Quote · My First Million
Mohnish Pabrai: This will save you 10 years of bad investments
Where this was said
Never use Excel
At 31:00 · chapter starts 30:29
When Shaan observes that the mental image of a great investor involves finance, strategy, and Excel spreadsheets, Pabrai gently dismantles every one of those associations [1] — Mohnish Pabrai "Buffett stood at cash registers. He went to movie theaters with his briefcase to study Disney. Great investing isn't spreadsheets — it's un…" 30:40 . His commandment is absolute: thou shall not use Excel. If you need a model to justify an investment, you don't understand the business well enough. Peter Lynch's method — make a list of every product you use, then study those companies, because you already understand them as a consumer — is a more powerful due-diligence framework than any DCF. Buffett's 'too hard pile' physically sits on his desk: he told Pabrai that 98% of everything goes there. Two criteria send an idea there: either it's outside the circle of competence, or it's simply too complex. The discipline to say 'too hard' to 98% of opportunities is an exercise in honesty and humility that most investors never develop — and it's the very thing that keeps the remaining 2% so powerful. The fat-pitch principle follows naturally: in investing, unlike baseball, there are no called strikes, so you can let 10,000 balls go by and only swing at the one pitch that hits the exact center of your sweet spot.
Buffett stood at cash registers. He went to movie theaters with his briefcase to study Disney. Great investing isn't spreadsheets — it's understanding businesses so well you can explain them in four sentences to a child. Complexity is a pass.
Buffett sifted through garbage bins for thrown-away winning racetrack tickets as a child, then spent years reading Moody's manuals page by page looking for anomalies. The Japanese trading companies came after 20 years of reviewing the Japan Company Handbook. The whale has to swim constantly — you only see it when it surfaces.
