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NO CRYING IN CONTRACTS #2
This is No Crying In Contracts, a weekly(ish) newsletter about what I'm working on and thinking about. You can subscribe to access past newsletters on Substack, and check out other essays on my website.
Good to have you back, and for new subscribers, welcome!
Here’s what I’ve got this week:
What’s Going On: Omaha, Somewhere in the Middle America
What’s On My Mind: Remembering when I became a devout Berkshire Hathaway shareholder.
What’s Going On
This weekend I’m heading to Omaha for the Berkshire Hathaway shareholder meeting. Before COVID, going on this trip had become an annual tradition, and I’m glad to be starting the tradition again. All my current thoughts are about this trip, so let’s jump forward.
On My Mind
Omaha…Lollapalooza for Investors
I first went to the Berkshire Hathaway (“BRK” for short) shareholder meeting on a whim in 2016. I only owned a few shares before the meeting, but I bought as much stock as I could afford immediately after.
Like everyone in Omaha that weekend, I spent too much time and money on steeply discounted products from the BRK subsidiaries. Justin’s cowboy boots, Pampered Chef pizza kits, Dairy Queen ice cream, Geico car insurance, See’s chocolates, Fruit of the Loom underwear, and many more brand names than I can name here. I only stopped buying when the Blizzards gave me a headache and I realized I could not fit any more in my baggage.
Tracy Britt Cool and the Berkshire Work Ethic
Later that night I met up with a college friend. He was with other people he knew that worked for Berkshire Hathaway companies. One of them was someone that I also went to college with but did not know well: Tracy Britt Cool. Tracy was the CEO of Pampered Chef at the time.
From Tracy I heard two stories that taught me more about BRK than I could learn from infinite hours of Warren Buffet videos. The first was that she and the CTO were in the Pampered Chef booth selling products all day. The people ringing up cash registers and fetching items for customers were the actual executives. It was not only Pampered Chef, either, executives of all the subsidiaries were working their own booths. We’ve all heard leaders spout clichés about getting their hands dirty, but CEOs of billion-dollar companies stuffing shelves and running cash registers takes the cake.
Warren Buffet and $5 Spatulas
The second story was that Tracy arrived to drinks late because Warren Buffet kept her on the phone for longer than expected, asking her which items sold the best. This was not some standardized debrief call with a manager, he genuinely wanted to know what customers thought about her $5 spatulas. To add one more surprising detail, while we waited at the bar for Tracy, Bill Gates was waiting to eat dinner with Warren.
Seeing with my own eyes the level of ownership that Berkshire CEOs took in their businesses, and the keen interest that Buffet (at 86 years old) still had in the minute details of each company, made me admire the hell out of them. It also made me feel guilty for all the times that I’ve glazed over the same details in my own businesses.
One approach to investing is the “Good Steward” method. What group of people will put my investment to work with care and diligence?
I left my first BRK meeting confident that Warren and Tracy are ideal stewards of any money I invest in them. Like the hats and t-shirts on Friday, on Monday morning I bought all the BRK stock I could manage.
All For Now
Thank you for reading! If you have thoughts or reactions to anything in the newsletter, please reach out!
Acknowledgments: Thank you very much to Charlie Becker and Leo Ariel for all your editing help!