Kennon Green and Company

For the first, I understand what Buffett and Munger mean when they say there is "no master plan". If you follow attractive values, and focus on opportunity cost, you end up in places you never expected. I have no idea what the firm will look like 10 years from now, only that we will focus on generating the highest risk-adjusted real return on capital.

I’ve been thinking a lot about the ultimate form the partnership or the holding company is going to take when I consolidate everything I own – all of my private businesses, stocks, bonds, real estate, and other assets, along with my parents, family, and friends, under a single investment vehicle (I explained this in We’ve Finally Settled on a Course of Action).  This has been occupying and increasingly large percentage of my time, mostly because I think the best thing to do is to simply raise capital, take a percentage of the profits, and then invest the money in the best risk-adjusted opportunities.  Which opportunities present themselves and which time is beyond our control, so there’s really no way to predict, ahead of time, what our holdings will be.

I do know, however, that there are a few areas that interest me.  I’ve been breaking them up in an organizational matrix so I can think about how to put together the various “pieces” when the time comes.  This is probably 5+ years in the future.

Here’s the plan …

(more…)

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David Oscarson Releases New Pen Series

David Oscarson Consider the Liles Black Pen

David Oscarson Consider the Liles Black Pen

Sweet!  David Oscarson released the next installment of his pen series called Consider the Lilies.  They were inspired by Luke 12:27 when Christ said, “Consider the lilies, how they grow. They toil not, neither do they spin; yet I say unto you, Even Solomon in all his glory was not arrayed like one of these.”

Here’s the company’s official statement on the pens:

Marking our Tenth Anniversary, the Lily Collection speaks of our gratitude for all that is virtuous, beautiful and pure. In a world full of clouds and error, the Lily Collection reminds us of all that we hold precious, all that we hope for and all that we aspire to be.

The Lily Collection incorporates three levels of Guilloché engraving and six colors of translucent and opaque Hard Enamel on each Collection piece. The entire body of each pen is first cut down to the level of the background, leaving the outer and inner lines of the lilies, pads and leaves in high relief. The backgrounds are then kiln-fired with opaque Hard Enamel in either Black or White. The Lilies are the first Collection pieces to incorporate three colors of Hard Enamel onto one surface without separating each of them with dividing lines in high relief and the three colors of the daylilies graduate and gradate inconsistently, emulating nature’s unique ability to distinguish one lily from another.

I have got to get my hands on both of these.  The rollerball version lists for $4,700 with the fountain pens coming in at $4,900 each before sales tax.

Consider the Lilies White Version David Oscarson Pen

Consider the Lilies White Version David Oscarson Pen

The great, eternal question is, of course, whether or not to ink a collector’s edition fountain pen.  Personally, I buy them to write.  I say ink away, absolutely, positively.  These are not just financial investments for me.  They are tangible and in that regard, they are different from stocks or bonds.  You can see them.  At some point, they become emotional attachments, as well.  I can still pick up the two Montblanc pens I bought as my first writing instruments when my mom took me to Omaha to visit Warren Buffett’s jewelry store, Borsheim’s.

At the time, I was in college and I spent $500 or $600 on the two pens, which consisted of a black and platinum rollerball Montblanc LeGrand and a black and gold fountain pen Montblanc LeGrand.  They still sit in my office at headquarters today.  In fact, I used them to sign the papers when I bought my first house, to sign my book contract, and a lot of other important documents.  I’ve used them to sign the incorporation papers for some of the businesses we launched this year.

These are not mere excesses or trivialities.  They are probably one of the best emotional and financial investments a man (or woman) can make if he knows what he’s doing.

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Triple Burl Wood 9 Pillow Watch Case

Triple Burl Wood 9 Pillow Watch Case

When you own businesses, certain orders just make you happy. Of course, you appreciate every one, no matter how small. From time to time, however, there is something about a particular piece of business that just makes you smile.

We actually do respectable global business through many of our online businesses. Surprisingly, quite a bit comes from The United Arab Emirates, specifically areas such as Abu Dhabi. Apparently, we just sold a $700 watch to a professional soccer star and are shipping the merchandise to his home there.

It’s crazy to think that as I sit here, working on a MacBook Pro, drinking coffee, and reading stock reports, there are people all of the world browsing the pages of companies that I own, buying products that generate cash for me to redeploy into other investments. It was always the goal, but the fact that it’s happening halfway around the globe is just amazing to me, even now.

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Aurora Talentum Classic Fountain Pen

Lately, I’ve been writing with a black and gold fountain pen from Aurora. It came as part of the inventory expansion we did at Kennon Home Accessories to launch the pen business this winter, and I’ve got to say, I’ve never written with anything like it. Truth be told, despite it being only $325 retail, it feels far more durable and enjoyable than some of the $850 or $1,200 pens I own.

Aurora Talentum Classic Fountain Pen in Black with Gold Trim

Aurora Talentum Classic Fountain Pen in Black with Gold Trim

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Murano Glass Beads for Chamilia Charm Bracelets

Murano Glass Beads for Chamilia Charm Bracelets

Our Kennon Home Accessories business, which is the online site launched in fiscal 2009 that sells thousands of luxury gifts, just expanded into murano glass beads and charms.  These stunning works of art are worn on charm bracelets and are made using a technique mastered in Italy centuries ago by artisans.

The truth is, until the folks at the Kennon & Company retail store introduced them to me, I had no idea how big of a deal they were.  As a man, my exposure to jewelry is mostly limited to fine pens, watches, and cufflinks.  Make no mistake, though, the women who suggested the product knew their stuff.  These charm bracelets are tremendously popular with some customers routinely dropping between $300 and $700 per visit simply to augment their murano glass bead jewelry charm collection.  We are weighing the brands to bring in now to accent our Chamilia product line.

We have hundreds of murano glass beads available for sale at Kennon Home Accessories.

We have hundreds of murano glass beads available for sale at Kennon Home Accessories.

To date, we have added several hundred sterling silver charms and murano glass beads to our online inventory and hope to have the rest of the merchandise up and available for sale by Christmas of this year.  It’s an ambitious goal, especially with the expansion of our other sites and the launching of the new team business, but I have faith.  By focusing on serving the customer and keeping costs low, we win.  It is a formula that has worked for time eternal and will continue to work in the future.

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