Here are the 8 best things I learned from MFM’s interview with Mohnish Pabrai, the Indian Warren Buffet

1. If you are a guy who loves to watch paint dry... you will do very well.

Investors like Prabai and Buffet are patient. They are selective, and buy and hold over a long period of time. If you had identified Amazon 20 or 10 years ago, you wouldn’t want to sell a year later. You’d be crazy. You want to hold. 

2. Search relentlessly for Low-Risk, High-Return Opportunities.

Prabai invested in a Canadian steel company where the downside risk was limited by the cash they had on hand. They couldn’t be worth less than their cash and hard assets. 

3. Success come from just a few big wins

Of the 400 different investments Buffet made, only 12 mattered. What mattered was inactivity. He held, and didn’t allocate capital elsewhere. 

4. Find what’s hated and unloved. 

That’s where you can find undervalued assets. Prabai thinks coal fits that criteria today.

5. Business Experience is Crucial for Investing

Entrepreneurs have a natural advantage in investing as they understand the fundamentals of business and risk management.

6. If you’re a parent, the ages 11-20 are magical years for the brain to develop. 

Bill Gates learned to code, and Buffet rented out pinball machines to Barbers as teenagers. Entrepreneurship and problem solving can be wired at a young age.

7. Be a harsh grader of those you include in your inner circle

Surround yourself with exceptional people. They will make you better. 

8. Be useful.

The most important lesson he learned from his friendship with Charlie Munger is the importance of selflessly trying to be useful to others.