Moats And Machines: A financial view from the top

How Warren Buffett Analyzes a Business

The one asset that our community lacks “business ownership” . At a minimum our community should own at least one business, and I’m not talking about a tavern or barber/beauty shop. A business that employs members of the community that pays a living wage and is sustainable. Without those businesses we will languish in perpetitude waiting on another ethnic culture to provide our families with employment. The real importance to ownership is control and long term sustainability for continued growth in a positive economic environment. The money connections goal has been always not to complain but have solutions for our readers. Real solutions that improves our community and brings positive results.

Moats and Machines – Your machine is building a business that operates in a repeatable and predictable way. A great business, for example, might know that if it gets 500 appointments, it can predict with great reliability that it will eventually land 300 customers. A good example is building apartments for your citizens, you have 15 apartments available but at anytime you have 80% capacity, so you base your projected revenue on rental of 12 apartments not 15. Any revenue above 12 goes into possible financing another apartment complex or increasing health coverage for your employees. Your moat is your business model is the best and you continually make your apartments the best value around. Ie free internet, clean laundry facility with reasonable cost. Providing your tenants with value that others don’t offer.

E. Bishop III, The Money Connection

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