But in theory, a holding company would have to pay a salary to its employees (CEO, analysts, secretaries) and an employee like Warren Buffett could probably charge millions per year (even if he is also the owner). I am not sure if this applies to BRK, or if he just works for his own good, but it doesn't strike me as a fundamental difference.
What is the decisive advantage of this company structure? Or would Warren Buffett's hedge fund be equally successful?
I can understand (4), though. (1) to (3) can be done by a hedge fund as well.
Can is different from does.
Hedge funds normally do not have low fees or low turnover, so he does get advantages from those. The low fees are in part due to high efficiency. Buffett and a staff of less than 20 perform functions that in a normal firm of its size would require many more people. He also eschews high salary, a personal decision, though one where his large equity stake means he can still benefit from it along with other shareholders. I agree that the decisive part for 1 and 2 is execution, not company structure. As for 3, buying whole companies or large stakes is again different for Buffett due to execution. Historically he has gotten a purchase price advantage by offering to hold companies for a long time and retain trusted management. This reinforces 1 and 2.
Re 4, Buffett/Berkshire get float because their insurance company again has execution skills that are above average. The structure part (owning an insurance company) is something a hedge fund could do, but the cost of the float is low because the insurance company has exceptionally low costs/high operating returns. To some extent this is execution, but it's also structural because Berkshire's structure still gives company management (Buffett) greater latitude to take a long term approach. Hedge fund investors can withdraw their money, corporate stockholders can't. What makes Berkshire different is the fact that where normal stockholders demand quick results, Buffett has explicitly warned over and over that he won't promise short term results, and his success has given him latitude to focus long term.
Many of the things Buffett does would make him excellent in a hedge fund setting too. However, the structure of Berkshire makes it even easier for him to compound the advantages he has. Partly I think that this is because it allows him to just work the way he likes to work. Buffett himself has written that not having a hedge fund structure, and instead having the structure that Berkshire has, allows him to take the long term perspective that he states is a permanent advantage for Berkshire.
My own thought is that once Buffett is gone, there will be a purer test of how much of the advantage is from structure, and how much from Buffett. I'm guessing about 1/4 to 1/3 from structure; curious about what happens after he is gone.