My Odyssey with the Oracle
Alice Schroeder, BBA’78, MBA’80, Talks to Texas About Her Insider's Perspective on Billionaire Warren Buffett.
Story by David McKay Wilson ~ Photography by Allison V. Smith
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Warren Buffett, the world’s richest man, has remained aloof from the media for most of his career. While the financier called the Oracle of Omaha amassed billions by investing in undervalued companies from his corporate suite in Nebraska, the world knew little about what made Buffett click.
Then he decided in 2003 to open up his world to Alice Schroeder, BBA ’78, MBA ’80, an insurance industry analyst who’d befriended him while covering the stock of his company, Berkshire Hathaway.
What emerged five years later was an intensely personal look at the public and private sides of Buffett in Schroeder’s biography, “The Snowball: Warren Buffett and the Business of Life,” which topped the New York Times Best Seller List in October.
Readers learn about Buffett’s financial strategy, such as finding what he called “cigar butts”—those “cheap and unloved stocks that had been cast aside like the sticky, mashed stub of a stogie one might find on the sidewalk” that still have a few puffs left in them. They discover that Buffett saw himself as his most valuable client and decided to promote himself at least an hour each day. On the personal side, they learn that Buffett is a picky eater who doesn’t like cauliflower and that he has a preoccupation with death that makes it quite difficult for him to deal with the passing of those close to him.
Those details emerged through thousands of hours of interviews Schroeder had with Buffett, his family and close associates.
She came to know him while following the stock of his company, Berkshire Hathaway, for several years. Then her career changed suddenly after she suggested to Buffett that he write his autobiography. He turned the question back on her, asking her who she thought should write it. Schroeder, who had no professional writing experience, had the gumption to volunteer.
He liked Schroeder and agreed to cooperate, opening his personal files and providing access to friends and family. She took a leave from her post as a managing director at Morgan Stanley to spend five years researching and writing what Janet Maslin of The New York Times called “the definitive portrait” of Warren Buffett.
“By the time I started the book, I’d known him five years,” says Schroeder. “My initial awe gave way to curiosity as I began to understand him as a human being. He became a fascinating puzzle I wanted to solve.”
Telling Buffett’s story was a mighty challenge for Schroeder, who started her professional career as an auditor with the accounting firm Ernst & Whinney, now known as Ernst & Young. She worked in Houston for six years, became a certified public accountant and then spent four years in the firm’s Cleveland office.
In 1991 she moved to Connecticut to serve as a project manager of the Financial Accounting Standards Board, where she drafted rules for the insurance industry. That work caught the eye of executives in the investment banking world. By 1993, she’d been recruited by Dowling Partners, an investment banking firm in Hartford.
A year later, she began working in Manhattan at Oppenheimer & Co., serving as lead analyst of the property-casualty insurance industry. By 1998, she’d moved to Paine Webber in a similar post, where she began covering the stock of Berkshire Hathaway.
“Nobody was covering Berkshire Hathaway then,” she says.
“I thought it was the most interesting, complicated company. Paine Webber was very accommodating. And it came as a complete surprise how fascinated investors were of Berkshire Hathaway.”
Buffett liked her work, and decided to meet with her once a year and talk on the phone. “I gained real insight into Berkshire Hathaway as a company,” she says.
She brought that knowledge with her to Morgan Stanley in 2000, where she became a managing director. She worked there until 2003, when she took a leave to research and write the Buffett biography.
James Rosen, in a review in the Washington Post, said the detailed account of Buffett’s life will become a must-read for the next generation of financial giants.
“[I]f the replication of any great achievement first requires knowledge of how it was done, then ‘The Snowball,’ the most detailed glimpse inside Warren Buffett and his world the world will ever get, should become a Bible for capitalists,” Rosen wrote.
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