@FoundersPodcast: Charlie Munger said "Henry Singleton's financial returns were a mile higher than anyone else's, they were utterly ridic…

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Summary

This podcast episode examines Henry Singleton's exceptional business practices and financial strategies, featuring insights from Charlie Munger and Warren Buffett on his capital allocation and management style.

Charlie Munger said "Henry Singleton's financial returns were a mile higher than anyone else's, they were utterly ridiculous." NEW episode: "HOW HENRY SINGLETON WORKED" based on the hard-to-find book Distant Force: A Memoir of the Teledyne Corporation and The Man Who Created It 0:00 — "He aggressively repurchased his stock, eventually buying over ninety percent of Teledyne's shares." 0:45 — "He was known as The Sphinx for his reluctance to speak with either analysts or journalists." 1:25 — Charlie Munger: "Singleton's financial returns were a mile higher than anyone else's, they were utterly ridiculous." 2:00 — Buffett: "The heads of many companies are not skilled in capital allocation. Their inadequacy is not surprising. Most bosses rise to the top because they've excelled in an area such as marketing, production, engineering, administration, or sometimes institutional politics." 4:10 — Singleton: "Our conclusion was that the key was cash flow. Our attitude towards cash generation and asset management came out of our own thinking. It is not copied." 4:30 — Buffett: "Henry Singleton has the best operating and capital deployment record in American business. If one took the hundred top business school graduates and made a composite of their triumphs, their record would not be as good as Singleton's." 9:40 — Singleton: "If anyone wants to follow Teledyne, they should get used to the fact that our quarterly earnings will jiggle. Our accounting is set to maximize cash flow, not reported earnings." 10:50 — Singleton believed buying stock at attractive prices was self-catalyzing, analogous to coiling a spring that at some future point would surge forward to realize full value." 11:50 — Singleton: "I don't reserve any day-to-day responsibilities for myself, so I don't get into any particular rut. I do not define my job in any rigid terms, but in terms of having the freedom to do whatever seems to be in the best interest of the company at any time." 14:35 — Singleton: "If everyone's doing them, there must be something wrong with them." (on share repurchases by Fortune 500 companies) 26:30 — Singleton: "Teledyne is like a living plant, with our companies as the different branches and each putting out new branches and growing so that no one business is too significant." 28:35 — Singleton: "We work our heads off to increase our own capability at collecting and promoting the right people. To the extent that we succeed, the whole company will succeed." 32:30 — "What's unique about him is that I'll ask him a question about one of these companies that I've asked him to supervise, and he always knows the exact numerical answer. That's the kind of fellow that you pick who runs a company and does it well." 35:00 — Singleton: "There are tremendous values in the stock market, but in buying stocks, not entire companies. Buying companies tends to raise the purchase price too high." 41:35 — Claude Shannon on Singleton: "He always tries to work out the best moves, and maybe he doesn't like to talk too much because when you're playing a game, you don't tell anyone else what your strategy is." 42:00 — Singleton: "We are not particularly persuaded by quick, temporary gains. We'd rather get something permanent, and that takes time." 44:40 — Munger: "Henry Singleton was the smartest single human being I've ever known in my entire life." 45:00 — Munger: "Henry was a lot smarter, but Warren had thought about investments a lot longer." (distinguishing raw intelligence from accumulated experience)
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Charlie Munger said “Henry Singleton’s financial returns were a mile higher than anyone else’s, they were utterly ridiculous.”

NEW episode: “HOW HENRY SINGLETON WORKED” based on the hard-to-find book Distant Force: A Memoir of the Teledyne Corporation and The Man Who Created It

0:00 — “He aggressively repurchased his stock, eventually buying over ninety percent of Teledyne’s shares.”

0:45 — “He was known as The Sphinx for his reluctance to speak with either analysts or journalists.”

1:25 — Charlie Munger: “Singleton’s financial returns were a mile higher than anyone else’s, they were utterly ridiculous.”

2:00 — Buffett: “The heads of many companies are not skilled in capital allocation. Their inadequacy is not surprising. Most bosses rise to the top because they’ve excelled in an area such as marketing, production, engineering, administration, or sometimes institutional politics.”

4:10 — Singleton: “Our conclusion was that the key was cash flow. Our attitude towards cash generation and asset management came out of our own thinking. It is not copied.”

4:30 — Buffett: “Henry Singleton has the best operating and capital deployment record in American business. If one took the hundred top business school graduates and made a composite of their triumphs, their record would not be as good as Singleton’s.”

9:40 — Singleton: “If anyone wants to follow Teledyne, they should get used to the fact that our quarterly earnings will jiggle. Our accounting is set to maximize cash flow, not reported earnings.”

10:50 — Singleton believed buying stock at attractive prices was self-catalyzing, analogous to coiling a spring that at some future point would surge forward to realize full value.“

11:50 — Singleton: “I don’t reserve any day-to-day responsibilities for myself, so I don’t get into any particular rut. I do not define my job in any rigid terms, but in terms of having the freedom to do whatever seems to be in the best interest of the company at any time.”

14:35 — Singleton: “If everyone’s doing them, there must be something wrong with them.” (on share repurchases by Fortune 500 companies)

26:30 — Singleton: “Teledyne is like a living plant, with our companies as the different branches and each putting out new branches and growing so that no one business is too significant.”

28:35 — Singleton: “We work our heads off to increase our own capability at collecting and promoting the right people. To the extent that we succeed, the whole company will succeed.”

32:30 — “What’s unique about him is that I’ll ask him a question about one of these companies that I’ve asked him to supervise, and he always knows the exact numerical answer. That’s the kind of fellow that you pick who runs a company and does it well.”

35:00 — Singleton: “There are tremendous values in the stock market, but in buying stocks, not entire companies. Buying companies tends to raise the purchase price too high.”

41:35 — Claude Shannon on Singleton: “He always tries to work out the best moves, and maybe he doesn’t like to talk too much because when you’re playing a game, you don’t tell anyone else what your strategy is.”

42:00 — Singleton: “We are not particularly persuaded by quick, temporary gains. We’d rather get something permanent, and that takes time.”

44:40 — Munger: “Henry Singleton was the smartest single human being I’ve ever known in my entire life.”

45:00 — Munger: “Henry was a lot smarter, but Warren had thought about investments a lot longer.” (distinguishing raw intelligence from accumulated experience)

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@rabois: Excellent interview.

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