“There’s an apocryphal story about Mozart. A 14-year-old boy came to him and said, “I want to learn to be a great composer.” And Mozart responded, “You’re too young.” The young man replied, “But I’m 14-years-old and you were only 8 or 9 when you started composing.” To which Mozart bent down and replied, “Yes, but I wasn’t running around asking other people how to do it.”
– Charlie Munger
I have always appreciated the straight forwardness, the I-don’t-care persona, truly an embodiment of the acronym DGAF, from Charlie Munger.
I have come to learn that investing eventually does that to you – risking your hard earned funds, making predications, and dealing with competitive, often cunning bankers and investors, will eventually give you thicker skin than a rhinoceros. It is no surprise that a legendary investor like Munger has learned to speak his mind freely without fear after 90+ years.
Maybe my most prized possession is his autograph on the outstanding Poor Charlie’s Almanac, which I was able to get several years ago:
Back to Munger, and Mozart, this story now happens to be a favorite of mine. It’s a reminder about going out and doing things rather than asking for golden advice each time. Go do it. No one has the answers, but you.
As an investor myself, and someone deeply fascinated by markets, what I also found particularly insightful is the background behind the saying and why Munger delivered it in the first place. A guest, in the audience and at the conference where Munger was speaking, stood up and asked a question. This guest wanted to know how Munger identified moats in business. He also wanted to know if Munger had any advice for him to find similar companies with strong moats.
You can imagine Munger’s reaction. And, now, why he delivered such a phrase.
In the business world, and especially startups, fast growth and heavy competition, all companies yearn for a moat. A moat is just what it sounds like in business: a defensible body of water that keeps a castle, or in this case a business, safe. It’s what makes that business viable for the long-term. The moat is the edge that business has whether it’s pricing power that no one else can compete with, technology no one else can mimic or something entirely strategic only to that business.
Without a moat, a company becomes a commodity, competing on open grounds with hundreds of other companies, no defensive formations are in sight. There is no castle, and no body of water protecting companies that do not have a moat.
Now, if Munger could so easily deliver such secret business insights in a matter of minutes, because an audience member asked, well, we would all be rich. And so Munger and Mozart is a timeless reminder: no one is going to give you the secret. Sure, they may direct you or help you. But, in order to find the secret, you’ll ultimately have to work at it yourself.
“Neither a lofty degree of intelligence nor imagination nor both together go to the making of genius. Love, love, love, that is the soul of genius.” – Amadeus Mozart