Friday, November 30, 2007

Book Review- "Alwaleed" by Riz Khan

As an avid reader of investment books and biographies, I've decided to add another element to the blog and review various books that I've finished that might be interesting to readers.

I've just finished "Alwaleed", a biography of the billionaire Prince Alwaleed bin Talal. Alwaleed is best known for high famous investment into Citigroup in the early 1990's. This is a move that saved the bank when it was in financial trouble (much like now, ironically), and it put him on the map as an investor. Alwaleed is considered by many as the "Warren Buffett of the East." Although he's shared the level of success as Buffett, he is much different overall. The prince has surprised many people in both Saudi Arabia and the U.S. by bridging the gap between two countries that don't have the best relationship, especially post- 9/11.

His background is rather interesting. He is a member of the Saudi Royal Family, but his mother's family is also politically connected in Lebanon. His parents divorced when he was young, so he was raised in both countries, which helped broaden his horizons. He got his college education at Menlo College in California. This was very important as it taught him how business is done in the U.S. After college he moved back to Riyadh, and went into business for himself. He basically started with a small loan from his father and went from there. He got his start by brokering deals between foreigners looking to invest and build in Saudi Arabia. His political connections helped him here, but he did the business himself. He then led a couple of the first hostile takeovers of under performing banks, a practice that hadn't been seen in that area. He quickly made the businesses profitable by cutting expenses and cleaning up the banks loan portfolios.
He then started investing in international equities. He did the Citigroup deal, which was very successful. He is also a major shareholder in US companies such as Apple, Time Warner, News Corp, Pepsi, Hewlett Packard, Kodak, Proctor and Gamble, and Disney. He believes in strong, well know brands, and the value that they add to a company.

The prince also has major investments in high-end luxury hotels. He is major owner in The Four Seasons Hotels. He also has various hotel investments, including Fairmont, Movenpick, and IFA. He has been in the ownership group for New York's Plaza Hotel.

To me, the main takeaway from this book is the Prince's attitude and determination. He works extremely hard when approaching an investment. He believes in perfection and demands it with his staff. He often travels thousands of miles per day on his jet, and his travel schedule is perfectly planned. He often only sleeps a couple of hours per day, and is up well into the night as he needs to communicate with business partners in the West during their daytime hours. The Prince is a very serious man, and is very serious about his business, but does spend a lot of time with his children. He also gives a tremendous amount to charity. The book does touch a little on relations between the US and Middle East. The Prince offered to donate $10 million to the 9/11 fund, but it was denied by Mayor Giuliani after the Prince suggested the US adjust its policies regarding Israel and Palestine. This created some media backlash, and the book covers it from an interesting point of view that our media probably didn't.

Much like many stories of successful investors, this is a story of hard work, determination, and prudent investments. His preaches patience, and that you should never overpay for an investment. These are the same principles of Buffett and others, but the Prince has his own style, and his story is interesting and motivating.

I'd recommend the book to anyone interested in investing. It does cover things strictly from the Prince's point of view, as the author was allowed to join his entourage for a few months, so it could be seen as a little one-sided. But overall, it is very informative and interesting. The book does also include a DVD that has some interesting footage of the Princes yacht, planes, and where and how he does business.

You can buy the book here:

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