Mohnish Pabrai: Great Businesses vs. Great Investments

Mohnish Pabrai’s lecture and Q&A with students of Peking University (Guanghua School of Management)

Mohnish Pabrai: Great Businesses vs. Great Investments

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Transcript

We do so anyway. Jason he's been my trainer for. More than 12 or 14 years long been a long time. And. I ask Jason you know every time there's a Powerball lottery, you guys know what a Powerball lottery is like sometimes the payout would be like 500 million 700 million. And whenever the payout is really big. Jason always buys a ticket. OK. So I asked it's and I said Yes and listen what's going to happen if you win the Powerball. OK. Can you explain what your life is going to be like. One day after you get the 500 million.

Okay so Jason thought about it. And he said You know I just want to hang out at the club. OK. So probably and as I said How are you going to dress. Are you going to dress after the five or a million. This is probably exactly the way I dress right now. And then what are you going to do in the morning is what brought this to come to the club. And I said Jason after you win the 500 million. Am I going to be a client of yours. OK. Like are you going to like. Am want to. He you know I'll probably keep you as a client. Some other clients have to drop. OK let's make it a little flexible which one I want but I'll probably just come and hang out at the club and that's OK. So. When Jason told me that it reminded me of what Buffett says what Buffett says is that. You should take the job you would do. If you were not getting paid. OK. So it's very important that when you pick in terms of what career or. Job or company go for go to work for.

 That. If there was a way you could support yourself you know pay your rent etc.. And this company paid you nothing. You still go to work there. If you do that. You have made the right decision. OK. If you. Make the decision based on the highest pay or the most prestigious name or any of those things that's the wrong. Way to. Make a decision. You will probably later. Regret that decision. So. This is the first talk I think I'm giving when I did not put on pants. Did you notice I did not put on pants. OK. Like that exposed. The length and exposed. Terrible. OK. So why did I not put on pants. OK. The reason I did not put on pants is I wanted you guys to see me the way I am dressed every day. OK. I did not wear special clothes for you today. I'm sorry. OK. Every day. And you know Farhad and Jaya that they work with me they've got sick of looking at my legs. You know they wished I would come with them but it's the way it is. So every day when I go to work I go to work in shorts. OK. If I am dressed like this. OK.  And why do I do that.

 Why do I not have. Because I'm running an investment fund. About eight hundred million dollars. It's a serious activity why do I not put on a suit and tie and go to work. Because I think I'll be less comfortable and I will not be as. Excited to do that every day. OK. Like I like my Nike sneakers.

 Do you like my sneakers. You know I think it's better than wearing the leg the dress shoes. So. So the reason I did this is because if.

 Pabrai Funds did not pay me just like would Jason not getting paid. I would want someplace to go to work. And I would probably dress like this. So I don't want to do something which I'm doing because I am getting paid because that's the wrong decision. And and also I learned many things from Warren and Charlie. But especially for Warren one of the things I learned is. To run an empty calendar. OK.

 Nothing on the schedule like Warren will show you this calendar for days and weeks. He has nothing on the schedule. Yes comes to work. He reads if he wants to call someone he'll call someone but there's nothing that at 10:00 a.m. he has to do something and then 30 something else he doesn't work like that.




About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Prior to ValueWalk, Jacob was VP of Business Development at SumZero. Prior to SumZero, Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and three kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own 2.5 grams of Gold