Warren Buffett's Ruthless 5-Minute People Filter For Efficient Networking

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Warren Buffett's Ruthless 5-Minute People Filter For Efficient Networking

Warren Buffett shared a surprising insight about his approach to judging character in a conversation with investor Mohnish Pabrai. Contrary to popular belief, Buffett doesn't claim to have exceptional people-reading skills.

According to Mohnish Pabrai, Buffett stated that he doesn't believe he has a good people radar, but rather what he possesses is a very tight filter.

Buffett explained that at a cocktail party with 100 people, speaking with each for just 5 minutes, he could identify the best and worst 5-7 individuals.

For the remaining 85-90 people? If he's uncertain about them, they all go into the rejection pile.

The Asymmetric Risk Philosophy

Buffett's seemingly harsh approach stems from a calculated risk assessment.

He told Pabrai that the cost of bringing a not-great person into his circle of life is extremely high, while the cost of discarding somebody who might be great is very low comparatively.

This binary system eliminates uncertainty: people are either obviously exceptional, or they're grouped with the "no" pile.

By maintaining such high standards, Buffett protects his time and surrounds himself only with individuals who clearly demonstrate excellence from the start.

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