Business basics with Buffett

7/10/2009 - A number of Kellogg students experienced what many called an “opportunity of a lifetime” this spring — meeting billionaire investor and businessman Warren Buffett on his home turf in Omaha, Neb.

Four Kellogg students participated in Berkshire Hathaway’s annual shareholder meeting in early May. The students were enrolled in the Kellogg School’s Asset Management Practicum, an experiential learning program that provides students an opportunity to invest about $2 million of the Kellogg endowment, with some investments in Berkshire Hathaway shares.

Berkshire’s annual meeting took on a sober tone in light of the economy and performance of Berkshire stocks, David Stott ’09 said. But during a five-hour question-and-answer session with Buffett and his business partner Charlie Munger, the value investors shared a message of optimism and hope about the economy, as well as reconfirming that sticking to investment basics is important.

“It’s one of those special occasions to see one of the best investors in our time and hear his point of view,” said Enzo D’Angelo ’09. “It was comforting to know that the best investor still focuses on fundamental business analysis and investing basics.”

About two dozen Kellogg students had traveled to Omaha a few weeks earlier, joining students from other business schools and organizations for a personal meeting with Buffett, CEO and chairman of Berkshire Hathaway.

The students toured Nebraska Furniture Mart, an Omaha furniture retailer Buffett invested in some 20 years ago. They also had lunch with Buffett and participated in a question-and-answer session with the “Oracle of Omaha,” inquiring on an array of topics, including environmental issues and whether children are a good investment.

“The students got to question Warren Buffett directly — no holds barred,” said Ravi Jagannathan, the Chicago Mercantile Exchange/John F. Sandner Professor of Finance and co-director of the Financial Institutions and Markets Research Center. Jagannathan accompanied the students on the trip.

“He is not just any success story — Warren Buffett is a phenomenon. His annual letters to his shareholders are a must-read for those interested in finance and general management and corporate governance. He covers a number of interesting topics in his letters to the shareholders, and they are related to the issues the students study in their classes here.”

Kellogg student Jackie Spring ’09 said that after reading about Buffet in depth, it was interesting to see him in action.

“What struck me was how down-to-earth he was and how passionate he is,” Spring said. “At 78, he’s still passionate about his career and it’s very rare to see that.”

Kellogg student Dan Huggins ’09 said Buffett reinforced the notion of loving the job that you are in.

“There is so much happening in the investment world now, so it was hugely valuable to have his perspective,” Huggins said. “This was one of those unique business school opportunities to meet Warren Buffett. It was a once-in-a-lifetime opportunity.”

Kellogg student Dave Blanchard ’09 said he was impressed with the energy and enthusiasm that Buffett had for the students, spending a couple of hours posing for photos with attendees after the two-hour question-and-answer session.

“It was surreal to meet one of the most successful investors in history,” Blanchard said. “It was one of those ‘grandson’ experiences — something that I would tell my grandson about.”