#21 Love Letters

Here's something 3 different people said to me this week, which sucks because I had to get 3 different permissions to write this. 

Each one mentioned some variation of, "I really wish I knew this when I was younger," followed by some form of: "I feel late to the game, like everyone else knew this stuff and I've just now gotten it."

First, let's address this straight up.

A sample of 3 is small, but statistically significant. So not everyone else could’ve known it all early. (Maybe it’s like when you’re 1 minute late you feel an hour late?) So that’s not right.

For the record, I still don't know anything.

But I get the feeling. You don't need to read many Warren Buffet letters to realize all the compounding you’ve missed out on.  What else do you know now you wish you knew then??

Second, a better response to this problem might be right there in shareholder letters. Watch how they communicate knowledge:

Buffet, 2014:  "In the world of business, bad news often surfaces serially: You see a cockroach in your kitchen; as the days go by, you meet his relatives.”

Translation: When you see problems, there's probably more problems. 

Buffet, 2000: "But a pin lies in wait for every bubble. And when the two eventually meet, a new wave of investors learns some very old lessons”

Translation: "Markets are cyclical."

Bezos, 2015: "I believe we are the best place in the world to fail (we have plenty of practice!), and failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment."

Translation: You have to try more than you can win.

SUMMARY? These are all more than just dead simple truths. They are OLD knowledge, truths older than everyone who wrote them. Nothing—absolutely nothing—new.

What some of the most successful leaders have in common is they may do new things and have new ideas, but they work from and communicate very old truths.

Why does this matter? Hear me out.

A certain fact of age is eventually you realize the greatest truths of the world have always been right there. Some are so simple that young-you either ignored them, or (rightly) searched for a truer truth.

The things you know now feel so frustrating because they are so fucking simple.

Meanwhile, if you’re a C-something in the care of someone else’s money, then in one way or another you need to communicate with your investors.

And investors, at whichever age they’ve achieved their own wisdom, expect yours.

Example: Zuckerberg speaking for Q4 2023. Meta beat the street by the same amount it does most quarters (8% EPS, 3% revenue), yet the stock ran 25% in one day. This was a after-hours rally that started before he even finished his statement.

Here’s the poetry that warms my heart:

"Meta has a long history of building new technologies into our services and we have a clear long-term playbook for becoming leaders. There are a few key aspects of this that I want to take some time to go through today."

Translation: "We’ve been doing the exact same thing for 20 years and it consistently works, so I’ll just describe it since we’re gonna keep doing it."

(It remains META's highest single-day growth ever.) 

But this is not a stock-picking newsletter (see new disclaimer section below!) It's a letter about how when and why to say something when you’re a C-something.

So what's the trick to a great shareholder letter, investor update, or other company report? 

In addition to communicating the simplest and OLDEST truths you know, a few other things that make a great investor update.

First, let’s address an elephant: if you lead a public company, all of the below is still true, just harder. You’re pushing change through cold peanut butter, and your lawyers have minds of steel but (unfortunately) flexibility of also steel.

Tradition pretending to be compliance will try to guide your comms more than actual communicating. Fight it!

For the rest of you, it’s easier to get more from communicating with your investors.

In either case, I hope this is a helpful if overly short guide.

Here’s what all of the best investor letters have in common. 

1. Respect your audience.

This sounds obvious, but it's harder in IR than it seems. The mindset Buffet channels is exactly what he writes in some form almost every year: "Our goal is to communicate with you in a manner that we would wish you to use if our positions were reversed"  

There's more to this though. One thing I’ve noticed, especially in the bubbly VC days of yore, is how few first-time founders think of their funding as YOUR money, and instead consider it THE money.

It’s a tiny distinction with big implications, namely, respect. Founders will need to work double-time to communicate respect, while GP’s have more shared experience with LP’s.

For everyone, showing respect is easy in a meeting or dinner, but from a comms perspective, how do you respect your reader??

Rule 1 is you tell them the good and the bad, and you don't bullshit. (Bullshit is when you’re saying something that shows what you want to be true more than what is true). Rule 2 is you speak as an equal.

I think Bezos is a dry writer, but notice how often he uses exclamation marks, slang terms, a very kidding wit. You get the sense that’s how he talks to his friends. Same for you.

Your investor email should be an email to your friends. When we're around people we respect and like as peers, we actually relax. So relax! Play a little in your investor comms, be yourself and tell the truth. You'll win every time.

2. Hold your ground.

In every letter since it mattered, Buffet takes time to trash EBITDA, despite having to report it. Instead he insists on showing net operating income, since that’s his view of real health. For Bezos: free cash flow. Every year. Each has chosen the metric they prioritize, defended it, and stuck to it. 

I mention this because choosing where you’ll be unique requires more than conviction: it requires you to take charge.

I've seen too many IR teams think they work for the i's with whom they have r's. That's simply not the case. The CEO works for the investors. The comms team works for you, always.

There’s a balance here, but you get the point. I strongly urge you to form a clear POV independently of Wall Street and especially tradition. Then stick to it.

You might lose some investors, but those will be people who were just renting your stock. Real owners re-up when believe in you.

3. Explain your long-term thinking.

The founder or CEO is almost always the longest-term thinker in the company, and they should be. You will always need to spend more time communicating this than you think.

Zucko's power-call I mentioned above (I'll link to it below) had to re-tell 20 years of business to an audience whose sole job it has been to analyze that business. 

Takeaway for you: let the numbers speak for your past and short-term future. Use the content of your letter to make your long-term thinking clear, accessible, and compelling. This is part of your stage, and it may be your legacy.

4. Say something.

You're a C-something. Have thoughts and say them.

Bezos's last letter as CEO just made fresh rounds on the internet, because he makes a metaphor from part of an 80's book on evolution. Buffet's this year (sadly like last) contains a tribute to a recently dead friend. (I’ll link both below).

These might seem like whimsy at first, but each story communicates a core belief of the author. Bezos takes the time to explain his metaphor, while Buffet's meaning is as clear as his story is touching.

Go ahead and make meaning, especially in the age where every other fund is just another fund, and every other startup is just another startup.

Private capital allocation is simply far too vast in 2025 for you to be anyone but yourself.

5. Repeat yourself. 

Sound familiar? Because I've been telling you to repeat yourself for 21 issues. (and 31 to come!) 

The ultimate ‘repeat yourself’ flex?  Amazon still attaches their 1997 shareholder letter to the end of every year’s new letter. And Jeff usually ended his with some form of, "it's still Day 1." (Jassy more subtle about it.)

Hey, you’re an investor: remember compounding? THIS is compounding in your IR.

Whatever you do, say it over and over. Then say it again. I promise you: you won't bore your audience. You'll simply remind them how or why they were inspired by you in the first place.  

Finally, to wrap this all up, I’ll give you some old knowledge I also discovered late in life. It’s this:

I personally receive only two kinds of investor letters. The ones I read, and the ones I don't.

Same as your investors.  It's that simple. 

And I can't wait to read yours,
Jesse

PS: Linkz!

Bezos’s last letter as CEO. It got internet famous a few weeks ago for his metaphor on page four, but I really like how he included the fan mail. (He’s a masterful communicator and gets very little pop credit for it.)

Buffet’s latest. It’s a good one this year, mainly because he’s having so much fun still. It’s fun to see fun. The tribute to Pete Liegl is another lesson in Buffet’s fee structure.

Zuckerberg’s Magic Earnings Call. One for the record books. Subtle in its town and goals but extremely well-delivered.

Song of the week: Bezos could’ve just attached this classic to most of his letters. I would to mine.

PSS: Fun story in case you feel like the existential questions above are age related (they are not).  

When Warren Buffet bought Nebraska Furniture Mart from its founder and CEO Rose Blumkin in 1983, she was only 4 years younger (90) than Warren is now. She managed the company for another six years before retiring. Aaaaaaand then….3 months after that: she opened a competing store right across the street from the one she sold to Warren for 200M (in today's dollars).  Her new store did so well that Buffet had to buy that one from her too.  And she CEO'ed that up until age 104. 

Lessons for us: 1) age is relative, 2) own furniture stores, 3) fight to win and die winning.

NEW SECTION: A DISCLAIMER! I hold a certain amount of META, BRK-B, AMZN and dozens of other positions in companies helmed by C-somethings I admire. I am not a financial advisor, accountant, or even that good at math. In fact, I'm frequently wrong, have made some very terrible bets, and if anyone would like to set up a GoFundMe for my dumb taste in Marine Layer hoodies it would be much appreciated.)

PSSSSSS: Share link! Send this one to your friend who runs a fund and needs to send more interesting updates.