Things I learned at Berkshire Hathaway’s annual meeting

1. Appearing in front of thousands of your stakeholders is an incredible
fear of courage. It must massively clarify your thinking and automatically
enforce high integrity behavior.

Buffett appears for a full day and answers essentially any question at all,
unscripted, very year. He isn’t too good for it. It keeps him honest.

2. People seem to ask him the same questions and he gives the same answers.
These “geniuses” who come to see him actually don’t know his body of work
that well. This is a PR conference not an insiders meeting. Yet it is an
essentialy step in bring people into the movement.

3. Investing and “being rich” are one of the great cultural movements of
the last two generations in America. People came to the stock market.
Buffetts public activism was a big part of this. Many countries don’t have
a culture of individual investors.

4. Buffett’s devotees appear to be a mix of
– hedge fund and wall st value investors
– financial advisors or brokers who are basically followers/marketers of
the stocks mystique
– Midwesterners that got on the bus early and got rich
– admiring Chinese and foreigners that came to pay homage to a global

5. The mechanics of the “stockpickers” resembles VC/entrepreneurship a bit!
People have ideas they are pitching. Those ideas just happen to be well
established public companies in some esoteric area or region “poised to
make a move”. These are things that might do 2-3x or “grow at 20% per year
for a long time” depending on the style you are investing in.

6. Quite a few of the professions here are pretty Main Street. This isn’t
an uber elite, super educated, cultured and urbane audience. It’s also
older. A few Alex P Keatons but largely people who are only a little
younger than Buffett.

7. Berkshire holdings are mostly insurance, railroad, and energy. These are
maaaaassive global indistries. They are changing from tech but Buffetts
position in these is more driven by growing market share and regional
share. That is “large markets” (as VCs say). And they have “terrific
managers”. Usually Buffett doesn’t say what their product differentiation
is exactly, and it usually varies across the normal MBA strategy levers
like brand or efficient operations or skilled risk management. We talk
about startups this way too! Except he invests once companies are already
executing well.

// Amol Sarva, Ph.D. // [email protected] // (530) SARVA-77 // @amol

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