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Comment by elchief | Hacker News Reader

It's not because he makes it easy. He buys them when they're strapped for cash

Fruit of the Loom: 1999 Bankruptcy, 2002 acquisition by BH

He even bought into Berkshire Hathaway itself, on the cheap

Exceptions to the rule. Precision Castparts, Burlington Northern, Clayton Homes, Duracell, Pacificorp, Lubrizol, Acme Brick, Dairy Queen, Pilot Flying J, all were bought as healthy companies.

+1. Warren and charlie also say that they would rather buy good businesses at fair price than fair businesses (or cash strapped ones or ones about to go bankrupt. I know thats not what fair means) at good price.

There’s also the consideration that a good, healthy business doesn’t want to be bought. The opportunity only presents itself if you are willing to massively overpay or if a good business runs into financial issues.

I worked for a Berkshire subsidiary before jumping into tech. First hand, it is zero bullshit that they invest in good management teams and let them run the business. The best run company I’ve ever worked at is one of these - Berkshire got ‘em when they were out of cash and almost about to fold, and they are overwhelmingly successful today with a stable management team with mostly internal succession. Having also worked at some startups that HN absolutely loves, it’s not that different than soaking up VC cash - it’s still outside money, and you still need a great leadership team to get to profitability.

> Clayton Homes

TBD per John Oliver: https://www.youtube.com/watch?v=jCC8fPQOaxU

John Oliver doesn't approve of certain aspects in their business model, but when Clayton was acquired in 2003, it was a healthy company and has grown massively since.

Scamming people isn't a business model. Everyone makes mistakes and I think this is a miss for Warren. That doesn't mean Clayton can't turn it around. Maybe Warren sees something Oliver didn't. It just doesn't look to be on the up and up when put to scrutiny.

They sell mobile homes to poor people using basically car loans. 15% is right. Plus--there are tons of fees.

It's like Payday loans.

I imagine this company will just get bigger, and bigger.

I wish our government would revisit every law concerning high interest loans.

And Apple, which makes up 41% of Berkshire’s value today, and Bank of America, which is another 14%.

>He even bought into Berkshire Hathaway itself, on the cheap

This is incorrect. He bought it and wanted to sell it back because of how bad the company was...but they tried to "steal" a small portion of the agreed upon price.

Buffet than went ahead and bought up shares and fired the guy who tried to short change him.

It’s definitely more than just being smarter. The shape of Buffett’s Salomon Brothers deal is an example.

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