We’ve all seen the same phenomenon time and time again in other types of businesses. Success convinces management that they’re smart, as opposed to simply having been fortunate enough to be in the right place at the right time. That’s why so many successful companies attempt to diversify into other businesses and then get their fingers badly burnt. In the stock brokerage business there’s a wise old saying “Don’t confuse brains with a bull market.”
So RedBlacks management probably thought they could repeat the trick of assembling a winning team for the second time. Sorry fellows. It’s not that easy. And contrary to what you may think, you’re not geniuses.