Google

Google (now Alphabet Inc.) is a primary case study in Berkshire’s Errors of Omission, famously missed by Buffett and Munger despite their admiration for its founders and corporate philosophy.

Origin of Relationship

While Berkshire never owned the stock, the relationship began in 2004 when Google co-founders Larry Page and Sergey Brin authored an Owner's Manual for their IPO inspired by Buffett's partner-centric communication style.

Major Milestones

• 2004: [IPO Philosophy] -> Buffett praised the Google S-1 filing: "I thought it was the most sensible thing one could put in an IPO document."
• 2004: [Missed Recognition] -> Buffett and Munger discussed the company as a "phenomenally good business" that was "ridiculously easy" to recognize in hindsight as having a massive Moat.
• 2004: [The "Smartest Young Men" Quote] -> Buffett noted that they were being out-advertised on GEICO search terms by the "smartest young men" who understood the economics of search better than his managers.

Strategic Importance

Google serves as the "anti-example" of Buffett’s Circle of Competence evolution. Initially dismissed as a complex tech company, it was later recognized as a "capital-light" royalty business on human information. The 2004 IPO manual solidified the Standard Selection of Shareholders as a modern governance value.

Primary Source Fidelity

"Google co-founders wrote an Owner’s Manual for the company... it identifies their prospective owners in a very straightforward manner. I like their prose. I think it’s exactly the kind of thing one person would say to another if you were setting up a partnership." — Warren Buffett, 2004 Meeting

"(On missing the business): We had a front row seat... and we were being out-advertised on GEICO search by people who were making a lot more money on it than we were." — Warren Buffett, 2004 Meeting

Connections

• Source: 2004 Meeting
• Concept: Errors of Omission, Owner's Manual, Moat