How To Determine Your Best Business Idea

When Warren Buffett spoke to MBA students at the University of Florida in the early 1990s, he gave some of the greatest advice that budding entrepreneurs could ever hope to receive. He said that his investment strategy advantage is that he stuck close to his best ideas and wouldn’t feel the need to further diversify merely for the sake of diversification. If you have investments in twenty different stocks, and you have some cash available for an additional purchase, the highest compounding rate is likely to come from enlarging the position in one of those twenty stocks that you already own rather than purchasing a 21st stock. In my own files, I call this strategy/mental model “Fidelity to Your Best Idea”.

People often ask variations of the question “How do I start a business?” or “What would be the best business to start?” That question is near impossible to … Read the rest of this article!