🙋It's not what you know, it's who you do it with

One of the biggest ideas in investing is aligned participants. It’s crucial because often it’s over long periods of (sometimes harrowing) time that great returns are had. Seth Klarman sums up the idea bestyou want people who write checks when you ask, and cash checks when you give.

This idea came up again, but in a new area, when Russ Roberts spoke with Robert Pondiscio about The Success Academy, whose testing scores seem to be downright amazing. Is it simply execution? It's partly that.

But it's also the stakeholders.

There are about six students per seat and according to Pondiscio, for a parent to get in to the Success Academy, they must: enter a lottery, attend a welcome meeting, accept the culture, fill out paperwork, attend a uniform fitting ("even if you're just on the waiting list"), and attend a dress rehearsal for meet-the-teachers.

Part-of-the-success of the Success Academy is getting the stakeholders aligned.

Investors do this through letters, schools through the application process. However an organization does this, it's important for them to find a way their competitive advantage must operate, and make it clear that that's the way things are going to be.

Aggressive filtering hurts in the short-run but helps in the long.