Following an odd quarterly earnings call last week during which he dismissed some analysts’ questions, the Tesla CEO shot down the idea of moats – a way for a company to protect itself from its competition. That drew criticism from investor Warren Buffett, who’s currently the third richest person on the planet.
Buffett commented on Musk’s stance on moats at a Berkshire Hathaway shareholder gathering over the weekend, saying:
There are some pretty good moats around.Certainly you should be working on improving your own moat and defending your own moat all the time. And Elon may turn things upside down in some areas. I don’t think he’d want to take us on in candy.
Buffett’s Berkshire Hathaway, which owns a bunch of big companies acquired See’s Candies in 1972. See’s, which operates more than 200 stores across the US, has a strong moat in the form of a loyal customer base on the west coast, which makes it hard for its competition to snatch a piece of its market share there. That was enough to prompt Musk to promise to launch a new business startup.
He twitted
I am super super serious— Elon Musk (@elonmusk) 5 May 2018
But there's also a chance that he's just making a joke.
Then I’m going to build a moat & fill it w candy. Warren B will not be able to resist investing! Berkshire Hathaway kryptonite …— Elon Musk (@elonmusk) 6 May 2018
So don’t hold your breath for a revolutionary new brand of candy.
