See a Man as a Business

This company can be in one of two scenarios: one is that its intrinsic value is already fully reflected in the valuation.

What does that mean? It’s like a princess marrying a prince.

He is a prince, and no one is blind—they all know it. Many want to marry him. Just like a great company everyone has spotted; then it’s bidding, and ultimately the highest bidder wins.

If you’re the princess, it’s a match made in heaven—a fair exchange.

In the other scenario, he’s a frog.

No one knows whether the frog will turn into a prince. If everyone knew that a frog could become a prince, the frog’s valuation would go up, and we’d be back to the previous path—more money would be needed.

You might say, no one in the world knows a frog can turn into a prince except me. Then you wouldn’t marry; you’d buy a winning lottery ticket instead—it’s far less trouble. Because it’s only you who knows, once you look at it closely, it’s incredibly simple. There are just these two directions.