Warren Buffett Reveals the Most Important Decision Founders Will Ever Make

The 2024 Berkshire Hathaway shareholder meeting lasted six hours and holds a treasure trove of wisdom from Warren Buffett, the world’s most successful investor. The annual meeting was the first without Charlie Munger, Buffett’s long-time business partner, who died in November at the age of 99.

Buffett and two other top Berkshire Hathaway leaders fielded questions about the company’s earnings, investments, and succession plans. But Buffett frequently launched into deep and philosophical thoughts on Munger’s lessons and legacy.

According to Buffett, the most important decision a person will make in their lives is choosing “who they associate with.” Of course, this decision will impact the joy you find in your personal life. Buffett says it’s also critical to building a lasting company.

“Surround yourself — and limit yourself — to people who you trust,” Buffett said as he recalled his relationship with Munger. “In all the years we worked together, he never once lied to me. Ever.”

While trust is a critical factor when deciding who to choose as founding partners or teammates, Buffett offered three tips on how to find the right people.

1. Write your obituary.

In response to the question, “What advice do you believe everyone needs to hear?” Buffett didn’t hesitate. “Think about how you would like your obituary to read,” he said. “Then start selecting the educational paths, social paths, and associating with the people who would best help you to get there.”

Buffett said another way of reverse engineering your life is to “ask yourself who you’d like to spend the last day of your life with. Then, figure out a way to start meeting them now.”

In his appearance at a shareholder meeting last year, Munger weighed in on the same topic, reminding the audience to keep “toxic” people out of their lives at all costs. Munger said, “The great lesson of life is get them the hell out of your life — and do it fast.”

2. Have fun and always keep learning.

Buffett and Munger hit it off immediately when they first met in 1959. “I knew instantly he was the kind of guy I’d have fun with and learn from,” said Buffett.

Entrepreneurship is always harder than people expect it to be. If you’re not having fun with your partners, it can be a long and difficult journey. Founders might be able to overlook the “fun” part of a relationship when business is booming, but Buffett reminded the audience that the real damage usually happens when business takes a downturn.

“We had as much fun, perhaps even more, with things that failed because we had to work our way out of it,” Buffett said. “We had more fun as partners digging our way out of a foxhole than we would have just sitting there watching an idea we had 10 years earlier produce more profits.”

3. Find people who complement your talent.

Buffett lavishes credit for his success on Munger.

“Over time, we worked together to achieve his vision,” Buffett told the audience. “Charlie was the architect of today’s Berkshire…. The carpenters and roofers, that would be me, are needed. But the architect is the genius who provides the blueprint.”

Buffett’s self-awareness of his own intellectual gaps led to one of Berkshire’s most important hires — Ajit Jain. Jain runs Berkshire’s insurance business, which includes its crown jewel, Geico.

While “insurance is the most important business at Berkshire,” according to Buffett, the complicated business of underwriting policies and assessing risk is not in his wheelhouse. Buffett handed Jain the reins to Berkshire’s insurance business in 1986, even though Jain had no prior insurance experience. It didn’t matter because Buffett recognized Jain’s prodigious intellect as “a rare talent.”

In response to a question about the impact of climate change on Berkshire’s insurance business, Buffett reiterated his confidence in Jain’s ability to navigate the challenge: “I’d rather have Ajit assessing this than a thousand underwriters or insurance managers…. You need one very, very smart guy, and we’ve got him.”

Then, in one of the highest compliments one partner can give to another, Buffett joked, “If Ajit and I are ever in a sinking boat and you could only save one of us, swim to Ajit.”

Do you feel the same about the people in your life as Buffett does about Munger and Jain? If not, reverse engineer your life and decide who you want by your side “in the foxhole.”

Above all, once you find them, says Buffett, “cherish those people and meet with them as often as you can.”