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Book Review: Ask Forgiveness Not Permission

Lessons on risk management from a military man turned hedge fund manager

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The City Letter
Sep 13, 2021


  • Anyone interested in "The Great Game" in modern times and risk management should read this book.
  • This is a book about managing risk, the management of an inexperienced team and an outsider navigating government bureaucracy.
  • For anyone interested in volatile emerging or frontier markets such as Pakistan or the defence industry in general, this is a must read.
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Howard Leedham, MBE is a British hedge fund manager based in Dubai. Most hedge fund managers start their careers as traders or analysts in investment banks or mutual funds. Leedham, however, spent the first part of his career in the British special forces before working for a year in Pakistan as a senior aviation advisor to the U.S. Department of State.

"Ask Forgiveness, Not Permission" is not a book about investing. In fact, its subtitle is "The true story of a discreet, post 9/11 operation in the 'badlands' of Pakistan." The reason I'm writing this review is because the book is about managing risk, the management of an inexperienced team and an outsider navigating the bureaucracy of the U.S. government to get things done. It is also a book about Pakistan. In short, Leedham is a doer or, in his words, a "sheepherder." I think investors and corporate executives can learn a lot from Leedham's aggressive but disciplined and risk-conscious approach to getting things done. It's also an interesting insight into life in Pakistan, an emerging market one can invest in via exchange-traded funds such as the Global X MSCI Pakistan (

PAK, Financial).

I was given this book as a present by someone who knew my interest in geopolitics and emerging markets. Although I read a lot of history books, I don't tend to read those alpha male special forces "inside story" type books. Before committing myself to reading this book, I Googled Leedham and found he gave a short Ted Talk about the lessons he had learned. I watched the video and I found him down to earth, likable and, more importantly, quite wise. So I decided to read the book. I'm glad I did because I certainly learned a lot.

After retiring from the U.K. military, Leedham was happily working as an executive for a private jet company managing $26 million worth of planes. Out of the blue, the U.S. Department of State contacted him and persuaded him to join their Narcotic Affairs Section in Islamabad, Pakistan on a one-year contract from August 2004 to July 2004. This was a highly dangerous job as it involved managing human and physical assets on the border of Pakistan and Afghanistan to stem the flow of narcotics and perform counter-terrorism intelligence gathering, to rescue hostages and provide support to local government security forces in the battle against the Taliban and Al Qaeda, deep in the heart of the "Great Game" territory.

Leedham was to spend his year between the city of Quetta, near the border to Afghanistan, and at the U.S. Embassy in Islamabad, (or "Slammy," as it was nicknamed). He trained two groups of 25 men from the Frontier Corps (essentially a para-military group not given the same status as the military) to be able to effectively patrol border areas and raid the enemy when the time came. The book is heavy on the training and patrol periods, but these parts show that Leedham won his men's trust and loyalty by treating them with respect, leading from the front and not asking them to do anything he would not do himself. Some "operations" he led were exciting and dangerous, while others were mundane. He kept up the morale of his men by giving them a steep learning curve and teaching them everything he could that he had learned himself from his vast special forces experience.

Another management takeaway is how Leedham dealt with both U.S. and Pakistan government officials. The saying "you catch more flies with honey" could apply to his approach. He was charming, but also careful and conscious of the politics of the offices he was dealing with, which ranged from divisions within the U.S. Department of Defense, the U.S. Department of State, the Pakistan Military and Pakistan Ministry of Interior. Leedham tried to minimize the bureaucracy around his tasks and would go directly to the decision makers if he really needed their help - generally getting more assets that he could use on his program, be they men, weapons or helicopters.

By treating his peers with respect, but also standing firm to his principles, Leedham won support in key places which helped him fast track the operational ability of the program he was managing.

From a risk management point of view, Leedham knew that the enemy wanted him dead; especially as the post training his Frontier Corps teams became very effective in making life difficult for them. Leedham carried a gun with him everywhere, and it was interesting to see how easy it was for him to purchase his own weapons on the black market. He was careful to blend in and not stand out. He took his time to give the trust to his Pakistani men. In his training and in jobs they carried out, Operational Security or "OpSec" was always the first priority. This could be anything from preventing the leakage of information about operations to how his FC troops mounted and exited the helicopters when in action. Always know your exit strategy was another rule Leedham emphasized, a rule that applies to both military and investment strategy in equal measure.

Information gathering was also important for Leedham, and he quickly formed a happy hour drinking club of "sheepherders." Sheepherders were people who had borne firearms for their country. They knew the risks involved on being on the front line, unlike their diplomatic colleagues, who were referred to as "sheep." While Leedham got on well with the diplomats, he tended to be closer to the "sheepherders" and would share information with them, be they American, British or Pakistani.

To get things done quickly and make progress, Leedham lived by the principle of "ask forgiveness not permission." This reminds me a lot of George Soros' maxim of "invest first, investigate later." Sometimes time is of the essence and if you wait too long, you miss opportunities. However, Leedham was always prepared, saying the enemy only needs to be better than you are only once and it is game over. So while Leedham marched forward, you can tell he lives strictly by the rule "fail to prepare, prepare to fail." While I don't know much about Leedham as a hedge fund manager (he doesn't go into it in the book), I can be certain that his strategy or strategies will be well researched and risk management is emphasized.

This book also made me think about defense industry stocks. The helicopters and other aircraft played a big role in this story. They were in constant use, either on operations Leedham was leading or being loaned out to Pakistani authorities. The maintenance of these aircraft was, therefore, crucial. Leedham built a close relationship with maintenance guys, who were contractors from DynCorp. Owners of defense contractor stocks might want to read this book to get a better understanding of the work carried out "on the ground" by these contractors. Obviously, those once-fat contracts have now evaporated.

Leedham leaves you with the impression that wherever U.S. government aircraft are employed, DynCorp or equivalent contractors are going to be absolutely vital. This means the policy of the Biden administration is going to be extremely important for companies like DynCorp (a private company). That's stating the obvious, but it means if you have a strong view on what the shape of U.S. and NATO defense and foreign policy strategy will be, defense stocks such as Lockheed Martin (

LMT, Financial) or Northrop Grumman (NOC, Financial) may be one way to play that.

Pakistan is clearly a chaotic place. Leedham's impressions of the ability of its people were positive, but he was predictably somewhat sceptical of its government. In short, he saw it as country with great potential if only the elites could tap into it.

Leedham himself is well versed in history and religion. He quotes the Koran, Lawrence of Arabia, Winston Churchill, Sun Tzu, Napoleon and Rudyard Kipling several times when explaining some of his thoughts and actions.

The bottom line is that anyone interested in volatile emerging or frontier markets such as Pakistan or defense stocks must read this book. Anyone managing inexperienced teams or working in political organizations would also do well to consider Leedham's management style. I believe Leedham's approach to risk management and applying it to investing is also vitally important to ensuring good investment returns.

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