#227 The Essays of Warren Buffett

**David Senra** (0:00)
I want to tell you about a one-time only limited event that I don't think you're going to want to miss. I am doing a live show with Patrick O'Shaughnessy from the Invest Like the Best podcast in New York City on October 19th. Patrick has interviewed over 300 of the world's best investors and founders for his podcast. I've read over 300 biographies of history's greatest entrepreneurs for my podcast. We'll be talking about what we learned from seven years of podcasting, sharing our favorite ideas and stories and doing a live Q&A. There will also be special event-only swag. If you live in New York City, I think it's a no-brainer, but if not, I think it's a great excuse to fly in. I've already heard from a bunch of people that bought tickets, they're flying in from other cities. Some people are flying in from other countries. That's setting the bar really high, so I will have at least four shots of espresso or four energy drinks before or during the show so we can make it a night that you'll never forget. If you're interested in attending this unique live event, I will leave a link down below. I highly recommend you get your tickets today and I hope I get to see you in New York on October 19th.
The original edition of The Essays of Warren Buffett was a centerpiece of a 1996 symposium that I organized. This gathering brought together hundreds of students for a two-day dissection of all of the ideas in the letters, featuring a series of vibrant debates among some 30 distinguished scholars, investors and managers, with Warren Buffett and Charlie Munger participating throughout from their seats in the front row.
In the decade since its initial publication, I have often taught this book in my classes and at seminars at four different universities.
The book is adopted by scores of professors at other schools for classes such as investment, finance and accounting. Investment firms have distributed copies to their professional employees and clients as part of training programs.
All the letters are woven together into a fabric that reads as a complete and coherent narrative of a sound business and investment philosophy. Experienced readers of Warren Buffett's letters to the shareholders of Berkshire Hathaway have gained an enormously valuable informal education. The letters distill in plain words, all the basic principles of sound business practices. The writings are broad in scope and long on wisdom.
And that is an excerpt from the book that we talked about today, which is The Essays of Warren Buffett, Lessons for Corporate America. And it was put together by Lawrence Cunningham. And this is another recommendation that came from a listener. If you have more book recommendations you'd like to see me cover on the podcast, please send them to me. The best way to, or probably the easiest way to do that is just email me, David at founderspodcast.com. I have a ton of highlights for this book before I jump into it. I want to tell you what it is. So back, I'll be back on Founders number 88 I read every single Warren Buffett shareholder letter in order by year. And it's by far the largest book that I've ever read for the podcast. It's the longest episode. It's like the size of a textbook. And so I just worked my way through that book in order, in chronological order, starting at the very first shareholder letter, I think in like 1965, all the way up, I think it ends in 2020 This book is an edited version of Warren Buffett's shareholder letters, but instead of organized by year, it's organized by topic. So 99% of what I'm gonna talk to you about today is gonna be just Warren Buffett's own words.
I do have some highlights from the introduction. Lawrence wrote an introduction. It's about 30 pages long, like his own analysis and like an overview of the lessons he learned from reading and rereading Buffett shareholder letters. I'm gonna jump into the introduction. So he says, some of Berkshire's businesses are massive. 10 would be included in the Fortune 500 if they were standalone companies. Buffett and Charlie Munger built this sprawling enterprise by investing in businesses with excellent economic characteristics and run by outstanding managers. So just pause there. I'll tell you the note that came to mind when I got to this section. That is repeated over and over again. We're looking for excellent businesses with excellent economic characteristics. So businesses that throw off a lot of cash and are run by outstanding managers. And as Buffett and then Munger with less tact points out over and over again, most businesses are poorly run. Most people are very average. So the supply, the note I left myself is the supply of companies that have these characteristics is really small.