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Warren Buffett on investing and character: interview summary

Warren Buffett, Terry Leadership Speaker Series

Terry College of Business at the University of Georgia · Apr 4, 2011 · about 77 min

Uploaded Apr 4, 2011 · 2.4M views (as of Oct 30, 2026)

Good value given

Know your circle of competence. He says the size of the circle matters less than knowing where its edge is.
He used to buy 'cigar butt' stocks, cheap companies with one puff left, and says that was a mistake at scale.
He now prefers wonderful businesses at fair prices.
When hiring, he looks for intelligence, initiative and integrity. Without integrity, the other two work against you.
He points out the Dow went sideways for long stretches of the last century even as the economy grew, so patience matters.

What does Warren Buffett look for in a business and in people?

In businesses, he wants something he can understand inside his circle of competence, with economics that will still be strong in 10 years, and he'd rather buy a wonderful business at a fair price than a fair business at a wonderful price. In people, he looks for intelligence, energy and integrity, and says without integrity the first two will hurt you.

Worth watching?Good value given. A long Q&A with students where Buffett explains how he picks businesses and people in plain language. It's older, but the ideas haven't aged at all.

ActionableLessons

Actionable

Write down which industries you truly understand and which you don't.
Before buying a stock, ask if you can picture what the business will look like in 10 years.
Add integrity as a must-have when you hire, and check references for it.
Pick admirable traits from people you respect and practice one of them this month.

Lessons

Staying inside what you know beats knowing a little about everything.
Quality businesses are easier to own for a long time than cheap, weak ones.
Character is a choice you can practice, like a habit.
Markets can go nowhere for years, so plan to hold for a long time.

Quick answer

Warren Buffett sat down with Terry College of Business at the University of Georgia for this interview, published Apr 4, 2011. Here's our summary in our own words: a verdict, the answer to the big question, 5 takeaways, Actionable and Lessons tabs, then the stories, frameworks and how to use them.

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Watch the interview

Watch on YouTube: Warren Buffett, Terry Leadership Speaker Series

Channel: Terry College of Business at the University of Georgia. Published Apr 4, 2011. About 77 minutes.

Who is Warren Buffett?

Warren Buffett has run Berkshire Hathaway since 1965 and is one of the best-known investors in history.

In this talk he answers questions from University of Georgia business students about investing, careers and character.

Key stories from the interview

He describes his early 'cigar butt' style of buying cheap, ugly stocks and why he moved on from it.
He explains that he carries a long list of companies he can't value, because he doesn't know who will win.
He walks through 100 years of the Dow, showing long flat periods between big bull markets.
A student asks how small businesses can compete, and he explains where small companies have an edge.

Frameworks and ideas

Circle of competence: know the edge of what you understand.
Wonderful business at a fair price.
Three hiring traits: intelligence, energy, integrity.
Character list: pick the qualities you admire in others and copy them.

In their words (paraphrased)

Knowing where the edge of your circle of competence is matters more than how big it is.
He would rather buy a wonderful business at a fair price than a fair business at a wonderful price.
If you hire someone without integrity, you'd rather they be lazy and dumb.

How to apply this

Make a short list of 5 companies you understand well and study only those.
Use the three traits as a checklist for your next hire or business partner.
When the market goes flat, look at the business results instead of the price.

Read the biography

Want the longer story? Read our The Snowball summary.

A note on this summary

This page reports what was said in the interview, in our own words. Lines under 'In their words' are paraphrased from the transcript, so check the video for exact wording.

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FAQ: questions people ask

What is Warren Buffett's circle of competence?

It's the set of businesses you truly understand. He says knowing where its edge is matters more than its size.

What three traits does Buffett look for in people?

Intelligence, initiative or energy, and integrity.

What is a cigar butt stock?

Buffett's name for a cheap, poor business with one 'puff' of value left. He says buying them was a mistake at scale.