This book is an inspirational autobiography of Guy Spier’s career and how he turned from an investment banker into a “value” investment professional managing his own fund, Aquamarine Capital. It is inspirational because Mr Spier not only describes his pursuit to become a true value investor, but also his quest to become the “best person that he can be”.

He starts his career in investment banking armed with an Oxford and Harvard education but is quickly disillusioned by the industry. During this time he comes across Benjamin Graham’s book, “The Intelligent Investor” and Roger Lowenstein’s book, “Buffett: the Making of an American Capitalist”. He becomes a disciple of Warren Buffett and he also becomes a friend of the value investor Mohnish Pabrai. Mr Pabrai, a hedge fund manager (Pabrai Investment Funds) and philanthropist (Dakshana Foundation), similarly has a very high regard for Mr Buffett.  This book is also interesting for its perspective on Mr Pabrai’s and his approach to life, especially in the chapter: “Doing Business the Buffett-Pabrai way”. In 2007 Mr Pabrai and Mr Spier together won an annual charity auction to have lunch with Mr Buffett.

Mr Spier was particularly fortunate because he comes from a wealthy family who provided him with seed capital to set up Aquamarine Capital.

Mr Spier describes his rule-based investment process in the chapter: Investing Tools. The eight rules he mentions all aim to avoid particular behavioural biases that cloud his decision making. He sees the purpose of these rules as “managing the non-rational part of my brain”. He also firmly believes that one’s environment and the people you communicate with should be selected so that you can become a better investor and person.

From the book it seems that Mr Spier might not have the natural personality of a “value” investor. However, he seeks to train himself to become a true value investor in his eyes. From that perspective his book is particularly useful. Are good investors born or can they be trained? A topic that will be covered in future blogs.

Mr Spier is a believer in checklists. He and Mr Pabrai interacted with Atul Gawande. They are mentioned in Mr Gawande’s book, “The Checklist Manifesto”. Four case studies that lead to items in his investment checklist are mentioned in the chapter: “An Investor’s Checklist”.

Case Study 1: EVCI Career Holdings Company. From this experience he adds checklist items on a company management’s current personal circumstances as well as career history.

Case Study 2: Tupperware Plastics Company. Given Mr Spier’s experience here, he now aims to invest in companies that add value to its customers as well shareholders and “do not make society worse”.

Case Study 3: Carmax.  Access to credit markets caused this company’s downfall.  In the light of this Mr Spier now only invests in companies that “control their own destiny” and are not controlled by outside forces.

Case Study 4: Boulder Brands. Based on his investment experience with this company he adds a checklist question: Do you buy the stock because you believe you are smarter than other investors or because it makes you feel smart?

The final part of the book deals with Mr Spier’s life philosophy and his strategy to become the best person he can be. During their charity lunch Mr Buffett told Mr Spier and Mr Pabrai to “hang out with people better than you and you cannot help but improve”. Mr Spier states that the most important point in his book is that “nothing matters as much as bringing the right people into your life” and, secondly, “to try and do something for these people without expecting anything in return”.