For a man in his 80s, Warren Buffett still gets around. At least, that is how it seems at first glance. Search the financial section of any bookstore and you will likely see his face at least once and his name several more times. It is hard to imagine all of these authors have a definitive insight into Buffett as an investor or a person. In fact, it is hard to imagine some of them spoke to him at all. More often than not, they are pulling info off of the Berkshire Hathaway (BRK-A) shareholder letters that Buffett writes. That said, there is a lot to be found in those letters, and a few of the books on those shelves do hold some truly unique insight. We’ll look at some of the best and what sort of audience can get the most out of them.
1. The Warren Buffett Way, by Robert G. Hagstrom
If you are looking for investing lessons from the impressive record that Buffett has put together, then Hagstrom’s book is likely all you will need. The Warren Buffett Way lays out all the rules of thumb Buffett uses in his investing and walks the reader through them with case studies out of Buffett’s own portfolio. These include well-known rules like buying businesses you understand and ignoring Mr. Market, as well as some deeper lessons drawn from the real-life investments the Oracle from Omaha has made. It is a great book for investors just starting out and it continues to be a strong read even when you think you know what you’re doing.
2. The Essays of Warren Buffett: Lessons For Corporate America, by Warren Buffett & Lawrence Cunningham
It is always a bit of surprise to think that Buffett has never written a book himself. Taken in total, however, his shareholder letters amount to the equivalent of several books – though, if read back-to-back, they suffer for the lack of an editor. Lawrence Cunningham solved that by going through the letters and organizing Buffett’s thoughts around topics. He's imposed some editorial voice – necessary to tie everything together – but the content is Buffett’s and so is the philosophy. Now in its fourth edition, The Essays of Warren Buffett: Lessons For Corporate America takes on a larger scope than The Warren Buffett Way and isn’t solely aimed at the individual investor (as the subtitle implies), although you will still learn a lot about investing.
3. The Warren Buffett CEO, by Robert P. Miles
The Warren Buffett CEO is less about Buffett as an investor and more about him as a manager. The book shows how Buffett selects the CEOs for Berkshire’s many subsidiaries and how he manages them, but it tells that story through the Berkshire executives. The Warren Buffett CEO isn’t an investment manual, but you will learn a lot about great companies and great management, two things every investor needs to keep in mind. More importantly, the book shows a side of Warren Buffett that is often overshadowed by his portfolio performance. Buffett is a great manager and a great investor, which has got to be one of the rarest pairings since the liger. This is a great book for aspiring managers and business professionals.
4. Dear Mr. Buffett: What an Investor Learns 1,269 Miles from Wall Street, by Janet Tavakoli
This is a Buffett book that really isn’t about Buffett, although he is one of the main characters. Janet Tavakoli is a structured finance expert whose previous books focused on collateralized debt obligations. She met with Buffett and, following the financial mess of 2009, started to see more value in Buffett’s philosophy and value investing methods. Again, this is one of those books where you see Buffett differently through someone else's eyes. This is a pure pleasure read, as some of the insights will be unsettling for investors, particularly the systematic abuses that encouraged the onset of The Great Recession.
5. The Snowball: Warren Buffett and the Business of Life, by Alice Schroeder, and Buffett, Making of an American Capitalist by Roger Lowenstein
If you read all of the above and still feel that you haven’t absorbed enough Buffett, then you have a problem. Fortunately, it is one you will soon be cured of. These two Buffet biographies are thorough looks at the life and times of Warren Buffett. Lowenstein’s book slants a bit more to the facts, while Schroeder's book was written with Buffett’s cooperation. Neither will change your knowledge of the man's investment strategies other than to emphasize that his approach evolved over time, but they will give you a long look at Buffett’s life and remarkable achievements.
The Bottom Line
There are a lot of pages devoted to Buffett, but they are all pulling from the same source material (with the exception of Snowball). Choosing which to read comes down to whether you want to learn investing from the man or learn about the man and the investor. These six books aren’t as satisfying as owning Berkshire shares has been for the last 45 years, but there is a lot of knowledge and enjoyment in them nonetheless.