I’m a consultant, coach, entrepreneur, and author but that wasn’t always my path. For many years I was in the corporate world and I was the CEO of a Warren Buffett company.
In this article, I’d like to share 3 Warren Buffet quotes to live by that I learned in my time as a Warren Buffett CEO.
That company was Prudential California Realty under Mr. Buffett’s Berkshire Hathaway company, a division of HomeServices of America serving all of Southern California. Serving in that capacity was one of the highlights and honors of my life and I learned so many valuable skills I still use today.
I began as a manager and ended up rising in that company from General Manager to Vice President, COO, to ultimately becoming the President and, and for the last few years I was at that organization, I was the CEO.
At our peak, we were doing around $25 billion a year in real estate sales and around 36,000 plus transactions a year.
That is a lot of real estate!
In my time at Home Services, there were some tragedies, and there were many triumphs. It was an amazing journey and I learned a lot along the way from all the people I worked with and met through that work while being part of the corporate world.
Mr. Warren Buffett is a very busy man, but I was fortunate enough to connect with him numerous times through business gatherings, board meetings, workshops & learning sessions, as well as cocktail parties, and other social functions.
He is a brilliant man and very charismatic, and he can answer any question that’s thrown at him from an audience or an individual.
He’s definitely one of a kind.
It was an honor and one of the highlights of my career to work for him. I took away many many lessons and I use them to this day in my life, in my business, and with my clients in their businesses.
I ultimately left that company in a fairly abrupt and challenging way after being at that organization for about 15 years, and I ended up starting my own venture where I built my own real estate company.
It was at that time that I was actually born as an entrepreneur.
That journey was very rewarding as over a five-year period, I and my partners built that company from a small organization to the fifth-largest real estate company in closed transactions in San Diego.
I’ve since moved on from that company to be a consultant, coach, speaker, podcast host, and author teaching others about purpose-driven entrepreneurship and how to integrate Spiritual Intelligence into business. These things are equally as important as the perennial business needs of driving more profits and scaling businesses.
Much of what I am doing today has its roots in what I learned in my 15 years working under Mr. Buffett and with other amazing leaders along the way.
So, in this article, I want to share with you some of the lessons, information, and tips that I took away from my time as a Warren Buffett CEO and executive.
These are Warren Buffett’s two rules for business:
“Rule number one: don’t lose money.
Rule number two: don’t forget rule number one.”
All of us want to make money, but sometimes we lose it as well. This is something that every successful entrepreneur or business leader will experience.
We’ve all made money, and we’ve all lost money. But the key is to try and make more money than you lose and to do that consistently.
Warren Buffett’s been a master at that over the years,
It is a common problem that businesses will have multiple different “leaks” in the boat through which money is just going down the drain. An effective leader would identify these places in the business where there is little to no ROI or profit being made and cut them out or remodel them.
So, the first thing is to focus on what you can do to not lose money in the first place. This means you need to track and measure monthly, And, if you are already losing money, see what you can do to cut your losses and move forward by doing whatever you can to reinvent or modify things so that that doesn’t continue to happen. If you need to empower your team or finance person to do so, then give that blessing immediately.
This rule is very simple but very powerful, as simply stopping the bleeding can make a big difference and people usually wait too long to course-correct.
Once you have eliminated all the areas where you are unnecessarily losing money, then you can truly focus on doing all the things that really drive your revenue and make money.
A powerful but simple process of doing this is making a list in a notebook of your Stop, Start, Continue items.
STOP right now doing what’s not working,
START doing that “one thing” that you know at a gut level is going to make the biggest impact, CONTINUE doing what is working, and scale it if you can.
Now that’s quite a visual!
“When the tide goes out, you really get to see who’s swimming naked.”
This one may be a bit humorous, but anyone who spends any time in the business world will experience those periodic times when things ebb and you really face adversity.
So this quote is all about answering this question: how do you overcome that and stay at your strongest level as an executive?
This isn’t Mr. Buffett’s original quote, but what he means by it is in our businesses and in our lives sometimes things are not going so well, the markets are down, and things crash. I’ve been caught up in various surprising low-tides myself over the years. Often when that happens you are just trying to find a way to get out of the tide and to get your head back above water.
Many times when the markets are great, everybody’s doing wonderful and things are going smoothly and all is moving forward, we get complacent and think it will always be this easy. But when the tide goes out, you get to really see where you and your business might be lacking, where there might be a lack of skills, or where there might be aspects of the business that aren’t built to last in the long run.
So the question to ask yourself would be: how can you be as prepared as you can be when you have issues with the tide going out and experiencing diversity?
What is it that you’re doing as an individual to survive and swim through the tide?
Do you realize that you can swim back to shore?
Or are you just swimming naked and you feel like you want to run from the world and that you’re exposed?
The successful entrepreneur and business leader is always ready to overcome that and is able to stay at their strongest level as an executive. They know how to make sure they’re moving to the right place. They make sure they’re on the right path and surrounded by the right people.
Perhaps they have even made contingency plans and are prepared for when the company’s good fortune dips and things outside of their control happen – such as a stock market crash, an economic recession, or maybe even a global pandemic!
So, the takeaway from this Warren Buffett quote is to always be prepared as much as you possibly can. Sometimes there are forces of nature that hit a business, and being prepared for adversity can really separate a business that has plans in place and can quickly recover from one that flounders and drowns in a short amount of time.
This one is an age-old principle that says: “You don’t have to make it back the way you lost it.”
We’ve all lost money. Warren Buffett has definitely lost money – a lot of money. He’s lost millions or even billions of dollars.
But guess what? He’s also earned it back – and then some.
And unlike many people who lose money doing one thing and then keep doing that same thing, Mr. Buffett understands that you need to be adaptable and look at other ways of making the money back.
“You don’t have to make it back the way you lost it”
Find a different way, find another path and go in a new direction and get out of the box that you might have been in, and reinvent yourself.
If you keep running into a brick wall, move around the brick wall, or go down another path.
So don’t keep beating your head against the wall if it’s not working. If you lost money in a certain venture, a certain division, a certain department, or a certain startup – reinvent yourself, move forward, and find a different way.
I have found through my extensive experience doing it, that reinvention can be really exhilarating. It can inspire you and be that catalyst that forces you to evolve to bigger and better things.
So, remember that after losing some money you can make some fundamental changes and gain that money back, and then some, by earning it back in a different way than how you lost it.
“Are you struggling with making the profit you want in your business, finding your purpose, or getting to the next level in your career?
Click the link below to book a free consultation call with me, Steve Rodgers, host of The Alchemy of Business Show and former Warren Buffett CEO.”