The difference between the best and average is not 20%, it's 50x. Working with the best people is overwhelmingly better. Productivity and efficiency skyrocket, and the gap widens as compounding takes effect. Steve Jobs' mission at Apple was only to let A players in.

"When you find a genius, give them all power." I've been obsessed with this idea for 12 months now. I learned it from Munger but then saw all successful people apply it. From Steve Jobs to Robert Oppenheimer. Thread:

Truly gifted, high-integrity, people are rare. When you find a person like this, you want to do 2 things: -Partner with them. -Get out of their way. This seems obvious, but few people do it.

Talent and outcome distribution follow a power law. The most gifted people drive 99% of progress in businesses and overall projects. A manager's job is to find and create an environment for them to thrive.

One of the best basketball coaches was John Wooden. His strategy was simple: concentrate all playing time on only the best players. This caused intelligence and skill to compound. And the best players became machines.

That's what Berkshire Hathaway did. Little by little, they added businesses run by superb managers to their portfolio. Warren just got out of their way. Managers did all the playing time and sent the money to Omaha.

When you find a great player, be cautious. Replacing these people is a huge problem. Not only are they in short supply, but "it's difficult to teach a new dog old tricks." Buffett avoided this by ignoring the conventional "retirement age."

To keep A players, they need to be in a place they like and earn more than anywhere else. Netflix realized that not having these guys is more expensive than paying them 2x what an average person would charge.

And it goes beyond that. You don't just sell your best player because your team depends on them. When you find a way for them to happily take a lot of responsibility, don't take it away. Try to see if they want to take more.

If you find an absolute genius, put them in charge. During WW2, the US gov gave Oppenheimer complete control of the scientific part of the Manhattan Project. And Robert proved a wonderful leader. He convinced 100s of the most brilliant people on earth to work with him.

Singapore shows what can happen if extraordinary people are in charge for a long time. Lee Kuan Yew governed Singapore from 1959-90. Singapore's per capita GDP grew from $500 in 1965 to $84,000 now. Corruption, security, cleanliness, and everything ranks world-class.

Sidecar investing is about partnering with extraordinary operators. "The investor rides along in a sidecar pulled by a powerful motorcycle." It is "free riding on the superior capability of others." Do this when you find a Henry Singleton or a LKY. Image credit to @sidecarcap

To know if you are in the presence of someone truly gifted, my question always is, "How stupid do I feel talking to this person?" Jobs' test was: The people you would bring if you could only take a 100 on a lifeboat to your next company. Netflix's has yet another test:

Munger highly praised this idea and was its greatest practitioner. He partnered with Warren Buffett, a once-in-a-century sort of talent, for over 50 years and gave him all power. The outcome was a $1tn corporation, beyond extraordinary.

I hope you found this thread interesting and make sure to share if you have! I post daily about books. You can follow me at @Giuliano_Mana to find good reads.

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