Capital Allocators · April 15, 2024 · 62m

Sam Hinkie: The Process and Second-Order Thinking

Former 76ers GM Sam Hinkie discusses how he applied investing principles to sports management. His 'Trust the Process' strategy was a long-term play that required enduring years of losing — and the organizational courage to ignore short-term pressure.

Canon

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Courage is learnable — Hinkie's Process required the courage to be publicly humiliated for years while trusting a probabilistic strategy that most people couldn't understand

Hinkie endured three years of public mockery, media criticism, and fan hatred while executing a strategy he believed was mathematically sound. He was eventually forced to resign — but the team he built later reached the NBA's top ranks.

Claude ChatGPT Gemini

Highlights

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Hinkie's 'Process' was a capital allocation strategy applied to basketball — he traded short-term wins for long-term draft picks, treating players as assets with expected returns

Hinkie explains that traditional NBA teams try to win every season, which keeps them in the mediocre middle (too good for top draft picks, too bad for championships). His strategy: deliberately lose now to accumulate top picks, creating a mathematical path to championship contention.

Claude ChatGPT Gemini