Famed investor Warren Buffett once emphasized the significance of trust and character in business partnerships, stating that these qualities are as vital as financial metrics when assessing investment opportunities.
Buffett, the esteemed investor and chairman of Berkshire Hathaway Inc. (NYSE:BRK) (NYSE:BRK), shared his thoughts on the importance of trust and character in business partnerships in his 1989 annual Berkshire Hathaway shareholder letter.
Buffett wrote, “We’ve never succeeded in making a good deal with a bad person.”
“Conversely, we do not wish to join with managers who lack admirable qualities, no matter how attractive the prospects of their business,” he added in his letter.
“I learned to go into business only with people whom I like, trust, and admire. As I noted before, this policy of itself will not ensure success: A second- class textile or department-store company won’t prosper simply because its managers are men that you would be pleased to see your daughter marry,” Buffett continued.
This belief is rooted in Buffett’s extensive experience leading Berkshire Hathaway, where he has consistently aimed to collaborate with leaders who exemplify competence, honesty, and integrity.
According to Buffett, a deal with an individual whose values or actions compromise trust is bound to fail, regardless of how appealing the financial aspects may seem.
Buffett’s strategy has been confirmed by some of Berkshire Hathaway’s most prosperous acquisitions, including See’s Candies, Nebraska Furniture Mart, and GEICO.
These were led by managers whom Buffett greatly admired for their integrity and long-term focus.
Buffett’s insights serve as a timely warning in the current financial environment, where short-term opportunities can often carry concealed risks.
His enduring lesson is that business success is not solely about identifying opportunities, but also about selecting the right individuals to seize them with.
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This article Warren Buffett Warns Entrepreneurs to Never Partner With Bad Person: ‘We’ve Never Succeeded In Making A Good Deal With A Bad Person’ originally appeared on Benzinga.com
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