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Warren Buffett & Jay - Z - Billionaire Investing Secrets (Interview with Forbes)

Warren Buffett & Jay - Z - Billionaire Investing Secrets (Interview with Forbes)
well J and

Warren

thank you very much for for coming by and thank you for the facilities

Warren

you too are unique even though you're in different spheres you've reached a level of success almost legendary what did you do what made you different

Warren

we'll start with you because there in

investing

there are a lot of bright people they've all claimed a read Graham and Dodd they all claim to be disciplined and yet there's only one

Warren

Buffett

well I was lucky that I got started early I mean it always helps me get started early and and my dad happened to be an investment business so I would go down his office on Saturdays and so at age probably 7 or something I started reading these books that were around the place and so I had a 15 year jump on many people in a sense and that that helped a lot and and I was always fascinated by time I knew what I wanted to do early and I think that's a that's a huge advantage too and then you don't need you you don't need a lot of brains in this business I mean I've always said if you got an IQ of 160 give away 30 points to somebody else because you don't need it in investments what you do need is emotional stability you have to you have to be able to think independently and you have to be you have to be when you come to a conclusion you have to really not care what other people say and just follow the facts and follow your reasoning and and that's that's tough for a lot of people but...
warren buffett jay   z   billionaire investing secrets interview with forbes
that part I think I was just lucky when I was born that way in terms of emotions it's a truism that

investing

emotions are your enemy absolutely that when the market is good if you feel good don't if you feel bad probably do it right but how how did you what was that extra thing where so many will acknowledge that and yet we saw in the current crisis they they panic why you went into seemingly potential disasters like GE and Goldman Sachs yeah I can't really tell you the I mean I didn't learn in school or anything I just it never bothered me if people disagreed with what I thought as long as I felt I knew the facts I mean I there's a whole bunch of things I don't know think about I just stay away from those so I stay within what I call my circle of calm you know that Tom Watson said it best he said you know he said he said I'm no genius but I'm smart in spots and I stay around those spots well I try and stay around those spots and I I just don't have a problem if somebody says you know you're wrong on something I just go back and look at the facts and I think that I think that really is much more important frankly than having a few points of IQ or or having an extra course or two in school or anything of the sort you need emotional stability and so in terms of people who are not even in the business if they I think we're talking when we had dinner the other day about how in tennis most of us are never gonna get to Wimbledon but if...
warren buffett jay   z   billionaire investing secrets interview with forbes
we just focus as somebody once said get the ball over the net don't try to be fancy about it just get the ball over the net you'll do fine yeah and that's a little bit like I've got this rule you know the first rule is don't lose in the second rule as never forget the first rule so it really isn't so much having a lot of brilliant decisions it's just not really having some terrible ones and and and frankly I did learn from men Graham how to avoid ever having any disasters and investments it it wasn't that you were going to come up with a very smartest thing but if you never have any any significant losses you know some singles and doubles will produce a lot of runs before you get through who was Ben Graham he was your primary mentor model it was a wonderful man and he was my professor at Columbia I read his book when I was 19 at the University of Nebraska and I'd started

investing

when I was 11 I started reading about it when I was like seven so I gone through all I read every book in the Omaha Public Library that was on by the time I was 12 on

investing

in stock market and I had a lot of fun but I never really found out I never got grounded to anything and it was it was entertaining but it wasn't going to be profitable and then I read Graham's book the Intelligent Investor when I was at the University of Nebraska and pulled the whole thing up to me yeah and I and I named my my oldest son is named Howard after my dad Graham

Buffett

...
warren buffett jay   z   billionaire investing secrets interview with forbes
and then he was a marvelous man never expected anything from me and reach just did all these things for younger people if it's just a couple of quick examples of the things that he did that you will look back on it's one thing to read something but quite another seed in action well he but what do you what he did was he got me thinking not as a stock of something with a ticker symbol that Wiggles around them that you know that you look at charts aren't everything he taught me to think about it as part of a business and and that was vital any any and he he taught me not to really pay any attention to stock market fluctuations except when they were working in my favor so that not to get you know elated because something had gone up or depressed because it went down so if I knew the facts on something and went down I bought more of it you know and and because I looked at it as a business and then and then he then he taught that famous lesson about a margin of safety that you don't drive a truck that weighs ninety nine hundred pounds across a bridge that says limit ten thousand pounds because you can't be that sure about it if you see something like that you go down a little further down the road and if I went that says limit twenty thousand pounds and that's the one you drive across so he in effect to taught you that stocks weren't just numbers and as a shorthand for flesh and blood as and never forgotten it mmm-hmm J you are in a business that's...
perhaps even more competitive because there's probably not a young person in the country who at some point in their lives wants to be an entertainer a star right and you've not only have done it but you've done it consistently and even though you're only forty going on forty one in that business that's a that's almost like eighty in

warren

s world it's tough to do more than one or two what looking back what were the things that broke you out of the packing of the most dramatic way possible when I was as I was listening to him I just hate does he hear all the similarities and all the things and what he's saying right because if you don't look at it as tickers and things like that are you really just searching for the truth within you know all that and within all the numbers and all the chaos you're just searching for the truth right and that's the key to being a recording artist maybe you're telling your story or finding your truth at the moment you know III had mine's a little opposite form cuz I started a little later my first album then come out till I was 26 so I had like a bit more maturity or where I was at it's my first album had all these you know emotions and complexities and layers to them that a typical hip-hop I didn't have because you know we were making it at 16 17 years old it wasn't enough wealth of experience to share with the world so at 26 I had been through so many different things I had so much...
wealth to share you know with the world at that time and you know from that starting point I've never forgotten those things like you say I'm you never forget those true things that you stick through your basic things that that uh you know make you successful and and and for me is that true finding that true the true for the moment of where I am at the time you know not trying to cater to a certain demographic you know or you know not being something I'm not not driving a truck over Bridgeton value you know the whole thing like there's so many similarities and what he was just saying now in terms of a mentor you mentioned yet at a young age you've got a love of words however you've met and before we recorded you mentioned a sixth grade teacher brought that out in you that's lived my lifetime yeah I was telling you earlier I can um you know our classrooms where we grew up I grew up in mossy projects in Brooklyn and um you know our classrooms were flooded you know so it's very difficult for teachers to give you like like one-on-one attention you know and there's just one sixth grade teacher named was Miss Loudoun you know she must have saw something in me and she gave me this attention and she gave me this love for words you know it's funny how it works you know you know work for me to this day but I'm just a little bit of attention you know no she also took us on a field trip to a house you know which opened me up to the world you...
know my neighborhood had been my world it's the only thing I'd seen you know you know I just saw a whole different world my imagination grew from you know I wanted that ispired to have that you know small thing she had like a ice thing on a refrigerator you know you push the ice in the water come down I was really amazed by it I was like you also even though you didn't record your first album - you were 26 you in effect we're writing music in your own mind yeah I was around music my whole life my mom and pop had like a huge record collection so I started out listening to music early on and I was just write music and you know I just had a love for me you know from there I didn't get to it you know I got caught into my neighborhood and my surroundings but I've always taken it with me and I've always went back to it and it just got to a point where it was like make this decision as this is something this something you really love and you love to do you know it's time to really focus on and get serious about it and you know give it you all and once I know I did that it was no looking back from there and you were able to overcome where where you grew up as you once put it you saw what happened and things like drug and where where the life would end and you decided at some point I'm not going there yeah just I mean you know those sort of decisions that happen in you know many of our lives you know we have we're faced with that those four you...
know the fork in the road moments you know you know I was around people and I'm seeing people really genuinely nice people going away for 13 years and you know all these uh you know unjust Enrico fella laws and you know I was just around that so much that I would just told myself map and make a decision at some point and you know I made this decision to uh you know focus on music which was my love you know and it worked out consistency you know people have a love of music they may do one or two or three albums and then for some reason they fade away that hasn't happened to you I think again again it goes back to a bit of a warm is saying as well like if the discipline as well the discipline to not get caught up in the moment you know music is like stocks to you know there's the hot thing of the moment you know there's this hot electro sound or the hot auto-tuned voice or the hot whatever whatever it's new and exciting and you know you know people tend to make emotional decisions based on that you don't stick with what they know this is who I am this is what you know this is what I do and then they you know jump on this next hot thing and you know it's it's not for you so for me just having a discipline and having the confidence that and in who I am you know and if I go into a studio and if I find my truth of the moment there's there there are a number of people in the world that can relate to what I'm saying and and it's gonna buy...
into what I'm doing you know not because it's the new thing at a moment but because it's my genuine emotions is how I feel this out I articulate the world and you know just having to discipline to just you know be yourself because you once said as an artist you are fighting against everything that's new and everyone's fascination with new things yeah shiny things people fall in love with shiny things so in essence as you grow older you bring an audience with you because topic of your music grows with you right right I mean tristeza doesn't go stale yeah because for hip-hop was like 30 years old like hip-hop is fairly a new genre music so we've never seen you know the maturation of hip-hop you know in this sort of way there's never happened before you know people would get a certain age and still try to pinpoint this you know you demographic because if I was a young man sport but you know people that listen to hip-hop when they're 18 they still don't like hip-hop I need 28 it's just that the voices and hip-hop are not speaking directly to them anymore word you know why they were speaking to a 18 year old demographic you know so you know you 28 you don't have anything listened to because no one's relating to you so you know my whole thing was I'm not gonna do that you know I'm just gonna make you know the music that I love the making and I want to make and I'm amateur of my music and you know luckily for me it was...
the right decision when did you realize that not only did you have this ability with music and not to get stale but recognize - you have to be treated also even though you love it as a business so that you don't end up as so many do they lose everything they have they're ineffective denture to companies and they're they're not masters of their faith yeah that was the greatest trick in music that people ever pulled off is to convince artists that you can't be an artist and make money I think the people that were making millions actually said that I think they set that whole thing up you know it was almost like shameful like specially in rock-and-roll you had to pretend it you know you got these millionaire guys who had to pretend as if they wasn't successful at all oh it would be like a detriment to their career you know hip-hop so in the beginning you know just it was always been aspirational you know just always broke that thing you know that thing that an artist can't think as well and I think at the end of the day as long as you when you separate the two and you're not making music with business in mind because you you at some point you have it has to be real when they touch it when they listen to it you know it's something has to resonate with them that's real as long as you when you're in the studio you're you're an artist you make music and then after you finish you you market it to the world I don't think anything...
is wrong with that in fact I know there's nothing wrong with that and so how going right from the very beginning you learned about the business of music because you could well we were forced yeah we were we were forced in the beginning I wish I could say we were geniuses and say we're gonna start our own company you know that's not what happened you know in the beginning we went to every single label and every single label shut the door on us the the genius thing that we did was we didn't give up we didn't say because these guys you know we use that what do they know approach you know we we didn't give up at that point I think that would you know I was the genius thing we did we start sounding our own CDs and we built their own buzz and then the record company came back to us so now we had a different negotiation you know it was in the same artists label relationship now we retain ownership in our own company and it was the best thing for us you know well one of the things you did fairly recently was about three years ago you were with a company you're a president of a company you saw firsthand what you thought was wrong with the music business you wanted out and you're willing to put money to get yourself out yeah didn't necessarily one out I wanted to work with them but I wanted like a fund in the center President to come yeah I was the president of Def Jam Records and I wanted to I wanted to fund to you know I wanted to work there...
because what I wanted to find sure he was they take all these artists almost like throwing him against the wall so you see which ones would stick you thought that was a huge waste of money yeah and the music business for a long time the hit record saw all your problems because there wasn't an internet and it wasn't as YouTube and it wasn't so many other factors it was just the music so that model still exists of you know just putting artists out and see what works you know and as the machine start moving faster a lot of things got lost in the process you know and iron and Latin artists artists development you know so it got to a point we were music business we were releasing hundreds hundreds and hundreds of albums every year and you know the percentages was like really low like 56 albums and four artists work you know something like that so I wanted to bring you know the entire culture into it I wanted to fund so I could do other things aside from signing on it's like you know you buy a television station or buy a club that you know we can develop these artists and or you know buy some headphones you know just all these different things I wanted to do and I don't think um at that time you know they could really get their mind around it it's not something they were willing to do and you know I just felt like I would be wasted so you know I started my own thing rock nation and you know that's what we do we pretty much we have everything from...
it's a publishing company you know we have writers you know it's a recording company we have it's a touring company it's would you have sleepless nights when you put what was it five million dollars to buy out the con your last contract for an album yeah it ended that my tough year very much so I even have a better story for you so my last year Def Jam you know when I proposed this and they didn't working us I went over to him with a group called Live Nation and made rock nation but that was me as a businessman as an artist I still had one album left with our Def Jam in Universal and I went to uh Doug Morris and la Reed who was the chairman of Def Jam at the time you know he did a great thing for me he allowed me to you know walk in and have the conversation with Doug and Doug you know we had a fantastic relationship so it was very cool but I I bought my last album back and people don't know about is the day I I flew in from Hawaii I was doing some recording and I had an iPod in my pocket and I was on a commercial flight coming from Hawaii to New York and I had on jogging pants and I'm my ipod with all the music that I recorded was missing if it's on the plane so so I had to walk into the office the next day and buy an album back that might leak the next day so every day I will wake up and I will check all the internet places and everywhere like for yeah for like three months I but I I you know at the end of the day was it was worth it you know...
just you know I was heading in a different direction and just that freedom and it turned out to be a great decision for me it's a great decision for the company they got some money and you know a great decision for me got a very successful album The Blueprint three and you know which had Empire State of Mind on it was sewed about you know four million singles itself and you know it which someday may become the anthem for New York yeah actually my first number-one record was off I mean as the solo artists tonight number ones is collaborate with collaborators but my first number-one across the board record came off that album so it was like really good time for me and I think and I believe in you know everything I'm lining up so I think it happened at that time for the right reason that leads to you mentioned things line up look we all know hard works essential disciplines essential staying powers essential but there's that element there that you can't quantify but you know it's they're warned you you you've had some fun with a lot of luck I mean I'm not just being born in the United States in 1930 the odds were like thirty to one against me I made know that I didn't have anything to do with picking United States as I emerged and having decent genes for certain things and in my own case I was sort of wired for capital allocation and being wired for capital allocation a couple of hundred years ago and Nebraska wouldn't emit a thing and and...
even now being born in various parts of the world that wouldn't have been much but here I was in this assumed to be very rich capitalistic system and and it just so happened that what I did paid off enormously in a market system like we have and I if I'd had a talent in some other area that was way less commercial I mean I would have I would have had a good time doing it but it wouldn't have paid off like this but of course Jay said it perfectly when he talked about he's in the recording for himself and the money comes afterwards I mean I I got to do what I love I mean and it doesn't get any luckier than that if you can spend your lifetime and I'm 80 now and doing things you love every single day I mean I would be doing what I did what I do now and I would have done it in the past if the payoff had been in seashells or shark's teeth or anything else it if you can go to work every morning I tap-dance to work you know and I come down and I every day is exciting so that is lucky I mean that didn't have to happen that way if I'd been born in 1930 if I'd been born a female if I'd been born black I would not have had the same opportunities that I had I mean I would it's just a chance I mean I my my parents love my sister's just as much as they love me my sisters are just a smarter smarter than I am in all of that but they didn't have the same expectations in the 30s for for a young smart girls they had for a young smart guy...
and so I I've had all kinds of like I had the luck of I got turned down by Harvard well getting turned on down by Harvard that I got to study under Ben Graham at Columbia which changed my life all kinds of things have worked out so I just hope I stay lucky lucky for 80 years you where you grew up you could have easily yeah discuss with your friends who did something and by golly they they were put away and didn't activity yeah I mean there are very few people that from my neighborhood you know in my environment that make it out I mean forget about being to be successful to make it out alive you know ought to be incarcerated you know for they have a great friend you know who just came home was one of the most beautiful people you ever meet you know he's you know he just came home from doing 13 years and we were we were together every single day you know it had it not been for music and um music taking me out you know at the right time you know my life could very easily have been his very easily we were together every single day mentioned a story about London you yeah so um they did you know into different things we were into a lot of Street things and you know just so happened I had a talent to make music and uh a guy by the name of jazz what started out with really early you know he got the opportunity he got to deal with EMI he had out but Sue needed to go to London to record his album and uh you know I went along with him and we wait for two months well then...
that two months there was a sting operation and he took you know my friend I'm talking about took him away for 13 years and the only reason I was in there because I was away you know doing this music stuff amazing business models we've touched on it that just because you've done something right before with a music business there customer doing things a certain way world changes they can adjust

Warren

what advice do you have you've seen it in the newspaper business you may know named Washington Post Buffalo News right legalize monopoly 30 IQ you could put them in those businesses and they succeed there it happened rashing it happens I mean Street railways were big hearing all the hundred years ago I the but I will say this about

investing

everything you do learn is cumulative I mean that doesn't mean that industry stay good forever or businesses stay good forever but but learning to think about business models what I learned at 20 is useful to me now what I learned to 25 is useful to me now and so it's not it's not so it's not a field that changes dramatically in terms of the underlying principles it's like physics I mean there's underlying principles now they're doing all kinds of things with physics I weren't doing 50 years ago but but if you know the if you got the principles if you know what makes a good business if you know what makes a good manager you know if you knows what they say a good product and you learn that in one...
business you can't there is some transference to other businesses if you go along and you learn what things you're not going to understand I mean knowing what to leave out is important there's no anger to focus on and I don't think I can win every game you know somebody said how do you beat Bobby Fisher you play many game except chess excellent I don't play bobby fischer's yes that's there's a lot of value there ordering that over time and and learning what you're good at and what you're not good at and J your business is like the newspaper business you've you yourself have said that record companies are an anachronistic that they lost it they lost it with Napster explain how they did it and what you learned from it and how you think and go forward and survive in an environment where it would have been true for decades is no longer true yeah I think that's that a big thing apart about a business is recognizing change you know you know that the variables are not the same you know there's a big thing called the internet so it changes the landscape of everything I think the consumption of music as is that all-time high but as we see that music business is down so something has to be done there you know it was a time in in music where a hit solved everything you just had a hit it didn't matter what what's going on you know get a hit and you know it solved everyone's problem or a lot of things you know that's...
that's that's no longer true not today and I think you know just having that mentality for so long I think it's the music business is still stuck in that place because I mean you know we haven't figured that it we haven't figured it out that Napster they made a huge mistake on Napster yeah well Napster came along and uh there was this file-sharing thing and um at the time we had we had the opportunity to embrace it and this way you can control it it was one place but when you stopped one map when you stopped Napster and we shut down Napster just the arrogance that we had it made a million Napster's now it's impossible to control you know just just that sort of thinking you know gee I I think a business won one of the biggest thing is to open yourself up for change you don't have to change who you are and how you operate but just you know you know if the landscape has changed and the way we do business has to change somewhat you have to change who we are we have to change the way we go about it because like I said the consumption of music is higher than ever well you've done it in your own music as you've gotten older you've brought audiences with you and others have not what are you doing in terms of the model that's been shattered in music you mentioned when you left the record label company you saw you how to do certain things how are you recreating a model but one we've taken our time with with you know artists and artist...
development the to it is just so many different parts of the business that we in you know for a long time music wasn't into touring you know now maybe they're making up these 360 I don't want this to be like a record company bashing English 360 model and it's like you don't that's not what you you know the record company does the record company is not in the touring business so why would an artist sign your rights to you and that's not what you do that's not your area expertise you know but where we you know we agree with the biggest concert promoter is so there's you know we're into publishing it's just so many different aspects of music we and when we're into more of it now and we're you know we're getting better at it you know just to open up different avenues you know make ourselves successful so touring clothing and also movies publishing you know just I don't want to be with them the tours you were wise enough or big enough for something where you don't mind sharing billing with Eminem or bono yeah it's fun for me for one and for two like we were saying in college you know one plus one is three for me you know I don't have that eat we are you know I have to be the only guy on the field of the only one that people look at you know I'm I'm cool with going out without what other artists I've been doing in my entire career you know before Eminem before bono he was you know our Kelly and all...
50 cent on you know DMX you know I've been doing in my entire career I just believe that you know the given people a better package you know that when they leave the concert all they want to come back again you know you can get them there the first time you know if what you're putting on is not incredible and impactful than how they why would they come back the second time you know I think that's a lot of you know a lot of people make that mistake you know when they're hot at the moment you know they just sell them you know they stay they date they sell off the name and sell off the moment yeah that does shiny things you fall in love with shiny things you sell off the moment and then when people come to the concert they don't have the experience well we're over delivering on the experience you know you're not only getting Eminem you're getting Eminem mjz you not only get bono you're getting bono and jay-z you can't help but leave that concert you know with it almost like a once-in-a-lifetime experience every single time that's what I'm trying to create Oh warrant you said you wouldn't want to compete against J what advice would you he's supa dupa joking what advice would you have man who's succeeded in a business where it's often short-lived being convulsed how do you would like to businesses where you say there's a moat where the competitors can't get you what advice would you give them Jake at building...
moats well he's building moats I mean all the time I mean obviously that's why succeeding even though he's moved beyond the age that you normally associate his field but so the best moats you can have is your own talent you know I mean it's they can't they can't take it away from you they inflation can't take it from you taxes can't take it from you so I when I talk to students I see these students and I tell them you know you're a million dollar asset I would pay you a hundred thousand dollars the MBAs for 10 percent of the earnings for the rest of your life so that makes you a million-dollar asset now if you can do something to increase that value 50 percent if you can learn to communicate better verbally or in written form and you become 50 percent more that's five hundred thousand dollars just by improving yourself I mean nobody can take that away from you and so I heard you everybody you know and then I talked to him in high school about this and and and and colleges just develop develop the habits you've got the brainpower you got the energy but develop the habits of success and then look around you with the people that you admire you know and list what makes you admire them compared to somebody else that looks equally strong or equally talented and those are those are things that you can do let me just write them down and and and you know people like people that are there they like them if they're humorous they're...
friendly if they're if they're they give credit to the other fellow I mean I and and they don't like them if they're stingy you know or they overstate know we're promised and all those sort of things well that's decision that's a decision you make so so I encourage everybody to build your own moat around yourself Jay you have any advice you want to give to

Warren

on building moats I get brilliant thinker this then gets to what is money for you greatly succeeded you haven't made the mistakes that others made to get a success and then you let destroy your discipline in terms of the only so many stakes we can eat our hamburgers or whatever the value-added we'll start with a

Warren

maybe you can start this part of the conversation the value-added you always had was you could employ capital multiply it which meant more businesses more people for pensions more hiring that was a great service I was doing a real public good yet a few years ago you decided you were gonna do something in addition to multiplying capital which meant opportunity and a higher standard of living what Steve if you go back really when I was in my 20s I mean I I it sounds obnoxious but I really did know I was going to become rich I mean it because it I just learned something that was gonna work and and my wife and I decided then I mean she was on represent on board my first wife and on this and we we were going to enjoy life we're gonna have everything to possibly use...
Ernie but incidentally I think a five-hour dinner in many cases is better than a dinner point yeah of course of living and standard over you're not necessarily the same but I thought I would compound money in a rate above that what well above average yeah and and we decided we'd live well we never denied ourselves anything in that independence so I could do what I wanted to do and and and then I felt one way or another we will go back to society now I thought my wife would outlive me she was a little younger and women live longer but man and she she loved the actual process of of seeing people with problems that money would help and I love I love the game I was in so I thought we wouldn't you know basically we'd pile it up and she would did the distribution of it and and she did a lot of it while she was alive but the big money was gonna be later on and then she died but while I was still alive and then I had to make a decision as to the best way to get this money spent in an intelligent way relatively promptly and I came up with the idea of splitting among five foundations the largest which of the Gates Foundation that was four years ago and I couldn't be more pleased with the decision I didn't didn't hide myself anything I mean I I eat everything I want I travel any place I've eaten I'd Society something that the capital if he'd keep employing it might have done more good well Berkshire still around I'm still running it charities...
but I'm making for a lot of other people right so I didn't have to give up anything I didn't even you know I didn't have to give up what I love doing every day I didn't have to give up any material thing in the world and and my three children are each involved with a Foundation which lets them put money behind their energies and no I think it it's really worked out wonderfully for me I mean it's a minute perfect solution and you know when my wife was pregnant I didn't think I was going to deliver her baby you know and and you know if I get a toothache or something I don't take out my own tooth I I turned it over I follow Adam Smith's advice you know I turn it over to a specialist and there's no reason to think that because I'm good at making money that I would be the best necessarily at distributing it I want certain goals in terms of how its distributed but I'm perfectly willing to turn it over to people we're gonna spend their lives specializing in that I want them to get it done promptly and I want it to be in sync with the kind of things I want to I want to support but I don't think I have to do it myself now in terms of that many times foundation gets set up and often in our direction there's thing called Parkinson's law that in an organization becomes self-centered in for itself and forgets its purpose that it was created for I see it all the time and you see it in business that's why they go broke...
often times but in foundations you see it so you made a provision that that was not going to happen with your funds and yeah they had to be those monies had to be employed what within ten years ten years after my stage completed yeah and then the money has to all be spent it can't go to institutions which in turn put it in their endowment or anything like that I I want people that I know and I I know her in sync with me and I know we'll be true to certain ideals I want them to dispense it because who the hell knows fifty years from now you know when the place becomes some large institution what will happen people will rationalize them that what's good for the institution is exactly what old

Warren

thought 40 years ago his deathbed so I've seen that happen too often and and now I foundations are not tested by a market system I mean if you've got a business idea and he's got music it's being tested by a market system whether people will make a decision with whether that next next album is good and they'll make a decision you know I'm whether coca-cola still keeps them happy and all that sort of thing a foundation has no market test so it's very easy if there's not a market test as people will find out and government never plays it's very easy to start rationalizing things that are a long way from what you originally people thought you're good setting out to do and you are in terms of you're just beginning looking at...
charities and you have a very unusual one scholarship fund Shawn Carter scholarship fund describe it and where do you think you see it going yeah for me yeah that the reason I focused on that because such a small thing changed my life writer a sixth grade teacher said you know what you're kind of smart and not and I and I believe they're said I'm smart right so she gave me that sort of opportunity she sparked the idea in my mind so that's why my first thing is uh the scholarship fund because there are ton of very intelligent kids that's coming out of these urban areas who who can make it all the way if given the opportunity and so the challenge that I gave to my mom and my mom is so involved with it like she she gets on the bus and she takes these kids to there to

interview

with colleges and you know now we're starting to see kids graduate from college and you know that sort of feeling you know when it's real you know I'm not just sitting home writing a check and you know for whatever reason make myself feel good or anything like this is something that I really to do and I'm really you know into and excited about so it's effective philanthropy in other words right I mean yeah I'm seeing the results I'm seeing you know we getting our first graduate summa sean.conner scholarship program which is like me the best thing ever and this seems like a contradiction when you think of Commerce it's meeting the needs and wants of others...
you provide the music people like it you do well they get the pleasure more on investment returns good companies and again philanthropy if you think about it it's almost the same opposite side of the same coin meeting the needs and wants of others a little different way of doing it but again as you say it's not just writing a check it's making sure it's actually delivering what it's supposed to deliver right it's tougher than business Tuesday because you're looking for easy things to do in business I mean you know you're looking you know people of like drinking coca-cola for a hundred years they'll probably like it for another hundred years it doesn't require any great great power to figure that kind of thing out but in philanthropy often you're tougher you're tackling the tougher problems of society or you're attacking the tackling things where people who applied money and intelligence before and haven't really solved the problem I mean education is a great example so you're really taking on things where you're not going to succeed every time and if you like succeeding every time it's you know you have to get it you have to adjust to that if you succeed a hundred percent the time at philanthropy the projects are too easy and you know you've got to look for four things that are important and where you may fail right now Gates is working on polio eradicating because they haven't gotten 99% of the way...
there but the last 1% is very tough and nobody knows for sure with it that will get done you know we did it with smallpox in the past than that so it it's a different mindset and and you don't get the same feedback you get in business either immediately that gets also do it universal things learning from mistakes one of the things you do in your annual report which has become a classic is you will discuss what went wrong like Dexter and what you how and what you learn from it during tough tough to do well it's it's very important recognizing this thing I mean if somebody goes around and says you know I never made a mistake I mean you quit listening to okay so facing up to it it's it's a little like in terms of discussing issues you should be able to discuss the other fellows position just as well as you can discuss your own so I mean that's part of thinking well and and certainly part of making good decisions in business is recognizing the poor decisions you've made and why they were poor and and and that doesn't mean you never do the same thing I mean it because sometimes it was a freaking situation but but I have made lots of mistakes I'm gonna make more mistakes but and I'm paper route struck out a lot of times I mean it's the name of the game that you do it you don't want to expect perfection in yourself you want to strive to do your best but but it's too demanding to expect perfection in yourself and it does some...
good to recognize them and that circle trying to go around kidding people about them getting the message out you've done a very high profile thing to get the message out on giving why and what do you think it's gonna lead and then I want to ask Jay very different audience how do you get the message out on the importance of philanthropy on helping people so they can have the opportunities you had absolutely well the way I got the message out was to get a copy of

Forbes

and look down that 400 list and start making phone calls thank you okay some of the did the same thing and and we we've only called 80 or so people so far and some of might know some of them I don't know and I mean we've gotten way better reception to some extent we hydrated the mind as I say in the mining business so we picked people in many cases but not all cases where we knew that they had pretty strong philanthropic interest but it was very low-key and we just asked them if they would sign a pledge not legal but moral that they would give away at least half of their net worth either during their lifetimes earth or death and and about half of the people that we call they may be slightly over half that said they'd be delighted and we've asked him to tell her own story and the stories are fascinating I mean how people got to that decision how they evolved how their family was involved in it how maybe personal experiences that shape that but it was really bad very encouraging I...
don't think you'd find that in any other society in the world other than the United States and we'll see how far it goes but if it will go further but even if it only went as far as it's gone it will have an impact so they think that even though even those who were giving are now in effect in their minds topping it I think certainly certainly in some cases I know that's the case and the very fact of getting involvement spending more time thinking about it talking with your family more about it I don't think it ever leads to reduce giving and I think sometimes it well I've seen examples of it here it's led the more the real interesting thing will be as if at least a smarter giving over time we hope to get this group together once a year and talk about again mistakes but do you see the same kind of entrepreneurship we see in commerce in philanthropy in there a handful of large organizations and except for Habitat for Humanity and a couple of others they've been around for decades yeah there's there's some it's harder to evaluate it's not a market system right you can't put out a P&L at the end of the year and you can't measure things you know I don't believe in measuring quarterly results in business but but the the timetable on many things is much longer in philanthropy so it's not as easy a game to me as business but it's an important game and then the fact that you can't do it perfectly does not...
mean that you should sit on the sidelines and it does not mean you can't learn from others I I will I've already learned something from the three or four dinners we've had and talking to people but the stories are interesting people do they do things that are amazingly affected they do things that where they bomb for one reason or another but we will have smarter philanthropy in this country ten and twenty years from now I think than we have now and I think in a small way this will contribute to it so keep publishing the list so I can milk it JJ will soon be on it but J yeah in terms of a philanthropy obviously you're very much focused on your business right now as

Warren

was on his for a long time but how do you get the message out to a different audience that it doesn't haven't even be dollars it's time and what your teacher did taking you and showing you another world or your mother getting you emotionally with your father in a way in which you could move forward in your life and improve your life yeah I think the first the first step for us because you know we as far as entertainers we like the first generation that really capitalize off our talent for many years you know artists who they were dying broke because the record company took advantage him in some way from shaping up right we this is like that really first generation I mean we're be fundamental mothers rock star to my final so the first thing for us for me I believe is to lead by...
example and show and show how these things have been affecting people's lives in a real way and and to tell that story of this is the neighborhood that made me and I know there's few future generation of stars in this neighborhood as well that we must help out as well you know if given opportunity you know someone what someone can be if given the opportunity so my first thing is to show by example and then i'ma slowly pull a guy like you know me and pop media I think we could have done more I think we put a visited and been there closer but we've made a huge pledge to you know Katrina together you know we you know we did that united front and we've made a donation together old hip-hop that sort of power how we can get together and do these sorts of things so again my first thing is to do it by example and show it how it works and show the example of you know how opportunities change people lives and you know we'll move forward from there and looking both forward and backwards when you think of certain people that pass like philanthropy Andhra Carnegie steel big steel man versus

billionaire

but great Public Works libraries 150 hundred years from now when people say

Warren

Buffett

what words and forwards have talked about we say Berkshire Hathaway yeah I hope is so around then doing very well so I'll come back and haunt him I know I well I bet has not been very complicated or I mean a followed somebody else's teachings and but what I really hope...
if he could pick one word it would be teacher I mean I and I got enormous about that min-jae's talk about his sixth grade teacher I think almost anyone that's been successful has had a teacher maybe not a formal teacher I mean it could you know it can be a parent obviously yeah but somebody's had a teacher that's affected them and and and if you couldn't pass that along I think that's better than money actually Jenny oh man because in some senses you're a pioneer yeah I think about it is I hope to inspire like I guess Obama took this thing already but you know just the hope of you know how far we can make it in the hope of you know if you really apply yourself and stay true to who you are you know how far you can come from where you come from you know because my sort of success I mean where I'm from it's like Jay is teaching all the time I mean I mean he's he's teaching a lot bigger class from the Nala rotation and it's a you know it's important I mean they're gonna learn from somebody you know a young person growing up and you know he's a guy to learn from so just the hope you know and I think that that's crucial especially as people begin to recognize yes you're fantastic artists but unlike artists of the past you also knew how to take control of your destiny by learning about business learning about distribution all the innards of production so that you weren't going to lose what you created Hey right...
well thank you thank you thank you