Defining Value: Become a millionaire

It seems now it is common knowledge for people pursuing a life as an entrepreneur that if you want to be rich you have to help others. I have heard it that if you want to be a millionaire you have to help a million people. You have to provide value to people. Startups and Venture Capital funds talk all the time about value. Warren Buffet, CEO of Berkshire Hathaway invests in it. But what is the definition of value?

Value can be broken up into money, time, and emotion. That’s really all there is to life. How can you give money to make money? Or how can you give time?

You can help others:

  • Save money
  • Make money
  • Save time
  • Make time (Health)
  • Change their emotion
  • Makes them look good

Let’s look at innovative companies (once startups) and some of Warren Buffet’s companies and see how they produce value.

Save money: Amazon & GEICO


No retail locations cut the prices of products. Amazon has invested a lot into its logistics infrastructure making each item it touches cheaper to get to consumers. The value Amazon is offering is lower prices.


15 minutes could save you 15% or more on car insurance. This slogan is burned into our brain. In GEICO’s business model there are no agents. Other insurance companies have agents to sell product and provide customer service. GEICO saves money by consolidating these services and by marketing their products directly to customers. From the money they save by not having agents they then offer better prices to consumers. Saving money is the value of GEICO. Oh and Berkshire Hathaway owns a 100% of it.

Make money: Airbnb & Kirby Company


This company took off from the 2008 financial meltdown. Part of the reason why it took off then was that people needed more money. Be founders had tried before to launch their idea, however, hosts were reluctant to offer their house or apartment to a stranger. With the financial meltdown, hosts were more willing to rent their extra room to a stranger. Airbnb has two customers the hosts and the guests. The hosts are happy to provide a supply of spaces because they are making money. Guests get value from saving money with Airbnb instead of staying at a hotel.

Kirby Company

Kirby vacuum is owned by Scott & Fetzer, which is owned by Berkshire Hathaway. Kirby, besides being a lovable video game character is also a vacuum cleaner brand. The vacuum cleaner company was established in 1920 and since then has sold vacuum cleaners door-to-door. Each person selling them is a private independent entity. Kirby allows people to start companies and make money. It’s a vacuum business platform. The major problem with this model is that the company can be held responsible for the actions of the people selling the product. Indepent contractors of Kirby have been found committing; fraud, unethical marketing, and rape. Kirby needs to run more background checks to stop these crimes. The business itself is still providing value to customers and independent contractors.

Save time: Uber & NetJets


What is Uber really selling? According to Gary Vaynerchuk, Uber is selling time. Providing you a quick way to get from point A to B. It connects you with the closest driver to give you the shortest wait possible, tells you how long the car will arrive, and automatically plots the quickest route. Uber is selling time. Similar to Kirby, Uber also uses private contractors, because of this they have also had several scandals. On the brighter side, one day all of Uber’s cars will be autonomous. With autonomous cars most of scandals it deals with today would go away. Uber is not the most ethical of companies. The reasons why unethical companies continue to exist is that they are offering more value to many people. We collectively overlook a companies faults to reap the benefits. If this is true and we know all allow companies to be unethical, then who is really to be blamed?


Before Uber was an idea, Berkshire Hathaway bought NetJets. During the dot-com bubble, when everyone was betting on new internet stocks, Warren Buffet was enthusiastic about NetJets. NetJets is a time-share for private jets. People buy fractions of a share of a jet to use anytime they want during the year. Shareowners can give as little as 4-hour notice to be up in the air. NetJets allows companies and businesses to have the flexibility of private jet without paying the full costs of owning one. This business model is very similar to Uber, the difference is that NetJets requires an annual commitment, oh and that they’re jets instead of cars. NetJets also owns and operates all of the jets. I am not aware of any scandals with NetJets and it is because they do not use private contractors in operations.

Make time: Fitbit & Pampered Chef

Ok, so I don’t know the physics of actually making more time in the universe, but for humans extending our time on earth would be health and healthcare.


People have started using the power of competition to challenge each other to be healthy. I’m sure this concept has been around since basic pedometers, but Fitbit has taken it to a new level. Fitbit’s app allows one to challenge friends for who can be the most healthy. What Fitbit is offering is to visualize your body in a new way, the social and health component makes this information valuable.

Pampered Chef

This company sells cooking utensils, cookbooks, and food products. The core piece of this is selling the idea of making healthy food at your home. Why not buy kraft food it would be cheaper? Why not go to Taco bell it would be quicker? There has to be another piece of value that Pampered Chef has to offer to compete vs. its competitors with price and time. Pampered Chef competes with health. That cooking in the home with food good for you will improve your ability now and extend your life down the road.

Sells you emotion: Netflix & The Buffalo News

What is the point of consuming media? When we pay for a movie we are buying an emotion. This might be because we don’t want to think about all the drama at work or that we just want to live as someone else for an hour.


Binge watching shows to escape reality was only possible when Netflix and services like it started streaming video content. Netflix has become more like a utility of emotional change than an occasional treat.

The Buffalo News

This newspaper is one of Berkshire Hathaway’s early investments. The news can make us feel; safe, fearful, happy, angry, excited and sad. News today seems to be remarkable at showing us the extremes of humanity. A mass shooting at breakfast, a puppy saved at lunch, and the stock market report at dinner. The news can also be used to save us from an emotion, such as the weather report telling to pack an umbrella so we don’t end up wet and miserable. These emotions are what the news is selling.

Makes the customer look good: Apple & Ben Bridge Jeweler

This is the value of luxury. This type of value can also be coupled with other value offerings. Many companies mentioned earlier have an element of this piece of value. Why would you need to fly in a private jet? Fitbit devices are less accurate on the wrist, however, people notice them there. If you read the news others will say you are knowledgeable and informed. Sometimes we buy things just so that others will think about us in a certain way.


One the world’s largest brands. Other companies can offer better technical products, however, few can bring the social currency an Apple product can. The iPhone makes phones that run Android look like a cheap knock-off, even when Android phones have better features. Why? It is because how we think about Apple’s products and how we associate that with the users. The recent standoff with the FBI was to protect Apple’s brand and social currency. Warren Buffet has become interested in buying equity in Apple. Right now Berkshire Hathaway owns more than 0.15%, that’s a lot, considering that is worth $1,100 million dollars. Warren Buffet understands the social currency of Apple, knows that Apple will be around for a long time, and that Apple has a TON of cash on hand. It is a little sad though, because if Warren Buffet is interested in your company, then your company is no longer creating innovative technology.

Ben Bridge Jeweler

This Jewelry retail store has been family operated for five generations.  It offers two things; luxury and better prices. It has two type of value going for it, that probably why Berkshire Hathaway bought it in 2000.


Value can be made by helping others. How do you help others to create value? You can help others:

  • Save money
  • Make money
  • Save time
  • Make time (Health)
  • Change their emotion
  • Makes them look good

Why did I write this post? So that this elusive idea called value can be understood. How is this post valuable? It can help you make money.

Read more about business and entrepreneurship on my blog.

Financial Disclosure: At the time of writing I own shares in Fitbit and Netflix.

Update 5/28/2017: I own shares in Fitbit.