Warren Buffett Told A 14-Year-Old The Secret To Success Is Hanging Out With People Better Than You — Even If It Means Unpopularity. 'The Hell With 'Em,' Adds Munger

On May 1, 2004, nearly 20,000 people gathered in Omaha, Nebraska, for Berkshire Hathaway Inc.'s annual meeting, a ritual that has become a mecca for investors and business aficionados alike. The spotlight was, as always, on company Chairman and CEO Warren Buffett, who shared insights that transcended investment advice.

During the meeting, 14-year-old Justin Fong of California asked Buffett a question that generated a piece of advice beneficial for people at any stage of life, especially in the realm of business and career development. The question was simple: "What advice would you give a young person like me on how to be successful?"

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Buffett responded: "It's better to hang out with people better than you. Pick out associates whose behavior is better than yours and you'll drift in that direction."

Not to be outdone, Charlie Munger, Buffett's business partner and vice chairman of Berkshire Hathaway, added, "If this gives you a little temporary unpopularity with your peer group, the hell with 'em."

Buffett's advice wasn't targeted solely at a teenage audience, steering them clear of schoolyard bullies or negative influences. Instead, he was imparting a life lesson for everyone. The essence of the advice is to surround yourself with people who have qualities and traits that can elevate you— be it as a leader, a worker or a human being.

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Four Qualities To Seek In Influential Associates

1. Integrity: The Nonnegotiable Trait

Buffett places a high value on integrity. "You're looking for three things, generally, in a person: intelligence, energy and integrity," he said. "And if they don't have the last one, don't even bother with the first two." Integrity is the cornerstone of trust, and trust is the bedrock of any successful relationship, be it in business or personal life.

2. The Art Of Saying ‘No'

"People that know when to say ‘no' are intentionally focused," Buffett said. This comes from his belief that time is the most valuable resource. Buffett once stated, "The difference between successful people and really successful people is that really successful people say no to almost everything." This serves as a call to action to evaluate priorities and focus on what truly matters.

3. Never Stop Learning

Buffett and Munger are learning machines, a trait they attribute to their success. "Read 500 pages like this every day. That's how knowledge builds up, like compound interest," Buffett said. While the temptation to relax and binge-watch TV shows may be strong, Buffett suggests that reading is the path to expanding knowledge and, by extension, success.

4. Be With People Who Are Loved

The people you associate with should be those who are genuinely loved by others. It's an indicator that they have the right mix of qualities that make them not just successful but also good human beings. Such people will likely have a positive impact on you as well.

Buffett and Munger's advice about surrounding yourself with better influences can also be applied to investing — especially when considering startups. Just as you would choose to associate with people who have traits you wish to emulate, it's critical to select startups that exhibit potential, innovation and integrity. Investing in a startup can be a high-risk, high-reward venture, much like aligning yourself with ambitious and morally upright people can bring exponential benefits in the long run. Buffett has often emphasized the need for thorough research and intelligent decision-making when investing. 

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