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Yahoo Finance Exclusive: Warren Buffett teaches students unforgettable lessons

The male students are wearing jackets and ties, the women in conservative dresses and skirts. They are seated and earnestly await their teacher. When he arrives, they applaud. This is not some Norman Rockwell scene from a wistful, bygone era. This is November 2015 and the teacher is Warren Buffett.

He enters by himself. Two Cherry Cokes are strategically placed on the table nearby. Then the Master Class begins. It is one of a handful he’s done this year in a tradition he has maintained for many years.

The quips begin immediately. “I used to be flattered when there was applause. But now that I’m 85…” he says to instant laughter.

Warren Buffett has many titles and most of them have to do with his extraordinary wealth, investments and philanthropy. But the Oracle of Omaha should have another: Professor Emeritus.

“One way or another I’ve been teaching students for 64 years,” Buffett told me. “Up until about 10 years ago I did sessions both in Omaha and on the road and I shifted to Omaha only.”

Students from eight schools: the Universidad del Pacifico in Lima, Peru, INSEAD from its campuses in Fountainbleau, France and Singapore, Buffett’s two alma maters, Columbia and the University of Nebraska and the universities of Kansas, Missouri and Tennessee all made the most recent pilgrimage to Omaha. And then there was my school, William Paterson University’s Cotsakos College of Business, a state university in Wayne, New Jersey.

The legendary investor poses with students from William Paterson's Cotsakos College of Business and the author.
The legendary investor poses with students from William Paterson's Cotsakos College of Business and the author.

Currently Buffett has pared his student sessions to five Q&A’s a year. With approximately 160 students attending each, that’s still 800 students a year.

Encyclopedic and Entertaining

The Q&A cannot be recorded. But that’s one of the few rules: Buffett doesn’t want to see the questions in advance and says you can ask him anything.

“Just make sure you don’t throw me any softballs,” he said at the start of the session. “I’ll duck if you throw them at my head.”

And this is where Buffett blows the business student’s mind. No matter how many Berkshire Hathaway annual shareholder letters they’ve read or CNBC interviews they’ve seen, many told me they were not prepared for the spontaneous display of encyclopedic knowledge, folksy humor or stories with boldface names from throughout Buffett’s life.

When talking about commodities, Buffett crunched the annual U.S. consumption of diesel fuel on the spot. He gave the population figures from each Europe, China and the U.S. in 1790 when tracking 200 years of capitalism.

He told a joke about how he tested his 91-year-old partner Charlie Munger’s hearing by asking him two times from varying distances in his office whether they should buy GM at $35. No answer. When he asked the question yet again this time closer still, the famously curt Munger said, “For the third time, yes.”

On why he doesn’t recommend postponing working at a job you love: “It’s like delaying sex until your old age. Not very smart.”

On the power of brands: “If you buy a girl a box of See’s chocolates and she kisses you, we own you.”

He said and he Munger went up to Microsoft in 1995 as non-techies to brainstorm with Bill Gates and his top people about the future of the Internet for the masses. He noted how mental blocks within even the brightest minds hinder new ideas. “Nobody came up with search. Nobody came up with auctions.” And to much laughter, he added, “Nobody came up with Tinder.”

How I Got to Go

The media eats up Buffett’s patented plain talk. So he is deluged with media requests. There is no outside PR firm or Corporate Communications which decides who gets the green light. It’s Buffett’s decision alone.

So when I first requested an on camera interview as a CNN correspondent in 2007, I knew I had to stand out. I talked to a mentor, veteran financial journalist Myron Kandel, who had played tennis with Buffett. We decided I should start with humor.

My request on company letterhead opened like this: “Dear Mr. Buffett, I feel you’ve been neglecting me.”

His prompt response began: “Dear Susan, I enjoyed your letter—so much so that I’m almost ready to propose.” Thus a relationship –a professional relationship-- was born.

I did not know about the Buffett Q&A but when I started teaching business journalism, I told him in a similarly unconventional manner: a Valentine’s Day poem. Even Hallmark would weep with its sophomoric Roses are red, Violets are blue verse.

But it got a quick response from the only person who mattered. He said: Bring your students out to Omaha.

On your dime, that is.

Buffett doesn’t sacrifice his legendary thriftiness –even for debt-laden college students. After the two-hour Q&A session at Berkshire Hathaway, he does spring for lunch at a favorite steakhouse, Piccolo Pete’s. Three years ago he even drove three of my students to the restaurant. That made for one memorable selfie from the backseat of Warren Buffett’s Cadillac.

And since Berkshire Hathaway is a collection of dozens of eclectic businesses: Dairy Queen, Geico and Benjamin Moore among them—several of the Omaha-based subsidiaries open their doors to students on the same day. So before the Q&A began, there was a tour at the Nebraska Furniture Mart. After lunch, there were stops at Borsheims Jewelry and Oriental Trading, where everyone was given a unique parting gift: two bespectacled suit-and-tie clad rubber ducks in the likeness of Buffett and Munger.

Buffett the Feminist

One rule Buffett stipulates in bold face is that one third of each group of students is female.

Buffett’s attention to gender representation prompted a memorable exchange the last time I brought students from William Paterson to Omaha. At the end of the Q&A in January of 2012, Buffett said he had room in his car (a 2006 Cadillac) for two males and two females from different universities. And then he quipped, “My driver says I have room for one more. To be fair, it will have to be a transvestite.”

One of my students, Nick Bowman, immediately raised his hand, stood up and volunteered for the latter. Buffett bent over laughing. When he squeezed in the car with four others Bowman, now an MBA student at Texas Tech, said that Buffett turned around and said “I’ve been saying that joke for 15 years and you’re the first person to take me up on it.” By the way, Buffett’s “driver” is himself.

One More Thing

When a University of Kansas student asked about the qualities of a Mid Western investor, Buffett talked about the mentors early in his life. He said his father “couldn’t have been a better teacher. “ He gave credit to his Columbia professor Ben Graham. And he said his first wife, the late Susie Buffett, was “enormously important.”

Above all, he talked about the power of unconditional love. “It gets you through things,” he said.

The students had come to Omaha to pick Warren Buffett's brain. Through word and deed they also learned something about his heart.

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