#338 Monty Moncrief Texas Oil Billionaire

Summary Notes


In this episode, the host delves into the life and legacy of Monty Moncrief, a Texas oil patriarch whose business acumen and family-oriented approach to the oil industry set the foundation for a multibillion-dollar dynasty. Moncrief's story, as told in Sally Helgeson's 1981 book "Wildcatters," highlights his belief in collective success, disdain for individualistic strategies, and the importance of continuity within the family business. Despite his wealth, Moncrief remained grounded, valuing achievement over luxury and demonstrating an unwavering confidence in his enterprise. The host also explores the broader context of Texas oil families and the competitive, risk-taking spirit of early wildcatters who shaped the industry against all odds. Moncrief's influence, described as a 'shadow' over his family, raises questions about the pressures on future generations to uphold or surpass the founder's legacy, with the host pondering where limitless opportunities exist in today's world.

Summary Notes

Monty Moncrief's Leadership and Business Philosophy

  • Monty Moncrief was 84 years old in 178 and still the decision-maker for his family and business.
  • He viewed family and business as inseparable, with a focus on founding both.
  • Monty always referred to business accomplishments as collective efforts ("we"), rejecting individualistic ("I") approaches.
  • He saw the oil business as a means to create a family legacy and was opposed to the idea of selling out for quick profit.
  • Monty's identity and the identity of Moncrief Oil were deeply intertwined, emphasizing continuity and independence.

"We're 100% family owned, unincorporated and independent, and we intend to stay that way." This quote highlights Monty's commitment to maintaining the family-owned status of his business, valuing independence over public offerings or mergers.

"Passing a legacy on were oilmen." Monty considered the oil business not just a commercial venture but a legacy to be passed down within the family, underlining the importance of heritage in his business philosophy.

The Influence of Monty Moncrief's Legacy

  • Monty's approach to business and family left a significant impact on subsequent generations.
  • His grandson, Dick Moncrief, felt the pressure of living up to Monty's legacy, often making risky decisions in an attempt to surpass his grandfather's achievements.
  • Monty's legacy is compared to the influence of other notable family patriarchs, such as the Morgans, highlighting the idea of a family business as the "lengthened shadow of one man."
  • The Moncrief family's internal conflict over the inherited fortune underscores the challenges of living under such a formidable legacy.

"The shadow by which Dick Moncrief measured himself was cast by his grandfather, Monty." This quote demonstrates the profound impact Monty's success had on his grandson, with the "shadow" metaphor illustrating the weight of expectations Dick felt.

The Cultural Context of Texas and Family Legacy

  • Texas is portrayed as a place where family lineage and bloodlines are of utmost importance.
  • Success in Texas is often measured by surpassing the achievements of one's ancestors.
  • The belief that "family is destiny" is a powerful force that shapes individual ambitions and actions within the state.

"What makes Texas different is not so much its money as its blood and its awareness of that blood." This quote emphasizes the cultural significance of heritage and lineage in Texas, suggesting that familial connections are more valued than financial success.

Monty Moncrief's Early Career and Industry Choice

  • Monty served in World War I and then entered the oil industry, a sector with seemingly limitless opportunities at the time.
  • The opportunities available to Monty were not as accessible to his son and grandson due to changes in the industry.
  • The narrative explores the concept of "opportunity without limits" and how such opportunities evolve over time.

"The old bulls in the story, the giants, the men of Monty Moncrief's generation came into the oil business in the wild old days of the open frontier." This quote captures the pioneering spirit of Monty's generation and their role in shaping the early oil industry.

The Changing Landscape of the Oil Industry

  • The oil industry's early days allowed for small teams with limited resources to succeed.
  • Over time, the cost and complexity of oil exploration increased, favoring large companies with significant resources.
  • The book "Wildcatters" explores the transition from independent oil ventures to the dominance of major oil companies.

"The trouble with this business is that everybody expects to find oil on the surface. If it was near the top, it wouldn't be any trick to it. You've got to drill deep for oil." This quote metaphorically suggests that true value and opportunity often require deep exploration and effort, rather than superficial attempts.

The Concept of Surfing Opportunity Waves

  • The idea of "surfing" opportunity waves is proposed as a model for understanding success in various industries.
  • Monty Moncrief's success is linked to the unique circumstance of private mineral rights ownership in America.
  • The notion that early birds have significant advantages is discussed in relation to identifying and capitalizing on emerging opportunities.

"There are huge advantages for the early birds." Charlie Munger's statement reinforces the idea that timing and early engagement in an industry can provide a substantial competitive edge.

Surfing Model

  • Monty Moncrief emphasizes the importance of catching and riding the wave of opportunity, akin to a surfer.
  • Staying with a great business and not giving in to restlessness or the desire to jump to new ventures is critical.
  • The surfing model is related to the success of big companies and individuals who stick with their industry.

"There's a model that I call surfing. When a surfer gets up and catches the wave and just stays there, he can go for a long, long time. But if he gets off the wave, he becomes mired in the shallows."

This quote illustrates the concept of the surfing model, where sustained success is compared to a surfer riding a wave, highlighting the importance of staying focused on one's industry.

Importance of Regulatory Environments

  • Limitless opportunities are often found in environments with little to no regulation.
  • Monty Moncrief's success was partly due to the almost nonexistent regulation in the oil industry during his time.
  • The third generation faces increasing difficulty due to the proliferation of regulations.

"Limitless opportunity usually found environments with little to no regulation. At the time the mani starts, there's almost nonexistent regulation. By the third generation. It's becoming increasingly difficult."

This quote emphasizes the contrast between the regulatory environment Monty Moncrief faced and the one encountered by the third generation, highlighting the impact of regulation on business opportunities.

Monty Moncrief's Influence and Legacy

  • Monty Moncrief's influence on his family and the oil industry is significant and long-lasting.
  • His continuous involvement in the oil business well past the need for money contributes to his legacy.
  • The presence of family patriarchs in their hometowns maintains their legends and influences the culture of the oil industry in Texas.

"He's doing oil deals until he dies, way past these decades, past the need to work for money."

This quote highlights Monty Moncrief's dedication to the oil industry and his influence on his family by staying active in the business until his death.

The Grandfathers' Mystique

  • The grandfathers of Texas oil dynasties are revered figures with a special role in the harsh landscape.
  • Their tough demeanor and insistence on family involvement in the business are part of their mystique.
  • These patriarchs often maintain their presence in their communities, contributing to their legendary status.

"The mystique of grandfather heroes exists partly because the grandfathers play a special in between role in this land of men that are impossibly hard."

This quote captures the essence of the grandfathers' mystique in Texas oil dynasties, where their tough character and role in the family business create a legendary image.

Entrepreneurial Similarities

  • Entrepreneurs studied by the hosts share more similarities with each other than with the general population.
  • The entrepreneurial spirit, characterized by a certain personality type, is consistent across different industries and eras.

"This is also something that I've noticed that the entrepreneurs that you and I study are way more similar to each other than you and I are to maybe like the general population or the population that are not entrepreneurial."

This quote reflects the observation that entrepreneurs exhibit similar traits and behaviors, which sets them apart from the general population.

Monty Moncrief's Values and Relationships

  • Monty Moncrief valued achievement over luxury and money, living modestly despite his wealth.
  • His interactions with presidents and his judgments of them reflect his personal values and moral standards.

"What drove Mani was achievement, not money. Knowing that if I chase achievement, the money comes with it."

The quote shows that Monty Moncrief's primary motivation was achievement, with the understanding that financial success would follow.

Early Life and Career of Monty Moncrief

  • Monty Moncrief's early life included service in World War I and meeting influential people in the oil industry.
  • His first job as a landman provided him with the foundation for his future success as an independent oil man.

"My dad got to Texas in a covered wagon. I made hundreds of millions of dollars in my lifetime."

This quote, interpreted as Monty Moncrief's perspective, encapsulates his journey from humble beginnings to significant wealth.

Funding in the Early Oil Industry

  • The early oil industry relied on funding from the railroad industry and Texas cattle ranchers.
  • Eastern financiers with control over railroads and wealthy Texans with cattle ranching backgrounds were key investors.

"So some of the earliest american oil financiers were actually easterners, right? These are very far away from the frontier in Oklahoma and Texas."

This quote highlights the geographic and industry diversity of early investors in the American oil industry.

Monty Moncrief's Self-Confidence and Optimism

  • Monty Moncrief's self-confidence and belief in his luck played a significant role in his decision to become an independent oil man.
  • His optimism persisted despite initial failures, reinforcing his belief in his destiny to find oil.

"Monty Moncrie believed that he had a gift, a special talent for finding oil. He believed that he had been born lucky."

The quote illustrates Monty Moncrief's unwavering belief in his abilities and luck, which drove his entrepreneurial endeavors.

Monty Moncrief's Oil Discovery and Business Tactics

  • Monty Moncrief's persistence led to a significant oil discovery after many initial failures.
  • His business tactics included partnering with others and selling off pieces of his enterprise to fund drilling operations.

"He's like, okay, I'm going to take another flyer. I've drilled 29 duds. I don't have money for this. What I got to do, I got to walk down the hall, knock on some doors, and see who wants to go in on this deal with me."

This quote shows Monty Moncrief's relentless pursuit of oil discovery and his willingness to collaborate and share stakes to achieve his goals.

Early Wildcatters and the Oil Business

  • Moncrief and his partner held onto their leases until the end of 1931 and sold for a significant profit.
  • Their wealth increased many times over, selling their oil interest for $2.5 million, equivalent to about $50 million today.
  • The company that purchased their interest later sold it to Standard Oil for $37 million.
  • Moncrief's family fortune became a foundation for a multibillion-dollar legacy.
  • Moncrief believed in the reality of what happened, not in hypotheticals, which is reflected in his quote about the oil business having no "what ifs."
  • Wealth based on tangible resources like oil allowed Texans to thrive during the Great Depression, unlike those with "paper fortunes."

"In the oil business, there's no what if. There's only what happened." "Unlike the oligarchs in New York, rich Texans were not necessarily forced into diminished circumstances by the depression."

These quotes emphasize the practical and tangible nature of wealth in the oil business, contrasting it with speculative wealth that was vulnerable during economic downturns.

Characteristics of Early Wildcatters

  • Early wildcatters like Monty Moncrief, H.L. Hunt, Sid Richardson, and Clint Murchison were not afraid of taking risks, including accumulating debt.
  • They believed in luck and optimism, which they considered essential to nurturing success.
  • They did not fear failure, as evidenced by Monty's 29 unsuccessful attempts before striking oil.
  • Early oilmen operated in legal gray areas, such as smuggling oil and operating unregistered refineries.
  • The goal was to build dynasties, and they were motivated by the potential of creating lasting wealth for future generations.
  • The wildcatters' optimism was fueled by the harsh conditions of West Texas, which required a strong belief in future success to endure.

"Sid's credo had always been that he'd rather be lucky than smart, because a lot of smart guys go hungry." "The risk is always there. And as Clint Murchison was fond of saying, after the first hundred million, what the hell?"

These quotes reflect the wildcatters' belief in the power of luck over intelligence and their acceptance of risk as an inherent part of their industry.

Impact of Early Oil Discoveries and Optimism

  • Experts in the early 20th century believed that 40% of America's petroleum reserves had already been exhausted.
  • Despite these pessimistic surveys, Texas oilmen continued to drill, leading to significant discoveries.
  • The oil discoveries in Texas were ten times the size of the California gold rush of the 1840s.
  • The wildcatters' success was partly due to their background of poverty, which gave them nothing to lose and everything to gain.
  • They were motivated by the opportunity for growth and the belief that hard work and high risk would bring rewards.

"Only something as stubborn and unreasoning as faith could have inspired men and women to settle and remain upon this harsh, unyielding land."

This quote captures the essence of the wildcatters' determination and faith in the face of adversity, which was crucial to their success.

Railroads and the Oil Industry

  • Growth in the oil industry necessitated the development of railroads for transportation.
  • Railroads and oil wildcatters had a symbiotic relationship, with railroads extending services to profitable oil fields.
  • Monty Moncrief's relationship with major oil companies was complex; he sometimes had to challenge them through regulatory boards for fair treatment.
  • The Railroad Commission played a significant role in regulating the oil industry and settling disputes.
  • Independent wildcatters like Moncrief found 80% of America's oil and gas, often on leases overlooked by major companies.

"Being crazy is something that majors just don't understand."

This quote highlights the independent spirit and risk-taking attitude of wildcatters, which often led to their success where larger companies saw no potential.

Monty Moncrief's Legacy

  • Monty Moncrief's life and career spanned the development of the oil industry in West Texas.
  • He realized his ambitions in a town he helped to grow and left a significant mark on the region.
  • His success and the establishment of a dynasty were a testament to the value of achievement over refinement in the oil industry.

"For Monty Moncrief and for men of this pioneer generation, achievement, not refinement, is the measure of all things."

This quote summarizes the ethos of the early oilmen, who prioritized tangible success and lasting impact over societal refinement.

Founders Podcast Merchandise Announcement

  • Monty Moncrief announces the launch of Founders Podcast merchandise.
  • Merchandise includes sweatshirts and hats, with a potential update to the hat design.
  • The merch can be purchased at the Founders Podcast website.

"Founders now officially has merch. If you go to shop founderspodcast.com or you can just go to founderspodcast.com and click on merch."

This quote is Monty Moncrief's announcement of the official launch of Founders Podcast merchandise, directing listeners to where they can purchase the items.

Partnership Opportunity with Monty Moncrief and Patrick O’Shaughnessy

  • Monty Moncrief and Patrick O’Shaughnessy are seeking partnerships with B2B product companies.
  • They offer distribution, capital, and access to talent.
  • The partnership aims to highlight founder-led companies that benefit other listeners of the podcast.
  • Interested parties are invited to email partnerships@founderspodcast.com with details about their company.

"Me and Patrick are looking for partners. If you are building products, if your company is building a product that makes somebody else's business better... email partnerships@founderspodcast.com."

Monty Moncrief is inviting businesses that have B2B products to partner with him and Patrick O’Shaughnessy, offering a range of resources to support their growth.

Vesto Partnership and Product Development

  • Monty Moncrief shares his experience with Vesto, a company he partnered with.
  • Vesto offers services for businesses to manage idle cash and get higher returns.
  • A new product was developed from customer feedback, allowing businesses to see all financial accounts in one view.
  • Monty emphasizes the importance of founder-led sales calls and product development.

"I partnered with them for a while. I knew the founder. Two of my close founder friends were both using Vesto to get higher returns on their business's idle cash."

Monty Moncrief explains his personal connection with Vesto and how it benefits businesses, highlighting the power of networking and partnerships.

Founders Notes Subscription Service

  • Founders Notes is a subscription service offering access to Monty Moncrief's extensive notes and highlights.
  • It is designed for successful entrepreneurs to turn knowledge into profit.
  • The service is built on the Readwise platform and is integral to Monty's podcast workflow.
  • Monty encourages entrepreneurs to invest in a subscription to enhance their business knowledge.

"Founders Notes is the best way, the single best way... I've been cataloging all of the notes and all the highlights."

Monty Moncrief promotes Founders Notes as a valuable resource for entrepreneurs, offering a glimpse into his personal note-taking system that has been essential for his podcast.

Founder GPT and Continuous Learning

  • Monty Moncrief teases a new tool similar to Chat GPT but focused on his notes and highlights.
  • He emphasizes the importance of continuous learning and studying history's great entrepreneurs.
  • The tool is designed to help entrepreneurs make connections and gain insights from historical figures.
  • Monty encourages the use of Founders Notes for daily learning and improvement.

"It's essentially a founder's GPT... It's trained on all my notes and highlights and then now all my transcripts."

Monty Moncrief reveals an upcoming tool that aims to help users draw insights from his extensive collection of notes, emphasizing the potential for learning and discovery.

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