Warren Buffett Bio, Founder of Berkshire Hathawa

  • January 13, 2020
  • by

Philanthropist Warren Buffett was born in Omaha, Nebraska, on August 30, 1930. The son of a stock broker, he began work in his father’s brokerage at the age of 11, and by the time he graduated high school five years later, he owned a pinball machine company and 40 acres of land he rented to tenant farmers.

On his father’s advice, he attended college rather than settle for his entrepreneurial achievements, attending the Wharton School at the University of Pennsylvania, the University of Nebraska, and Columbia University, from which he obtained a Master’s degree in economics and the only A+ famed economist Benjamin Graham ever gave a student.

After working as a stockbroker for both his father and Graham, Buffett established his first investment partnership in 1956. Buffett Associates, Limited, was financed by seven limited partners — his family and friends — and was later consolidated with other limited partnerships he founded, to become Buffett Partnership Limited.

In the 1950s and 60s, at a time when a 7-11% return could be expected from most such ventures, Buffett’s partnerships consistently made 30% compounded annually.

In 1969, he began running Berkshire Hathaway full-time, having acquired stock in the textile manufacturing company over the course of the decade.

Berkshire Hathaway soon became one of the largest holding companies in the world, with its available funds under Buffett’s stewardship used to buy out other businesses, especially insurance companies — which had large amounts of available cash he could use to acquire still more companies.

In time, Buffett came to favor buying companies entirely, over simply buying controlling shares of stock. Today, Berkshire Hathaway owns such well-known companies as GEICO, Business Wire, Dairy Queen, Fruit of the Loom, Jordan’s Furniture, Shaw Industries, and See’s Candies — among dozens of others.

Buffett’s hands-off approach to his control of other businesses is considered a large part of his success, as it avoids the friction which could cause executives to make decisions not in their interests.

To the general public, though, Buffett is best known as a philanthropist. A billionaire several times over, Buffett donated over $30 billion worth of stock to the charitable Bill and Melissa Gates Foundation, and has himself established several multi-billion dollar charitable foundations.

He has said that he doesn’t believe in creating new billionaires through inheritance — his children will inherit a generous amount of money, but in his words, “not so much that they would feel like doing nothing.” He has long encouraged other billionaires to share their wealth through charitable endeavors.

Perhaps influenced by learning his trade so soon after the Great Depression, Buffett has been a vocal critic of investments that have perceived value but no utility — notably gold.

Now in his late 70s, he continues to run Berkshire Hathaway (but is searching for a replacement), to write candid and erudite annual letters to his shareholders, and to drink five Cherry Cokes a day (Coca-Cola has proven to be one of his best investments).

Comments Off