Warren Buffett was the single most successful investor of the 20th century. Time magazine named him one of the most influential people in the world.
He is worth over seventy billion dollars.
Here are his top 10 rules for success.
Rule #1 – Find your Passion:
Buffett says, he was very very lucky to find his passion when he was just seven years old.
Fortunately, my children have found their passion too. My one son loves farming like nothing else, one son loves music and all three of them love philanthropy. If your passion is your work, you are lucky.
It is a thin line between doing well and being happy. if you think, you are going to be lot happier if you’ve got two X instead of single X, you’re probably making a mistake. You’ve got to find something that works and does not get you in trouble. If you think, making 10X or 20X is the answer to everything in life because than you will do things like borrow money when you clearly should not, think again. To me, it just doesn’t make any sense, you won’t like it either when you look back on it later.
Rule #2 – Hire Well
When you are hiring people, look for three things. Look for integrity, intelligence and energy. If that person does not have the first two that the later would not work either, because if you don’t have integrity, you are dumb and lazy, you are not smart and energetic.
Rule #3 – Don’t care what others say
it never bothered me if people disagreed with what I thought as long as I knew the facts. There’s a whole bunch of things one does not know so simply stay away from those and stay within what is your circle of competence.
I just don’t have a problem if somebody says, you know; you’re wrong on something.
I just go back and look at the facts and I think that is really much more important frankly than than having a few points of IQ or or having an extra course in school.
Rule #4 – Read, Read and Read
I just read and read and read. I probably read five to six hours a day, I don’t read as fast now as when I was younger but I read five daily newspapers. I read a fair number of magazines, I read annual reports and I read a lot of other things. I’ve always enjoyed reading, I also love reading biographies. Reading broadens your thinking horizons.
Rule #5 – Maintain a margin of safety
Famous lesson about a margin of safety is that, you don’t drive a truck that weighs ninety nine hundred pounds across a bridge that says limit is ten thousand pounds. Think about safety first and dont act foolish.
Rule #6 – Gain a competitive advantage
Warren says, the nature of capitalism is that people want to come in and take your castles. That is perfectly understandable, if I’m selling television sets or something there’s going to be ten other people who are gonna try and sell a better television set.
If I have a restaurant, people gonna try and copy my menu and get more parking and take my chef and so on. Capitalism is all about somebody coming and trying to take the castle. Now, what you need is, you need a castle that has some durable competitive advantage, some castle that has a moat around it and that moat is one of the best moats in many respects. That is exactly how you get competitive advantage, innovation is the key.
If you’re a heavyweight champion of the world and keep knocking out people, you’ve got a competitive advantage as long as you can keep doing it. In business, it is very profitable. Take Steven Spielberg for example. He is a fellow to bet on and it has enormous economic value because of his work.
Rule #7 – Schedule time for your personality
Warren says, you’d be surprised – in my days there were almost no meetings. I don’t like meetings. I do read a lot and I wish I was a faster reader, I use phone a moderate amount. Our businesses run themselves out there. My job is allocating capital and that’s what I’m thinking about. I don’t like to have things all packed hour an hour after hour.
Bill Gates and I are both extraordinarily lucky. We really get to do what we like to do and the way we want to do it with people we choose to be around with. Always find time for yourself.
Rule #8 – Always Compete, Study failures
I try to study failures. In business, we want to see what has caused businesses to go bad and the biggest thing that kills them it’s complacency. Take Coca cola for example, 1.8 billion servings being sold daily when they were selling around 10 a day, that is the belief about tomorrow. Always compete, study failures and learn from them.
Rule #9 – Model Success, My Mentor
Ben Grimm was my primary mentor, he was my professor at Columbia. I read his book when I was 19 at the University of Nebraska and I’d started investing when I was 11. I started reading about it when I was like 7 so I’d gone through all. Mentors are very important.
By the time I was 12, I read every book in the Public Library on investing in stock market.
Rule #10 – Give unconditional love
The best advice I ever got was from my father. The advice I got was the power of unconditional love. I think there is no power on earth like unconditional love.