Video Link: https://youtu.be/TseEo3Rqcl8
In this episode, Charlie Munger talks about his first investment [William Miller Instruments] which almost lost all his money.
In this episode, you’ll learn:
Charlie Munger's first investment.
The cause that keep Charlie Munger out of venture capital on the edge of technology.
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At some level, once you make an investment, you’re putting your money into the hands of an entrepreneur who is going to actually produce something.
CHARLIE MUNGER 00:10
Seems that the value investment that you practice has that characteristic relative to a pure arbitrage approach to trying to make money in finance.
CHARLIE MUNGER 00:24
Well, I did not make my fortune by and large on the cutting edge of technology. My first investment with my pitiful savings of [inaudible]. I invested in a company right in Pasadena, and it was called William Miller Instruments. And I damn near lost all my money. It was hell on Earth. We just barely squeaked out with a substantial outcome.
What did us in is that the oscillograph that we’d invented and we were so proud of, and we thought it was going to knock the world flat. Somebody invented magnetic tape without telling me, and by the time we got that oscillograph ready to go to market, we sold three. Three total in the whole world country. This technology is a killer as well as an opportunity. And my first experience had damn near killed me.
That’s sort of the other part, right? Over the 75 years that you’ve been involved in investing.
CHARLIE MUNGER 01:42
Well, what that did for a long time was keep me out of venture capital on the edge of technology.
But even so-
CHARLIE MUNGER 01:49
I tried to avoid it.