Recently, Warren Buffett surprised his shareholders by announcing he was stepping aside as the CEO of Berkshire Hathway
Warren Buffett is not like other billionaires who show off their wealth with rocket ships or spend it buying political favor.
He’s the best of the billionaires. Financial journalist Andrew Sorokin termed him the “conscience of capitalism.”
I’ve been a follower of Warren Buffett for 30 years. One day in 1994 my dad came to my office. He announced he might buy some shares of Berkshire Hathaway stock. His only reluctance was the price — $9500 a share — was a little high. He thought he would wait for a while.
A few weeks later, Dad confirmed he bought some shares. I asked if he had to pay $9500 a share. Sheepishly he smiled and said NO! I had to pay $11,200.
Dad and I became avid fans and followed him from then on.
Over 60 years he has been the most successful investor in history. If you had invested $1000 in Berkshire when he bought the company in 1965, you would have $55 million today. No wonder they call him the Oracle of Omaha.
My favorite glimpse into Buffett is the Chairman Letter at the beginning of the annual report. It’s always a great read.
These letters describe his annual shareholder meetings and demonstrate why they have grown from a few hundred attendees to over 40,000 today. He previews the fun folks will have while getting a glimpse of the companies Berkshire owns.
The first day starts with a contest, throwing a newspaper on to the stoop of a Clayton Manufactured Home. Buffett tossed nearly half a million papers as a boy. You have to roll your own papers (no rubber bands). It’s 35 feet from the line to the porch. He gets the first toss.
In what he calls “the ultimate hustle” he lists Berkshire companies who will have displays and sales at the meeting: Justin Boots, See’s Candies, Nebraska Furniture Mart (NFM), Dairy Queen, BNSF, Geico, Net Jet, and Coca Cola.
The hustle works. Over two days, See’s Candies sells upwards of 20,000 lbs. of candy, Justin Boots around 2000 pairs, and NFM can generate as much as $50 million in sales.
Borsheim’s Jewelry, another Berkshire company, hosts two shareholder champagne receptions – another shopping hustle.
Buffett sometimes posts a picture of the 25 folks he calls “my gang” at their Christmas gathering. He sports a red blazer. And relishes reminding shareholders the size of headquarters crew has not increased.
What makes him the best of the best of the billionaires?
First, the company: no hefty Director fees. $2100 annually unless you want to strike it rich and be on the audit committee; then you get $6000. There are no stock options for directors, but they all own stock. No directors and officers liability. This guarantees independent thinking. (In contrast, Meta and Microsoft pay hundreds of thousands in fees with stock options.)
He loves what he does.
He values integrity, loving relationships, and good friends.
He knows you can’t make a good deal with a bad person.
He gives credit to his company managers and his lifelong business partner Charlie Munger for his success.
He admits his mistakes.
He doesn’t like broccoli, loves a good Dilly Bar, and drinks real Coke.
And he shares his wealth – generously. He has given away half of his Berkshire stock since 2006. Now he has a plan for all of his money to be given away within 10 years of his death.
When he says, “I can keep 2% of my wealth and it won’t make me any happier, but I can give away 98% of it and make a difference in people’s lives.” He means it.
So if you are an aspiring billionaire, be like the best of them: Warren Buffett.
