Elon Musk presents himself as the new Willy Wonka to respond ironically to the veteran tycoon, after an exchange of statements about the investment strategy.
Musk (CEO of Tesla and Space X) has announced his arrival in a new business, nothing less than sweets, after an exchange of statements with magnate Warren Buffet, CEO of Berkshire Hathaway.
Earlier this week, Musk criticized one of the principles that Buffet defends that must guide the decisions of investors: the ‘economic moat’ or competitive advantage; that is, that the company is able to find business niches in which it is not easy for the competition to enter. According to Musk, letting himself be guided by this principle is a ‘weak’ strategy, since he gives much greater relevance to factors such as the pace of innovation.
Days later, Buffett responded publicly joking during a meeting of shareholders of his company: “Elon can dare with something new in some areas. I do not think he wants to compete with us in [the business of] sweets “, in reference to one of the companies of his holding company, See’s Candies, a candy manufacturer specializing in chocolate.
Musk decided to accept the challenge immediately. First he posted on Twitter the comment of Buffet adding to it a link to the trailer of the animated movie “Trolls”, and then made an unexpected announcement: “I’m starting a candy company and it’s going to be amazing.” “I am super super serious,” he insisted immediately on the same social network.
I’m starting a candy company & it’s going to be amazing
— Elon Musk (@elonmusk) May 5, 2018
In short, an ingenious way (although no, it has not strained to say it seriously) to trick Buffet and his investment strategy: if the announcement of a new competitor in the field of sweets had been real, the ‘economic moat’ of See’s Candies would have been immediately depleted. “To say that he likes moats,” Musk later insisted in reference to Buffett, “is just a good way to admit that he likes oligopolies.”
It will be better for everyone that Musk does not disperse by playing Willy Wonka, and that he dedicates himself to electric cars and space trips. And take better care of your own investments: remember that Tesla is choked by the losses despite its record income.