Mimicking Buffet in India

Let me confess. I am an eternal Warren Buffet fan. I absolutely enjoy reading his style of business selection for Investing.

Let me try to give you a flavor of his style of managing businesses. The best analogy for him would that be of an Art Collector. 

His 56 years-old company "Bekshire Hathway" looks after 72 odd businesses and their 35,000 employees worldwide. He calls himself an Art Collector as he is very fond of his paintings. His plan is to never sell them. Just imagine. A few mistakes or wrong decisions doesn't bother him as long as the competitive edge of business and passion of management is well alive.   

what differentiates him is the fact that he allows the passionate owners to run their respective businesses. He neither calls or meet them unless they want to talk. He never asks for regular update reports or anything like other class of Investors known like VCs, PEs, etc. However, the only ingenuous thing he does with those businesses is to pull the excess cash produced at the end of the year to buy more of these new sustainable businesses that produce cash. Fascinating! isn't it?

I am a forever bull on India and there is no such known Indian entrepreneur who comes even a decade close to him. Reliance Industries' Mukesh Ambani is one passionate owner who has built USD 70 billion empire over his legacy. He has dominated in segments like Oil, Retail and lately telecom. However, i won't relate his modus operandi to that of Mr.Buffet's. Ambanis has a more aggressive approach with growth at any cost. While Buffet prefers a competitive edge built over long time.

Warren has followed this process patiently for over 47 years now and his net worth would belittle an known business of modern human civilization. He is worth north of USD 70 billion (or INR 5,40,000 Cr). And just to top it, he has pledged 99% of his wealth to Melinda gates foundation- which he thinks is one of the smartest philanthropic organizations. 

Fascinating lessons and learning from the likes of Warren Buffet, Charlie Munger, Monish Pabrai, Howard Marks, Radhakrishan Damani needs to be leveraged to identify passionate entrepreneurs. With population of 130 Crores and 30% of it under 35 years of age, India has no dearth of passion or energy. 

It won't be far-off to dream of a case wherein sustainable businesses run by passionate people are identified and kept under a single umbrella company. Model pretty similar to that of Bekshire. And all the un-utilized earnings are ploughed back into the original fund to buy more of such businesses. Thus, this vicious cycle continues for long time.

Hope this piece generates more curiosity about the financial sages of present day.