High Bar
Warren Buffett is an absolute icon of the investing world.
Despite the fact I currently spend my time in the more speculative end of capital markets as a VC, I very much worship at the altar of Buffett. The combination of phenomenal business performance and a strong reputation for moral and personal “goodness” is pretty much spot on with what I aspire to.
Yesterday, Buffett formally handed the reins of the $1.1trn horse that is Berkshire Hathaway to Greg Abel, marking the closing of a door that was already beginning to squeak shut after the death of Buffett’s long-time business partner, Charlie Munger.
Abel has a hell of a job ahead of him. The markets - both in absolute terms and on important ratios like the CAPE Ratio and the Buffett Indicator - are at all-time highs. The world is more volatile and unpredictable than ever. And the sheer scale of Berkshire Hathaway today means that by definition - and through Buffett’s own teaching - there are fewer needle-moving opportunities to deploy the $350bn+ of cash sitting on Berkshire’s balance sheet.
Nonetheless, what a privilege (and a bit of a curse) it must be to succeed a man like Warren Buffett. Money aside, the gravity and profundity of that role is head-bending. I wish him all the very best!