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Would Warren Buffett buy a tuition agency?

First Published on 14/10/2015 at Estate and Manor Magazine

Would Warren Buffett buy a tuition agency?

Warren Buffett looks for excellent businesses where there are considerable barriers to entry, high returns on investment and excellent, honest management. This strategy has led him to become the most successful investor on the planet, compounding value over many decades for his shareholders.

What would Warren make of British tuition agencies? Would Berkshire make a bid for Bonas MacFarlane, Keystone, or even Bright Young Things?

I would haphazardly suggest that you are not going to see any one of those names pinned up in an office in Omaha, Nebraska any time soon. Over the last few years it has been clear that everyone and their Labrador has had the excellent idea of starting a tuition agency. I would guess that over half of agency owners have no relevant teaching experience and perhaps a quarter have come from a separate profession. How did this happen? To answer this question we have to think about what you need to start a tutoring agency and how innovative technology has made it so easy. Although I have never started my own agency I know many people who have, it is an asset light business, no heavy machinery is required to squeeze information into a thirteen year old boy’s head. The use of a laptop, mobile phone and access to tutors, clients and perhaps the use of the wonderful TUTORCRUNCHER software to automate all the boring maths is the bones of the business; some staff and an office outside of your bedroom can obviously come later.

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