Apply Warren Buffet's investment criteria to your life to make better decisions
How to be better at being better?
“Who would you bet on?”
This is the question Conor Neill posed to his audience at a TedX talk. Conor Neill is an entrepreneur and teacher at IESE Business School. He speaks and writes about Persuasion.
You may not take his name in the same breath as Elon Musk or Brian Chesky, but read on as he gives profound advice on making better decisions.
He wanted the audience to pick someone on whom they can bet a 1000 dollars. They will give the $1000 to Conor and in return, Conor will pay them 10% of that person’s annual earning every year. Sounds simple enough, you want to pick a winner, whose lifetime earning will far outweigh 10 times $1000.
But then the question boils down to how do you pick a winner. Conor goes back to Warren Buffet’s 3 criteria for picking up investment.
How Warren Buffet evaluates investment 💰
He bets on people and not companies for which he uses three simple criteria: Energy, Intelligence, and Integrity:
Energy: The person should be in good health and alert to his context
Adaptive intelligence: The person should not be intelligent just in the absolute sense, but should be able to adapt to changing context
Integrity: Most importantly, the person should have high integrity. She should be able to say no to a lot of overtures (implicit/explicit). Even more important is for the person to have high integrity with herself and not lead a life split into a million pieces based on other people’s demands
He exhorts people to adapt these three criteria for evaluating their own lives and then instead of just 10%, they can have 100% of the lifetime earnings by betting on one person - themselves!
Putting it all into action - Making better decisions 🏃♀️
He then provides 3 tools to put these three criteria in action.
🔥 🔥 This is the part which I really liked as it provides a framework for making better decisions as an individual, for both professional and personal lives. 🔥🔥
Intelligence: Write stuff down. No one wrote a book in one day and everyone can write a book if they write one page every day. Write to describe your own life so that it becomes a repository of knowledge that you can lean on when looking for answers on a rainy day
Energy: Focus on present and one step at a time. He spoke to high-performance athletes and all of them said that instead of focusing on the end result, they focus on the next few steps. So a long-distance runner thinks about running the next 15 mins and anybody can run for 15 mins. A long-distance swimmer thinks about the next few strokes and anybody can take a few strokes. Thus, instead of time-traveling too much into the future, focus on the present and what you need to do now
Integrity: Be true to yourself and let your time spent on activities reflect your value and choices. Focus on the few things you want to do well in life and dedicate your energy to it. If you want to be a writer on decision models and mental models, spend all your time reading and practicing these models. Also, don’t beat yourself up over one missed chance. Failure is not one missed chance but a series of missed chances. You have to enjoy what you are doing
The link to the full talk is below. I hope you enjoy it as much as I did.
Have a good weekend!
Rohit
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