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Here’s What I Learned at Warren Buffett’s 2019 Berkshire Hathaway Shareholders Meeting (Plus a Guide for First-Timers)

It took me 11 years after becoming a Warren Buffett enthusiast to finally attend my first Berkshire Hathaway Annual Meeting in Omaha, Nebraska. Here are my notes and my guide for first-time attenders.


Key Learnings from 2019 Meeting

Write down your thesis
Before you buy a stock, write down: “I’m buying this company for [insert market cap, e.g. $500 billion], because…” If you can’t answer this question, don’t buy the company. Remember: A stock is not a piece of paper, it’s a part ownership of a business.

Broad vs. narrow circle of competence
You need to find what you can understand. There is much more competition today than when Buffett started. It’s always a good strategy to specialize. Read as much you can. Figure out what you are good at. You need an edge. Be smart in spots and try to stay around those spots. Having one edge is enough.

Environmental, social and governance (ESG)
Don’t spend time creating ESG committees and writing long reports. Simply do the right thing. Example: Berkshire Hathaway’s utility is on a path to soon produce 100% renewable energy in Iowa.

The Future Performance of Berkshire Hathaway
“Berkshire Hathaway won’t be the biggest compounder by a long shot. But it will and continue to be a very safe way to make decent returns for a long time.” — Warren Buffett

Keep trying things
“If you keep doing enough things, some of them will work out.” — Warren Buffett

Figure out what works
“Figure out what works, and go do it.” — Charlie Munger


How to attend / Guide for First-Timers

This guide by The Investors Podcast (TIP) is a great starting point. But there are a lot of additional details to figure out. Here is my guide for first-timers:

When to plan the trip?
Next years meeting will take place on May 2, 2020. It’s advisable to plan the trip as soon as possible, optimally as early as October or November. I planned my trip in January and it was already quite difficult to find reasonably priced hotels (I was still lucky though, see below).

Credentials / Tickets
You don’t need to be a shareholder to get tickets, and there aren’t any further controls once you have tickets. The easiest way is to order them on eBay directly from Berkshire Hathaway (brka_b is their user name) and send them to your hotel address. If you are a shareholder, then simply print out a recent broker statement, bring a matching ID/passport and pick them up at the CHI Health Center on Friday before the meeting at the “Will Call”. You can pick up as many as 4 credentials, so not all of your friends need to stand in line.

Accommodation / Hotels
I highly recommend staying in Council Bluffs, right across the river in Iowa. I booked in January and was lucky to find a decent hotel for just $55 per night. It only takes 10 minutes to go Downtown and the traffic was always very smooth, because you take the freeway most of the way. If you are on a low budget or like to stay with locals, you might also consider Couchsurfing. If budget is not an issue, then you might stay near the Old Market area, so you have everything in walking distance.

Rental Car / Parking
A rental car is highly recommended, and only costs around $30 per day. The alternative is using Uber/Lyft, but this can get quite expensive if you want to see many things. I never had parking problems, even in Downtown. Mostly you have parking meters which cost $1.25 per hour (payable with credit card or cash). I downloaded the “ParkOmaha App” which made the process even easier. (If you don’t mind walking 10-15 minutes, you can park for free on the bridge next to the Durham Museum. That’s what I did most days. But don’t tell others ;)

Join a WhatsApp / Telegram group
One of the best things I did was to join WhatsApp / Telegram groups. That way I always knew what’s going on and was never alone. We ended up being a group of 4-5 people that did most things together. One group I found on the TIP Forum, and the other through Guy Spier’s mailing list. I’m pretty sure there are others as well.

The TIP WhatsApp group photo!

How to prepare for the meeting
If you want to stand in line very early, I recommend to buy a $10 camping chair from Walmart. I did and it was a very good investment. Some Chinese people also brought blankets to lie on the ground, but I’d say this is optional. Other than that no special preparations needed.

When to stand in line for the meeting
There are multiple entrances. Mohnish Pabrai recommends to go to the South Entrance, so I did that. We were there at 3.00am, which guaranteed us excellent seats. I think 3.30am would have been fine as well. Most people come after 4.00am and the line will get very long after that. I was sitting in my chair and was even able to take a few naps, as did several Chinese people next to me. In fact, most of the very early people at the South Entrance were Chinese.

Waiting in line with Mohnish Pabrai and thousands others.

How to get great seats
When you pass the security check at the South Entrance, take the stairs down one floor, then continue straight until you see the Lexus Club. Take any door to the left to enter the hall (the sectors are not separated, so you can move freely within the hall). If you feel lucky, you might go all the way down to the ground floor and try to get a front row seat. We didn’t do that. We chose Sectors 104 which offers a fantastic view.

The Floor Plan. The South Entrance is on the left side near sectors 211/212.

Want to see Warren Buffett up close?
After you have secured your seats around 7.15am, I recommend to go the the Exhibit Hall. Warren often takes a walk trough the hall before the meeting starts. The movie starts at 8.30am, so there is plenty of time to look for Warren. Don’t forget to go to the restroom before the event starts. The morning session is nonstop until noon.

Backpack / Security
CHI Center’s clear bag policy doesn’t apply to the Berkshire Hathaway meeting. You can bring a backpack. Full bottles are not allowed (empty ones are okay).

Events / Meetups
There are a lot of events and meetups, and the best way to stay up to date is to join a WhatsApp/Telegram group. I highly recommend doing the 5k on Sunday. It’s a very nice and quite short run. As we’re in the US I expected 5 miles, and was pleasantly surprised to see the finish line after just 5 km :) After that I went to Borsheims to play against ping pong champion Ariel Hsing, which was a lot of fun.

Restaurants
I really liked Jams in the Old Market. They have great salads. I also liked the Old Chicago pizza place in the Old Market. On weekdays they have great lunch deals.

Other fun things
The Hollywood Candy store was fun. That’s where Buffett and Gates made the Sweet Nostalgia video. You can easily spend one or two hours there. Don’t forget to have a strawberry milkshake!

Disclaimer: All the above information is based on my 2019 trip. Things might change in the future, so keep your eyes and ears open.

The closest selfie I got with Warren and Charlie.
My first meeting and I even made it into the Omaha World-Herald, thanks to my friend Marnix Troudes.

Other people’s experiences:


Why I created a Facebook page

Inspired by Rolf Dobelli’s book, I stopped using Facebook six months ago. Mainly because I was addicted, and also because the constant social comparisons and the instant gratification treadmill became toxic for me. (I’m still using Messenger/WhatsApp for one-one-one contact.)

The downside of leaving Facebook was that I lost a distribution channel for my content, and the people who were following me on FB suddenly stopped seeing my updates.

Reading Crush It! and Crushing It! by Gary Vaynerchuk convinced me that this was not wise if I wanted to maximize my impact, which I want.

So recently I changed my Facebook strategy and created a personal FB page.

Why a FB page?

#1: More reach: 1.52 billion people use FB daily. I want a slice of that.

#2: Compatible with social media software: I am using Crowdfire (they have a completely free plan, by the way) to manage my social media channels. You can only use such software with FB pages, not with personal profiles. This allows me to manage the page without having to actually log in to FB (which is what I don’t want).

#3: I can outsource my social media management: You can give third parties access to manage pages. So eventually I can completely outsource this channel.

#4: More options to customize: I can customize a page much better than a personal profile.

#5: Reply to private messages by email: I receive an email whenever somebody writes a message trough my page. I can answer by email, without having to log in.

#6: You can boost individual posts with ads. I’m not intending to do this, but it might be a good way to promote your business.

Final note on my private use of Facebook
I’m feeling a clear pressure to log back into FB occasionally. Some of my friends publish exclusively there (e.g. in private groups for travel notes), so each month or so I log in to check the updates of those selected people.

Also, less than 24 hours since creating my page, I received the first message from an acquaintance who missed my updates (and I his). I now make an effort to occasionally reach out to those people one-to-one. Since leaving FB, I ramped up my calls/lunches/dinners/coffees, which is socially much more rewarding anyways.

Follow me on Facebook.


15 Years of (Failed) Side Projects

When writing about the hyper-niche strategy, I thought back to all my own side projects. In this post, I offer a brief post-mortem for each one, so you can learn from my mistakes and don’t repeat them. (There were even more projects, but these were the main ones.)

Webmaster forum (2003-2015)
While this started as a side project during my university time, it became my main project between 2003-2006. This was my first project where I could feel real traction. In its best days, it had 100.000 unique visitors per month.

  • The main mistake was a technical one. Most of our traffic came through organic search (SEO). In 2005, I wanted to rebrand the service and move it to a new domain. The new domain had a Google penalty from the previous owner. I didn’t know about the penalty, but I knew there were indexing issues, and I had an uneasy feeling. I did the switch anyways, mainly motivated by my ego. We lost all Google traffic for 90 days, until the ban was lifted. We never regained the past traction. F*ck! (I’m pretty sure that without this, the site would have grown to be 10x larger than it ultimately became…)
  • Managing a discussion board is hard. I let myself be totally absorbed by reading and writing in the community. I neglected everything else. Bad monetization, no business development deals, no development of own service offerings. Instead of working “on the business”, I worked “in the business”. We should have outsourced more and getting more help from freelancers. Don’t do everything yourself. Get help!
  • I just didn’t realize how many different monetization strategies could have been applied to this project. We only monetized with banner ads. We should have used more affiliate links. Write an ebook. Create paid directories of professional service providers. Promote our own professional services. Create a paid membership community etc. I’m pretty sure we could have come up with 25 different ways to monetize the site, while providing value. With banner ads alone, we made 15-25k CHF per year. Not bad for students. But not enough to make a real business out of it. It could have been a 250k a year business.
  • We had a niche, but didn’t communicate well enough. We should have been much more specific in our positioning/branding, and don’t be afraid to repel people we weren’t addressing. What do we stand for? Who is this service really for? We never answered those questions.
  • After moving on to our new startup in 2007, we held on to the site for 8 (!) more years. These were frustrating times for all community members and ourselves, and it went downhill pretty soon. Don’t hold on to projects you don’t want to focus on anymore! We eventually sold the site in 2015 for a small sum. In 2007/2008 it would have been worth much more, and we would have avoided much frustration.
  • I learned a lot from this project, and it pays dividends until today. I learned HTML/CSS, SEO, SEM, Affiliate Marketing, and many of the core skills I use until this day.

Keyword-based arbitrage website (2008-2013)
The idea was to pick an affiliate program on TradeDoubler or Zanox, to build a highly specialized site around a specific set of keywords, attract organic search traffic, and redirect it to the affiliate program to earn commissions. I hired freelancers to write the content.

  • I picked the wrong market and language. It was a Swiss site, in German only. Combined with the hyper-niche aspect the total addressable market was too small. Why didn’t I pick a global affiliate program and built a site in English? I wasn’t thinking big enough. Think big!
  • I didn’t want to spend much money, so I hired low-quality writers. I wasn’t proud of the site. Outside of SEO, I didn’t promote the site. I didn’t want to put my name behind it. Life is too short to do things you are not proud of!
  • At peak months, the site had 300 visits and made 100 EUR per month.
  • All the money we made was reinvested in buying backlinks and content. The project was not profitable.
  • In the end, traffic and motivation faded away, so I shut it down.
  • I still think that picking a hyper-niche topic and building an authority site around it is a viable strategy. But it needs to provide real value or solve a real problem, and don’t be a pure arbitrage play.

Meditation app (2014-2016)
Since 2012 I had the desire to build an app. In 2014 I had the idea for an app based meditation community. The idea was “Runkeeper for meditation”, and it was my main project in 2014. I sold it in 2016 and it still exists today.

  • My main goal was to build a lifestyle business. I outsourced the design and development to an app development company, and wanted to keep the operations as lean as possible.
  • I underestimated the amount of work (and cash, if you use contractors) it takes to create an app. It’s much more complicated than a website.
  • We got 40k downloads in the first two years, and our users logged 380k meditation sessions. Unfortunately, retention (in terms of repeat daily usage) and revenues were not very impressive. Only 3k Monthly Active Users and $200-$560 monthly revenues.
  • A larger pivot would have been needed. Addressing beginners instead of experienced meditators, create paid audio/video guides, or trying out radically different business models would have been possible approaches.
  • In the meantime, a different opportunity came up, and I decided to focus on that. I didn’t want to repeat the mistakes from the webmaster forum project (see above) and let the app die a death of abandonment. So I decided to find a new owner and found one. In fact, one candidate was a prominent Silicon Valley entrepreneur with >1M followers, but it ended up to not be a good fit.
  • I was applying the Lean Startup methodology for this project. But, I was not totally rational, intentionally so. I really wanted to build an app. It was a bucket list kind of thing. It might have been wiser to create a lean web-based version first, to validate the market, before building the app.
  • In the end, I learned a lot from this project. I now have the skill to build and market apps, and work with outside development companies. I was able to successfully apply this know-how at Exsila, where I led the creation of the iOS and Android apps.
  • Read more: What I learned building the ZenFriend meditation app

Investor community (2018-2019)
The idea was to build a paid membership community for entrepreneurs and professionals, and to give them everything they need to define and implement a passive stock investing strategy.

  • The main hypothesis was to make the discussion forum the center piece of the product. For members to share and encourage each other to take action. I recruited 40 founding members from my newsletter. Unfortunately, it didn’t work out. Even though it was a closed group, people didn’t feel safe (or simply didn’t want to) share their progress with others.
  • The guides I created for the members area were helpful and valuable. I was proud of them. Members found them useful, and I was able to inspire at least two people to start investing.
  • I wasn’t proud of the whole service. A larger pivot was needed.
  • In the end, inspired by Seth Godin, I decided to shut down the site, to have the freedom to start again with a blank canvas. Build. Test. Learn. Repeat.
  • I learned from this project that I don’t want to build online communities anymore. I want to have more direct relationships with people. Maybe in person. Maybe digitally enabled, but more personal. I also learned a lot about ClickFunnels, the service I used to build the site.
  • I still have a desire to help people achieve financial freedom. But not in this format. Maybe one day, I will come up with something new.

Conclusion

  • I seem to have trouble with Reid Hoffman’s wisdom: “If you’re not embarrassed by the first version of your product, you’ve launched too late.” I am pretty good at starting things, launching quickly, and also being somewhat embarrassed. But, when I’m not proud of the product, I don’t want to promote it and stand behind it, limiting its early adoption.
  • I seem to have trouble with pivots. When the initial hypothesis doesn’t hold true, I lose motivation to do larger pivots. On the flip side, people like Seth Godin recommend to better shut things down and start from scratch, instead of being influenced by the things you already have (a form of path dependency). It seems there is no clear answer. What is clear to me: don’t hold on to a product that is not working. Move forward, or go home.

What’s next?
I will keep creating new projects. I learn from each one, no matter whether it succeeds or fails. And also, to be totally honest, I see it as a personal challenge (and bucket list item) to build a side project that I am truly proud of, that solves a real problem, has traction, is fun and profitable. I’m not there yet, but I will keep trying!

What have you learned from your side projects? Let me know on Twitter.

PS: Here is a compilation of Thirty years of projects by Seth Godin.


Why You Should Go Hyper-Niche

Since the agricultural, and more recently the industrial revolution, specialization has been one of the key drivers of human economic progress. It allows for a unique win-win situation: You focus on what you do best. I do what I do best. Then we trade. In total, we produce better and more things, which keeps increasing our standard of living.

No matter how big your ambitions, whether you want to build a large company, or a side project, I believe one of the best strategies available is to go hyper-niche. Picking a niche of a niche of a niche.

Don’t be the “plant person”. Become the “baby spinach guru”.

Don’t do “asset management”. Offer “value investing for entrepreneurs in Germany with a net worth between €5 million to €25 million”.

Don’t do “book reviews”. Do “reviews of artificial intelligence science-fiction audiobooks”.

Why?

  • You have a chance to stand out
  • You can leverage your unique skills and experiences
  • You have a chance that your hyper-niche is not taken yet
  • It’s easier to find your first customers, because you exactly know who your audience is
  • It allows you to focus on just one thing, and not be “everything for everyone”
  • It helps you to say no to clients and opportunities, because you’re not that person, sorry
  • You have the chance to fill your hyper-niche globally and become a hyper-monopoly
  • Customers gravitate towards the most specialized provider. If you have eye problems, do you go to your general physician, or an eye specialist?

Your market entry strategy depends on the product you want to offer. If you offer a highly personal and professional service, you might want to start locally. If you want to build an authority website covering your topic of interest, you might want to start in one language. After you have succeeded in one segment, you might expand.

Personally, the more I think about it, the more I’m feeling the itch to go hyper-niche too. To create one (or multiple) side projects, and to create real value in a narrow segment. I had several side projects in the past 10 years, some with moderate success, and others failed miserably. That, too, is part of the game: Fall down, get back up, and learn!

I think it’s a great model for entrepreneurs. And especially a great model to build lifestyle businesses that provide value, are fun, and profitable.

(I keep re-learning this lesson from Seth Godin, Gary Vaynerchuk, Chase Andrews and others.)


Will I Buy the New Apple AirPods?

Will I buy the new AirPods? The short answer is: No. Should you buy the new AirPods? The short answer is: Yes. (If you don’t own any yet.)

I bought my AirPods exactly two years ago. To be honest, I was reluctant to buy them. I have been pretty happy with my regular headphones, and was used to the daily untangling ritual. Also, another device you need to charge. And another item in your pocket. Really?

Then I kept reading/hearing positive reviews about them. Most people were surprised how good they were, and recommended the purchase.

So I took the plunge. Today, I can confidently say: It was one of the best sub-$200 purchases I have done in the past two years. I use them every day.

Also, I don’t feel weird anymore. In the first few months, not many people had them, so I stood out. These days, you see them everywhere. But still, I’m surprised how many iPhone users I know that don’t have them yet.

That’s why I’m writing this post, to promote a great product. By the way, dear entrepreneurs, this is what true product/market fit looks like: people can’t stop talking about your product.

Why I love AirPods:

  • No cord untangling anymore (!)
  • You can charge your phone while moving freely around the apartment, listening to something
  • The charging case provides 24 hours of battery life, and it’s always with me
  • It’s much more convenient to listen to audio while walking/hiking, on a bicycle, while brushing teeth, or shaving (yes, I do all of that)
  • When I’m on a long call and my AirPods are about to get empty, I can simply charge them one AirPod at a time, without an interruption to the call and usually without the other party even noticing it
  • Answering a phone by double-tapping an AirPod feels really cool

By now, you should have learned that audio is “titanically important“. Therefore, I highly recommend that you get your pair of AirPods (or some equivalent high-quality wireless headphones, if you don’t have an iPhone). You won’t be disappointed.

Want to see the new AirPods in action? Here’s a video review by Marques Brownlee.


Audio Is Titanically Important

I am a huge believer in audio. These days, more than ever.

I started listening to audiobooks 11 years ago, inspired by a friend (thank you, Rouven!). I had a portable MP3 player. First, I had to buy or lend a CD, then convert the CD into MP3, and then load them onto the device. The device would not remember my audio position, so I would keep a note on my phone with the last track I completed. It was cumbersome, but I loved it. I would listen to books on my commute or while walking around. A whole new world opened up to me.

Fast forward to today. Each smartphone is a high-end audio player. You can subscribe to things, and they are automatically downloaded onto your device. Or you simply purchase and download them digitally. How cool is that?

I agree with Marc Andreessen that audio will be (and already is) “titanically important“. For me, audio is the most important medium. I listen to 2 to 8 hours of audio per day. Books, Podcasts, YouTube videos, text-to-speech, everything.

Text is great. I love writing and reading. But I have to admit: audio is more convenient. It can be better integrated into your daily life. Personally, I have the capacity to consume much more audio than text.

I think it’s time for everyone to start thinking about audio. Personally, my audio production skills are pretty underdeveloped, so I have a natural reluctance. It’s a completely new area of expertise. Of course, it’s not exactly rocket science, but it’s something you need to learn and master.

I’m starting to think about it myself. This episode was great food for thought. It doesn’t need to be a podcast, though. It could simply be what Switzerland’s daily newspaper NZZ or Pocket is doing: offering a text-to-speech button.

Also, I found it important what Daniel Sennheiser, CEO of Sennheiser, said during his recent talk. You need to focus on your core competences (where you have an edge), and outsource or find partners for everything else. For most of us, audio is probably not our core competence. However, it should be pretty easy to find some talented freelancers on Upwork to help you with that.

Another thing I learned from Daniel Sennheiser is that smartphones are very good at video, but pretty shitty at audio. So you definitely need an external microphone. Personally, I have bought the Blue Yeti USB Microphone and have been very happy with it. It offers great value for money. Now, I only need to use it more often to bring my cost per use down…


The Cost per Use Principle

Do you want to spend less money than you earn, so you can save more, invest more, and ultimately achieve financial freedom?

Then I suggest you pay attention to the Cost per Use Principle:

For each material possession (especially the most expensive ones), calculate and minimize your cost per use.

Crave a swimming pool? Then interview someone who owns a pool and calculate his cost per use. It could be twenty dollars per swim.

Want to go on vacation with an RV? Then calculate the cost per night and compare it with a regular rental car in combination with hotels/motels/bungalows. The RV rental alone can easily be 100-150 EUR per day. Gas, campsite fees, parking, and additional public transportation not included. A regular rental car costs 20-25 EUR per day, with much less gas expenses. That leaves 75-130 EUR per night for the accommodation and parking. I love renting RVs myself, but you just have to be aware that more often than not, it’s the more expensive option.

Want to buy a Tesla with the largest battery pack and performance package? Compare the cost per kilometer with a smaller battery and regular performance. And then compare it with a pre-owned one. I talked to people who ended up paying more than $2 per kilometer ($3.22 per mile). So if I ever would buy a Tesla (I almost did), I’d do a careful calculation and try to bring my cost per kilometer down as much as possible.

Do your parents own a vacation home? You’d be surprised how much they pay per night if they don’t use it often. For the same money, they could often stay at 4 or 5 star hotels, and not always go to the same place.

I am aware that this is a purely financial perspective. You might want to consider convenience, quality of life, potential appreciation of assets, potential rental income, and other factors that are important to you.

Even more important than that is to make sure to consider the total and true cost of ownership of anything you own. Including maintenance, insurance, storage, opportunity cost of invested capital, your own time, people you need to hire, hassles/headaches, and all other directly and indirectly related expenses.

Of course, the most efficient cost per use is zero. This is achieved by either getting your things for free, or not buying them at all. Here are some hacks:

Hack #1: Instead of buying something, put it on your wishlist and wait for 48 hours. Often, your purchase impulse fades away. Example: Last year, I considered buying an electric moped. I ended up not buying it, and am using my bicycle (in combination with mobility-as-a-service options) ever since.

Hack #2: Force yourself to sell or give away one item before you are allowed to purchase another. Advanced: Give away two or more for each new one.

Hack #3: Make it a habit to buy things used. Example: I recently needed more teaspoons, so I went to a thrift store and bought some for a fraction of the price at IKEA.

Last year, I increased my iPhone cycle from 2 to 3 years, bringing my cost per day down by 33%. If I increase it to 3.5 years, 6 months after the introduction of a new model, I’d be able to buy it second-hand, decreasing my cost per use even further.

This is a powerful principle, and I hope that it will serve you as well as it did me.

[Hat tip to Mr. Money Mustache]


31 Takeaways from START Summit 2019

My main motivation for going to START Summit 2019 was to meet old friends and acquaintances from the St. Gallen area, but also to learn from the talks. I was positively surprised. It ended up to be one of the best and most innovative tech/startup conferences I have ever attended. Check out the opening video as one of the details they nailed.

Here are my key takeaways:

#1: The University of St. Gallen (HSG) has a palpable entrepreneurship vibe. This event has been 100% student organized by 60 students. They had support of HSG’s Dean and the St. Gallen Mayor, both of whom came to the opening. I loved my time at the University of Basel, but looking back, I really missed the entrepreneurship vibe I felt in St. Gallen!

#2: St. Gallen wants to become the hub for eSports, similar to how Zug became the “Crypto Valley”. They started the initiative “Digital Sports Hub Switzerland” to push this forward. (Learned from the Mayor of St. Gallen.)

#3: There is no such thing as an “AI startup”. It always needs to be “AI plus x”, i.e. AI applied to a specific thing. AI itself is not a product, it’s a technology, similar to electricity. (Learned from Richard Socher, Chief Scientist at Salesforce.)

#4: How to build an AI startup: (1) Pick a very specific niche/problem. (2) Collect as much structured data as possible in this niche. (3) Create specialized algorithms that create value. (Learned from Richard Socher, Chief Scientist at Salesforce.)

#5: Ask yourself regularly: “Where can I have the biggest impact, given my personal skills and resources?”. I have added this question to my quarterly life review. (Learned from Richard Socher, Chief Scientist at Salesforce.)

#6: “Essentialism” is a better term than “Minimalism”. It’s not about the number of possessions, but how essential/important they are to you. (Learned from Cédric Waldburger, Entrepreneur and Essentialist.)

#7: Quick tips on how to start with essentialism: (1) For everything you add/buy, remove/give away one thing. (2) Put things you haven’t used in the past 90 days in a box. Then wait another 90 days to see whether you go back those things. If not, give away the box. This battles your loss aversion and the instinct of “I might need this one day”. (Learned from Cédric Waldburger, Entrepreneur and Essentialist.)

#8: “As an investor, it’s important to cut your losses. As an entrepreneur, it’s important to keep going. So there is a difference in mindset.” (Learned from Daniel Aegerter, Investor and Entrepreneur.)

#9: Dragon = a company that returns >1x the whole fund (compared to Unicorn = Startup valued at >$1 billion.) Recent European dragons were Spotify, Adyen, Supercell, Delivery Hero, Just Eat. (Learned from Nenad Marovac, Investor.)

#10: Logitech transformed itself from a PC peripherals company to a Cloud peripherals company. Now multi-brand, multi-category. Vision: Become a Nestlé or Unilever type company. (Learned from Bracken Darrell, CEO Logitech.)

#11: Best team size is a team of 2. Reason: You only have 1 relationship to manage. Team size of 3 = 3 relationships. Team size of 16 = 120 pairs of relationships. That’s why Jeff Bezos at Amazon focuses on very small teams (“two pizza teams”). (Learned from Bracken Darrell, CEO Logitech.)

#12: Large organizations have only one advantage: scale and resources. But one huge disadvantage: complexity and bureaucracy. Startups have the advantage of small teams and less pairs of relationships. That’s why startups can move much faster than the big guys. (Learned from Bracken Darrell, CEO Logitech.)

#13: Logitech CEO has 25 direct reports. This is a wonderful number. As he cannot micromanage them all (because they are too many), he needs to give them responsibility, so they can work autonomously. It’s not a 25 people team either (with 300 individual relationships). It’s 25 single pairs, i.e. 25 subsets of two people. This is manageable. (Learned from Bracken Darrell, CEO Logitech.) [Want to know how to calculate the number of relationships for a given number of people? I did. Here is formula with n representing the number of people: (n*(n-1))/2 e.g. for 25 people it’s (25*24)/2 = 300 pairs of relationships]

#14: Give each new employee this task: “after 30/60/90 days send me a note with things that are broken. What obviously broken/ineffective/inefficient things can we improve?” (Principle: Fish don’t notice water anymore). Logitech CEO meets with each new employee and gives her/him this task. They have implemented many suggestions already. (Learned from Bracken Darrell, CEO Logitech.)

#15: Logitech sees itself as a design company. Why did Bracken Darrell join Logitech as CEO? Because he wanted to be part of a design company.

#16: Pick a very specific niche. How did Scalable Capital (soon €2 billion assets under management) get started? They focused on a very particular target group. Super exclusive. Focused on people with a university degree in business or computer science (i.e. people with a high degree of numbers literacy.). (Learned from Erik Podzuweit, Founder of Scalable Capital.)

#17: California Privacy Act 2018 (CCPA) is coming. It’s similar to GDPR, i.e. everyone who has users in California needs to comply. (Learned from Lisa Gradow, Co-Founder of Usercentrics, a Consent Management Platform).

#18: Privacy = freedom from unauthorized intrusion. Cyber Security = measures taken to protect a computer against unauthorized access or attack. (Learned from Lisa Gradow, Co-Founder of Usercentrics).

#19: Archlet.io won the startup pitching competition. They use machine learning algorithms to make value chains more efficient. They implemented one project so far, and achieved cost savings of 3% for the client.

#20: A great business model for hackers is to become ethical hackers and sell their know-how to companies. Edwin van Andel (Hacker & CEO of Zerocopter) believes that 60% of all hackers could be converted to ethical hackers, applying responsible disclosure principles.

#21: How to fix your security issues? Apply the Security Knowledge Framework. (Learned from Edwin van Andel, Hacker & CEO of Zerocopter.)

#22: “There is no way to happiness. Happiness is the way.” — Buddha (Learned from Daniel Graf, Uber Advisor.)

#23: Kilian Wagner, Co-Founder of VIU Eyewear won the HSG Founder of the Year 2019 award. The other nominees were the founders of Avrios, FELFEL and Globegarden.

#24: N26’s first product was “pre-paid cards for teenagers”. They spent all money, it didn’t work, then pivoted to the current product. (Learned from Valentin Stalf, Co-Founder N26.)

#25: Most of N26 customer service is done via chat. Their new chatbot reduced 20% of customer service requests. (Learned from Valentin Stalf, Co-Founder N26.)

#26: In the real estate space, a lot of digital low handing fruits are still available, e.g. remote signing of contracts with DocuSign. Lot’s of other innovation/disruption potential in this industry! (Learned from Dustin Figge, Founder von Homelike.)

#27: Don’t underestimate the power of mentors. Look for somebody with the same values, who is 10-15 years ahead of you. Don’t do it half hearted. Create a project and systematically reach out to specific mentors! #mentors That’s what I will implement, to find 1-2 additional mentors.

#28: Sennheiser, a 3rd generation family business, was founded in 1945; born out of necessity (needed food for his family, founder was scientist before); started with voltmeters, microphones; today 3000 employees (50% in Germany, still near the farmhouse where the company started); invented the first headphones in 1968; built a new innovation campus; CEO is here in St. Gallen to see what is going on, to not become complacent; the big opportunity is to create audio solutions for iphone/ipad. Video of those devices is great, audio still shitty. (Learned from Daniel Sennheiser, CEO of Sennheiser.)

#29: Audio & video are the future (Podcasts, YouTube videos etc.). If you are not good at it, then hire freelancers to help you! Lack of action is not an option.

#30: “Only do what only you can do.” Always ask yourself: Where is my edge? Then 100% focus on this area. All other things: Outsource them, find partners, or don’t them at all. (Learned from Daniel Sennheiser, CEO of Sennheiser.)

#31: Freigeist Capital investment criteria: How big is the market? Is the team right? Can this have a huge impact? Traditional KPI’s are not important (cashflow etc.). (Learned from Frank Thelen, CEO at Freigeist Capital.)

Conclusion:
If you are interested in the Swiss and European innovation and entrepreneurship scene, you should definitely consider adding START Summit to your schedule in 2020! I will be back for sure. 

Related links:
– My Photos (many pics of slides!)
– My Tweet summary
– My LinkedIn summary


Be a Useful Member of Society

Every morning, I answer the question “What is important to me?” One of the answers is “Be useful”.

Benjamin Franklin has been teaching it 300 years ago. Charlie Munger is teaching it today.

The idea is simple:

Be a useful member of society.

Remember Charlie Munger’s Three Basic Rules: Don’t sell things you wouldn’t buy yourself. This alone would solve many problems of society.

Benjamin Franklin always tried to be useful. He started one of the first public subscription libraries. A volunteer fire department. He owned a newspaper. Published useful books. He started the American Philosophical Society, still existing today. And so many other things.

If we could all be a little more like Ben Franklin, the world would be a better place.

Earning money and making a profit are important. But more important is to always ask yourself: Is what I’m doing useful? How can I be more useful? How can I be of service to humanity?

One way I try to be useful is this blog. I try to share everything I learn, and making a tiny contribution to the improvement of humanity. May you find it helpful.