell us a bit about yourself?

Y: As I mentioned, I’m originally from Ukraine and came to America about 20 years ago, chasing the “American dream” - starting from nothing.

I was fortunate enough to meet the right people most of the time and climb the ladder, so to speak. I didn’t know much at first, but I learned along the way.

Even without a degree, through hard work and knowledge, I was able to keep climbing. I implemented everything I learned, and that's how I started my medical supply business (employing over a dozen people) and gained knowledge about finance and investing, all through trial and error.

I've been doing it (my medical supply business) for over 10 years now, that’s my day job. In the evenings, I focus a lot on investing.

I realized early on that while a few people tried to screw me over, I caught on quickly and moved on from those who weren't my kind of people.

Now, I'm looking to implement everything I've learned into my next project, which is documenting my investing journey.

What was/is your motivator?

Y: I never really figured out what I wanted to do in life. Maybe as a kid I had some ideas, but my parents split up when I was young, and my grandma raised me. So I wasn’t exposed to a lot of those typical figures, like ‘this is a policeman’ or ‘this is a fireman.’

My dad was a chef, but I hate cooking, so that was off the table.

Everything I tried, I just didn’t find any interest in. It was almost like I was stumbling in the dark, but I was always hungry for knowledge. I just couldn’t find something that clicked. So I started working a nine-to-five for someone, learning from them. This person actually gave me a lot of knowledge.

Even though I was getting a regular paycheck, the knowledge I gained was priceless. I used it to start my own business.

And even though that business wasn’t my passion, I discovered that investing is. I got into it after taking a seminar by Phil Town, a famous hedge fund investor. At first, I thought investing sounded cool but shady, like, how can you make that much money? But I won a free ticket to his three-day seminar. All I had to do was pay for the flight and hotel. There was no obligation to pay anything else, so I told my wife, ‘I want to try something different. Let me give this a shot.’

That’s where I got introduced to Warren Buffett’s way of investing, treating stocks as if you’re buying into a business. That’s when it clicked for me, ‘holy guacamole, this is like running my own business!’

It was on a bigger scale, in public markets, but the principles were the same: people working, products being sold, and a way to make money.

From there, I just dove in. I’ve read or listened to who knows how many books, constantly learning about investing. It took a while to get over the imposter syndrome, but now, with substack and investing, I’m starting to feel more comfortable.

Phil Town and that seminar really set me on this path, teaching me Warren Buffett’s approach. That’s also why I started substack, to document my journey, be transparent, and show my credentials in this space.

I know it’s not sexy, but the only way I know how to do things is by doing.

A lot of people procrastinate and never even start.

I gave myself a timeline - 10 years - and told myself I’d just put myself out there and see what happens. I was scared at first, but what I’ve learned is that people are actually pretty nice. They want to see you succeed.

Why did you choose individual stock picking over index funds? What's your philosophy?

I first dipped my toe into investing through an app called Acorn, which takes your spare change and invests it into ETFs for you. It was cool to see my money compound, and that’s how I got started with ETFs.

But as I learned more about investing, I realized that while ETFs are great, they can also be risky because you have no control, someone else is managing your investments. Initially, I wasn’t comfortable taking the risk of picking individual stocks, so I stuck with ETFs.

The $100,000 I originally invested came from savings and my ETF account, which I pulled out and moved into my individual stock portfolio. I felt like I had too much tied up in ETFs and never sold them, so I thought it was better to try my hand at individual stocks.

After taking a seminar from Phil Town, it all clicked. I became more confident, knowing that if individual stocks didn’t work out, I could always fall back on ETFs, like the S&P 500.

It's probably not the smartest answer, but it felt like that Matrix moment when you're given two pills. Once I took the 'reality pill' and realized how ETFs are managed, I felt less comfortable just continuing to buy them.

That said, I do think it makes sense to keep buying ETFs if you don’t want to worry about it. But with my passion for investing and my goal to eventually start my own fund, it made sense to take the gamble and pick individual stocks.

If I wasn’t interested in researching companies, I’d probably stick to something like Wealthfront or Betterment - just put in money, have them buy diversified indexes.

You won’t make a lot, but hopefully you won’t lose much either, and over time, they say you’ll have a million dollars before you die.

What mistakes or learnings have you made so far?

I’d take it two ways if possible: one, going the ETF route, and two, focusing on individual stocks.

One big miss for me, not necessarily a mistake, was not investing early enough. Just starting with any amount is key.

As soon as you learn about investing and feel like it’s not a scam, because some people still think the stock market is nonsense - just start.

Get in the habit of investing weekly, biweekly, or monthly, even if it’s $5 or $10. It adds up over time.

At first, I wasn’t consistent. I’d put in $5 one day, forget about it, and maybe put in another $5 months later or skip half a year. But those small amounts add up, so don’t procrastinate until you're in a better financial position, start with whatever you can.

When it comes to individual stocks, I avoid mistakes by sticking to my own investing philosophy and rules. For example, I won’t invest in a company unless it has at least five years of data in the public markets. I broke this rule once by investing in a SPAC (special purpose acquisition company) in 2021, and while some did well in the short term, most went bust in the long run.

I stick to five years because most small businesses fail within the first three years.

If a company has lasted five years, it’s likely on a positive trajectory, and there’s still room to catch the growth. You can choose four or seven years, but I like to keep things simple. If a company doesn’t meet that criteria, I move on.

Another rule I follow is that the company must either be founder-led or have management with a significant stake, at least 10% of their own money invested. This reduces the number of companies I look at but increases the quality without needing too much analysis upfront. It’s almost like a filtering process.

Do you have a set of established investment principles, or do you continually refine them?

I have a core set of about five to ten principles that I stick to no matter what, and that hasn’t changed in the last year or so.

But I still find new opportunities in the investing landscape, so it’s always a work in progress.

One thing I’m currently debating is how much a company’s size matters to me.

I’ve realized that anything over $10 billion doesn’t have as much alpha potential. At the same time, I don’t want to go too small, where there’s not enough information to make informed decisions.

Like with NVIDIA, if you’ve held it for a while, I get it, but buying it right now? I’d probably just stick with an ETF like the S&P 500.

I read a lot, including plenty of older books by investors like Phil Town, Warren Buffett, Joel Greenblatt, and Seth Klarman. They all have little nuggets of wisdom that I found helpful. It’s not like I’ve come up with these ideas on my own; I’ve just taken insights from successful investors that resonate with me and my philosophy.

How do you handle market volatility?

So, on one hand, I think you have to be a bit sick to enjoy the volatility when stocks go against you. But I don’t think it goes as far as short sellers, that’s the pinnacle of self-inflicted pain, really. You’re basically betting everything on the idea that something is wrong.

What helps is reading enough about psychology and understanding myself.

I don’t have a problem with things going against me if I believe in the long run and have done my homework.

If I think the intrinsic value of a company is much higher than its current share price, I can ride out these fluctuations.

When I buy stocks, I try to think of it as buying businesses. I know everyone says that, but it really makes sense. It’s easier to hold a stock when you view it as a legit business. For example, even if Coca-Cola drops by 30%, I don’t own it, but knowing it’s a real company with people showing up for work every day makes it easier to average down.

But you also need to have a certain mindset. Some people just aren’t comfortable with the volatility, especially when it comes to dollar amounts or seeing red in their portfolios.

I used to notice that on my app, when everything was green, I felt happy, and when it was all red, I felt down. It took me a while to realize that this wasn’t a healthy way to react.

So I removed that color feature. I use Webull, and they have an option for a grayscale view. It’s a simple but effective feature that takes away those emotional reactions to my whole portfolio. Without the rainbow of colors, I don’t stress over day-to-day fluctuations as much. Yeah, a company might be down 30%, but when it’s just a number in gray, I can move on without getting caught up in the color.

What role does diversification play in your portfolio?

So, on my substack, I have three portfolios, but two of them have a significant amount of money. One is my IRA, which has maybe 20 or 30 holdings, or maybe more. Then there's my main one, which only has about 10 to 15. The reason I keep both, even though I’m trying to cut down on the IRA one, is that everyone says the perfect number of stocks to own for diversification is anywhere from 10 to 20.

If you ask me why, I might say it’s because Greenblatt said so, or someone like that. I can’t pinpoint exactly why, but some folks have done the math, and it shows that around 15 is where the risk volatility doesn’t change significantly, but the potential for profit really does, which is what caught my attention. If it makes sense mathematically, I’m all for it.

Now, regarding the IRA account, there are actually quite a few people who own 20 to 30 stocks and are outperforming the market. So, there are multiple ways to approach this. I’m trying to push myself out of my comfort zone to see what works for me and what doesn’t.

To answer your question, I’m still working on it, but I’m leaning toward owning about 10 to 15 companies for diversification. I want to ensure they’re not all in the same sector and provide different services. I think that’s manageable enough to keep track of, as long as they’re not all in the same circle; I wouldn’t want to own 10 banks.

Have you ever considered other asset classes?

I dipped my toes into Bitcoin and some other cryptocurrencies, but it just didn’t make sense to me. It felt more like trading, which isn’t my style.

I’m not saying it’s not profitable; it just doesn't suit me. I also tried buying some municipal bonds, but the process was so annoying that I quickly lost interest. And when you compare the profits from bonds to stocks, it just didn’t add up for me. As for gold, it never felt like the right move. I guess I have certain things in my head about investing, and I tend to stick with those beliefs.

What has been your biggest win or let's call a breakthrough moment?

I don't know if I have one, to be honest. The fact that I've been doing this substack thing for almost four years has made me a lot more comfortable. I no longer feel like an imposter, and I see people backing me up in terms of support.

I have about 4,000 subscribers. They’re not all from hedge funds, but there’s a good chunk of folks from the investment world. The ones who do engage give me comfort, like, “Aha, I’m doing something that people are interested in.”

Seeing those kinds of people engage, many of whom I’ve never spoken to, boosts my confidence. It reinforces the idea that I’m doing something people enjoy. I enjoy it too, and it motivates me to keep going.

What’s your advice to someone just starting out their investment journey?

It’s about just starting and taking action. Any amount is worth starting with.

Things will change, but it’s important to keep putting that money in because it compounds. Sometimes you might not notice it or forget to check, but having it on autopilot helps you stay on track. Just try not to lose it all and keep it going.

I’m a big believer in building financial wealth, especially generational wealth. One of the reasons I’m doing this isn’t just for myself, but for the financial future of my kids.

Before me, none of this was ever considered in my family; nobody even thought about it. I don’t know if my kids will want to invest or not, but I at least want to instill the idea that they should invest whatever they can. If they can avoid touching it, they can let the next generation benefit from it and watch it compound.

Here’s a link to Yegor’s substack.

If you found this valuable, it’d be great if you could leave a ❤️ as it helps me figure out what you like.

Thanks!

Jason

DISCLAIMER: None of this is financial advice. Concepts of Finance newsletter is strictly for educational purposes.