Warren Buffet's Letters to the Shareholders of Berkshire Hathaway - The Best Resource for Investing, Business, and Leadership

We would like to elaborate on what we recently posted on twitter.

Capital MONEY! believes that Warren Buffett's letters to the shareholders of Berkshire Hathaway are the single best resource for learning about investing, business, and leadership. If you were to read only one thing on those topics, it should be Warren Buffett's shareholder letters. In addition to providing a wealth of wisdom on a wide range of topics, reading the letters from oldest to newest gives a unique historical perspective on 20th century America.

The terrific news is that they are all available for free on the Berkshire Hathaway website. They are also available for sale in paper copy if you prefer.

We will provide a number of posts summarizing and highlighting the wisdom found in Warren Buffett's letters, but a few of the key principles are below..

Discipline. For both investing and business operations, much of Warren Buffett's success has come from having the discipline to stick to his strategy in good times and bad. It is easier said than done to be greedy when others are fearful and fearful while others are greedy.
Leadership. Warren Buffett has such a prolific record as an investor that it overshadows how great of a leader he is. Reading the shareholder letters you learn that Warren Buffet leads by context, not command and that he clearly communicates the values of Berkshire Hathaway and his top priorities. He then empowers his managers with full autonomy and praises them publicly for their contributions. Berkshire Hathaway has acquired and operates many dozens of individual businesses, many of which are large enough to be Fortune 500 companies if they were on their own. Across all industries, the majority of mergers fail due an to inability to successfully integrate the two companies. Meanwhile Berkshire Hathaway has successfully integrated many dozens of businesses. It's not by coincidence.
Failures. Warren Buffett has talked at great length on many occasions about his failures. He goes out of his way to discuss his failures, what he learned from them, and how he plans to avoid them in the future. He takes accountability and never blames others or outside forces for adverse results.

Vol 2: Capital MONEY! Leadership Series - #2 It's not about you

Leadership is not a vehicle to serve your self-interests, it's not about you. The purpose of leadership is to improve the outcomes of everything around you. A successful leader is a catalyst that maximizes the long-term outcomes for their people, teams, organizations, and customers. Leadership is about pouring gasoline on the fires of success for those around you. Leadership is not about making yourself more money or inflating your ego through power and status. Though we think good leaders should be compensated commensurately with the incremental value that they create, and that there is nothing wrong with a leader feeling proud of their contributions. But for a leader, money and pride should be a result of a job well done, not the reason for doing the job. In order to maximize the long-term outcomes for their people, teams, organizations, and customers a leader must.. Understand and articulate optimal outcomes for each stakeholder. Create a framework of sh...

Business Valuation Vol 1: PayPal

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These were provided in Berkshire Hathaway's shareholder letters for many years. They were provided to attract prospective businesses interested in being acquired by Berkshire Hathaway (BH). If an owner was interested in selling their company and their business met these criteria, then they could contact Warren Buffett to see if BH would be interested in acquiring them. BH acquired multiple businesses through this process. These 3 criteria apply to investing in shares of public companies as much as they do for acquiring entire companies. At the core of Warren Buffett's investment philosophy in public companies, is to treat shares as what they are - ownership in a business. Investing. It's simple, but it's not easy. Successful investing is about consistently buying assets for less than their future value. That sounds simple enough, buy low sell high. I got this. You don't have unlimited money to invest with, so successful investing also requires efficient capital ...

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