I’m rereading The Warren Buffett Way by Robert Hagstrom. I enjoyed this book last year, and I decided to read it again after reading Hagstrom’s book Warren Buffett: Inside the Ultimate Money Mind.

The book contains lots of insightful information about Buffett’s investing approach and how he thinks about capital allocations as the CEO of Berkshire Hathaway. One part of the book I found invaluable was the chapter called “Common Stock Purchases.” In this chapter, Hagstrom walks through Buffett’s process to analyze and value nine of his biggest investments: GEICO, Capital Cities/ABC, Coca-Cola, and others.

Many people are familiar with Buffett’s investing strategy, but how he applied it when making investment decisions isn’t always clear. Hagstrom explains how Buffett valued each company and compares his valuations to the prices he paid. He walks through the math and shows how Buffett’s investments were made for prices below the intrinsic values that Buffett calculated. Buying for less than intrinsic value is core to his strategy of investing only when there’s a margin of safety.

I noticed that Buffett sometimes broke his own rules, such as when he invested in GEICO. Buffett usually invests only in companies with a consistent operating history that are generating increased free cash flow. However, when he invested significantly in GEICO in 1976, the company was on the verge of bankruptcy, had zero earnings, and needed a turnaround. Over several years, Buffett bought roughly 33% of the company. Hagstrom does a great job of detailing why he made this seemingly risky investment. Needless to say, Buffett was right, as GEICO is now a household name. This example reinforces that rules sometimes need to be broken when great investing opportunities present themselves. It also shows how Buffett spent decades preparing for this investment by reading and learning about insurance, and how that preparation positioned him to act swiftly when he needed to.

Last week, I shared that I want to learn more about psychology to improve my decision-making and because it seems like a fun topic. Charlie Munger famously studied the failures of others to understand thinking errors. That approach resonates with me, and I decided it’s best to start by regularly analyzing my own failures. I wasn’t sure how, though, so I started looking for ways others have done this.

I started rereading The Warren Buffett Way by Robert Hagstrom and found a great idea. Hagstrom says that Buffett included in his Berkshire Hathaway annual shareholder letter a section called Mistake Du Jour. In it, he “confessed not only mistakes made but opportunities lost because he failed to act appropriately.” He was transparent about his mistakes and shared them broadly.

I’m a huge fan of update emails (see here, here, and here). But I can’t recall ever seeing an update email with a section dedicated to the founder's mistakes. The more I thought about it, the more I thought it’s brilliant. It’s a great way to make a habit of analyzing your own mistakes—and also to build trust with others and maybe even get unexpected advice based on how other people navigated similar mistakes.

My weekly update blog posts are inspired by update emails. Including a mistake du jour–type section in them would be cool. It would check the box regarding forming a habit to analyze my mistakes and force me to crystallize and communicate them concisely. If I also force myself to include the lesson learned, this could be even better. I’m not sure about some things and need to think about them (e.g., will I have enough to do this weekly, or should I do it monthly?). But I like this idea and want to add my mistakes to my 2025 weekly updates.

I finished reading Newspaperman: S.I. Newhouse and the Business of News by Richard H. Meeker. The biography is about Samuel Irving Newhouse Sr., who founded Advance Publications. At Sr.’s death, Advance Publications owned multiple newspapers and Condé Nast, which publishes famous magazines such as Vogue, Vanity Fair, GQ, and The New Yorker. Since then the company has grown rapidly, and it owned 26.5% of Reddit when Reddit began trading on the public stock market this year (see here, page 194). Reddit’s market capitalization (i.e., valuation) is just under $12 billion as of this writing.

This book and Newhouse: All the Glitter, Power, & Glory of America's Richest Media Empire & the Secretive Man Behind It by Thomas Maier detail one key strategy the Newhouse family used to grow their wealth: they optimized their tax liability and maximized the compounding of their wealth. The family studied the tax laws and implemented strategies that reduced their tax liability. This gave them more capital to reinvest in growing their companies or acquiring new companies.

Both books contain numerous examples. Their estate tax strategy especially caught my attention. When someone dies, their estate is transferred to heirs and a tax is due on the value of the estate being transferred if it exceeds that year’s federal threshold. When Sr. died in 1979, his sons filed a return valuing his ownership in Advance Publications at roughly $182 million and showing an estate tax due of roughly $49 million. The IRS said his estate was worth somewhere between $1 billion and $2 billion and that the estate tax due was, at a minimum, $600 million, and as high as $1.2 billion. At the time, Advance Publication owned thirty newspapers and various magazines. Its two most prosperous newspaper properties alone were worth more than $182 million.

Sr. had studied other publishing families to understand how death and estate taxes negatively impacted their family empires. Families often had to sell all or some of the company’s assets to pay the estate tax upon the founder’s death. Sr. developed a dual-share-class strategy to avoid that outcome. Sr. owned common shares in Advance Publications but issued preferred shares to his siblings, wife, and sons. His common shares carried voting rights and, essentially, control of company decision-making, but the preferred shares gave holders the right to vote on a company liquidation or sale. Said differently, if a buyer wanted control of the company, the buyer had to get the approval of the preferred shareholders first. The result was a gray area in the tax law. It could be argued that the fair market value of the company—the price a willing buyer and seller would transact at—was significantly lower than the IRS’s figure because there would be fewer buyers willing to buy a minority stake in a family-owned company that had such a bizarre ownership structure. Most buyers spending that kind of money would want majority ownership so they could have control. To gain control, they’d have to convince multiple family members to sell, a prospect many buyers would rather avoid. There’s more to this, but that’s the gist of it.

The IRS took the family to court, and the family prevailed. The result was that the family paid an estate tax bill that was a fraction of what it would have been if Sr. hadn’t planned so carefully. It wasn’t a material amount for the company, so it didn’t have to sell any assets to pay the tax. The Newhouse family’s empire could continue compounding for another generation and grow exponentially under Samuel “Si” Newhouse Jr.’s leadership for the next forty years.

I haven’t been a fan of books that tell the history of a company or a group of people (i.e., a family). These books introduce numerous people but don’t go very deep into any of their journeys. I enjoy biographies more because the in-depth coverage of a single person’s journey usually includes challenges encountered, lessons learned overcoming adversity, and details about how they applied lessons learned to achieve their goals. Biographies get me thinking and often lead to new ideas and insights, which excites me.

Though books about the history of a company or group of people aren’t my favorite, I now recognize they’re useful for something: links to other people or companies in an industry or time period.

I’m currently reading Newhouse: All the Glitter, Power, & Glory of America’s Richest Media Empire & the Secretive Man Behind It by Thomas Maier. It’s about the Newhouse family and their media empire. But because it covers so many decades and so many people, it’s introduced me to other companies and founders I wasn’t aware of. I’ve ordered biographies about several people mentioned in this book.

My thinking on the value of reading this type of book has changed. While I’m not learning as much about an individual as I’d like, I’m being introduced to more people in the publishing industry and can read about each person’s journey. These books are good discovery mechanisms and help me understand industry periods. I don’t want these to be the majority of my reading, but they’re a helpful supplement to biographies.

I had a conversation with an entrepreneur who’s an avid reader and history buff. He pointed out something that stuck with me: biographies and autobiographies about business founders are the most challenging historical books to write. He based that on a few insights:

• Authors who write about entrepreneurs aren’t entrepreneurs and don’t usually understand business. They focus on telling a compelling story and don’t deep dive into an entrepreneur’s actions or why they took them. This leaves entrepreneurs who read their book craving more details about some parts of the journey.
• Entrepreneurs who write autobiographies usually aren’t gifted writers. They know all the details about their journey, but putting it down on paper is challenging for many of them, and they need help. If they move forward with the book, many will get a coauthor to fill the gap.
• The more time that passes, the harder it is to piece together exactly what an entrepreneur did and why they did it. This isn’t as true of other historical events, such as wars.

The details of what an entrepreneur did and why they did it are what make a journey resonate with me and help me figure out how to apply it to my situation. When that’s missing from a biography, I tend not to enjoy it as much. My favorite books are autobiographies. Reading them is the closest you can come to getting inside an entrepreneur’s mind without talking to them. They usually include the nitty-gritty, reasoning, and emotions.

This entrepreneur made a great point today. I’m going to think about this more.

Last week, I finished reading Roy Thomson’s autobiography, the second book I’ve read about him in the last month. I found another biography about him, and I’m considering reading that, too. Last month, I read a biography about Felix Dennis, the second book I’d read about him.

I initially resisted reading more than one book about an entrepreneur, but I don’t feel that way anymore. Some material may be repetitive, but subsequent books usually contain new information too. Multiple books provide multiple perspectives on an entrepreneur’s life and get closer to a 360-degree view of that person’s journey. Reading too many books about a person would yield diminishing returns, but right now, my gut tells me that two or three books about a person is likely a good number.

I’ve also changed my thinking about how I record information about entrepreneurs I’m studying. Before, I thought in terms of books. Each book was an individual record, and I created a digest for each book. This meant I could have multiple digests about a single person. But now I’m thinking in terms of people. I need to consider how I want to capture the information. Ultimately, I want to do more than create blog posts and podcasts with these digests. Do I create one digest per person and add information from multiple books? Do I keep creating one digest per book? Or do I do something completely different?

I’ll be thinking about this question more and getting perspectives from people with relevant data management experience. In the meantime, I might experiment with my digest and blog post formats a bit.

I finished reading the biography about Jack Kent Cooke. The book detailed Jack’s journey from high school dropout to billionaire entrepreneur and sports mogul.

How Did Jack’s Early Years Affect His Trajectory?

Jack bet on himself early in life. He dropped out of high school and turned down a college scholarship to play hockey. Instead of pursuing education, he tried many things—and failed at most of them. He ended up going broke, and he and his wife had to move in with his parents. He didn’t give up, though. He picked himself up and kept trying. Experiencing failure and hitting rock bottom at a young age transformed Jack. From that point forward, he was no longer afraid of failure. And he realized he could outwork everyone else to increase his chances of success. With a fearless mindset and a dogged work ethic, Jack positioned himself to conquer almost any challenge.

What Strategy Did Jack Employ to Achieve Success?

Jack was a content master. He had a superior understanding of how people wanted to be entertained in their leisure time and knew how to create or acquire content that captured people’s attention. He started by creating programming for radio stations but eventually moved into magazines, newspapers, and professional sports. The type of content Jack focused on shifted, but the goal was always the same: provide people with something that captured their attention. Once Jack had captured an audience’s attention, advertisers paid him handsomely to make his audience aware of what they were selling.

Jack also understood the importance of distribution. He didn’t just want to create or buy content; he also owned content distribution mechanisms. He started with radio stations but eventually made a fortune in cable systems. The genius in Jack’s distribution strategy was that he preferred to own distribution mechanisms in areas where he could have a monopoly or where the barrier to entry was extremely high. This limited his competition and kept his margins high.

This isn’t unique to Jack, but he used leverage strategically throughout his career to acquire assets and build his empire. He also got extremely lucky when the S&L crisis allowed him to buy back, from the government agency that took over the S&Ls, hundreds of millions in bond debt issued a few years earlier for pennies on the dollar.

Jack achieved outsize success despite humble beginnings. But his health and relationships suffered because of how he went about achieving success. Anyone interested in publishing, broadcasting, professional sports teams, or the early days of cable could benefit from reading this book about Jack’s life.

According to the biography about Jack Kent Cooke, while he was still recovering from his heart attack in October 1973, Jack flew to New York to install himself as CEO of TelePrompTer Corporation to save the company. The stock price suffered after the CEO, Irving Berlin Kahn, was convicted of bribery. Jack’s stock in the company fell in value from roughly $50 million to less than $2 million, stirring Jack to action. Jack split his time between running his sports empire in Los Angeles and TelePrompTer in New York City. He cut 25% of the cable operator’s staff and stopped expanding into new areas. Over time, he was able to get the company back on solid footing.

At the same time, Jack was making winning championships a priority. In 1968, he signed superstar Wilt Chamberlain to the biggest NBA contract ever: $250,000 a year for four years. The Lakers won a championship in 1972. In 1975, he acquired superstar Kareem Abdul Jabbar in a trade. Jack ultimately drafted Earvin “Magic” Johnson in the 1979 draft and set the Lakers up for a decade of dominance.

His sports teams were doing well, but his marriage to Jean was falling apart, and in 1976, she tried to commit suicide again and left him. A contentious divorce and asset-separation process ensued. The divorce was finalized in 1977, but the division of assets wasn’t finalized until March 1979 after Jack’s underhanded tactics to hide information from Jean came to light. After over forty years of marriage, their assets were spilt as follows:

• Jean received their $1 million Bel-Air home, $24 million in TelePrompTer shares, and 28% ownership in Raljon Corporation, an entity that owned the Los Angeles Kings NHL team, the Los Angeles Lakers team, the Forum arena, the 13,000-acre Raljon ranch, and a videotape enterprise.
• Jack received a home in Las Vegas, all of his ownership in the Washington Redskins, and 72% ownership in Raljon Corporation.

Each of them received roughly $42 million in assets. It was the largest divorce settlement up to that point and was included in the Guinness Book of World Records. Three months later, in June 1979, Jack sold the Forum, the Kings, the Lakers, and Raljon Ranch to Jerry Buss for $67 million. The Buss family still owns the Lakers. Looking for a fresh start, Jack promptly moved to Washington, D.C., that summer to be closer to the NFL team of which he was the majority owner.

Jack owned 82% of the football team, and he put his stamp on the team. On the basis of his experience, the team leaned on ads and sponsorships to generate additional revenue. During his tenure as owner, he hired legendary coach Joe Gibbs, and the team appeared in three Super Bowls, winning two titles. The other owner of the team, until Jack bought him out in a contentious battle, was Edward Bennett Williams, an attorney and eventual owner of MLB’s Baltimore Orioles.

Jack also got into commercial real estate when the New York City market struggled. He bought the iconic Chrysler Building there for roughly $87 million in August 1979 from an insurance company that had foreclosed on the property. Jack finished their $58 million renovation project and added another $30 million to the budget. He refinanced his purchase in 1982 with an interest-only loan, paying $553,000 monthly at 10.5% interest on a $60.5 million loan. He refinanced again in 1987 for $250 million. The building was worth an estimated $550 million a decade after his purchase.

The 1980s were a busy time for Jack. He moved forward in his personal life and, in 1980, married Jean Maxwell Williams Wilson, but they divorced ten months later in 1981. In 1981 Jack sold TelePrompTer to Westinghouse for $650 million, netting himself over $70 million and a $4.65 million consulting contract. He won the bid to purchase Elmendorf Farm in Kentucky in 1984 for $43 million, using a controversial add-on bid. And in late 1985, he acquired the Los Angeles Daily News, paying the Chicago-based Tribune Company a whopping $176 million, or roughly twice what other bidders had offered for a paper generating $100 million in annual revenue and $12.5 million in annual profit. His biggest purchase was McCaw Communications, the twentieth-largest cable system with over 464,000 subscribers in forty-two communities. Jack paid roughly $1,800 per subscriber, or $755 million, for the company.

To finance all these deals, he used leverage. He did what everyone else was doing at that time: he used junk bonds to raise capital. In April 1987, he hired Michael Milken of Drexel Burnham, and a $951 million bond offering was completed. Jack used most of the proceeds to pay for the McCaw purchase and to refinance debt on and enhance operations at the Los Angeles Daily News. Jack wasn’t done. In 1987, he bought First Carolina Communications, a cable system with 156,000 subscribers. Jack paid $1,900 per subscriber, or $300 million.

In 1989, Jack decided to cash in. He exited the cable business for good in grandiose fashion. He sold all his cable holdings for a staggering $1.6 billion, or $2,300 per subscriber, likely making himself a roughly $400 million profit. With this deal complete, Jack liked to remind people that he’d become a billionaire. This was a rare accomplishment in the 1980s and early 1990s, even among the fraternity of NFL owners that Jack was part of.

Between 1987 and 1990, Jack married two more women and had a daughter by one of them. Both marriages were messy, making the pages of Washington, D.C., newspapers, and are detailed in the biography. At the time the book was published in 1992, Jack was still alive and running his sprawling empire. He passed away in 1997 at the age of 84.

Jack was a wildly successful entrepreneur whose gift of deeply understanding how people wanted to spend their leisure time allowed him to build sports, cable, and publishing empires.

In 1959, before becoming a U.S. citizen, Jack Kent Cooke purchased an AM radio station in Pasadena, California, for $900,000 in his brother’s name.  In 1960, a contest the station ran caused an FCC investigation that uncovered Jack’s majority ownership. In 1962, the FCC ordered the station shut down, and Jack lost the license. It was a major financial blow. While he was licking his wounds, Jack stayed in a remote California hotel. He was surprised to get clear television reception. He learned the hotel was wired for CATV—cable TV—and that people were paying $5 a month for the service. Jack immediately recognized the potential of cable TV and jumped into action.

Cable was simple then, just a way to bring six or so channels to a community from broadcast networks that didn’t have strong enough signals. In the fall of 1964, Jack made his first cable TV antenna system investment for $4.6 million. The profit potential of a protected cable franchise was obvious and reminded him of the early days in northern Ontario when Roy Thomson had a license to print money in broadcast radio. The formula was simple to Jack. Current customers plus projected growth of a cable system’s coverage combined with current and future subscriber rates told you how much each system could generate in revenue. Having calculated these figures, Jack paid $300 per cable subscriber when he purchased a cable system. With customers paying $5 monthly, one deal was netting Jack $80,000 in monthly cash flow. Jack named his company American Cablevision.

Jack’s broadcasting and publishing background gave him an advantage in understanding the potential of the cable market. He moved fast and, in 1965, added tons of communities to his coverage area by buying existing franchises in rural areas. He created two subsidiaries, too—one that “engineered other CATV systems” and one that sold cable equipment. Jack built American Cablevision to 85,000 subscribers and, in 1968, merged it with H&B Communications in a stock deal valued at $30.8 million. In 1970, H&B was bought by TelePrompTer Corporation, then the largest cable system in America, in a stock deal. After the acquisition, Jack owned almost 12% of TelePrompTer’s publicly traded stock, meaning Jack’s shares were worth roughly $40 million. In about five years, Jack had created a $40 million cable fortune.

Cable wasn’t enough for Jack, and in 1965, he purchased the NBA’s Los Angeles Lakers basketball team for $5,175,000, a record price. Jack viewed a team in Los Angeles as one of the three most valuable NBA properties, teams in Boston and New York being the other two. Jack was also gunning for the rights to start an NHL expansion team and thought owning the Lakers and having partial ownership of an NFL team legitimized him as a sports mogul. He was right. Less than a year after purchasing the Lakers, he was granted rights to Los Angeles’ expansion NHL team for a $2 million fee and a promise to play in an arena that seated at least 12,500 people. Jack also paid $250,000 for the right to have a team in the United Soccer Association.

Jack kept pushing and, in 1966, added real estate to the mix. He started building the Forum, a modern, roughly $17 million sports arena in Los Angeles that his basketball and hockey teams could play in. The arena opened in 1967 and was unlike anything anyone had ever seen. It was a huge success.

While Jack was thriving as a sports entrepreneur and also running other enterprises, his health and home life were suffering. In 1965, his wife Jean was unhappy and attempted suicide for the first time. And Jack’s brutal work schedule led to him having a heart attack in 1973. This slowed Jack down, but it didn’t stop him. He was just getting started and was focused on his teams becoming champions.

Jack Kent Cooke’s Toronto radio station was doing well, so he started and acquired businesses that provided services to it. For instance, he purchased a small ad agency and started a service that syndicated radio shows in Toronto. Owning these companies decreased expenses for his station and allowed Jack to profit when other stations needed the same services.

Jack was also doing deals with his partner Roy Thomson. They bought a drive-in movie chain, two national radio sales agencies, and other businesses. But one of their deals landed Jack in legal trouble: the 1947 purchase of an edgy and unprofitable magazine, Liberty. Roy and Jack bought it for $400,000, each owning 45%. But the magazine’s content got Jack sued for libel and led to criminal charges against him for “conspiring to publish defamatory libel.” Jack was acquitted, but the magazine was a financial drag, losing more than $300,000 over the years before finally turning a small profit. Jack’s experience with Liberty led to his 1952 purchase of a publishing empire, which included Saturday Night and other national and trade magazines owned by Consolidated Press. Jack had added publishing entrepreneur to his resume.

The Consolidated Press deal was significant but didn’t include Roy. The partnership between the two soured when Jack cut Roy out of a lucrative consulting deal to manage an Ottawa radio station. Roy felt Jack broke their agreement to share in each other’s deals and opted not to partner with him on deals anymore, although they remained business associates. Jack didn’t need Roy as a partner anymore. He was financially successful and started doing deals on his own. He had six offices in Toronto for his various businesses, which he bounced between daily.

Jack wanted to own more businesses in leisure industries, so in 1951 he bought the Toronto Maple Leafs, a minor league baseball team, for $200,000. With his knack for promotions and flair, Jack turned the games into must-attend events in Toronto. He also used the games as content for his radio station and did play-by-play calling of each game. He tried to do the same with local hockey team games, but because he didn’t own the team or the rights to broadcast the games, he was charged with radio piracy by the Canadian government.

Jack kept buying businesses. In 1956, he bought a company that owned two plastics factories and an aluminum foundry. Jack saw plastics as the future and a growth industry he wanted to be part of. His ownership got off to a rocky start when he sued the seller for misrepresenting the value of the inventory he’d bought.  

Jack’s dream was to start Toronto’s first TV station, and he’d been working it for years. He needed to be awarded the first license to turn that dream into reality. When Jack submitted his application to the Broadcasting Board of Governors (BBG) in 1960, his past tussles with regulators and his reputation for stuffing too many ads per hour into his radio broadcasts worked against him. In a crushing defeat, the license was awarded to another group.

After his television broadcasting license application was rejected, Jack made a major move. He uprooted his family and moved to California. He didn’t just move; he pulled off political wizardry to make it happen. Jack and his high-powered lawyers convinced the U.S. Congress to create a special bill for Jack. It allowed him to become a U.S. citizen immediately, bypassing the normal five-year waiting period, and backdated his citizenship by a decade. It passed the House and Senate and was swiftly signed into law by President Dwight D. Eisenhower. Jack had become powerful and connected not just in his home country but in the United States too. As a U.S. citizen, Jack couldn’t own certain Canadian companies, so he sold his radio stations, publishing business, and baseball team.

Having friends in high places paid off again for Jack. That same year, his well-connected lawyer, Bill Shea, shared an opportunity to buy into an NFL franchise. Jack jumped at the chance and paid $350,000 in 1961 to purchase 25% of the Washington Redskins (now the Washington Commanders).

This deal kickstarted Jack’s life as a U.S. citizen and launched what would become a professional sports team empire for him.