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CHRIS HOHN HAS GENERATED RETURNS THAT MOST HEDGE FUND MANAGERS WOULD KILL FOR He just explained the one trait Warren Buffett taught him to look for in every investment. It's the difference between a good business and a great one: "Most companies don't have pricing power. They can only... price if they're lucky, at inflation. But there is a special group of super companies that can price above inflation. And that's, as Buffett taught, the test of whether you have the moat." Then he ran the math. If a company can price just 1% above inflation with a 20% profit margin, profit grows 5% faster than revenue every year. Compound that over a decade and the gap is enormous. His final point: "People don't go into it or analyze it because there are so few companies that have it."show more

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Marc Andreessen: “I’m always urging founders to raise prices, raise prices, raise prices.” “We spend a lot of time working with our companies on pricing,” a16z co-founder Marc Andreessen explains. “It’s really this magical art and science that a lot of companies don’t take seriously enough.” Marc continues: “A core principle of pricing is that you don’t want to price by cost if you can avoid it. You want to price by value. Especially when you’re selling to businesses, you want to price as a percentage of the business value you’re creating.” He gives the example of building an AI that can do the job of a programmer, a lawyer, or a radiologist: “Can you price by value and get a percentage of what otherwise would’ve literally been a person? Or equivalently can you price by marginal productivity? If you can take a human doctor and make them much more productive because you give them AI, can you price as a percentage of the productivity uplift?” Marc argues that high prices are under-appreciated by founders: “The naive view on pricing is the lower the pricing, the better it is for the customer. The more sophisticated way of looking at it is that higher prices are often good for the customer because the higher price means the vendor can make the product better, faster. Companies with higher prices and higher margins can actually invest more in R&D and make the product better. Most people who buy things aren’t just looking for the cheapest price. They want something that’s going to work really well.” Marc also emphasizes this point in an interview in Elad Gil’s High Growth Handbook: “What I hear from companies is, ‘Oh, we have an awesome moat, and we’re still going to price our product cheap, because we think that’s somehow going to maximize our business.’ I’m always urging founders to raise prices, raise prices, raise prices. I’m always urging founders to raise prices, raise prices, raise prices. First of all, raising prices is a great way to flesh out whether you actually do have a moat. If you do have a moat, the customers will still buy, because they have to. The definition of a moat is the ability to charge more. And so number one, it’s just a good way to flesh out that topic and really expose it to sunlight. And then number two, companies that charge more can better fund both their distribution efforts and their ongoing R&D efforts. Charging more is a key lever to be able to grow. And the companies that charge more therefore tend to grow faster. That’s counterintuitive to a lot of engineers. A lot of engineers think there’s a one-dimensional relationship between price and value. They have this mental model of commerce like they’re selling rice or something. It’s like, “My product is magical and nobody can replicate it, and I need to price it like it’s a commodity.” No, you don’t. In fact, quite the opposite. If you price it high, then you can fund a much more expensive sales and marketing effort, which means you’re much more likely to win the market, which means you’re much more likely to be able afford to do all the R&D and acquisitions you’re going to want to do. And so we always try to snap people into a two-dimensional mindset, where higher prices equals faster growth.” Video source: a16z (2026)

Marc Andreessen: “I’m always urging founders to raise prices, raise prices, raise prices.” “We spend a lot of time working with our companies on pricing,” a16z co-founder Marc Andreessen explains. “It’s really this magical art and science that a lot of companies don’t take seriously enough.” Marc continues: “A core principle of pricing is that you don’t want to price by cost if you can avoid it. You want to price by value. Especially when you’re selling to businesses, you want to price as a percentage of the business value you’re creating.” He gives the example of building an AI that can do the job of a programmer, a lawyer, or a radiologist: “Can you price by value and get a percentage of what otherwise would’ve literally been a person? Or equivalently can you price by marginal productivity? If you can take a human doctor and make them much more productive because you give them AI, can you price as a percentage of the productivity uplift?” Marc argues that high prices are under-appreciated by founders: “The naive view on pricing is the lower the pricing, the better it is for the customer. The more sophisticated way of looking at it is that higher prices are often good for the customer because the higher price means the vendor can make the product better, faster. Companies with higher prices and higher margins can actually invest more in R&D and make the product better. Most people who buy things aren’t just looking for the cheapest price. They want something that’s going to work really well.” Marc also emphasizes this point in an interview in Elad Gil’s High Growth Handbook: “What I hear from companies is, ‘Oh, we have an awesome moat, and we’re still going to price our product cheap, because we think that’s somehow going to maximize our business.’ I’m always urging founders to raise prices, raise prices, raise prices. I’m always urging founders to raise prices, raise prices, raise prices. First of all, raising prices is a great way to flesh out whether you actually do have a moat. If you do have a moat, the customers will still buy, because they have to. The definition of a moat is the ability to charge more. And so number one, it’s just a good way to flesh out that topic and really expose it to sunlight. And then number two, companies that charge more can better fund both their distribution efforts and their ongoing R&D efforts. Charging more is a key lever to be able to grow. And the companies that charge more therefore tend to grow faster. That’s counterintuitive to a lot of engineers. A lot of engineers think there’s a one-dimensional relationship between price and value. They have this mental model of commerce like they’re selling rice or something. It’s like, “My product is magical and nobody can replicate it, and I need to price it like it’s a commodity.” No, you don’t. In fact, quite the opposite. If you price it high, then you can fund a much more expensive sales and marketing effort, which means you’re much more likely to win the market, which means you’re much more likely to be able afford to do all the R&D and acquisitions you’re going to want to do. And so we always try to snap people into a two-dimensional mindset, where higher prices equals faster growth.” Video source: a16z (2026)

Startup Archive

423,249 Aufrufe • vor 8 Monaten

Peter Thiel: "Competition is for losers" "Competition is for losers, which got people's attention, because we normally believe the opposite. We believe that the losers are the people who don't compete intensely enough. You're a loser if you're not competitive. But what if you're a loser because you're too obsessed with competing? If you're too focused on competing, maybe you're losing sight of what's really important." Thiel explains the distinction most people miss: "The most important distinction in business that people don't talk about enough is that there are two kinds of companies in this world. There are companies that are competitive, and there are companies that have monopolies. If you're a one-of-a-kind company, a happy company that's doing something different, you are a monopoly. It is the goal of every founder, every entrepreneur, it should be their goal to try to build a monopoly business." He frames this as an unconventional truth: "Most people believe that capitalism and competition are synonyms. I believe capitalism and competition are antonyms. A capitalist is someone who's in the business of accumulating capital. A world of perfect competition is a world where all the profits are competed away."

Peter Thiel: "Competition is for losers" "Competition is for losers, which got people's attention, because we normally believe the opposite. We believe that the losers are the people who don't compete intensely enough. You're a loser if you're not competitive. But what if you're a loser because you're too obsessed with competing? If you're too focused on competing, maybe you're losing sight of what's really important." Thiel explains the distinction most people miss: "The most important distinction in business that people don't talk about enough is that there are two kinds of companies in this world. There are companies that are competitive, and there are companies that have monopolies. If you're a one-of-a-kind company, a happy company that's doing something different, you are a monopoly. It is the goal of every founder, every entrepreneur, it should be their goal to try to build a monopoly business." He frames this as an unconventional truth: "Most people believe that capitalism and competition are synonyms. I believe capitalism and competition are antonyms. A capitalist is someone who's in the business of accumulating capital. A world of perfect competition is a world where all the profits are competed away."

Jaynit

55,406 Aufrufe • vor 6 Monaten

Peter Thiel on why the best businesses never compete: "Most people believe that capitalism and competition are synonyms. I believe capitalism and competition are antonyms." His point is simple: "A capitalist is someone who's in the business of accumulating capital. A world of perfect competition is a world where all the profits are competed away." Peter explains that the most important distinction in business is one nobody talks about enough. "There are two kinds of companies in this world. There are companies that are competitive and there are companies that have monopolies." His go-to example of a bad business? Restaurants. "Opening a restaurant is super competitive and nobody ever makes any money doing it." His example of a great business: Google. "Google has had no competition in search since 2002 when it definitively distanced itself from Microsoft and Yahoo, and it's been making enormous profits for the dozen years or so ever since." So what should founders actually aim for? "If you're a one-of-a-kind company, a happy company that's doing something different, you are a monopoly. It is the goal of every founder, every entrepreneur—it should be their goal to try to build a monopoly business." True market power means never having to compete in the first place.

Peter Thiel on why the best businesses never compete: "Most people believe that capitalism and competition are synonyms. I believe capitalism and competition are antonyms." His point is simple: "A capitalist is someone who's in the business of accumulating capital. A world of perfect competition is a world where all the profits are competed away." Peter explains that the most important distinction in business is one nobody talks about enough. "There are two kinds of companies in this world. There are companies that are competitive and there are companies that have monopolies." His go-to example of a bad business? Restaurants. "Opening a restaurant is super competitive and nobody ever makes any money doing it." His example of a great business: Google. "Google has had no competition in search since 2002 when it definitively distanced itself from Microsoft and Yahoo, and it's been making enormous profits for the dozen years or so ever since." So what should founders actually aim for? "If you're a one-of-a-kind company, a happy company that's doing something different, you are a monopoly. It is the goal of every founder, every entrepreneur—it should be their goal to try to build a monopoly business." True market power means never having to compete in the first place.

Big Brain Business

73,938 Aufrufe • vor 8 Monaten

SpaceX at $2 trillion is either the most obvious buy or the most expensive lesson in IPO history They cut the cost of reaching orbit by 95% compared to the Space Shuttle era. They own two thirds of all low Earth orbit satellites. No dorm room startup will ever compete with that But incredible companies and great investments are not the same thing at any price Amazon built distribution centers and 747s and that moat made it worth trillions. SpaceX is building the same kind of irreplaceable infrastructure in space The difference is Amazon spent a decade losing money before it earned its valuation. SpaceX wants you to price in the decade it hasn't had yet Scott Galloway said it best: "digital companies scale fast but analog companies have moats that are nearly impossible to cross" That is not a startup. That is infrastructure The question is not whether SpaceX is great. It is whether you are the right buyer at this price

SpaceX at $2 trillion is either the most obvious buy or the most expensive lesson in IPO history They cut the cost of reaching orbit by 95% compared to the Space Shuttle era. They own two thirds of all low Earth orbit satellites. No dorm room startup will ever compete with that But incredible companies and great investments are not the same thing at any price Amazon built distribution centers and 747s and that moat made it worth trillions. SpaceX is building the same kind of irreplaceable infrastructure in space The difference is Amazon spent a decade losing money before it earned its valuation. SpaceX wants you to price in the decade it hasn't had yet Scott Galloway said it best: "digital companies scale fast but analog companies have moats that are nearly impossible to cross" That is not a startup. That is infrastructure The question is not whether SpaceX is great. It is whether you are the right buyer at this price

plutos

124,108 Aufrufe • vor 3 Monaten

Can companies responsibly build a business model around Starship? .Eric Romo, President & COO of Impulse Space doesn't think so. "Why would you (SpaceX) sell a thing you don’t have enough of for yourself, at a bargain-basement price, to your competitors? The logic just doesn’t hold anywhere there. And it’s just sort of the wishful thinking of, “Well, because I want it,” that these companies say they’re going to get this at a low price. And the reality is, in the market, this is the same thing that happened with Falcon 9."

Can companies responsibly build a business model around Starship? .Eric Romo, President & COO of Impulse Space doesn't think so. "Why would you (SpaceX) sell a thing you don’t have enough of for yourself, at a bargain-basement price, to your competitors? The logic just doesn’t hold anywhere there. And it’s just sort of the wishful thinking of, “Well, because I want it,” that these companies say they’re going to get this at a low price. And the reality is, in the market, this is the same thing that happened with Falcon 9."

Mo Islam

57,699 Aufrufe • vor 2 Monaten

Khosla Ventures' Keith Rabois explains how a mere blip in the Anthropic or OpenAI IPOs would be catastrophic for the venture-funded AI ecosystem: "The most devastating thing to the frothy hype, traction, and funding of AI from VCs would be if Anthropic or OpenAI has a blip in their IPOs." "Do they have to show metrics over the next month to first few quarters that cause people to value either company less than the current belief that they will trade in the trillions? They could have a miss on revenue traction, a miss on margins, something like that." "That would be catastrophic. It would immediately reset virtually all the valuations in the AI world. And probably deprive half the companies that are raising money from access to capital." "I'm not saying that is going to happen, or is likely. And I think if they miss, it would be more on the margin side than on the revenue side." "But if they do, everybody is predicating their new investments in dollars on the idea that you can build a trillion-dollar company within the lifecycle of a venture fund. There are 2 examples, currently, and there are several companies that people believe have the potential to get there." "If that changes, and you cannot predict that more trillion-dollar companies can be created, then the valuations that people are investing at, and the dollars that are being invested, do not make that much sense."

Khosla Ventures' Keith Rabois explains how a mere blip in the Anthropic or OpenAI IPOs would be catastrophic for the venture-funded AI ecosystem: "The most devastating thing to the frothy hype, traction, and funding of AI from VCs would be if Anthropic or OpenAI has a blip in their IPOs." "Do they have to show metrics over the next month to first few quarters that cause people to value either company less than the current belief that they will trade in the trillions? They could have a miss on revenue traction, a miss on margins, something like that." "That would be catastrophic. It would immediately reset virtually all the valuations in the AI world. And probably deprive half the companies that are raising money from access to capital." "I'm not saying that is going to happen, or is likely. And I think if they miss, it would be more on the margin side than on the revenue side." "But if they do, everybody is predicating their new investments in dollars on the idea that you can build a trillion-dollar company within the lifecycle of a venture fund. There are 2 examples, currently, and there are several companies that people believe have the potential to get there." "If that changes, and you cannot predict that more trillion-dollar companies can be created, then the valuations that people are investing at, and the dollars that are being invested, do not make that much sense."

TBPN

78,950 Aufrufe • vor 21 Tagen

BREAKING NEWS: Trump announces economic plan. “So there are some of the most brilliant people in Wall Street that are saying that if President Trump doesn't win, you're going to have a depression. I have to agree. I think that's true. Because I know how bad these people are. You know, they like to say that they did this and that. You saw the seven trillion that they said it was me for seven trillion. It wasn't me. It was them. They said that I had inflation. They took over 9% in inflation. No, no, I had 1% inflation. I had actually no inflation because if you look at the categories, we had just about no inflation. But I had a very minor-- I actually had a positive inflation. It was a perfect number. Because you don't want zero. I mean, I'm not going to give you a whole course on economics. But you don't want zero. 1% 1.4% is great. You want a little bit because you don't want to have deflation. Deflation is, in many ways, even worse. I had a perfect number right around the 1% number. It was perfect. And to show you, it stayed there for two years. And then he did all of the different borrowings that he did. And then he did so many things wrong. Every time he would do it, I'd say big mistake. And don't forget they sell hats. And they sell stories. Trump was right about everything. I happened right about a lot.”

BREAKING NEWS: Trump announces economic plan. “So there are some of the most brilliant people in Wall Street that are saying that if President Trump doesn't win, you're going to have a depression. I have to agree. I think that's true. Because I know how bad these people are. You know, they like to say that they did this and that. You saw the seven trillion that they said it was me for seven trillion. It wasn't me. It was them. They said that I had inflation. They took over 9% in inflation. No, no, I had 1% inflation. I had actually no inflation because if you look at the categories, we had just about no inflation. But I had a very minor-- I actually had a positive inflation. It was a perfect number. Because you don't want zero. I mean, I'm not going to give you a whole course on economics. But you don't want zero. 1% 1.4% is great. You want a little bit because you don't want to have deflation. Deflation is, in many ways, even worse. I had a perfect number right around the 1% number. It was perfect. And to show you, it stayed there for two years. And then he did all of the different borrowings that he did. And then he did so many things wrong. Every time he would do it, I'd say big mistake. And don't forget they sell hats. And they sell stories. Trump was right about everything. I happened right about a lot.”

Jim Stewartson, Decelerationist 🇨🇦🇺🇦🇺🇸

2,407,932 Aufrufe • vor 2 Jahren

Mohnish Pabrai: "See's is a wonderful business. It taught [Warren Buffett and Charlie Munger] a lot. It taught them more than they ever thought they'd learn from a stupid candy business." "Both [Warren] and Charlie were amazed that you could have a business where you are continuously raising prices significantly above the rate of inflation — and there is no resistance from the customer base to accepting those prices. That gave them a huge lesson in brands." "They paid 3x book value for See's. They were choking almost when they paid that amount. I think they bought See's for $25 million. Looking back, they could have paid $200 million and it [still] would have been great." "If they had not bought See's, they would have never bought Coke. The lessons that they learned about branding and the power of brands is what led to the Coke investment — which was a much bigger home run." (h/t My First Million)

Mohnish Pabrai: "See's is a wonderful business. It taught [Warren Buffett and Charlie Munger] a lot. It taught them more than they ever thought they'd learn from a stupid candy business." "Both [Warren] and Charlie were amazed that you could have a business where you are continuously raising prices significantly above the rate of inflation — and there is no resistance from the customer base to accepting those prices. That gave them a huge lesson in brands." "They paid 3x book value for See's. They were choking almost when they paid that amount. I think they bought See's for $25 million. Looking back, they could have paid $200 million and it [still] would have been great." "If they had not bought See's, they would have never bought Coke. The lessons that they learned about branding and the power of brands is what led to the Coke investment — which was a much bigger home run." (h/t My First Million)

Kevin Carpenter

53,374 Aufrufe • vor 3 Monaten

Mark Cuban says one of his companies is saving $50K/month using an AI agent that just takes pictures "One of my Shark Tank companies is called RebelCheesedotcom, they sell vegan cheese and ship it all over the world and they like a lot of companies that ship products in boxes" "You know there's different size boxes for UPS or DHL and there's a different price to ship to a different zone, also they don't ever charge you the right price" "So they wrote a little agent that took a picture of the box when it's getting ready to ship and determined the size looked at the price list, look at the invoice, took a picture of the invoice, compared them and when they were different created the credit request and are saving $50,000 a month and it's all automated they don't have to touch it"

Mark Cuban says one of his companies is saving $50K/month using an AI agent that just takes pictures "One of my Shark Tank companies is called RebelCheesedotcom, they sell vegan cheese and ship it all over the world and they like a lot of companies that ship products in boxes" "You know there's different size boxes for UPS or DHL and there's a different price to ship to a different zone, also they don't ever charge you the right price" "So they wrote a little agent that took a picture of the box when it's getting ready to ship and determined the size looked at the price list, look at the invoice, took a picture of the invoice, compared them and when they were different created the credit request and are saving $50,000 a month and it's all automated they don't have to touch it"

katsu

1,490,684 Aufrufe • vor 5 Monaten

"Mr. IPO" on SpaceX IPO: "There have only been about 18 companies that have gone public at a price-to-sales ratio above 40. SpaceX will go public at 80×. on average, the stock has been a disappointment." SpaceX is eyeing a $1.5 trillion valuation — the largest private-sector company ever to go public Last year it did $18.7B in revenue — bigger than almost any private company at IPO But the price-to-sales ratio will be ~80×. only 18 companies in US history have cleared 40× Of those 18, most disappointed investors after listing The competitive moat is real. Starship makes it nearly impossible to replicate their launch cost advantage The question is not whether it's a great company. it is The question is whether $1.5 trillion leaves anything on the table for you

"Mr. IPO" on SpaceX IPO: "There have only been about 18 companies that have gone public at a price-to-sales ratio above 40. SpaceX will go public at 80×. on average, the stock has been a disappointment." SpaceX is eyeing a $1.5 trillion valuation — the largest private-sector company ever to go public Last year it did $18.7B in revenue — bigger than almost any private company at IPO But the price-to-sales ratio will be ~80×. only 18 companies in US history have cleared 40× Of those 18, most disappointed investors after listing The competitive moat is real. Starship makes it nearly impossible to replicate their launch cost advantage The question is not whether it's a great company. it is The question is whether $1.5 trillion leaves anything on the table for you

plutos

150,212 Aufrufe • vor 3 Monaten

Elon Musk: If you are creating a company or joining a company the most important thing is to attract great people "If you are creating a company or joining a company the most important thing is to attract great people, so either be with or join a group that's amazing that you really respect, or if you have building a company you have to gather great people I mean all the company is a group of people that have gathered together to create a product or service and so depending upon how talented and hardworking that group is, and the degree to which they're focused, cohesively, and in a good direction, that will determine the success of the company Do everything you can to gather great people, if you are creating a company"

Elon Musk: If you are creating a company or joining a company the most important thing is to attract great people "If you are creating a company or joining a company the most important thing is to attract great people, so either be with or join a group that's amazing that you really respect, or if you have building a company you have to gather great people I mean all the company is a group of people that have gathered together to create a product or service and so depending upon how talented and hardworking that group is, and the degree to which they're focused, cohesively, and in a good direction, that will determine the success of the company Do everything you can to gather great people, if you are creating a company"

SMX 🇺🇸

12,251 Aufrufe • vor 6 Monaten

Marc Andreessen on the 3 things he looks for when investing in a startup The first thing Marc Andreesen looks for is a big market: “Is there a big existing market that you think you can go after and displace incumbents? Or do you believe there will be a new market that will be big?” The second thing he looks for is a 10x better product: “Is there a fundamental technology or economic change that justifies a new company? And the way I always think about that is: Is there a 10x change happening in the technology landscape? Is something 10x faster, 10x cheaper, or 10x better? If it’s not 10x, we as both VCs and entrepreneurs have to ask ourselves if it’s really worth doing because it’s really hard to start new companies . . . Existing companies are usually pretty good at what they do. So for a new company to exist, it has to bring a product to market that’s so much better than what exists that it punches through the status quo.” The third is the team: “Is the team outstanding? . . . You want to have a founding team of complementary skillsets. You want to have at least one super strong technologist — quite possibly more than one. Some of the best startups are actually more than one founding technologist. And then it often helps to have someone who is a marketing or salesperson who has a really good understanding of business.” Marc believes that you need all three of these, but if you’re going to compromise on one of those as an investor, it should be the product: “A great market is a lot easier to make up for with iterative product execution. The problem with a poor or small market is that even if you do a good job on the product, there just aren’t that many customers so it’s hard to ever get big and people get demoralized . . . And then we evaluate the team of a startup by its ability to get into a big market with a good product.”

Marc Andreessen on the 3 things he looks for when investing in a startup The first thing Marc Andreesen looks for is a big market: “Is there a big existing market that you think you can go after and displace incumbents? Or do you believe there will be a new market that will be big?” The second thing he looks for is a 10x better product: “Is there a fundamental technology or economic change that justifies a new company? And the way I always think about that is: Is there a 10x change happening in the technology landscape? Is something 10x faster, 10x cheaper, or 10x better? If it’s not 10x, we as both VCs and entrepreneurs have to ask ourselves if it’s really worth doing because it’s really hard to start new companies . . . Existing companies are usually pretty good at what they do. So for a new company to exist, it has to bring a product to market that’s so much better than what exists that it punches through the status quo.” The third is the team: “Is the team outstanding? . . . You want to have a founding team of complementary skillsets. You want to have at least one super strong technologist — quite possibly more than one. Some of the best startups are actually more than one founding technologist. And then it often helps to have someone who is a marketing or salesperson who has a really good understanding of business.” Marc believes that you need all three of these, but if you’re going to compromise on one of those as an investor, it should be the product: “A great market is a lot easier to make up for with iterative product execution. The problem with a poor or small market is that even if you do a good job on the product, there just aren’t that many customers so it’s hard to ever get big and people get demoralized . . . And then we evaluate the team of a startup by its ability to get into a big market with a good product.”

Startup Archive

17,333 Aufrufe • vor 8 Monaten

Warren Buffett explains why the best inflation hedge isn't gold or real estate — it's a business that can grow without requiring much additional capital During a Berkshire Hathaway annual meeting, Buffett was asked whether a high-return, capital-light business like See's Candies remains the best protection against inflation, or whether capital-intensive assets like railroads have become more attractive. His answer was clear: the capital-light business still wins. The reasoning is simple. When inflation rises, businesses that can increase revenue without needing large amounts of new capital are in the strongest position. Buffett compares it to your own earning power. “The ultimate test is your own earning ability. If you’re an outstanding doctor, lawyer, teacher, as inflation goes along, your services will command more and more in dollar terms and you don’t have to make any additional investment in yourself.” By contrast, businesses tied up in inventory and receivables need more and more capital just to maintain the same level of business as prices rise. He then points to See's Candies, one of Berkshire's most successful investments. When Berkshire acquired the company, it generated about $30 million in sales with just $9 million in tangible assets. Years later, sales had grown to more than $300 million while requiring only around $40 million in tangible assets. Berkshire invested just $30 million of additional capital over that entire period, producing roughly $1.5 billion in pre-tax earnings. “If the price of candy doubles, we don’t have any receivables to speak of. Our inventory turns fast. The fixed assets aren’t big. That is a much better business to own than a utility business if you’re going to have a lot of inflation.” His ideal business is even simpler: “You want a royalty on somebody else’s sales. All you do is get a royalty check every month based on their sales volume. You have no receivables, no inventory, no fixed assets. That kind of business is real inflation protection.” Charlie Munger jokes that they didn't always understand this—and sometimes still forget it. Buffett agrees. “It shows how continuous learning is absolutely required to have any significant achievement at all in the world.” As for Berkshire's investments in railroads and other capital-intensive businesses, Buffett says it isn't because his philosophy changed. It's because there simply aren't enough businesses like See's Candies large enough to deploy Berkshire's enormous amounts of capital. “We’d love to find them. But we can’t find them in the quantity.” Source: Berkshire Hathaway Annual Shareholders Meeting (2004)

Warren Buffett explains why the best inflation hedge isn't gold or real estate — it's a business that can grow without requiring much additional capital During a Berkshire Hathaway annual meeting, Buffett was asked whether a high-return, capital-light business like See's Candies remains the best protection against inflation, or whether capital-intensive assets like railroads have become more attractive. His answer was clear: the capital-light business still wins. The reasoning is simple. When inflation rises, businesses that can increase revenue without needing large amounts of new capital are in the strongest position. Buffett compares it to your own earning power. “The ultimate test is your own earning ability. If you’re an outstanding doctor, lawyer, teacher, as inflation goes along, your services will command more and more in dollar terms and you don’t have to make any additional investment in yourself.” By contrast, businesses tied up in inventory and receivables need more and more capital just to maintain the same level of business as prices rise. He then points to See's Candies, one of Berkshire's most successful investments. When Berkshire acquired the company, it generated about $30 million in sales with just $9 million in tangible assets. Years later, sales had grown to more than $300 million while requiring only around $40 million in tangible assets. Berkshire invested just $30 million of additional capital over that entire period, producing roughly $1.5 billion in pre-tax earnings. “If the price of candy doubles, we don’t have any receivables to speak of. Our inventory turns fast. The fixed assets aren’t big. That is a much better business to own than a utility business if you’re going to have a lot of inflation.” His ideal business is even simpler: “You want a royalty on somebody else’s sales. All you do is get a royalty check every month based on their sales volume. You have no receivables, no inventory, no fixed assets. That kind of business is real inflation protection.” Charlie Munger jokes that they didn't always understand this—and sometimes still forget it. Buffett agrees. “It shows how continuous learning is absolutely required to have any significant achievement at all in the world.” As for Berkshire's investments in railroads and other capital-intensive businesses, Buffett says it isn't because his philosophy changed. It's because there simply aren't enough businesses like See's Candies large enough to deploy Berkshire's enormous amounts of capital. “We’d love to find them. But we can’t find them in the quantity.” Source: Berkshire Hathaway Annual Shareholders Meeting (2004)

Finance Nerd

15,692 Aufrufe • vor 2 Monaten

Marc Andreessen explains the 3 Necessities for Start-up Success: "The general criteria for a successful high-tech startup, in my view, you see different sort of rules of thumb from different people. But the three big things you always come back to are, is there a big market? And by the way, that comes in two parts. Is there a big existing market that you think you can go after and sort of displace incumbents or do you believe there will be a new market that will be big? So big market. Is there a fundamental technology or economic change that causes you to basically justify having a new company? And that's really important. And the way I always think about that is, is there a 10X change happening in the technology landscape? Is something 10X faster or 10X cheaper or 10X better? And if it's not 10X, we as both VCs and entrepreneurs, we really have to ask ourselves like, is it really worth doing? Because it's really hard. I mean, it's really hard to start new companies. new companies generally shouldn't exist. Existing companies are usually pretty good at what they do. And so for a new company to exist, it not only has to like come in and go into business and bring a product to market, but it has to bring a product to market that's so much better than what already exists that it punches through the sort of status quo. And most customers in most markets are pretty happy buying from the current suppliers and so there has to be a real kind of edge on the thing and we look for that in either a technology change, usually a technology change or an economic change. which are often the same thing. And then the third is team. Is the team outstanding? And if you think about this as an entrepreneur, it becomes a question of the founding team. Some companies are solo founders and they can work, but generally most of us, like myself, we're human beings, we're mortal. You want to have a founding team of complementary skill sets. And so you want to have at least one super strong technologist, quite possibly more than one. Some of the best startups are actually more than one founding technologist and then it often helps to have somebody who's like a product or who's a market or sales person or has a sort of really good understanding of business on the team, certainly helps a lot. And so we sort of look at market, product, and team. And the reality is you need all three. I would say, interestingly, if you're going to compromise as an investor, if we're going to compromise on one of those, it would actually be the product. And the reason I say that is because a great market is a lot easier to make up for with iterative product execution than a poor market. Because the problem with a poor market, a small market, is even if you do a great job on the product, there just aren't that many customers. It's hard to ever get big."

Marc Andreessen explains the 3 Necessities for Start-up Success: "The general criteria for a successful high-tech startup, in my view, you see different sort of rules of thumb from different people. But the three big things you always come back to are, is there a big market? And by the way, that comes in two parts. Is there a big existing market that you think you can go after and sort of displace incumbents or do you believe there will be a new market that will be big? So big market. Is there a fundamental technology or economic change that causes you to basically justify having a new company? And that's really important. And the way I always think about that is, is there a 10X change happening in the technology landscape? Is something 10X faster or 10X cheaper or 10X better? And if it's not 10X, we as both VCs and entrepreneurs, we really have to ask ourselves like, is it really worth doing? Because it's really hard. I mean, it's really hard to start new companies. new companies generally shouldn't exist. Existing companies are usually pretty good at what they do. And so for a new company to exist, it not only has to like come in and go into business and bring a product to market, but it has to bring a product to market that's so much better than what already exists that it punches through the sort of status quo. And most customers in most markets are pretty happy buying from the current suppliers and so there has to be a real kind of edge on the thing and we look for that in either a technology change, usually a technology change or an economic change. which are often the same thing. And then the third is team. Is the team outstanding? And if you think about this as an entrepreneur, it becomes a question of the founding team. Some companies are solo founders and they can work, but generally most of us, like myself, we're human beings, we're mortal. You want to have a founding team of complementary skill sets. And so you want to have at least one super strong technologist, quite possibly more than one. Some of the best startups are actually more than one founding technologist and then it often helps to have somebody who's like a product or who's a market or sales person or has a sort of really good understanding of business on the team, certainly helps a lot. And so we sort of look at market, product, and team. And the reality is you need all three. I would say, interestingly, if you're going to compromise as an investor, if we're going to compromise on one of those, it would actually be the product. And the reason I say that is because a great market is a lot easier to make up for with iterative product execution than a poor market. Because the problem with a poor market, a small market, is even if you do a great job on the product, there just aren't that many customers. It's hard to ever get big."

Founder Mode

39,005 Aufrufe • vor 8 Monaten

David Friedberg explains that owning a home is worse than investing in stocks Calls it the "Great lie" FRIEDBERG: "This is one of the great lies. Convincing everyone that the great American dream is to own a house. When owning a house for a lot of Americans ends up putting all your capital in one asset, and you've got to basically get the price of housing to go up every year to keep everyone moving up the ladder." "So now, fast forward 30, 40, 50 years, young people can't afford to buy a house anymore because we've pushed the asset value up so much to try and make sure that everyone's got good household wealth." BARTLETT: "We are told. I mean, that's the sort of central idea once you leave university—is to figure out how quickly you can get a mortgage or buy a house." FRIEDBERG: "Great lie. It's one of the great lies. And there's a lot of countries where people have been able to accumulate capital and jump that ravine from labor to capital much more quickly when they don't buy a house because they can invest in stuff. They can buy, you know, the S&P 500, which you can just buy on an E-Trade or Robinhood account, and you can just own it; on average, it will make you 10-11% a year. You just put your money in that, you're making 10-11% a year, and it can go up every year, and you don't have to pay taxes. You don't have to pay property tax. You don't have to pay insurance. You don't have to deal with repairs and maintenance. All that sort of stuff. So, a lot of people would have been better off, depending on the markets that they're in. There's some markets that ballooned, but a lot of people would have been better off over the last 30 years actually owning the S&P 500 than owning their home and paying for the rent on a home."

David Friedberg explains that owning a home is worse than investing in stocks Calls it the "Great lie" FRIEDBERG: "This is one of the great lies. Convincing everyone that the great American dream is to own a house. When owning a house for a lot of Americans ends up putting all your capital in one asset, and you've got to basically get the price of housing to go up every year to keep everyone moving up the ladder." "So now, fast forward 30, 40, 50 years, young people can't afford to buy a house anymore because we've pushed the asset value up so much to try and make sure that everyone's got good household wealth." BARTLETT: "We are told. I mean, that's the sort of central idea once you leave university—is to figure out how quickly you can get a mortgage or buy a house." FRIEDBERG: "Great lie. It's one of the great lies. And there's a lot of countries where people have been able to accumulate capital and jump that ravine from labor to capital much more quickly when they don't buy a house because they can invest in stuff. They can buy, you know, the S&P 500, which you can just buy on an E-Trade or Robinhood account, and you can just own it; on average, it will make you 10-11% a year. You just put your money in that, you're making 10-11% a year, and it can go up every year, and you don't have to pay taxes. You don't have to pay property tax. You don't have to pay insurance. You don't have to deal with repairs and maintenance. All that sort of stuff. So, a lot of people would have been better off, depending on the markets that they're in. There's some markets that ballooned, but a lot of people would have been better off over the last 30 years actually owning the S&P 500 than owning their home and paying for the rent on a home."

Tony Jacob | FindaClip.com

450,752 Aufrufe • vor 1 Monat

Warren Buffett on the biggest investing mistake of his career: Buffett explains that early in his career, he was taught by Ben Graham to buy stocks on a purely quantitative basis, hunting for things that were dirt cheap. He calls this the "cigar butt" approach: "The cigar butt approach to buying stocks is that you walk down the street and you're looking around for cigar butts and you find this terrible looking soggy ugly looking cigar one puff left in it but you pick it up and you get your one puff disgusting it's thrown away but it's free. I mean it's cheap and then you look around for another soggy you know one puff cigarette." That's exactly how he bought Berkshire Hathaway. The stock was selling below its working capital. He got the plants, the machinery, the inventory, and the receivables all at a discount. It was cheap. So he bought it. The problem? Twenty years later, he was still running a lousy business, and the money didn't compound. Buffett reflects on what he learned: "You really want to be in a wonderful business because there the time is the friend of the wonderful business; you keep compounding it keeps doing more business and you keep making more money. Time is the enemy of the lousy business." This led to one of his most famous investing principles: "I would rather buy a wonderful business at a fair price than a fair business at a wonderful price." Looking back, Buffett admits he could have liquidated Berkshire for a quick profit, taken his "one puff," and started fresh. Instead, he used a struggling textile business as the platform for everything that came after: the insurance business, See's Candy, the Buffalo News. "I would have been way better off doing that with a brand new little entity that I'd set up rather than using Berkshire at the platform."

Black Edge

19,375 Aufrufe • vor 4 Monaten

🇺🇸MARC ANDREESSEN: ELON IS THE LEAD PROBLEM SOLVER IN HIS COMPANIES “He identifies the biggest problem that the company is having that week, and he fixes it, and then he does that every week for 52 weeks in a row. And then each of his companies has solved the 52 biggest problems that year, and you know, most other large companies are still having the planning meeting for the pre-planning meeting for the board meeting, for the presentation. That is just really amazing to watch.” Source: Marc Andreessen 🇺🇸, Chris Williamson

🇺🇸MARC ANDREESSEN: ELON IS THE LEAD PROBLEM SOLVER IN HIS COMPANIES “He identifies the biggest problem that the company is having that week, and he fixes it, and then he does that every week for 52 weeks in a row. And then each of his companies has solved the 52 biggest problems that year, and you know, most other large companies are still having the planning meeting for the pre-planning meeting for the board meeting, for the presentation. That is just really amazing to watch.” Source: Marc Andreessen 🇺🇸, Chris Williamson

Mario Nawfal

400,201 Aufrufe • vor 1 Jahr

Brian Wong: The biggest profit margin companies won't be AI models. They'll be agents that help you build other agents. Most of America is running construction companies, factories, carpentry shops. They don't have time to prompt anything. Orchestrate the agents FOR them and they can run it without thinking. "Commerce only grows if it's buying for me. We don't scale agentic commerce if I have to tell it to buy things every time." Promptless AI + stablecoin payments is the wave. FT The Rollup Andy Brian Wong

Brian Wong: The biggest profit margin companies won't be AI models. They'll be agents that help you build other agents. Most of America is running construction companies, factories, carpentry shops. They don't have time to prompt anything. Orchestrate the agents FOR them and they can run it without thinking. "Commerce only grows if it's buying for me. We don't scale agentic commerce if I have to tell it to buy things every time." Promptless AI + stablecoin payments is the wave. FT The Rollup Andy Brian Wong

Milk Road

28,182 Aufrufe • vor 4 Monaten