Founders - #221 Charlie Munger

Episode Date: December 13, 2021

What I learned from reading Damn Right: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger by Janet Lowe.----Get access to the World’s Most Valuable Notebook for Founders at Founders Notes.com----[16:02] I had a considerable passion to get rich. Not because I wanted Ferraris—I wanted the independence. I desperately wanted it.[26:49] I met the towering intellectuals in books, not in the classroom, which is natural. My family was into all that stuff, getting ahead through discipline, knowledge, and self-control.[37:44] He talked about business in a way that was animated and interesting though now I see he was almost broke. I knew he drove an awful car. But I never thought he was anything but a big success. Why did I think that? He just had this air-everything he did was going to be first class, going to be great. He had these enthusiasms for his projects and his future.[38:48] Charlie drummed in the notion that a person should always "Do the best that you can do. Never tell a lie. If you say you're going to do it, get it done. Nobody gives a shit about an excuse. Leave for the meeting early, Don't be late, but if you are late, don't bother giving people excuses. Just apologize. They're due the apology, but they're not interested in an excuse.”[42:22] The rabbit runs faster than the fox, because the rabbit is running for his life while the fox is only running for his dinner.[49:15] He wouldn't accept anything on face value. His interest in almost everything can be so intense, he will have a perspective that others will not have.[49:29] Do things that other people aren't doing.[1:07:55] I am a biography nut myself and I think when you're trying to teach the great concepts that work, it helps to tie them into the lives and personalities of the people who developed them. I think that you learn economics better if you make Adam Smith your friend. That sounds funny, making friends among the eminent dead, but if you go through life making friends with the emìnent dead who had the right ideas, I thìnk it will work better in life and work better in education. It's way better than just giving the basic concepts.[1:15:15] It is Charlie's philosophy that a first-rate man should be willing to take at least some difficult jobs with a high chance of failure.[1:21:28] Though few companies last forever, all of them should be built to last a long time, says Munger. The approach to corporate control should be  thought of as "financial engineering." Just as bridges and airplanes are constructed with a series of back-up systems and redundancies to meet extreme stresses, so too should corporations be built to withstand the pressures from competition, recessions, oil shocks, or other calamities. Excess leverage, or debt, makes the corporation especially vulnerable to such storms. It is a crime in to build a weak bridge. How much nobler is it to build a weak company?----Get access to the World’s Most Valuable Notebook for Founders at Founders Notes.com----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested so my poor wallet suffers. ” — GarethBe like Gareth. Buy a book: All the books featured on Founders Podcast ----Founders Notes gives you the ability to tap into the collective knowledge of history's greatest entrepreneurs on demand. Use it to supplement the decisions you make in your work.  Get access to Founders Notes here. ----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested so my poor wallet suffers. ” — GarethBe like Gareth. Buy a book: All the books featured on Founders Podcast

Charlie truly is one of a kind. I recognized that in 1959 when I first met him, and I've been discovering unique qualities in him ever since. Anyone who's had even the briefest contact with Charlie would tell you the same, but usually they would be thinking of his, shall we say, behavioral style. Miss Manners clearly would need to do a lot of work on Charlie before she would grant him a diploma. To me, however, what makes Charlie special is his character. It's true that his mind is breathtaking. He's as bright as any person I'd ever met, and still has a memory that I would kill for. He was born, though, with these abilities. It's how he has elected to use them that makes me regard him so highly. In 41 years, I've never seen Charlie try to take advantage of anyone, nor have I seen

him claim the least bit of credit for anything that he didn't do. In fact, I've witnessed exactly the opposite. He has knowingly let me and others have the better end of a deal and has always shouldered more than his share of blame when things go wrong and accepted less than his share of credit when the reverse has been true. He is generous in the deepest sense and never lets ego interfere with rationality. Unlike most individuals who hunger for the world's approval, Charlie judges himself entirely by an inner scorecard, and he's a tough grader. On business matters, Charlie and I agree at a very high percentage of the time. On social issues, we sometimes see things differently.

But despite the fact that we both cherish our strong opinions, we have never, in our entire friendship, had an argument, nor found disagreement a reason to be disagreeable. It is very difficult to imagine Charlie on a corner in a Salvation Army uniform. No, make that impossible to imagine Charlie on a corner in a Salvation Army uniform. No, make that impossible to imagine. But he seems to have embraced the charity's creed of hate the sin but not the sinner. And speaking of sin, Charlie even brings rationality to that subject. He concludes that sins such as lust, gluttony, and sloth are to be avoided. Nevertheless, he understands transgressions in these areas since they often produce instant, albeit fleeting, pleasure. Envy, however,

strikes him as the silliest of the seven deadly sins since it produces nothing pleasant at all. To the contrary, it simply makes the practitioner feel miserable. I've had an enormous amount of fun in my business life, and far more than if I had not partnered up with Charlie. With his mugnerisms, he has been highly entertaining, and he has also shaped my thinking in a major way. Though many would label Charlie a businessman, I would opt for teacher. And Berkshire clearly is a much more valuable and admirable company because of what Charlie has taught us.

That was Warren Buffett writing in the foreword of the book that I'm going to talk to you about today, which is Damn Right, Behind the Scenes with Berkshire Hathaway billionaire Charlie Munger, and it was written by Janet Lowe. So this is now the fourth book that I've read on Charlie and the fourth podcast that I've done on him. So if you haven't gone back and listened to the other episodes, in case you're unaware of them, it's number 78, The Tao of Charlie Munger, number 79, Charlie Munger, The Complete Investor, and number 90, Poor Charlie's Almanac. And the reason that I wanted to read another book on him is because two things that Warren Buffett just said about Charlie, I think of him in the same way. And it's when Warren said that he has shaped my thinking was the first thing, and then that he would describe him as a teacher is the second thing. Many years ago, I was listening to this interview, Kevin Rose, the founder of Digg, the former founder of Digg, was doing with Elon Musk. And Elon said something in that podcast that I thought was interesting.

He talked about why he didn't read business books, that he said he preferred to read biographies because he was looking for, he thought they were helpful, but he was saying, he said he found, he didn't know many mentors in person, but he found mentors in an historical context through these books, through the biographies that he was reading. That's the way I feel about Charlie. I feel like he's been a mentor to me. I consider him, like when I listen to him speak or when I read his words, he's like the wise grandfather I never had.

So one of my grandfathers died before I could remember him. And the other grandfather is the worst person I ever met. And so Charlie fills that gap of somebody that is 60 years further down in life than I am, and yet is very generous in sharing all the lessons he learned from his multiple decade career and just life in general, and then is sure to push them down and share them with future generations. So let me go jump into the introduction of the book that is written by Janet Lowe, by the author, and she's talking about what she's hoping to do. Like she had some cooperation with Charlie. This book, I should point out, she's going to reference him as a 76-year-old. He's, I think, 97, 98. So the book is about 21 years old. But she says,

although he became involved in the project,lie tried to resist the temptation to direct the book other and this is what why he would even be involved in something like this and basically what i was just describing to you other than to say that he hoped it would emphasize the lessons he learned during his 76 years of life he would like others to benefit from his errors and successes and then she describes uh munger's personality type and his approach to life, which also describes the people that would benefit from his advice and learning from him. Munger constantly strove to maximize his talents and his financial situation. He often lectures on big ideas that can change your life, but in those speeches, he does not give detailed instructions on what to do. He hands his listeners a map, which they can find the treasure, with which they can find

the treasure rather, of wisdom. And like any good treasure map, it is so simple that it's deceptive. You don't get the treasure until you figure out what the instructions mean and follow them to the end. Okay, so I want to move on to the first chapter. It has a fantastic title. It's called An Extraordinary Combination of Minds, and it's all about the relationship, the, what is this, 40-something, at the time the book is written, you know, more than four-decade-long relationship and partnership between Warren Buffett and Charlie Munger. The book is a biography, so I'm going to tell you a little bit about, like, his life story, Charlie's life story. But mostly, just reading over my highlights before I sat down to talk to you again, most of it is just Charlie just talking directly to us, telling us all the ideas that he found valuable. And again, thinking of him as like a teacher, like a mentor in a historical context, like that this is just,

he just happens to deliver his message in the form of the author's writing. So I want to start where the first time Buffett hears of Charlie Munger, I've heard this story before, and I think it's hilarious. So he says, I heard about Charlie Munger in 1957, explained Buffett, I was managing money on a very small scale. So he's going around in Omaha, Nebraska and meeting all these people trying to get them to give him money to invest on their behalf. This is way before Berkshire Hathaway. So it says he's meeting with the Davis family and he's with Mr. and Dr. Davis. Mrs. Davis was very sharp. I explained how I ran money.

Dr. Davis paid no attention. When I was done, they agreed to invest $100,000. Remember, that's in 1957. That's an extremely large amount of money. I said to Dr. Davis, you weren't paying any attention. Why did you put your money in? He said, you remind me of Charlie Munger. I said, I don't know who Charlie Munger is, but I like him already. At this time, Omaha is a small place. They have a lot of mutual friends, but they don't know each other. Charlie actually worked for, at the Buffett grocery store for Warren's grandfather. So eventually they're both invited to like a lunch or a dinner. And there's just a group of friends. And this is what Charlie has to say about that. His minimal expectations of the meeting were unjustified. Munger, who was

reserved in his judgments, was floored. I would have to say that I recognized almost instantly what a remarkable person Warren is. And I just want to pause there before I continue with this description of their first meeting. Actually, there's two ideas that Charlie's already mentioned so far in this book that I think are fantastic, especially if you combine the two. And he talks about, hey, don't really worry about the outside world's perception of you. Really, this idea of having an inner scorecard, judging yourself by your own estimation of yourself, and being a tough grader. So hold yourself to extremely high standards on one part, and two, have lower or minimal expectations of others. So you hold yourself to a high standard, and yet you don't really expect much from other people. Charlie talks about you avoid disappointment. You avoid putting faith in people.

That faith is unjustified. And instead of being disappointed when people don't meet your expectations, you're actually surprised in this sense when people exceed them like Warren Buffett. And that's really how you can identify exceptional people. So Charlie began asking questions immediately about what Buffett did for a living and how he did it and was fascinated by what he heard. And this is one of my favorite things thinking. And I actually went back and looked. There's a few pictures in this book, but not many. But I always look at, you know, everybody knows what Warren Buffett looks like and Charlie Munger looks like now. But

Warren is 29 at this point and Charlie is 35 when they meet. And so just in my mind, I always think of Charlie and Warren as elderly people, because that's what they were when I came to know them. But I love going through and looking at pictures of who they were when they were 29, 35. There's a number of times and I do this in every book or try to bring it to your attention. Like if there's something going on in the book, and it says the year I'm constantly looking up, okay, what year were they born? Where are we at? How old are they? I want to know what they were like, when they were my age, or maybe when they were younger, or maybe 10 years older than when I'm at. You can relate a lot more to somebody within a 10, maybe 15-year age frame from where you are now, as opposed to,

let's say you're 20, 30, 40 years old, and somebody's maybe 70. You can learn a lot from them, but you don't know what it's like to be 70. You can remember what it was like when you're in your 20s in that case, or you have an idea what it's going to be like when you're five years older. And I just I'm fascinated by what they were doing and what they were thinking and what was important to them when they were around my age. So it says Charlie was so wrapped up. I just said they're 29 and 35. Charlie was so wrapped up in what he was saying that when he raised his glass to sip his drink, he held his other hand up to stop anyone from interrupting the conversation. So he's listening to Warren telling everybody, hey, shut up and let this guy talk.

And it also talks about why Charlie's back in Omaha. Warren stayed and lived there. Charlie, once he left for college, he never returned. He wound up moving up to California. I'll get to more than a minute, but it says the timing was beneficial for the two to meet. Why? Because Charlie's beloved father had just died, and Buffett's mentor, Benjamin Graham, had retired from investing. And why is that important?

Remember, this chapter that we're in right now is called An Extraordinary Combination of Minds. The introduction that – it should be the foreword that Warren Buffett wrote just said. Like, Berkshire would not be nearly successful if it wasn't for my partnership with Charlie. So it says, as Graham became less interested in investment problems, Warren felt the loss. He needed a new sounding board. It may be precisely because Munger was so similar to Graham in his thought process. He was honest, realistic, profoundly curious, and unfettered. This is my favorite thing.

One of my favorite things. I shouldn't say my favorite thing. One of my favorite things about Charlie Munger. He's unfettered by conventional thinking, that he captured Buffett's attention in the first place. And so why is that important? Because Buffett is focused just on one thing. So I've read a bunch. If you go back to, I think, Founders number 88, I read a textbook. I read every single, it's like 60 something years or 50 or 60 years of Warren's shareholder letters. I've read, I don't know, two or three biographies on them. I've studied both Charlie Munger and Warren Buffett a lot. Combined, I don't know,

read thousands and thousands of pages just between these two. If I had to choose which one I'd want to emulate more, they're both extremely wise. But I like the fact that Charlie was really good at work, but he did not... Warren essentially spent his entire life, and what I'm about to read to you about this, he's single-minded, focused on investing. Like he sat in a room, figured out how to become the richest person ever, right? He was just constantly obsessed with that.

If you remember, I think it was on Founders Number 100 in the biography, Snowball. You know, that was his greatest mistake because he ignored, and we see this over and over again in the history of entrepreneurship, I try to bring it to attention over and over again so you don't make the same mistake. It's something I'm very aware of because if I left my own devices, I think I would just work all the time.

But I know I'd get to the end of my life and like, oh, I screwed up my personal relationships. I was a shit father. I was a bad husband. I didn't have fun. These are all things that a lot of founders that we cover talk about because they were so obsessed with work. So the problem with Warren Buffett is why is he the best in the world? He's got one of the greatest quotes I've ever heard. He says, intensity is the price of excellence.

I love that quote. But intensity is the price of excellence. Having that mind frame and not having some kind of guardrails about your obsessive singular focus means that he drew his wife away. He ignored her. She wound up leaving him. You know, he said it was the biggest mistake. Anything – I forgot the exact quote in the book, but he said something like, whatever I did to drive her away was the worst mistake I ever did in my life. And, like, he would regret it.

And I think if you could talk to him today – I'm not talking about the wife he's married to now. This is – I think her name is Astrid. This is Susan. I think her name is astrid this is susan i think her name is susan buffett i think if you could talk to him and say hey you're half as wealthy but you're you stayed married to susan or you're a tenth as wealthy or whatever the number is i have a feeling he would take that deal and so why am i bringing that up to you now because charlie you know he's not worth 100 billion or whatever warren's worth he might be only worth two or three billion but he had a wide range of interests.

I'll talk to you a lot about picking the right heroes today, and Munger won't shut up about Benjamin Franklin. He talks about Benjamin Franklin like 15 times in the book. Anytime you hear him speak, he's like, that's my hero. And what he liked about Benjamin Franklin is he had various interests, which I'll go into later, but I want to compare these two first because even at a young age, you saw Buffett. Okay, this guy is obsessed. Buffett, who is known for his single-minded focus on investing, agreed that Munger is like Graham in his wide range of interests.

Charlie's mind has a greater span than I do. He has read more biographies, hundreds per year. Now, that can't be true. I know he's read hundreds in his life. I thought I was doing pretty well. And Charlie, that's one thing I learned from Charlie, because he won't shut up about the fact that he feels like reading biographies is essential to having a good life. And that's really what I guess I'm jumping ahead. I'm all over the map here because I'm kind of excited. And I really do love Charlie. Like. I love this guy. I love the way he thinks. I like how pithy he is.

I love the fact that he can communicate profound ideas in a minimal amount of words. He is by far, I guess what I'm saying, I'm not being clear. He is by far one of my favorite people I've discovered based on the research and reading from this book. But I hope that more and more spoke there. Because you can read 100 books books a year that's pretty hard that's you know two books a week you know charlie reads all the time so maybe he reads more than that but hundreds that means he's reading what four biographies a week come on there's no i hope that's just crazy so anyways he says um charlie's mind has a greater span than i do and this comes

up because you can when you hear him speak it's very obvious that charlie has read widely right he's read more biographies hundreds per year he soaks them up and remembers them and then this speaks he could the author picks up where at the end of that warren quote and it just speaks to how long this this extraordinary combination of minds has gone on and it's the fact that by the time jfk was elected u.s president buffett and Munger had become mental partners, a relationship that involved no contractor titles, at least in the beginning. Then it talks about what else they have in common. You know what? I just realized. I think I lost that train of thought earlier. What I was trying to say about reading the biographies and learning from Charlie Munger, differing from Warren Buffett, is – and we're going to get to this when you hear how like his children

describe Charlie. But I think what Charlie was going after is realizing like, okay, he always talks about, you know, invert, like work backwards. How do I have a good life? And I think what Charlie figured out is, yes, being really good at what you do for work, not only does it give you satisfaction, but it gives you financial freedom, which he's going to talk about in a minute. But I really feel like he was he he looked at the problem was like how do i have a good life and then and then used all his time and effort trying to learn how to do that as opposed to like over optimizing in your work or any really area of your life to the detriment of others um so this says munger buffett had something else in common like

warren i had a considerable passion to get rich. That's a direct quote from Charlie, who early on was working as an attorney. I'll get into more on that in a little bit. Not because I wanted Ferraris. I wanted the independence. I desperately wanted it. And then since Munger was working with the author of the book, we get a lot of insight that I haven't found in the other books I've read about him. I thought this was interesting. I see this over and over again. The maxim I used actually comes from hip hop. I think it might have been Notorious B.I.G.

who said this, but it says bad boys move in silence. Munger did not. I mean, it's kind of funny now because he's super famous, right? He did not want to be well known. He just wanted to be wealthy and anonymous. Munger said his goal was to stay just below the wealth level required to be named to the Forbes richest American list. So he'd like to be number 401. It would help him stand just outside the limelight. That strategy didn't work. And so as Berkshire grew more and more successful, there's more people saying, okay, who is this number two to Warren Buffett? And part of that is also, Charlie has a lot to share and a lot to teach. And so part of

his accumulation of increased levels of fame also gave him a platform where people want to listen to him. And so it may make him uncomfortable, but it's also beneficial to other people to learn from his experience. He's got giant family. He winds up getting married early. think he was like 20 years old something like that his wife is 18 they wind up getting divorced he gets remarried so between like his kids with his first wife his second wife's kids with her first husband and their own kids there's like a gang of them there's like 10 of them or eight of them something like that but and they're very important. He wanted a gigantic family. This is a quote from Charlie's stepson, but he doesn't like to use those words. He just says it's his son. These are all there's no we're not going to distinguish. This is they're all our kids. So who is the real Charles T. Munger to Borthwick?

That's one of his stepson. He's a dedicated stepfather, a mentor and someone who made life a real adventure. And something that's also really interesting when you analyze how munger and buffett uh actually spend their time like not only are they reading a lot they're thinking a lot but they know the value of building relationships with your peers and even if you consider munger like more introverted he'd be fine just sitting there quietly reading he did have he does still alive um you know have an extensive network and so it it says, and this is what James Senegal, which is the founder and now former CEO of Costco, said about that. To James Senegal, the CEO of Costco at the time the book is written, Munger is one of the best connected businessmen in the country.

When he met Charlie to ask him to serve on Costco's board of directors, the two had lunch at the California Club. This is in L.A. There was a big lunch crowd, recalled Senegal. I think all 400 of them knew Charlie. So earlier Buffett was talking about how important Charlie was to his thinking. Munger saying the same thing. And it was really interesting because people were saying, oh, you need to get opposites attract. Munger disagrees. You know the cliche that opposites attract? Munger said, well, opposites don't attract. Everybody engaged. This is fascinating. Again, the way he's able to communicate such a big idea in such a short amount of words or a few number of words. Everybody engaged in complicated work needs colleagues. Just the discipline of having to put your thoughts in order with somebody else is a very useful thing and it just i just realized that um while i was reading that

to you something munger repeats over and over again i've seen this in other areas is he keeps constantly quoting richard feinman where richard feinman has that quote where it's like uh you're the easiest person it's just like you're the easiest person you must not fool yourself and you are the easiest person uh to to feel to fool so that idea where you just said just a discipline of having to put your thoughts in order with somebody else is a very useful thing. And I think helps you avoid fooling yourself. We're going back to Buffett talking about really just filling in some personality for you. He is a figure monger. He is a sensational friend.

The niceties are not there. None of the superficial acts acts but all of the real ones we both think the other one is worth listening to and then sprinkled throughout the entire book is these mongerisms these little his his ability to just speak in these short sentences these aphorisms this is a few of them here to finish first you have to first finish don't get in a position where you go back to go. That is almost like Munger's version of Warren Buffett's two rules. Warren always says, rule number one, never lose money. Rule number two, don't forget rule number one. So Charlie's interpretation, or I guess version of that, is to finish first, you must first finish. Don't get in a position where you have to go back to go.

And then he adds another one of his ideas, another big idea promoted by Munger, always act as honorably as possible. His quote, how you behave in one place, he says, will help in surprising ways later. And so that idea, he talks about that later, like Berkshire winds up getting opportunities later in their careers because they acted honorably, you know, a decade, two decades, three decades before.

Then you were able to build up trust and people realized, hey, we can trust these guys. We can go to them, and that wound up giving them opportunities that no one else – that wasn't available to other people. Munger talks about over and over again. Really, I think the best book on this is Poor Charlie's Almanac. But if you don't have any books at your house on Munger, I would say the first one to buy is The Tao of Charlie Munger. Keep it on your bedside table, keep it in your kitchen or something. It's like a book you can pick up, you can read it in a minute or two, you'll get a good idea, a prompt for your thinking for that day, and you can put it back down. It's just like a book of aphorisms. And there's some expansion by the author, the person that collected it, I think his

name is David Clark, if I remember. But it's just fantastic. And again, it serves. The reason I say leave it out is because it's on a bookshelf, it kind of gets lost with all the other books you own. But if it's out, it's like, okay, I need to pick this up. And I have a bunch of books on aphorisms. D. Hawk, the founder of Visa, his autobiography of a restless mind, I leave out and I constantly pick up. And it serves the same purpose as like the Tao of Charlie Munger. But anyways, Munger talks about, you know, says, and there's like variations of this quote. It's like, never think of anything else when you should be thinking of incentives, like incentives rule everything around you. And so he has a good idea. I'm just going to give you a quick little aphorism here. Munger's attitude about fishing is revealed in the story he once

told when musing on the gullibility of many investors. This fishing tackle manufacturer I knew had all these flashy green and purple lures. I asked, do the fish take these? Charlie, he said, I don't sell these to the fish. So then the book goes into great detail about his ancestors. A lot of that I skip over besides a few basic lessons to take out that he learned from them. But just to give you an idea, you know, Charlie's almost 100 years old. Like when he came into the world, check this out, Charlie came into the world during the Roaring Twenties, four years after the Volstead Act brought the prohibition of alcoholic beverages to America and four years before penicillin was discovered. So he's had a ton of

time on this earth to gather up good information for us and tell us obviously what to avoid. And he's talking about the generations of his family that settled in Nebraska. Just a quote for you here. That generation admired the conquering of nature through discipline. And then it talked about a lesson that Charlie learned from his grandfather. He firmly believes that work is the best way to keep young. So one of Charlie's heroes was his father, and he goes into detail what he learned from him and the traits that he admired. His name's Al. Al Munger, said Charlie, was one of the happiest men who ever lived and achieved exactly what he wished to achieve, no more or less. He faced all troubles with less fuss than either his father or his son,

describing himself, each of whom spent considerable time foreseeing troubles that never happened. He had exactly the marriage and family life that was his highest hope. He had pals he loved and who loved him, including one in 10,000 types. So he talks about like the quality. Charlie's an elitist for sure. And he talks openly. He thinks most people are just rat poison. You have to be very careful. You have to have high standards. So he describes like, you know, if you have a good friend and he describes a lot of people as his best friend, some of his best friends. And so he has this idea of that when you find a one in 10,000 type, and he's saying this for like a personal friend.

I also think like when you hear Warren and Charlie describe the intelligent fanatics is the term they use over and over again about the managers of their businesses. They call them like one in 10,000 types. I think that's actually really useful, like a thought, like really useful tool for thinking. When you think about the people you have around you, whether you're working with them, or you're spending any time with them,

whether it's personal or professional. And he so he says, like, his dad was able to, you know, have a good family, he was success, he like what got what he wanted out of life didn't worry. And then he also developed good relationships, not only with his kids and his wife, but also his friends. And again, this is what I learned from Charlie. It's like having this well-rounded life that you'll be most content and happy as you progress. And when you're older, looking back, like, okay, I did the right thing. He had pals he loved and whom loved him, including one in 10,000 types. And so he's talking about his dad was an attorney, never made a lot of money, but that doesn't mean he didn't think he was successful. I don't see my father as less successful in the sense that really matters.

He was just differently aimed and lived in a time when lawyers made less money. Charlie once said, and now that's a great little anecdote about the relationship he had with his dad and how much he loved him and his dad loved him. Charlie once said that if he'd come home at midnight and say, Dad, you've got to help me bury this body, his father would have gotten up and helped him bury the body. Then the next morning, he would have gone to work on convincing Charlie that he'd done something wrong. So I'm going to stay in Charlie's early life for a little bit. This is his personality as a kid. This is also going to be the quote from David Ogilvie that I repeat to you over and over again.

Charlie was a star student, but he was also one of the most challenging to deal with. He was too independent-minded to bow down to meet certain teachers' expectations. And so that idea that Ogilvie warned us when he's like, listen, if you're picking talent for your, in this case, he was talking about the people that you hire for your company. He's like, talent is most likely to be found among nonconformist dissenters and rebels. And the idea there is that you have to tolerate genius. He's like, there's very few men of genius in advertising agencies.

That's what he's right. That just so happens to be the subject that David's writing on. But he says, but we need all we can find. Almost, and this is the point, almost without exception, they are disagreeable. Charlie is definitely disagreeable in one of these. Then he talks about where he actually like, I didn't really care much about school.

I just love to read. We see this over and over again. I met the tower. And this is a quote from Charlie. I met the towering intellectuals in books, not in the classroom, which is natural. I can't remember when I first read Ben Franklin. I had Thomas Jefferson over my bed at seven or eight years old. My family.

And this is such a great example set by his parents. My family was all into that stuff, which is and and this is, he's going to describe the philosophy of his family, something that he adheres to for his whole life, getting ahead through discipline, knowledge, and self-control. My parents used to say, there are no dumb mongers. And so in his family, he admired his dad he also admired his grandfather and so he's going to grow up during the the great depression and that left an impact on him for the rest of his life um if you go to warren buffett's office he actually posts um uh he has hanging up newspaper clippings from the great depression to remind him how bad things can actually get it's really easy

like when you're a bull market for 10 or 15 years, I've never even seen them to realize you have no idea what happens in these, these contractions. There's this devastating so much. I mean, think about like the correlation between economic recessions and depressions and increased suicide rate. Like that's how crazy things can get. And then you have an increase in violence and everything else. So Charlie says it's amazing how poor people were in the 1930s. His family suffered somewhat. His father was able to support the family. They were never destitute. They weren't taken from their homes or whatever.

But other members of the family were not able to survive on their own. And so this is why Charlie admires durability, something he talks about over and over again. Like if you cultivate one aspect that you can in your life, you should aim to be durable. And he really admired the strength of his grandfather through tough times. And the fact that he was the person that the family could rely on, because he had good judgment, because he was, you could see almost like in his admiration for his grandfather, the role that he wants to play, right. And so he says, he learned some of the most important life lessons during that time, I had the example in early life of family members who behaved well under stress. It must have been very hard for grandfather Munger to cure family financial distress

that wouldn't have happened if the suffering family members had been more like the judge. That's what his grandfather was called. So he's saying you wouldn't have got yourself in this position if you actually followed his example. But even though you didn't, he was still there for you. And the fact that he was so strong and durable, he was able to support the entire family. And so it says he was able to cure family financial distress that wouldn't have happened if the suffering family members had been more like the judge, but he came through anyway. So during the 1930s, Charlie starts working in the Buffett family, in the Buffett family grocery store. Just a little bit about that here. Charlie took jobs when he could. I

first encountered the Buffetts when I worked at the family grocery store. This is his description of it. The hours were long, the pay low, opinions cast in iron, and foolishness zero. And so this miserable job helped him understand, okay, this is what I don't want my life to be. He says, you were just so goddamn busy from the first hour of morning until night, he explained. And Warren's grandfather was a tough taskmaster. He would pay you $2, and in return he expected 12 hours straight of uninterrupted work, no breaks. Fast-forwarding, this is when he goes to college and he actually joins the military.

This is right around World War II. So he's going to school. It says, Charlie was introduced to physics. To me, it was a total eye-opener. So he talks about over and over again, you have to at least read basic physics, have a basic understanding, because then you can apply those same principles

to everything that you do in life. The tradition of always looking for the answer in the most fundamental way available. That is a great tradition and it saves a lot of time in this world. This is a quote from Charlie. And of course, the problems are hard enough that you have to learn to have

what some people call assiduity. Well, I've always liked that word because to me, it means you sit down on your ass until you solved your problem. Munger says that if he were running the world, anyone who qualified to do so would be required to take physics simply because it teaches a person how to think i find the methods used used are useful outside of science so he winds up joining the military as any person his age at this time in history would have to when when he first joined

the military military or munger was an ordinary soldier and his training gave him time to think about his future. So this is what he came up with at an early age. Like, what is the outline for my life? I want a lot of children, a house with a lot of books and enough money to have freedom. And so this is the first hint that we get that Charlie's an autodidact. He's largely self-taught.

He built his own curriculum because what he studies in college and he never actually graduates from college, if I'm not mistaken, is meteorology. So he winds up at the California Institute of Technology in Pasadena, California to train as a meteorologist. Charlie took one look around Pasadena and knew he liked his new surroundings. So he winds up living in California his entire life. When he's in the military, when he's in college, he likes to play poker and then he talks about some ideas that he learned, learning how to play poker that he applied to other areas, playing poker in the army as an end as a young lawyer, hone my business skills,

where you have to learn is to fold early when your odds are against you. And if you have a big edge back it heavily, because you don't get a big edge often opportunity comes, but it doesn't come often. So seize it when it does come. And that's something he repeats over and over again. Bet heavily when the odds are in your favor. It's also interesting at this point, you could go to law school without actually needing a degree. So he actually applies to Harvard, gets in. Though Munger had not earned a college diploma, he applied to the nation's oldest and perhaps most distinguished law school, Harvard. And he had this vague idea that he might want to major in study mathematics before this. And so what he realized is once he figured out who was really gifted at math, that he didn't have those natural abilities.

And so his insight – it's interesting. Bill Gates considered being a mathematician too, and then he realized the same idea that Charlie is going to realize here. He's like, oh, I can never be the best in the world at this. And so this main idea that Charlie is going to discover about himself when it comes to regard to his mathematical ability, I think applies to a bunch of other things. Like you should try to do something that you can be the best in the world at,

even if you have to keep redefining what that is, right? To go into a calling where he would not be exceptional was not in Charlie's thinking. And so this is where we get more of Munger's personality and what he talks about. Like I just mentioned this earlier, Charlie built his own curriculum, which I think is again, a very common theme

if you study the history of entrepreneurship. I hurried through school, said Munger. I don't think I'm a fair example of an ideal education. And I don't think you are either, Warren. I learned better sort of plowing through written material by myself. I've done that a lot in my life. And I love this because this is exactly what you and I are doing. I frequently like the eminent dead

better than live teachers. And that's why Warren mentioned earlier, Charlie had the habit of reading hundreds of biographies. He talks about this, make friends with the eminent dead. There's all these smart people that lived throughout history, read their words, steal their ideas. They're not using them anymore. So it sayslie munger once described himself as having a black belt in chutzpah i think how you pronounce that word he was opinionated almost to the point of arrogance this is what he says i'm never gonna listen i'm not a humble person he mentions that a bunch he says he had admitted in fact that he was apparently was behind the door when humility was handed out and people think oh it's like oh you're you're arrogant and you're you're this way because you're super rich now his harvard classmate henry gross disagreed he says uh gross defended munger

when an acquaintance remarked that prosperity was making charlie pompous nonsense said gross i knew him when he was young and poor and he's always pompous and when i read that when i got to this part of the book when i read that part i immediately one of my favorite quotes that i've ever come across in the 225 or 28 books, whatever it's been so far that I've read for the podcast, and I've never forgotten, because I think it's exactly what we. And in that book that he wrote, it's somewhere in the archive. It's probably like Founders 30 something. It's one of the first books I wrote for the podcast. But it's called Finding the Next Steve Jobs, How to Find, Keep, and Nurture Talent. And I'm going to read this quote to you. And I think it's important to always remember because it's, again, a lot of the stuff that we're learning is counterintuitive.

If you just go ask some average Joe out on the street, they're going to give you advice that is almost the exact opposite of what we're learning in a lot of these books. And so Nolan talks about the value of arrogance. Listen to what he says. And he talks about how this applies to Steve Jobs. I've read like 10 books on Steve, something like that now. He's definitely not humble at all. So it says, perhaps everyone has creative potential. This is Nolan speaking. Perhaps everyone has creative potential, but only the arrogant are self-confident enough to press their creative ideas on others. This is why this is important. Steve believed he was always right and was willing to push harder and longer than other people who might have had equally good ideas, but who caved under pressure. So he winds up becoming an attorney. This is what he does for, I think he was like 41. I think I have the exact ages now.

But we're at this point, we're in the worst thing that could happen to a person. Happened to Charlie Munger. He is 29 years old. And he is going through a divorce with his first wife. I think they have two or three kids. I think they have three kids. And his nine-year-old son has leukemia. And what makes this even more devastating is they talk about there's treatments.

If this happened today, he most likely would have survived because of the treatments. And at the time, all you could do, there was 100% rate of death at this point. So it says, Teddy was gravely ill with leukemia. Charlie was stunned by the news it went against everything that he had experienced everything that he'd dream and so it says they didn't really have anything they could do for leukemia nothing even now it's not an easy thing but there are a lot more options in those days you just literally sat and watched your kid die by inches his friend described the 29 year old-old Charlie's grief. He said that when his son was in bed and slowly dying,

he would go in and hold him for a while and then go out walking the streets of Pasadena crying. And then this is what Charlie said, I can't imagine any experience in life worse than losing a child inch by inch. So eventually he's going to wind up getting remarried. He's in his, when he's in his early 30s, this is really important to realize,

he didn't have any money. Lawyers did not make a lot of money at the time. And so he knew, but he knew he was going to be successful. So I really think like the note I left myself on this page is the value of default optimism, of having optimism as your default mode, excuse excuse me and then something that there's another i'm going to read you a quote from charlie and it's really an illustration of his idea that you need to follow your natural drift like figure out who you are and what you're naturally interested in and then do that

so it says he knew that if he was to earn sufficient income he would have to apply all his talents to the task. He started to invest in the stock market. He talked about business in a way that was animated and interesting, though now I see he was broke. But I never thought he was anything but a big success. This is his daughter speaking. Why did I think that? He just had this air.

Everything he did was going to be first class. It was going to be great. He had these enthusiasms for his projects and his future. So he starts to build a new life. He's got to obviously he's got to get over like continue with his life after that devastating tragedy. He's practicing law. He's starting to invest in real estate on the side, starting to learn about being a professional investor. And then he talks about this is the quote that that, you know, follow your natural drift. I like the independence of a capitalist, and I always had sort of a gambling personality. I liked figuring things out and making bets, so I simply did what came naturally.

So this is Charlie at 35. He's got a bunch of kids already, so we're going to hear the advice he was giving to his kids at this point, and then also what was going on in his career at 35. The Munger children often hearken back to the lessons they learned from growing up around a father who had definitive ideas of right and wrong. Charlie drummed in the notion that a person should always, quote, do the best you can do. Never tell a lie. If you say you're going to do it, get it done. If you say you're going to do it, get it done.

Nobody gives a shit about an excuse. Leave for the meeting early. Don't be late. But if you are late, don't bother giving people excuses. Just apologize. They're due the apology, but they're not interested in an excuse. So again, nobody gives a shit about an excuse. And he says he was in his mid 30s starting his financial life all over his financial life over again, and managing several careers at once this is what i meant he's practicing law he's investing in real estate and trying to to invest in the stock market charlie was a young man in a hurry in a hurry to live a full life in a hurry to get rich

and so as you can imagine trying to make this transition from attorney to entrepreneur and investor he's essentially rolling in the school of hard knocks like you're not going to make that transition easily without making mistakes. But Charlie was smart enough to learn from his mistakes. So it says he gradually accumulated money from his legal practice and began investing in securities and joining friends and clients and business endeavors, some of which proved to be a graduate level course in the school of hard knocks. So they wind up buying and taking ownership of a small transformer manufacturing company. Charlie takes an ownership position in the business with a partner. The company makes highly specialized transformers that were designed for military rockets. So like, oh, okay, we have a good opportunity here. This is I think, during the Korean War. So it says it was obvious that the

company would have to expand rapidly to pay off the debt from the buyout. So they bought out their original investors because the company had raised venture capital, venture capital, the venture capitalists at the time, try to kick out the founder. So Munger actually was the one that provided them with the idea. It was almost like a leverage buyout, like an early example of a leverage buyout is what Charlie said. Like, we're just going to buy, borrow a bunch of high interest debt, buy out the investors, and then hopefully grow the company to pay off the debt. That's essentially the basic idea. Okay. It was obvious that the company would have to expand rapidly to pay off the debt from the buyout. At the same time, however, competing companies spotted the wartime opportunities and also expanded rapidly.

There's a point that I'm reading all this to you. Don't worry. Soon there were too many producers. Uh-oh. The business aspects of their lives became miserable. And so he is, this is, he just met Warren while this is all going on, OK? And this is also – he's realizing through this experience I got involved in a crappy business. He's going to realize like the value in investing in the very best businesses and only working with the very best people. That's the same idea applied to different domains, OK? And so he says, Charlie began to realize that – and this is also the reason I brought up Warren is because this is also the influence he has on Warren. Uh, Charlie began to realize that buying high quality business has certain advantages. It is not that much fun to buy

a company that you hope liquidates at a profit just before it's destined to go broke. He also learned how to define a good business. The difference between a good business and a bad business is that good businesses throw up one easy decision after another. The bad businesses throw up painful decisions time after time. So now we get into how Charlie's going to make his first million dollars. He always tells people to read Richard Dawkins' book, The Selfish Gene. He's got a bunch of books that he recommends, influenced by Chialdini. I forgot his name. i read the book a long

time ago he gives that out he actually like i think i think even gives he gave the author um berkshire stock a long time ago he loved his work so much but anyways there's a quote here from the selfish gene that i think also describes munger when he's in his early 30s or mid 30s by this point, he's just so hungry and desperate to be rich and to not have to work as an attorney. And so it says the rabbit runs faster than the fox because the rabbit is running for his life while the fox is only running for his dinner. Okay, so let's get into how he makes his first million dollars. This is 1961. So that would make Charlie 37 years old. A lot of the people that he's going to start doing business with, and he actually meets them

because they're clients, and he's in a law firm in Los Angeles. And I was actually just thinking of, I'm glad I just discovered this guy, this guy named Otis Booth, who's going to be one of his first partners. I was actually thinking about him like a few hours ago. I'll tell you why. It was like, I read the book, I reread my highlights, and just kind of just sitting there like letting it like percolate. And I just had this idea. Well, I guess I'll tell you now because Otis Booth is going to wind up becoming a billionaire. He's got successful businesses. But what he did, I was smart. He just identified he's like, Warren really knows what he's doing. I'm just going to let this guy and like, this is after Warren stopped taking other people's money,

like investing other people's money into Berkshire. So Otis invests. He's just like, okay, I have, I'm not being clear. Charlie and Warren talk about the fact that you should identify intelligent fanatics, right? These people that are really smart and really obsessed with their businesses, that they give a ton of examples in their talks, in the books, in the shareholder letters. And I think it was a really good idea. It's like, okay, there's an intelligent fanatic managing this business. I'll buy the business. Why don't I just leave this guy in place? Like, why would I ever replace him? He's so good. I'm just essentially like, he's doing the work and I get to ride along with him. And then I had the thought, I was like, wait a minute, Otis kind of realized that about Warren and Charlie. He's like,

well, instead of putting my money in an index fund or trying to invest in myself, like, why don't I, there's just this intelligent fanatic here. Why don't I just put my money behind this guy because I'll never be able to do what he does. And so maybe you're the intelligent fanatic in your business and maybe you've identified as somebody else's intelligent fanatic. But if you do, especially early on, it's like, wait a minute, I'll just put all my money on this guy or this girl and i can benefit from their fanaticism um so anyways this is the reason that popped my mind just now is because this is where we come where booth and munger start to be partners on this real estate deal and this is how charlie makes his first million again he's 37 years old it was around 1961 booth came to munger to handle the probate settlement don't worry about the details of that charlie and instantly advisedoth to keep the property and to develop it. I said to Otis, build your own apartments.

So he's saying, buy the two houses at the end of the block. You buy them, tear them down. This is Munger talking to Otis. Tear them down, rezone, build, and then sell your own apartment units. Otis said, Charlie, if this is such a good idea and you're so sure it'll work, why don't you put up some of the money and join me? I'm not going to do this without you. He shamed me into demonstrating the wisdom of my own advice, chuckled Munger. And so him and Otis are going to do several of these real estate developments. They build apartment complexes. And eventually what they have to do is he's constantly reinvesting. And that's how he ends up getting a net worth over a million dollars. Munger continued to practice law. On the side, he's doing all these real estate deals with Otis Booth while he worked on the real estate ventures. For years, he took

no money out. Rather, he invested in one project after another. And that's an important point because that's what Munger would tell you over and over again. He's like, listen, the climb from zero to $100,000 is hell. It's so hard. Then you have to climb from $100,000 to a million, and that is difficult as hell too. And he's like, but that's why you have to climb from $100,000 to a million, and that is difficult as hell too. And he's like, but that's why you have to live below your means so you can accumulate enough investable assets. He's like, it gets easier. It's not easy, but it gets easier after that. But you'll never finish that climb if you're constantly spending everything you make.

So he talks about, you know, when I was in my late 30s, early 40s, I was just reinvesting every dollar I made back into another project to make more money. And then the author goes into something that Munger talks about over and over again, the fact that the combination of big ideas can lead to these outside effects. And they're going to do it. They're going to set this up by going back in time in the story and going back to when Munger and Buffett first meet and start developing their relationship and then future partnership. It's really just about the converging of several great ideas and what Charlie liked about Warren. When Munger went home to take care of his father's estate, he was introduced to young Warren Buffett, a meeting that would change the lives of many people. It is also a perfect example of the sort of success matrix Munger often talks about, the converging of several great ideas to produce

outstanding results. In this case, it was the coming together of two people with superior intellects and shared objectives. And Munger's like, how could I not like this guy? And so it says, this is a direct quote from Munger about Buffett, with my background, how could I fail to take to a man who preferred reading and thinking to delivering groceries and who had learned something from everything he ever read, including the manuscript that his grandfather left behind, which is a hilarious title, by the way, entitled How to Run a Grocery Store and a Few Things I've Learned About Fishing. And so Buffett is actually the ones like, you're wasting your time as an attorney.

You should be a professional investor. Buffett urged him to give up like you're wasting your time as an attorney. You're you're you should you should be a professional investor. Buffett urged him to give up law and become a professional investor. He told him law was fine as a hobby, but he could do better. And this is what Buffett says about that. We saw that we had odd personalities that happened to fit fairly well. And we've been partners in one way or another ever since. So that is that, you know, that this meeting happened 41 years ago at the time of the writing the book.

Now it's like 61 years, 62 years ago and present day. But really, it's another example of something I mentioned last week on a couple days ago on the Ferrari podcast, like the people we study are way more similar to each other than they are to just the average person that you would meet. Even though many of them didn't know he who didn't know each other worked in different industries lived in different countries and were alive at different points in history so just they they think differently in the same way another maxim i think i don't know if this is my interpretation of or if charlie actually said it but it's self-pity has no

utility might that might be a direct quote from from charlie but he's not into self-pity has no utility. That might be a direct quote from Charlie, but he's not into self-pity and he doesn't like envy. So it says one of Munger's favorite ideas comes from Aristotle. The best way to avoid envy is to deserve the success you get. So now we're fast-forwarding back into the timeline. This is what Charlie was doing when he's 38 years old, and that means Warren's probably 32, 31, 32. He's got a collection of ventures. He's going to start a law firm. He's investing in real estate.

And then he starts like an investment partnership on the advice of Buffett. In 1962, the same year Buffett started buying shares in the beleaguered New England textile manufacturing company Berkshire Hathaway, Charlie Munger helped establish two new ventures in Los Angeles. The first was a law firm, which still exists to this day, and the second was a securities firm. And then this is a description of Charlie at this age. These are really just traits that Charlie had that we can emulate. Charlie's the most unique person I've ever met. He wouldn't accept anything on face value. His interest in almost everything can be so intense, he will have a perspective that others will not have. He used to say, why do you insist on being a traditional lawyer? Do things that

other people aren't doing. That's fantastic advice. Do things that other people aren't doing. One of my favorite quotes I learned from Edwin Land, the founder of Polaroid. He said, my motto is very personal and may not fit anyone else or any other company. It is don't do anything that someone else can do. So Edwin Lansing, don't do anything that someone else can do. Charlie Munger saying, do things that other people aren't doing. So eventually he's going to make make enough money so he can, he can go out and be a professional investor full-time. Now this is Charlie at 41 years old. And so that's extremely important. Like, it took him until he was 41.

This is now the start of the life that he actually wanted, right? He learned, he grinded, he worked until he was 41. It says, within three years of founding, Munger told, this is the law firm that selects us today, Charlie dropped out. He finally left the firm in 1965 because he believed that he would never again need to rely on legal fees. He transferred his remaining balance of the firm to the estate of a partner who died young. Munger had been plotting his escape from law for a while. I actually sent this paragraph. I took a picture of it and sent it to a friend of mine who's an attorney. He's like, this is the perfect way to describe this horrible profession. He's trying to make a transition out, but he says, Charlie once ended up practicing law this way. Too often, if you absolutely kill yourself over an impossible client and get a 10 strike,

your reward is you get to do it all over again for an equally impossible client. It was a relief to Munger to quit law. I preferred, and this is why, because he's, again, follow your natural drift. I preferred making decisions and gambling my own money. I usually thought I knew better than the client anyway, so why should I have to do it his way? And again, at 41, his goal is very clear. Munger hoped to use his wealth to emulate his childhood idol, Benjamin Franklin. Franklin was able to make the contribution he did because he had financial freedom, Munger said. Munger came to understand that in order to be truly wealthy, a person needed

to build ownership in a business. So now he's spending time at this thing called Wheeler and Munger. It's this equities firm. It's hilarious because he's operating his new company out of a utility room. And so it's like, why are you working out of a utility room? He's got a great quote. He says, the opulence at the head office is often inversely related to the financial substance of the firm. In 1962, Munger made the commitment to spend at least part of his time acting as a professional investor using other people's funds. He took the step that Buffett had repeatedly suggested to him and set up Wheeler, Munger and Company, which was an investment partnership similar in format to the Buffett Partnership. The Buffett Partnership is what Warren Buffett was doing before Berkshire Hathaway, okay?

So it talks about, like, why are you working in a utility closet? It suited Munger because the rent was cheap. It was $150 per month. The penny pinching wasn't entirely necessary. When Wheeler and Munger was formed, Munger had accumulated a net worth of about $300,000, which was more than 10 times his annual rate of personal expenditure at the time. And this gives you insight into what they were doing, what Munger was doing at this point in his life. Buffett described both the Buffett partnership and Wheeler Munger as classic hedge funds, similar to those that again became popular in the late 1990s. But they were doing that all the way back in 1960, in the early 1960s.

So this is going to go on for quite some time, but I want to bring to your attention why Buffett realizes he doesn't like managing other people's money. Munger realizes that too, but he waits way longer, and I think he regrets this. He made the same decision Buffett made, but makes that five years years later. So it says when dealing only with his with his own money, investment losses never bothered Munger much to him. This is such a great perspective to him. It was like losing losing. It was like a losing night in a regular poker game where you knew you were one of the best players and you'd make up the difference later. But now he found that reported temporary losses in the Wheeler Munger limited partnership accounts gave him tremendous pain. And so by the end of 1974, he had resolved, like Buffett, to stop managing money for others in a limited partnership format.

And if I'm not mistaken, Buffett made that transition in 1969, if I have that correctly. And so the reason I'm bringing this to your attention is because Munger is now 50 or 51 years old. And he has a net worth through a couple years of doing this partnership and real estate and everything else he's doing of about $5 million. He had about $3 million of securities of his own money in his fund and about $2 million more from real estate. Now, he still does not have an official – they're doing deals and stuff together, Buffett and all these other partners, some of which are most – all of them. Rather, I'm omitting from the story for today. But there's like a small group of friends and associates that go into deals, and the ownership structure is complicated, which actually that benefits him later because the SEC is looking into what Munger and Buffett are doing. Like, what the hell are you guys doing?

And they realize, oh, wait, this network of investments and everything we're doing is so super complicated. Let's just put it all in one holding company. And that's Berkshire Hathaway. But anyways, the reason I'm bringing this to your attention is because, again, Munger is a billionaire, right? This book is published. He's 76 years old. When he's 50 to 51, he had $5 million. Most people are like, oh, 50 is too late.

He's just getting started. And this also ties into why he's constantly talking about, hey, diversification only works if you don't know what you're doing. Because most of his wealth is going to come from the compounding of Berkshire Hathaway. His cost basis. So it says Munger's own cost basis for Berkshire shares is less than $40, right? And so that's taking place in the 60s and 70s. And this is what Munger says, the money in Berkshire Hathaway stock outperformed the rest. Little else could compound that way. Yeah, that's the understatement of a lifetime. Little else could

compound that way. So it says, and then Munger talks about over and over again, quality of the people, quality of the people you have running your businesses, quality of the friends you have, quality of the person you are. That's what you should be optimizing for. People are power law. It's so important. Like the good ones are so, so rare. It says, Munger says having good partners was crucial to his success. All my life, I had high-grade partners, some of the very best that could ever be. And what's great is these people, this group of partners and friends,

they've been friends for multiple decades. They had similar interests. They seemed to spend a lot of time together, and they all got rich together, and they stayed friends. It's just really fantastic to read. This part is just about his odd personality, which, again, I think is why so many people find him appealing because he's so the stuff that comes out of his mouth is just so unusual and this part just made me laugh this is

one of his partners and somebody he says really high quality this guy named al marshall al marshall found himself having to pull charlie out of all kinds of social messes every once in a while munger would go on a talking spree and grab and gab so long and rapidly that nobody was able to interrupt or change the subject. One evening at a dinner party, the host cornered Al and begged him to go into the other room and get Charlie, who had consumed several glasses of wine. She was and the host was asking him asking Al to get him to shut up. Nobody can get an edge a word in edgewise. He's lecturing them on difficulties religions have in describing heaven, something he called a thousand-year orgasm.

And Charlie's always getting Al in trouble. They wind up going on vacation. They vacation together. They're in Hawaii one time. And Al's thinking he's standing next to his wife at the counter, at the butcher, trying to pick out steaks for dinner. And Al didn't realize she'd walked away. And so he reached out, he says he reached out and grabbed the rear end of some other woman. Al was startled to learn that the buttocks was not, the buttocks, I love that word,

were not those of his wife, and the victim was furious. Munger, who was at the other end of the meat counter, shouted, you know, he does that to all the women. Charlie's comment only made the woman angrier. Despite the jokes, Marshall said he learned that to all the women. Charlie's comment only made the woman angrier. Despite the jokes, Marshall said he learned a lot during the decades he worked with Munger. Okay, so there's a bunch of like these business deals that Munger, Buffett, and some other people are doing together. It's really complicated. I just mentioned it.

Really, the story is how an SEC investigation led to an official position at Berkshire for Charlie Munger. And I'm going to give you the top-level highlights here. And so Munger's going to tell us about this. He says, yet he admitted that convoluted ownership at Blue Chip did appear suspicious. When the SEC started looking, there was all these crisscrossed ownerships that happened by accident. But it was complicated, and because so many people create complications to hide fraud, the SEC delved and delved and finally fixed the tension on something.

How we got Wesco. Don't worry about the names of the businesses here. People assume if what you're doing is enormously complicated, you're probably doing something wrong. Indeed, Buffett and Munger own stakes in an incredibly intertwined bundle of companies. There's a bunch of people involved. The men's investment had grown this way and that way, taking whatever structure seemed logical and fair at the time. But over many years, it becomes obviously really complicated, right? The organization was a little too disorganized for the tastes of the SEC. Buffett responded to the inquiries by shipping three cartons of documents, memos, stock transfer documents, and so on. And the SEC responds by

opening a full-scale investigation of Buffett's investment practices. When Buffett and Munger realized that their financial relationship had become too complex that it was difficult to explain to the SEC, they decided to restructure their holdings and simplify matters. It was a stressful time.

They have to pay like a fine of like 100 grand. It was a stressful time, but as a result, Berkshire Hathaway became a larger, simpler company. All these companies that doesn't worry about the names were merged into Berkshire. Finally, giving Munger a formal position at Berkshire. Munger got 2% of the stock of Berkshire and was named vice chairman. The organization of the company under a single corporation eliminated almost all appearance of a conflict of interest. This is when and this is what Munger, Buffett and Munger

said, it will be somewhat simpler for us to run a combined enterprise, reducing some costs. And this is a fantastic sentence that I underlined twice, and I think applies more to just Berkshire Hathaway, just in life in general. And it says simplicity has a way of improving performance through enabling us better to understand what we're doing. That made me think of last week, the difference between Ferrari and Maserati. Maserati was somewhat building race cars named after themselves and racing them just like what Ferrari wanted to do. And yet after they had success, they're like, OK, we'll build race cars and we'll race them and then we'll build trucks and then we'll build machine tools and then we'll build a sedan. And they lost focus and they complicated their business. And Enzo's like, no, I'm just going to build race cars and race them under race cars that have my name and race them. And so his business and then sell some of those cars to consumers like his business was

extremely simple. And so again, simplicity has a way of improving performance to enabling us to better understand what we are doing. So Ferrari took off from there and overtook Maserati. Maserati obviously decreased and never recovered in relation to Ferrari, that is. And then Charlie's looking back at this point when they're organizing under Berkshire, and he has some interesting thoughts here. What Charlie finds interesting when thinking back about all this progress is how a few big business decisions were involved in creating billions of dollars out of less than $40 million, which is what they had at the time, fewer than one every three years. Direct quote from Charlie here, I think the record shows the advantage of a peculiar mindset, not seeking action for its own sake, which is obviously

extremely hard for us humans to do, not seeking action for its own sake, but instead combining extreme patience with extreme decisiveness. And I'll get to how fast they make decisions. This idea of extreme patience with extreme decisiveness. But I want to go back to this idea. It's one of the most important ideas you can learn from Charlie Munger. And it's just like he values durability. He would counsel you to be durable.

Let's define durable. Able to withstand wear, pressure, or damage. So it says there are a million business traps. You can get sloppy, you can get alcoholic, you can get megalomaniacal. You cannot understand your own limitations. So this is a classic Charlie identifying what not to do, right? And just avoid being stupid. So don't be sloppy, don't be an alcoholic, and don't be megalomaniacal. You cannot understand your own limitations. There are a million ways to gum it up, meaning to screw it up, right? To survive and prosper as long as this company has, so they're talking about See's Candy,

which is going to be at the time the largest acquisition they make up until this point in their life. But he's describing the fact that this company, this fantastic company, was started by a 71-year-old woman. That's amazing. To survive and prosper as long as this company has, started by a woman who was 71 years old, is an amazing example. Seed has stayed out of a lot of traps. And then he's identifying some of the smart ideas they did, right?

The ordinary candy company puts in too many stores. You have this huge overhead that you're carrying through all the summer months, the months when people are not buying candy because most of them are buying it during the holidays, okay? But See's has always had the discipline of knowing their own business. That's harder on employees, by the way. They have this huge crunch in the stores at Christmas, but it's also part of the secret to See's success. And of course, the fanaticism, remember, intelligent fanatics is who you're trying to work with and invest with. And of course, the fanaticism about the quality of the product and service is the heart and soul of the business. I love the fact that this room is full of longtime customers and longtime suppliers. You get suppliers who are good and who are trusted because they deserve trust.

And you behave the same way towards your own customer then you are a little part then you are then you are a little part of a civilization that is a seamless web of deserved trust this is also something that he repeats for decades of his career develop a seamless web of trust this is the way the world ought to work it is a better better example for everyone else and so charlie's going through the history of seeds up until the point they buy it and all the smart decisions they made because this is like multiple generations of the family and really i want to bring this out this quick story to you because it's just the importance of never compromising quality because your customers will respond says another crisis came during world war ii when sugar was severely rationed rather than compromise quality with

inferior ingredients or alter their recipe seas decided to produce as much high quality candy as possible with the ingredients that were allocated to the company and no more. Customers lined up around the block to buy the limited supply of chocolates and once the supply was gone, the shop closed for the day. No matter what time the store closed and the sales staff was paid for a full day of work this turned out to be a smart marketing ploy since the waiting crowds added a added to the candy stores cachet that reminded me of um i read this book on walt disney on um it's called disney's land and it's how he built what he he thought his greatest creation he was most proud of two things in his life being being able to found the Disney company

and keep control of it because he lost control of his first company. And number two, Disneyland. And in that thing where he talks about never compromise quality, your customers respond, they're over budget, they're behind, and an employee, one of Disney's employees,

tries to get them to compromise quality. And he doesn't like that at all. So let me read you a quote from that book. I think this is, it's called Disney's employees tries to get him to compromise quality and he he doesn't like that at all so let me read you a quote from that book I think this is it's it's called Disney's land it's in the archive somewhere they were among the first of the parts attractions to be finished but the pressure of time was weighing on everyone one day John Hench stopped by to check the progress on the coaches so like a coach it's like uh like what the horses uh like have behind them uh progress on the coaches and had an idea, which he brought to his boss.

Why don't we just leave the leather straps off Walt? The people are never going to appreciate all the closeup detail. The same scrupulousness that had recently made Walt Disney refuse to license a license, a Davy Crockett revolver because the firearm hadn't existed in Davy's day treated Hench to a tart little lecture. You're being a poor communicator, Walt Disney said. People are okay.

Don't you ever forget that. They will respond to it. They will appreciate it. Hench didn't argue. We put the best darn leather straps on that stagecoach you've ever seen. So Walt Disney's applying that to leather on a stagecoach. You see See's Candy doing the exact same things.

I'm not changing it. Okay, I'll sell less, but I'm not compromising on the quality. And so when they're presented with the opportunity, the family is putting the company up for sale. Look how fast Warren and Charlie can make decisions. So this is, let's figure out how old everybody is here. This is 1972, so Charlie would be 45, think for no he's 48 i'm pretty sure he's 48 uh so it says uh and keep in mind this is a 25 million dollar transaction which at this time

was the biggest purchase up at this time okay so ramsey the guy that's trying to sell uh help sell the company says ramsey called buffett g bob buffett said the candy business i don't think we want to be in the candy business for some some reason, the phone line went dead. Took a few minutes for Ramsey to get Buffett back on the phone. Several minutes elapsed. They reconnected. Before they could speak, Buffett burst out, I was taking a look at the numbers. Yeah, I'd be willing to buy C's at a price. And so Munger is talking about C's as another example of the idea for businesses and people it pays to go after quality um and then we'll see how they learn from one experience and then apply that to another opportunity sees candy reminisces monger it was acquired at a premium over book value and it worked hoth's child cone the department's chain was bought at a discount

from book from book and liquidating value. It didn't work. Those two things together helped shift our thinking to the idea of paying higher prices for better businesses. And so what did I mean about learning from one experience and applying to another? Warren Buffett fills this in for us. If we hadn't bought C's, we wouldn't have bought Coke, said Buffett. So thank C's for the $12 billion that they made from Coke so far. Munger says he and Buffett should have seen the advantages of paying for quality much earlier. You know, they're 40, 50 years old, close to that age at this point. I don't think it was necessary to be as dumb as we were, Munger said.

So then Munger's going to bring up the fact that you should be reading biographies. And he talks about Franklin again. I'm a biography nut myself. This is one of my favorite quotes from Munger. I'm a biography nut myself, said Munger. And I think when you're trying to teach the great concepts at work, it helps to tie them into the lives and personalities of the people who develop them. I think that you learn economics better if you make Adam Smith your friend.

That sounds funny, making friends among the eminent dead. But if you go through life making friends with the eminent dead who had the right ideas, I think it will work better in life and work better in education. It is way better than just giving the basic concepts. His favorite eminent dead person has always been Franklin. And I like this idea. Like Franklin, Munger has learned that his ideas about a good and proper society, our good and proper life, do not always coincide with the beliefs of others, which speaks to the importance of having an inner scorecard, meaning you the supreme judge of of what you're doing and how your life is as opposed to

an outer scorecard and also being capable of independent thought because his ideas about a good and proper society good and proper life do not always coincide with the beliefs of others another one of my favorite ideas that i learned from munger is this idea it's good ideas are rare when you you find them, bet heavily. Being prepared, so now this is a direct quote from Munger, being prepared on a few occasions in a lifetime to act promptly in scale in doing some simple and logical things will often dramatically improve the financial results of that lifetime, said Munger.

A few major opportunities clearly recognizable as such will usually come to one who continually searches and waits with a curious mind. And then all that is required is a willingness to bet heavily when the odds are extremely favorable, using resources available as a result of prudence and patience in the past. So a way to summarize that good ideas are are rare when you find one. Bet heavily. Go all in. Another Mungerism. This is just straight maxim after maxim and now we get towards the end of the book. We try to profit from always remembering the obvious than from grasping the esoteric, said Munger. It is remarkable how much long-term advantage people like us have gotten by trying to

be consistently not stupid instead of trying to be very intelligent. So then Munger talks about their preferred – they like to be adaptable. They like to be flexible. They don't have a master plan. This is what I call the Singleton approach, so Henry Singleton. I learned about Henry Singleton because Buffett and Munger – Munger says like Singleton's results were just utterly ridiculous. Buffett said if you took like the top 100 business school graduates and combined all the records, they wouldn't be as good as Singleton. They said he probably has the best record in American business history. I was like,

what the hell? So I went reading two books about him. And he came like a few years before Munger and Charlie did. And a lot of the ideas I learned from Munger, Munger Charlie, from Munger Buffett, and a lot of the ideas I learned from Munger Buffett I realized they learned those ideas from Henry Singleton and one of them is Singleton's steer the boat daily approach and he talks about it's like I don't like master plans life is chaotic he says my only plan is to keep coming to work I like to steer the boat each day rather than play plan way ahead into the future that was Henry Singleton we see Munger says the same thing Munger said there was no particular strategy involved except to wait and watch for opportunities. Our rule is pure opportunism, said Charlie. We do not have a master plan. If there's a master plan somewhere in Berkshire, they're hiding it from me.

Not only do we not have a master plan, we don't have a master planner. Another idea. Keep it simple, stupid. I don't know. And be frugal. I don't know anybody. I don't know of anybody our size who has lower overhead than we do, Munger said. And we like it that way. Once a company starts company starts getting fancy he said it's difficult to stop at one time berkshire was subpoenaed for its staff papers in connection with one of its acquisitions but said munger there was no papers there was no staff another example of charlie's maxim that great opportunities are rare so you have to load up. A shareholder once complained that there were no great franchises like Coca-Cola left, meaning that Berkshire's

style would be cramped in the future. Munger replied, why should it be easy to do something that, if done well two or three times, will make your family rich for life? And that's the exact point. Great opportunities are rare, so that's why you have to load up. Of course, there's not a million Coca-Colas out there. Then we have a great quote from munger about what he feels the game of vesting is all about and the note i left to myself on this page is like well okay what do you believe that other people don't um and really so that that that's like a prompt for my own thinking and then a reminder that i need to make sure that i know my niche better than anyone else on the planet okay the game of investing is what this is not Charlie speaking. The game of investing is one

of making better predictions about the future than other people. How are you going to do that? One way is to limit your tries to areas of competence. If you try to predict the future of everything, you attempt too much, you're going to fail through lack of specialization. So that's why I said I should know my niche better than anyone else. And then what I love about reading about Charlie and Warren does this too, is like they just get their point across with like simple anecdotes. And it's not even like they leave some of the work done to the person listening or reading too, which I like. And so it talks about he's getting this question in an annual meeting in 1993. Like, why is Berkshire not writing more insurance policies considering its size? You know, everybody else is doing this and this is how they're doing it.

Why aren't you essentially copying them is the premise of the question? And so Munger replies, people are always saying to Berkshire, gee, why don't you write a lot more volume in relation to capital? Everybody else is doing it. The rating agencies say that you can write twice as much in annual volume as you have capital. And so they look to our $10 billion in insurance capital and say, that's $20 billion a year you could be writing. What are you doing only writing a billion? So if somebody else has $10 billion, they write $20. We have $10 billion, we write one. And so Charlie says. But then somebody else comes and asks, why did everybody get killed last year but you?

And his punchline is perfect. Maybe those questions are related. And then Charlie cannot stop bringing up Benjamin Franklin. Really, the idea behind this is the importance of picking the right heroes. And he says his hero is benjamin franklin during his life and during his lifetime franklin worked as an editor author legislator scientist inventor diplomat revolutionary war hero and a founding father of the nation franklin's story can scarcely ever be told enough born into poverty and obscurity he was the 15th

of 17 children he only went to school for two years. He died 84 years later and perhaps was the most famous man in the world. So I've done two podcasts on Benjamin Franklin. If you're interested in learning more about him, I did the Walter Isaacson biography on him and then his autobiography. I also have another Franklin biography. That one's going to take me some time to do because I think it's like 600 pages. I think it's called like the first American or something like that. But again, I'm going to read a bunch of books on Franklin. If you think about he might be the single most influential American entrepreneur in history. If you think about the influence, if you think about who he

influenced and then who those people in turn influenced, generations and generations of entrepreneurs were influenced by ideas that came from Benjamin Franklin, even if they don't know they came from Benjamin Franklin. Another important attribute for a human being to have, according to Charlie, is you must risk failure. Charlie's philosophy is that a first-rate man should be willing to take at least some difficult jobs in his lifetime with a high chance of failure. And so he continues this idea that you must risk failure that you must risk failure. You must do things that are also hard. It's part of just being a full,

living a full life and being a competent human being. He says, I have a lot of respect for Good Samaritan Hospital. This is where he's sitting. He's a chairman of the board at this hospital in LA. And so he's talking about like, but it's like, it's a headache. He's not doing it for money. Like why is he doing this? So he says, I have a lot of respect for Good Samaritan Hospital, but it's a very tough hand to play. And if you ask Charlie why he does it, one of the things he'll say is that he doesn't want all the hands that he plays in life to be easy ones. That reminded me of one of my favorite quotes. One of my favorite people I've discovered on the podcast is Teddy Roosevelt. I actually have another.

I'm reading his autobiography soon. I've read, I think, two or three books. I've done at least two podcasts, maybe three podcasts on him so far. And he lived like 60 short years, maybe 61 short years, but lived as much in those short years as 10 lifetimes. The average person does like it's it's incredible how much life he filled into his time. And there's a great quote about him. It says Roosevelt was forever at it.

He was a curiosity, always pushing and straining and admonishing friends around him to do the same. This is the punchline. It says, Roosevelt was forever at it. He was a curiosity, always pushing and straining and admonishing friends around him to do the same. This is the punchline. It's fantastic. Teddy loved to row in the hottest sun over the roughest water in the smallest boat. And this is something I mentioned earlier, his maxim that self-pity has no utility. Every time you think that some person or some unfairness is ruining your life it is you who are ruining your life and then munger has some advice for training you for your profession for like let's use the term professional research professional research is this idea that came from danny meyer uh the restaurateur it's talked about in that that that um talk that i've tried

to get you to watch on YouTube. I would consider it's probably the best talk on YouTube. It's by Bill Gurley. It's called Running Down a Dream, How to Survive and Thrive in a Career You Love. Danny Meyer is one of the people he profiles in there. And Danny and Bill talk about the idea of professional research. It's like, what do you do to learn to get better at your work when you're not working? Munger claims that most people would be better off if they were trained for their professions the way pilots are taught to fly. Munger says they learn everything that is useful in piloting, and then they must retrain continuously. That's an important part,

retraining continuously, so that they can cope promptly with practically any eventuality, he explained. Like any good algebraist, the pilot is made to think sometimes in a forward fashion and sometimes in reverse. And so he learns when to concentrate mostly on what he wants to happen and also when to concentrate mostly on avoiding what he does not want to happen so the main idea constantly retrain continuously retrain continuously and then we're gonna have some quotes uh or a quote a paragraph here from charlie but really the way i think about this is like a good like spend a lot of what charlie's did what warren's doing like i think this is just good for in general like the best thing you could do for another person is teach him something spend a lot of time learning and then share everything that you learn um so the fact that a way to think about

like what is important what was important to charlie is the fact that like he could spend a lot of time learning and then he was able to share everything he learned. He talks about this. A student once asked Charlie Munger if he and Warren Buffett were fulfilling their responsibility to share his wisdom. Quote, sure. Look at Berkshire Hathaway. I call it the ultimate didactic exercise. I always think it's helpful to like, there's a lot of words you think you know the meaning to. You can kind of guess what the meaning is based on the context clues around it. But I looked up that word didactic. I knew it had something to do with teaching. I'm going to read you the definition. Didactic, intended to teach, particularly in having moral instruction as an ulterior motive.

Sure, look at Berkshire Hathaway. I call it the ultimate didactic exercise. Warren's never going to spend any money. He's going to give it back to society. He's just building a platform so people will listen to his notions. Needless to say, they are very good notions, and the platform's not so bad either. But you could argue that Warren and I are academics, or Warren and I are teachers, in our own way. and then the author says and this is why we're reading the book and we're trying to learn these lessons and hopefully turn around tell to other people he meaning charlie like warren prefer to talk to prefer to talk to young people to students who are still learning about life and who have time to implement some of the concepts that the two of them consider important and then we have charlie's four ways to guarantee failure and his opinions on how to read munger added four practices that he believes will also help guarantee failure and his opinions on how to read. Munger added four practices that

he believes will also help guarantee failure. Be unreliable. Number one, be unreliable. Number two, learn everything from your own experience rather than learning from others. So number two is why he reads so many biographies, right? Learn everything from your own experience rather than learning from others. You're guaranteed to fail. Number three, give up after trying, give up trying after your first, second, or third reversal of fortune. And number four, give in to fuzzy thinking. So then he talks about the importance of reading and then how to read. It's really, this is somewhat what you and I talk about a lot. It's like, I'm not really worried. I'm like, I'm not focusing on the what, I want to know the

how in these stories, right? So it says, if you get into the mental habit of relating what you're reading to the basic structure of the underlying ideas being demonstrated, okay, so you're reading, and you think about you get in the habit of relating what you're reading to the basic structure of the underlying ideas being demonstrated. So like the principles right behind what's happening, you gradually accumulate some wisdom about investing. I don't think you can be a really good investor over a broad range without doing a massive amount of reading. I don't think any one book will do it for you. And here's a quote from Munger, and I'll tell you what I wrote to myself. If it weren't a little difficult, everyone would be rich, Munger insisted. If it weren't a little difficult, everybody would be rich, Munger insisted. When you're going through struggle, just repeat it. This is now me talking to myself. When you're going through struggle just repeat it this is now me talking to myself when you're going through struggle just repeat it is

supposed to be hard it is supposed to be hard it is supposed to be hard if it were easy everybody would do it if it were if it weren't a little difficult everybody would be rich monger insisted uh he talks about if he was a professor if i were teaching finance monger said he would use the histories of 100 or so companies that did something right or something wrong. And then I want to go back to his idea about being durable. This is fantastic. He's saying it's a crime to build a weak company. So, again, optimize for durability.

Let's see who's around for a decade from now, right? Though very few companies last forever, all of them should be built to last a long time, says Munger. The approach to corporate control should be thought of as financial engineering. Just as bridges and airplanes are constructed with a series of backup systems and redundancies to meet extreme stresses, so too should corporations be built to withstand the pressures from competition, recessions, oil shocks, or other calamities. This is such a really profound idea that he expresses in such a great way. Just say, hey, same thing. If you're building a bridge and airplane, you're constructed with a series of backups and redundancies to meet extreme stresses. Why aren't you building your company the same way? It's such a great idea. Excess leverage or debt, this is still Munger talking, excess leverage or debt makes the corporation especially vulnerable to such storms. It is a crime in America, stated Munger, to build a weak bridge. How much nobler is it to build a weak

company? This is more on his idea. It's like, don't diversify. If you know what you're doing, just find a great business and go deep. Go all in. It isn't even necessary to worry about diversification. A person with almost all wealth invested long term in just three fine corporations is securely rich. Munger went as far to suggest that investors could have aimed at a life of quality and then strove diligently to bring that about. Again, he's not saying aim just to build a successful business. That is one part. I think entrepreneurship, especially for a certain personality type, is essential, right? But it's just one piece of having a quality life. He aimed at a life of quality and he strove diligently to bring that about this is another great he talks about this over and over again like you got to be durable it's supposed to be hard it is necessary

to accommodate a lot of failure and because no matter how able you are you're going to have headwinds and troubles do not be discouraged by a few reverses so again same note to myself it's supposed to be hard it's supposed to be hard it's necessary to accommodate a lot of failure because no matter how how able you are you're able you're going to have headwinds and troubles. Do not be discouraged by a few reverses. And then I just want to end a little differently than I normally do with a question from Charlie that is worth thinking about. Charlie once asked me, if you could do anything in the world, what would it be? That is where I'll leave it. If you want the full story, read the book. There's a link in the show notes. If you use that link to buy the book, you'll be supporting the podcast at the same time. If you want to buy a gift subscription for a friend, family, coworker, there's a link in the show notes as well. You can do that. You can also go to founderspodcast.com and you'll see, you should see a link there for

the gift subscription as well. If you want to see every single book that I've ever done in reverse chronological order, and you want to support the podcast, go to amazon.com forward slash shop forward slash founders podcast. Same thing. If you buy a book off that list, you'll be supporting podcasts at the same time. That is 221 books down, 1,000 to go, and I'll talk to you again soon.