He calls it “the lollapalooza prize.”
In a memo sent to managers of companies owned by Berkshire Hathaway (BRK-A), Warren Buffett lays out his March Madness offer for this year’s NCAA men’s basketball tournament: If an employee predicts the Sweet Sixteen round perfectly, he or she will win $1 million every year, for life.
“Think of it as the ultimate ‘office pool,’ with the parent company providing the prize,” Buffett wrote in the Berkshire memo. “Get the word out—use this letter if you like—so that our sports-minded employees can start thinking about their picks,” he urged.
Berkshire Hathaway held a March Madness contest two years ago for the general public, offering $1 billion for a 100% perfect bracket. The odds of doing so were 1 in 7,419,071,319, according to FiveThirtyEight. No one won. Last year, Berkshire and Buffett dropped the contest.
This time, the prize is smaller, but so is the entry pool: only employees of companies majority-owned by Berkshire can play. That includes brands like Brooks Running, Dairy Queen, Duracell, Geico, NetJets, Russell, and See’s Candies, to name a few.
The contest has “No entry fee, no nothing, all you have to do is be working for us on March 1,” Buffett told Yahoo Finance Editor-in-Chief Andy Serwer in an exclusive conversation this month in Omaha. There were 331,000 Berkshire employees as of 2015. According to a 2014 Career Builder survey, nearly 20% of all American workers have participated in an office March Madness pool.
The $1 million-every-year-for-life prize isn’t the only chance for Berkshire employees to score money. The person whose bracket remains perfect for the longest gets a prize of $100,000. That prize is guaranteed even if no one is perfect for very long; someone is going to win that money. It will be split evenly if there is a tie. As for the Sweet Sixteen, it only requires perfectly predicting 48 games. Still a long shot, but easier than nailing all 63 games. “It’s two to the 48th power if it were coin-flipping,” Buffett told Yahoo Finance, “but it’s nothing like coin-flipping.”
To fill out their brackets, Berkshire employees go to a specially created web site, bhbrackets.com, and register with their company and email address. The brackets come out on March 12, Selection Sunday, and lock on Thursday, March 17.
Berkshire employees are understandably excited. "Everyone's talking about it," says one employee of a Berkshire-owned company who asked not to be named discussing the contest externally. "We're also wondering if it's okay to quit your job if you win? I mean, it's almost rude not to," he joked.
As Yahoo Finance’s Serwer surmised, it’s unlikely that someone will predict the Sweet Sixteen perfectly, but if someone does, “you figure you’re at risk like $60 million at the most. And you can handle that.”
“We can handle it, yeah,” Buffett said.
UPDATE, Mar. 19: Buffett's contest ended before the end of Day Two. Forget having a perfect bracket for the Sweet Sixteen; no one in the country even made it out of the Round of 64 still perfect. After Hawaii (a 13-seed) beat U.C. Berkeley (4) on Friday night, two people in the Berkshire Hathaway pool were still perfect. After Middle Tennessee (15) shocked Michigan State (2), it was over. The two co-winners both work at insurance companies owned by Berkshire: one at Geico, one at USLI. They will split the $100,000.
Catch Warren Buffett and Berkshire Hathaway’s annual meeting this year live online, for free, on April 30 exclusively at Yahoo Finance.
Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology.