In spring of 2009, as the financial world was in free-fall, I had the opportunity to meet the richest man in the world, Warren Buffet, in Omaha. What a dream come true! I’d been investing any money I could save in stocks for a few years, and I knew he was possibly the best investor ever.
I went as a part of a program he runs for students. Dozens of colleges across the country send groups to Omaha to participate in a Q&A, tour his businesses, and share a meal with him.
Two Hours of Q&A
It seemed like 5 minutes to me. I could’ve listened to him a lot longer. Someone would ask a question, then he would give an extremely detailed and thoughtful answer. Spending this amount of time with us was beyond generous.
Notes from the Q&A
- His stock pick was Wells Fargo. One person asked for his best stock pick. He responded that if he had to buy one stock, then close his eyes for 5 years, he would pick Wells Fargo. This was literally at the bottom of the financial crisis. If you would’ve bought WFC that day, you would’ve made 35% annualized returns for the next 5 years.
- His insurance companies are really well run. I learned that most insurance companies lose a small amount of money on premiums. They pay out more on claims than they take in for premiums. They make their money by investing the “float.” The “float” is basically the premiums they’re holding on to, waiting to pay claims. So, It was interesting to learn that Buffett’s insurance companies are profitable on premiums. He likes for things to run efficiently.
- He laughs a lot. This is something that many people have noted. He really does love making jokes. He laughs at his own jokes (in a good way.) When he describes the day he met his partner Charlie Munger, he tells a story about them ‘rolling on the floor’ laughing at their own jokes.
- He uses ‘rules of thumb’ and ‘mental models’. He talks about sophisticated models like DCF, but no one ever sees him doing calculations. It seems like he’s able to simplify it in his head, because he’s done the math so many times.
- He puts a lot of effort into his annual letter. He claims he writes his annual letter with his sister in mind. What’s really incredible is that one of the greatest financial minds ever is able to express his ideas with such clarity. Finance can get pretty abstract, but he makes it simple in his letters. They’re always a great read.
- He bought a company on the suggestion of a student. The investment club at Tennessee recommended he take look at mobile home maker, Clayton Homes. He decided to buy it. And in gratitude to them, he gave every member a class B share of Berkshire Hathaway, valued at $2,876.
Local Business Man
Buffett owns hundreds of global businesses, some worth up to $35 Billion, but it was really cool to see his local impact.
He owns a large furniture store, a jewelry store, and many other large local businesses. Many of these businesses are still run by the entrepreneurs who started them, or their families. It was fascinating to see the types of businesses he likes.
He drove himself in a ‘couple year old’ Cadillac, like any other 77 year old man. Buffett could truly drive any car he wanted, but he drives a late model Cadillac. He doesn’t have a driver, he drives himself around town.
Breaking Bread with The Richest Man In The World
Piccolo’s was Buffett’s go-to restaurant for out of town guests and celebrations. He bought us steak for lunch, and finished up the meal with his famous root beer floats. After lunch we each got to take a picture with him, and get an autograph.
In 2017, an anonymous bidder paid $2.68 million to eat lunch with Mr. Buffett. It seems like we got an incredible deal!
Underpriced Experiences
The crazy thing is that only 30 out of 35 seats were filled. Why wouldn’t students jump at the opportunity to eat lunch with the richest man in the world?
I couldn’t believe there were open seats on this trip. A business fraternity sponsored this opportunity. They didn’t fill up the seats, so they extended the offer to other students. We still didn’t fill it up! I couldn’t believe it. We paid $400 to go. This included airfare, all transportation, hotels, and a couple meals.
There were three other schools there with us. Schools from all over the country are invited to come to Omaha. I know he had at least a couple more “field trips” scheduled. If you’re in college reading this, I would highly recommend finding out if your college is involved.
It was something I’ll never forget. No doubt, it was a key factor in launching my 6 year career trading stocks. I’m very thankful to Mr. Buffett for giving me this experience.
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