In this episode, I compare your child's summer activity strategy with the financial concept known as a "real option". How can your child create a summer experience that maximizes options and minimizes obligations?
[00:00:25] Hello friends, and welcome back to the PrepWell Podcast. In today's episode, I want to compare what a student may do over the summer with what we call in the finance world a real option. A real option gives a firm the right, but not the obligation to undertake certain business opportunities or investments. For example, if a firm gets into a merger arrangement whereby they have the option in the future to expand the business or shut down the business or spin off the business. This quote unquote option is considered valuable because of the flexibility the firm has to execute different strategies based on what happens down the road in the future. They're not obligated to do A, B or C, but they have the right to consider all of them. Let's say you merge with a company that focuses on A.I. artificial intelligence, and you have the option to expand that business or shut it down or spin it off. This flexibility can be incredibly valuable as the artificial intelligence landscape develops. If I get regulated and censored by the government, you may want to shut that business down. If I becomes the next Internet, you may want to spin off that AI based business at a super high valuation. The point is that nobody knows what will happen down the road. So having the ability to make adjustments as needed to fit whatever the market is dictating is a valuable thing.
[00:02:04] Now, how does this relate to summer activities? Well, let me relate this to a student whom I recently spoke to about her summer plans. Let's call the students Sawyer. Sawyer is a high school freshman. She's a student athlete who, after thinking about it for a few weeks after our first consulting call, told me that she thought she was interested in medicine, physical therapy, athletic training, and maybe even becoming a family doctor. She wasn't 100% sure of exactly the path she wanted to take, but she was taking her best guess, which, by the way, is exactly what most high school freshmen should be doing. Nobody expects you to have your whole life planned out. But it's not a bad idea to start forming an impression about what interests you. This could take the form of a particular major interest or a career or a field or an industry, or even a particular role in any of these contexts. And this is exactly where Sawyer is right now. Okay, so what might a 15 year old do over the summer to help her refine some of her ideas and take advantage of this concept of a real option to help her figure out if she's barking up the wrong tree or not? As a 15 year old. There are typically some legal constraints to contend with. Most states require students to be 16 years old before they can get a quote unquote, real job. So she'll have to deal with that. She can't drive on her own yet. So whatever she chooses to do has to be practical, at least from the standpoint of transportation and level of commitment. So we came up with two ideas, and here's the first one. Shadow sessions. I brought this up before, and I'm repeating it now because it's so valuable.
[00:03:57] A shadow session is when you spend a day observing someone doing a job in your area of interest. You pack a lunch and a notebook and you simply hang around with that person watching what they do, where they do it, how they do it. Ideally you build some rapport with that person and maybe even get a chance to ask some questions throughout the day about what they're up to. It's relatively low risk and low investment for the person being observed and often comes to pass thanks to some kind of personal relationship that the person has with the students, parent or teacher or coach. In Sawyer's case, she was able to arrange a few shadow sessions with an orthopedic surgeon, a family medicine doctor, a genetic researcher, an EMT, and a radiologist. Now, this is over the course of a few weeks. These people offered a great variety of experiences for Sara to learn from. And by the time she's done observing all of these people, the hope is that she will have a better idea of what she's interested in. It doesn't mean that she's going to vow to become an orthopedic surgeon after a one day interaction with an author pod. Not that there would be anything wrong with that. But she may be more inclined to think about surgery as a path compared to the less intensive family internal medicine path, for example, or vice versa. That's the whole point. We won't know until she tries. And oftentimes these initial shadow sessions will spawn a relationship between the two parties. Which may lead to additional shadow sessions with more people in Sawyer's area of interest. Expanding her network of relationships. It may lead to a part time research project during the school year or internship opportunities down the road, or volunteer opportunities or even a paid position a few summers down the road.
[00:05:58] It may even lead to a letter of recommendation for college from a doctor or a research partner. The point is, it could lead to none all or just a few of these things. That's what I mean when I refer to the act of participating in a shadow session as a real option. Sawyer isn't obligated to do any of these things, but she has the right or the potential to gain a lot of value based on how the summer and the shadow sessions develop. The same idea applies to volunteering. I'm not talking about volunteering at the local soup kitchen. Once or twice over the summer to meet your high school's minimum number of service hours. Not that there's anything wrong with that either. Instead, I'm talking about volunteering strategically at a place which may give Sawyer more information about the path that she's expressed interest in. For example, Sawyer has expressed interest in personal training, rehab, physical therapy. So how do we get some real world experience with such things? My suggestion was to look for volunteer opportunities in the athletic training department at a local college. Most colleges have extensive athletic training facilities that could probably use an eager young volunteer to help with setting up and breaking down before and after games, getting ice bags, doing laundry, cleaning the ice baths, restocking shelves, sweeping the floor, collecting uniforms, and the list goes on and on. And while Sawyer might be doing what some would consider menial tasks, she's also getting a feel for what it's like to be an athletic trainer who has to tape 20 players ankles in 10 minutes before a big game or prepare hot compresses or deliver electric stimulation or help with rehab exercises or make decisions about whether an athlete should play or not play.
[00:07:59] Getting a front row seat to observe what happens inside a college's athletic training program could be very valuable. Or Sawyer might hate it. She might think it's too smelly or hectic or impersonal. She might love it. We don't know. She may enjoy the interactions with the athletes, the mission of getting them back on the field. The mental aspect of helping them deal with injuries. The point is that Sawyer will never know about any of this stuff if she doesn't take the initiative to try it out. And once again, one summer, she might be relegated to sweeping the floors and collecting water bottles. The next summer she upgrades to helping with the electric stem machine and ultrasound. The next summer, she gets a full fledged athletic training internship for college. She creates an opportunity which gives her the right or the option to pursue this path, but not the obligation. I like to think of this scenario as a real option. There are many more examples like this, but I think you get the idea. This happens to be very specific to Sawyer, but my hope is that you will go through this same process with your ninth or 10th grader. This is exactly what I do with the students in my online mentoring program called Prep Academy. I also do this on a one on one basis with many PrepWellers who want or need a little extra coaching and mentoring to help them sort out some of these strategies. This is one way to come up with a plan for the summer, and it has many benefits. It encourages students to think about what they might be interested in. It helps them focus on long term goals. It helps them develop a strong extracurricular activity list for their college application.
[00:09:45] It helps them eliminate ideas that sounded great on paper but weren't so great in practice. And finally, it gives them options without obligations that will ideally steer them in the right direction. I wish you great luck with the strategy. And please don't hesitate to reach out to me if you want me to help your son or daughter go through an exercise like this. That's all I've got for you today, folks. Thank you for tuning in. Thank you for your continued support. In case you didn't know, this podcast supports prep academies online mentoring program where high schoolers and their parents receive a weekly video from me where I break down important topics and give timely advice about college admissions, particularly for top tier colleges, service academies, and for ROTC and athletic scholarships. Many parents who listen to this podcast already have their high school is enrolled in Prep Academy, which is great. If you don't yet, please consider enrolling them. Registration is only open during freshman and sophomore year. After that, we no longer accept new students. So if you have a freshman or a sophomore in high school and you like what you're hearing in this podcast and you like to get more content like this tailored specifically for your child, for their specific grade and with their specific goals in mind. Go to PrepWellAcademy.com and enroll today. If you know a parent with a middle schooler or a high schooler that might find this helpful, please share the episode with them and give us a rating. If you have the time. Word of mouth and positive ratings help our podcast reach a much wider audience. If you have questions, comments, or an idea for an upcoming episode, please reach out to me by email.
[00:11:30] Demi on Instagram. Check out our blog, our Facebook page. Connect with me on LinkedIn. I would love to hear from you. Until next week, Goodbye. Good luck and never stop preparing. This podcast is brought to you by PrepWell Academy. PrepWell Academy is my one of a kind online mentoring program that delivers to your ninth or 10th grader a short, highly relevant video from me every week. Every Sunday, in fact, where I give them a heads up about what they should be thinking about to stay ahead of the game to get these valuable lessons into your child's hands. Please head over to www.PrepWellAcademy.com and enroll your child today.
PrepWell Academy's Founder, Phil Black, has spent a lifetime cracking the code on the world's most competitive programs: Yale University, Harvard Business School, Navy SEALs, Goldman Sachs, Entrepreneurship, Shark Tank (2X), etc.
Inside PrepWell Academy, Black teaches students everything they need to know about the college admissions process in a series of expertly-timed, 3-5-minute, weekly training videos starting in 9th grade and continuing through 12th grade [Note: this program can only be joined in 9th or 10th grade]. My specialties include military service academies, ROTC scholarships, Ivy League, and student-athletes.
