Prospective investors love to read about successful investors. On Twitter there’s a semi-frequent joke about ‘the next Warren Buffett’ that’s complete with magazine covers featuring past appointees. Many people read Buffett’s letters and try to emulate his style. That’s a bit fit, but it’s a good start.
One such prospective investor needed the inspiration. His first job was at an investment company that peddled IPO’s where, “From an investment banking standpoint, this sort of price action would make the deal a runaway success—even if the company eventually failed.” The company would either make a little or a lot of money on the IPO’s success. It was legal, but not moral.
Then our investor read a letter from Buffett and “I’d never seen a report like this.” Whereas in New York it was all about “shouting louder than the next guy so you could get his attention,” the Buffett letter “was reaching out to people who weren’t impressed by noise.”
It was this kind of investing that this investor wanted to do. But how? He kept reading Buffett. Then he found another investor he liked and read his stuff too. Then thanks to some family money he started his own office, modeling the lessons he learned from Warren. He left the noise of New York City, found investors with the same values, and kept his costs low.
In 2008 he bid more than half a million dollars to have lunch with Buffett. There, he saw Buffett’s secret appointment diary, “which was mostly empty.” Afterwards came the real lesson.
“For me, the (lunch) lesson was clear. Instead of trying to compete with Buffett, I should focus on the real opportunity, which is to become the best version of Guy Spier that I can be.”
Warren Buffett’s system fits Warren Buffett. Your system should fit you. Tomorrow we’ll take a small detour and see how.