It's been over a month since the Berkshire Hathaway meeting in Omaha, but one conversation continues to resonate deeply. At ValueX Berkshire, the Friday event hosted by a friend and a renowned investor and author, Guy Spier, I had the pleasure of listening to Luca Dell'Anna—a thoughtful friend whose insights Guy introduced me to years ago. This year, however, Luca shared a concept that has occupied my thoughts ever since: the idea of "near misses."
The Dark Road Story
Luca recounted an incident where he drove too fast on a dark night and an animal suddenly crossed his path. In that split second, he managed to avoid a collision. The natural response, he noted, would be to celebrate our skillful driving—to pat ourselves on the back for being such capable operators behind the wheel. But Luca suggested a different perspective: instead of congratulating ourselves on the miss, we should question why we put ourselves in that position in the first place. Why were we driving after dark? Why were we going too fast? The "near miss" became a lens for examining our decision-making in the moments leading up to the crisis.
This reframing triggered an avalanche of thoughts about life, investing, and business—about all the situations where we almost got ourselves into serious trouble.
Investment Near Misses
Reflecting on my own investment history, I can recall certain instances early in my career where I conducted thorough due diligence and ultimately decided to walk away from an opportunity. Later, I discovered what terrible investments they would have been. In those moments, it's tempting to congratulate myself on being such a skilled stock analyst, such a great "driver" in the investment world.
But Luca's framework asks a different question: How did one end up considering those investments in the first place?
The Everyday Near Miss
Beyond investing, life presents countless near misses. We've all experienced moments of imminent danger—small and large—where by a fraction of a second or an inch, we avoided ending up in bed, in a hospital, or worse. We might praise ourselves as incredible athletes, runners, or hikers for our narrow escapes. The risks are real: I've seen friends suffer disproportionate injuries from seemingly minor missteps that sidelined them for weeks from their jobs and pursuits.
The Humility of Recognition
Luca's insight about near misses forces us to be more humble and recognize that luck often plays a larger role than we'd like to admit. Maybe we should drive a bit slower. Maybe we should skip certain experiences or decline particular meetings. The goal isn't to eliminate all risk, but to avoid courting potential disasters—to prevent near misses from becoming actual catastrophes.
A No-Zero Policy
Years ago, this kind of thinking led me to adopt what I call a "no-zero policy" for our portfolio. I won't invest in anything I can imagine going to zero at the moment of purchase. While this might seem overly cautious, it's my way of heeding the near-miss lesson: don't find yourself in the wrong rooms, even for consideration.
The Gift of Perspective
Life sometimes offers us wake-up calls—like Luca's driving incident that sparked this entire reflection. But rather than relying solely on luck to save us, we can help luck along by simply not putting ourselves in situations that could derail our financial future, our well-being, our health, or the safety of our loved ones.
The power of near misses lies not in celebrating our escapes, but in learning from our proximity to danger. They serve as valuable teachers, reminding us to examine not just our reactions in crisis moments, but the decisions that brought us to the edge in the first place.
More about Luca’s work, and the Omaha talk itself:
Disclosure:
Blue Infinitas Capital, LLC is a registered investment adviser. The information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.