2004: What does Buffett think of Google's "owners manual"?

AUDIENCE MEMBER: Good afternoon. My name is Matt Lynch, and I’m from Palo Alto, California.

Mr. Buffett, a couple of times today you alluded to Google and its co-founders.

I was hoping you could share with us your thoughts and reactions to the owner’s manual the co-founders included in Google’s S-1 filed last week, especially in light of the similarities and differences between it and that of Berkshire Hathaway?

WARREN BUFFETT: Well, that’s a real softball for me. The obviously —

AUDIENCE MEMBER: You’re welcome.

WARREN BUFFETT: I’m very pleased that the Google — the fellows at Google decided — and they say they, it was, I think they used the word “inspired” by the Berkshire Owner’s Manual.

And, you know, it obviously pleases us enormously that other people think that it’s a good idea to talk to their owners — or in their case, their prospective owners — in a very straight-forward manner.

If you buy into Google, having read their owner’s manual, you know, you will — I think you’ll know the kind of people you’re associating with. You’ll know what they will do and won’t do.

It’s the kind of thing that one person would say to another if you were setting up a partnership. And were — you said, you know, “I’d like you to join me in a partnership. I need your money. And here’s the way we’re going to do business.”

And I think more companies — obviously, I think more companies ought to do it.

It’s been simple for us at Berkshire. We’ve had these principles in mind for a long time. And we really want people to understand those principles before they join with us.

And the Google fellows, in a very straightforward manner, you know, I liked their prose. You know, it doesn’t mean I agree with every idea they have, but, you know, I do know what ideas they do have. And I hope more companies sign on for that sort of thing.

Charlie?

CHARLIE MUNGER: Well, you know, most of the world does not, in any way, imitate Berkshire Hathaway. This is a quirky few. It may look — there may be 19,500 of you that came — but it’s still a quirky few by the standards of the country.

And what’s interesting about Google is those two guys who created that are two of the smartest young men in the whole country. And it’s much more fun to be copied by people that smart, than — (Laughter)

WARREN BUFFETT: Hey, we even think they are smarter than we thought they were last week. (Laughter)

CHARLIE MUNGER: And we now think they’re a lot smarter, yeah. (Laughter)

WARREN BUFFETT: It’s going to be a lot of fun to watch that. I — and my guess is that their annual reports are going to make very good reading. They’re actually going to alternate the two of them in writing the reports. And I think you’ll know a lot about them, and a lot about their business if you read it.

Although they had an interesting — as I remember, they had an interesting sentence of two in there, which I admired also, where they said that, you know, certain of the things that might affect their business prospects really would be better left unsaid, in terms of competition, and so on. And if so, they weren’t going to tell you. (Laughter)

CHARLIE MUNGER: Yeah.

WARREN BUFFETT: I kind of enjoyed that.