Many people know that Munger invested in Wang Chuanfu and BYD, earning 40x.
But few people know that when Tesla was valued at only about $200 million in 2008, Musk also reached out to Munger.
If Munger had invested in Tesla back then, he could have earned 7,500x.
Munger recognized Wang Chuanfu as an outlier, but missed Musk’s even bigger outlier.
One of the hardest problems in investing: when to trust the baseline probability, and when to bet on the outlier?
But few people know that when Tesla was valued at only about $200 million in 2008, Musk also reached out to Munger.
If Munger had invested in Tesla back then, he could have earned 7,500x.
Munger recognized Wang Chuanfu as an outlier, but missed Musk’s even bigger outlier.
One of the hardest problems in investing: when to trust the baseline probability, and when to bet on the outlier?
