In 2008, Warren Buffett became the richest man in the world. Now 94, he has just announced that he will be stepping down as CEO of Berkshire Hathaway, the multi-billion dollar US conglomerate he has headed up for over 50 years. It made early investments in companies like Apple, Coca-Cola, and American Express.
Buffett may have a net worth of around $168 billion, but he’s managed to stay grounded. He has an egg McMuffin for breakfast every day and has lived in the same house in Omaha, Nebraska for more than 65 years. As well as becoming one of the world’s sharpest investors, he has also become famous for the wit and wisdom he dispenses in his annual letter to Berkshire Hathaway’s shareholders.
In the letters, Buffett shares advice for everything from making money to winning the attention of kids. Here are some of his best pearls of wisdom.
Don’t be afraid of owning up to mistakes – 2024
“During the 2019-23 period, I have used the words “mistake” or “error” 16 times in my letters to you. Many other huge companies have never used either word over that span. Amazon, I should acknowledge, made some brutally candid observations in its 2021 letter. Elsewhere, it has generally been happy talk and pictures.”
“I have also been a director of large public companies at which “mistake” or “wrong” were forbidden words at board meetings or analyst calls. That taboo, implying managerial perfection, always made me nervous “
“I never look at where a candidate has gone to school. Never!” 2024
“Look at my friend, Bill Gates, who decided that it was far more important to get underway in an exploding industry that would change the world than it was to stick around for a parchment that he could hang on the wall.”
“Secrets are catnip to kids.” – 2021
“My toughest audience was my grandson’s fifth-grade class. The 11-year-olds were squirming in their seats and giving me blank stares until I mentioned Coca-Cola and its famous secret formula. Instantly, every hand went up”.
“Be fearful when others are greedy and greedy when others are fearful.” – 2004
This quote summarises Buffett's contrarian investing philosophy: great investment opportunities often arise during market panic, not during euphoria. It encourages long-term thinking and emotional discipline – hallmarks of Buffett’s success.
Reputation takes a lifetime to build and seconds to ruin – 2010
“We can afford to lose money – even a lot of money. But we can’t afford to lose reputation – even a shred of reputation.”
Integrity is non-negotiable. Buffett values ethical behaviour above short-term success.
“Never invest in a business you cannot understand.” – 1996
Stay within your circle of competence – a sound investment is a company you believe in.
“You don’t have to do extraordinary things to get extraordinary results.” – 1994
Patience, focus, and clarity beat constant hustle. Busy doesn’t equal productive.
