Video Text (literal) Transcription:
Hello, Olivier Roland here, and welcome to this new video from the blog Life-changing Books. I am currently in the Costa del Sol in southern Spain, and I’m taking this opportunity to tell you about a great book, which is a biography on the life of Warren Buffet. It is called “The Snowball”.
Warren Buffet is one of the richest men in the world. I’ve started reading The Snowball, it’s absolutely awesome. The only reservation I have to express is that Warren Buffet has built most of his fortune by investing in the stock market. My current perception is that when we succeed on the stock market, it is always to the detriment of someone, since when we buy a share, we buy it from someone; when we sell it, we sell it to someone, and inevitably when we earn more than others, it means that others have been less successful.
My perception of entrepreneurship, when it’s done well, it’s, on the contrary, to bring more value to our customers than the price we ask them. Otherwise, they would not buy our product or service. Those are my reservations. The Stock Exchange is an exchange of value while entrepreneurship is a creation of value.
With these reservations being expressed, I found The Snowball really great.
Incidentally, this is the very first book I’m talking about that I haven’t finished yet. It’s rare that I review a book that I haven’t yet finished yet, but I couldn’t wait to share it with you; I found it to be too good.
In fact, you should know that Warren Buffet, before starting his career as an investor, had to earn some money to be able to start investing in the stock market. He started as an entrepreneur, and his early life is fascinating.
In particular, he gives an extraordinary example of how to apply a book. He read a book when he was 11 that completely changed his life. The book is called “One Thousand Ways to Make One Thousand Dollars”. It is a book from the thirties. Back then, $1,000 was worth much more than it is today.
At the age of 16, this gave him the idea of starting his first business to generate passive income. He bought a used pinball machine for $25. He went to see a barber offering him a deal, which consisted of placing the pinball machine in his lounge and making it available to his customers who were waiting their turn. It would entertain them, and the barber could make more money. Warren Buffet offered to take care of the maintenance of the machine and in addition to share the income with him.
After a week he came back to the barber, took the money out of the pinball machine and gave his half to the barber. His share was $25 in just one week!
He realized that he had found something that was working, and so he repeated the operation. This is a piece of advice that I give often. When you find something that works in business, keep doing it until it no longer works.
He went to buy 7 or 8 pinball machines that he dropped off at other barber shops, and every week he was making money without doing anything. It was a business. He just had to come every week and collect the money. Everyone was delighted. The barber was happy because it made him an income while doing nothing, and the clients were delighted as it entertained them while they waited for their hair to be cut. That’s how he started one of his first businesses. It is an example for us.
Then he read Dale Carnegie’s book “How to Win Friends and Influence People”, which I’ve already told you about.
You should know that he was quite shy and that he was what we call a geek. He had a hard time making friends and approaching women. Reading the book, he thought it was great but wondered if it really worked. He decided to do a split test.
A split test is a way to test on a sales page (for example) if one slogan is catchier than another. You offer two versions of the same page and you look at the version that has sold the most.
That’s what Warren Buffet did. He decided to interact with people half the time using Dale Carnegie’s rules, and half the time being normal.
He found that when he used Dale Carnegie’s rules, people were nicer, more open, more cheerful, more accommodating and seem to enjoy the time spent with him more.
Warren Buffet had the stroke of genius to test and imagine an experiment to see if this method worked or not.
You should know that this book by Dale Carnegie “How to Win Friends and Influence People” is one of the bestsellers in personal development. It has sold over 50 million copies. Obviously, most of the people who bought it haven’t read it, and those who read it haven’t applied it. Warren Buffet had this stroke of genius to test the concept.
Same for the book “One Thousand Ways to Make One Thousand Dollars”, it was a bestseller in the thirties. Tens of millions of people have probably read it and arguably very few have applied it.
This book allows us to enter the mindset of a billionaire, of someone who has been extraordinarily successful. The book goes on to tell us how he started investing in the stock market, how year after year he has significantly beaten the market, how he has always reinvested his income to create the fortune he has today. Hence the title of the book ”The Snowball”.
It’s amazing to get into the mindset of someone who has been so successful.
It is no coincidence that the two examples I gave you really set him apart from most people. He has a way of thinking, a state of mind, methods that are more effective than others.
These are two examples that I gave you, there are plenty of others. We see that there is no luck, that when we use methods, a way of thinking, a state of mind that are more effective than those that most people use, we have results that are beyond what most people just get.
The Snowball is a book that I highly recommend to you. I am still reading it; it’s full of advice and extremely interesting things. It’s fascinating to get into the state of mind of someone who has had so much success.
Thanks for watching this video and see you soon for more adventures.
3 Life Lessons Warren Buffett Conveys in The Snowball
1. Develop your communication skills
Buffett was so terrified of public speaking that he would become physically ill before stepping onto the podium. At 19, he enrolled in a public speaking course at Dale Carnegie, an institute named in honor of the influential speaker and author of How To Win Friends and Influence People.
According to Joe Hart, President and CEO of Dale Carnegie, Buffett likely learned several crucial lessons from this course.
One, he says, is the importance of sharing personal anecdotes in conversations or speeches. To have stories you can think of in an instant, do some work ahead of time. Write down a list of relevant anecdotes that you can share if prompted, such as trips you’ve taken, books or movies that have changed your thinking, mistakes or lessons you’ve learned in life.
Another important lesson Buffett likely learned, according to Hart, is to never read a speech or presentation verbatim. Instead, create a general layout with the points you want to make. That way, says Hart, you’ll remember what you meant to say while looking natural.
2. Read a lot
Buffett attributes many of his excellent financial decisions to his amazing reading habit. He says he starts each morning by reading several newspapers and estimates that he devotes up to 80% of his day to reading.
When asked once for the key to his success, Buffett pointed to a stack of books and said, “Read 500 pages like this every day. That’s how knowledge works. It builds up like compound interest. You can all do it, but I guarantee that few of you will.”
Of course, reading 500 pages a day might be difficult for you. However, if you can find ways to read (or to listen to an audiobook) during the day, night, or weekend, you will likely reap multiple benefits.
A study published in the Journal of the American Academy of Neurology finds that people who engage in mentally stimulating activities such as reading experience slower memory decline than those who do not. Reading is also linked to higher emotional intelligence, broader vocabulary, and increased reading comprehension. It has also been shown to reduce stress.
3. Choose your friends wisely
Buffett, who is a longtime friend of Microsoft founder Bill Gates, says the right group of friends can inspire you to reach higher career goals. “You’re going to be heading in a similar direction to the people you associate with,” Buffett said.
A good friend prompts you to tackle something in your career that scares you, introduces you to a potentially important network of contacts , or recommends good books or resources.
“It’s important to associate with people who are better than yourself,” Buffett says.
Have you read “The Snowball“? How do you rate it?
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