Perhaps what is more concerning is the method of the deal and the team behind it. Only last week, the company wrote down the value of numerous brands in the portfolio sending the shares crashing 30%. The company is one of the largest foods & beverage firms in the world, but it also carries plenty of dated brands. Buffett teamed up with 3G Capital to merge his Heinz business with Kraft foods. More recently it has not been plain sailing for the Oracle of Omaha.

A 5-fold winner on American Express and a $500 million dividend from Goldman Sachs.

A 7-times return on a $120 million investment into Wells Fargo.

A $680 million profit from a loan to Mars.

Some of the most acclaimed paydays from those lending days include: Him and Berkshire saw an immense opportunity to lend to businesses that needed the short-term capital and boy are they reaping the rewards today. Well, when the tide went out during the 2009 financial crisis, Buffett went swimming. When the tide goes out, we’ll see who is swimming naked. Just look at today’s portfolio: How Warren Buffett Capitalised On The 2009 Financial Crisis He was interested in its valuation and its ability to deliver returns. When he acquired Berkshire Hathaway for the first time, Buffett was not interested in the product or the production. While the insurance industry proved to be his bread-and-butter in the early days, Buffett does have a pretty varied diet when it comes to investing. On Keeping Berkshire Hathaway Diversifiedĭespite his own Cherry Coke addiction, Buffett has always kept Berkshire pretty well diversified. Buffett has forever been about cash-rich businesses and he decided acquisitions of insurance companies – where the cash they take to cover future pay-outs – would provide the perfect launchpad for further acquisitions. Several of which, led him to his first love, Insurance companies.

That foray quickly amounted into an aggressive addiction and contrary to his principles of today, Buffett started to demand a switch of leadership.ĭespite admitting to his regrets around the Berkshire acquisition, Buffett used the rich cash flow of the business to force some acquisitions. Warren Buffett & Berkshire Hathawayīuffett’s first foray into Berkshire Hathaway came in 1962. Buffett expanded these partnerships with other investors and held a 9.5% stake in more than $1 million of assets. This is what is today known as a packaged product but back then, it was pretty revolutionary.

Cover a quarter of any losses the partnership incurred.Buffett would take half of the partnership gains over 4%.The terms of his management fees seem a little steep in today’s market: To keep investors onside and reduce the beef, Buffett created a partnership with friends and family that would see Buffett invest small amounts into the fund and re-invest his management charges back into the fund (under his name). He actually turned into a pretty dynamic investment salesman and loved his job…the bit he didn’t like so much…? When things went south, and clients lost money.

After reading ‘How to win friends and influence people’, Buffett claims he found renewed confidence to get out and sell his ideas.

Warren buffett success story