Yesterday, we removed contingencies on the second deal for Adaptive Realty Fund 3.
No matter how many times I do this, I still get a major hit of anxiety during the days leading up to the contingency removal.
I obsessively check and re-check the diligence. I harass the contractors about their bids (Is this included? What about this? What happens if this happens?). I harass our team about their budgets. I harass the architect about what is and isn’t possible. I run and re-run my model looking at what might happen under different scenarios.
But you can never really get absolute certainty. There is always the chance that you’ve missed something or that some uncontrollable external factor ruins your deal.
You can’t let that uncertainty paralyze you. You have to carefully weigh the expected value of the various good and bad scenarios. If you become convinced that the expected value on the deal overall is strongly (not marginally!) profitable, you have to be willing to pull the trigger.
Then, once you commit irrevocably to doing the deal, you need to channel all of that anxious energy into doing every single thing you can possibly do to make the deal a success. And that’s what we’re going to do with this one… Wish me luck!