“I always knew I was going to be rich,” says Buffett. “I don’t think I ever doubted it for a minute.”
With an estimated net worth of around $42 billion, Warren Buffett is considered the second wealthiest person in the world. He has used his unique personality and management style to master the art of investment and create an empire, owning a 38% stake in Berkshire Hathaway. In recent years, he has committed himself to giving away 85% of his fortune, primarily to the Bill and Melinda Gates Foundation. Whether he is making money or giving it away, Buffett has made a name for himself as one of the most astute entrepreneurs and investors in history.
Born on August 30, 1930, Warren Edward Buffett grew up in Omaha, Nebraska with his two sisters, Doris and Bertie, his mother Leila, and his father, Howard Buffett, who was a stockbroker as well as a Republican member of the U.S. House of Representatives. His grandfather owned a local grocery store, where Berkshire Hathaway’s current Vice Chairman Charlie Munger once worked alongside Buffett.
When Buffett was just six years old, he bought six packs of Coca-Cola from his grandfather’s store. They cost him 25 cents but he managed to resell them for five cents a bottle. Buffett had made a profit of five cents but more importantly, the experience had whet his appetite for business. With his newfound passion for profit, Buffett shunned the playground in search of more moneymaking opportunities.
Five years later, when Buffett was 11 years old, he purchased three shares of Cities Service for himself and his sisters at a price of $38 each. The stock quickly dropped to $27 per share and although he was afraid, Warren decided to hold onto his shares. Eventually, the stock rebounded and Warren sold the shares when they reached $40. Despite having been rewarded for his patience, Warren soon found out he had not been patient enough and shares of Cities Service shot up to $200.
Throughout high school, Buffett worked as a newspaper delivery boy and by the time he had graduated in 1947, he had saved over $5,000 from his two routes. He used $1,200 of this money to purchase 40 acres of farmland in Nebraska, which he promptly rented to tenant farmers for a profit. He even deducted his bicycle as a work expense when he filed his first income tax return at the age of 13.
At the urging of his father, Buffett enrolled in the Wharton Business School at the University of Pennsylvania. He had never wanted to go to college and indeed, only lasted two years at Wharton. When he started complaining that he knew more than his professors, Buffett moved back home and transferred to the University of Nebraska-Lincoln. Here, while working full-time, Buffett managed to graduate in just three years.
After reading Benjamin Graham’s The Intelligent Investor, Buffett decided to apply to graduate school. He was rejected by Harvard Business School for being “too young” and subsequently applied to Columbia Business School, where he would study under Graham himself. Buffett became the first-ever student in Graham’s security analysis class to receive an A+. In 1951, Buffett received his Master’s degree in economics and went to work as a salesman at his father’s brokerage. After three years, Buffett was hired by Graham’s investment firm but returned to Omaha in 1956 when Graham retired. With education and experience in hand, Buffett decided to set off on his own.
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