Entrepreneurs

Here's how Warren Buffett hustled to make $53,000 as a teenager

Some billionaires are born into wealth while others hustle their way to the top.

Warren Buffett is a poster child for the hustlers.

Before the "Oracle of Omaha" earned an average of $2 million a day, he was a scrappy kid working schemes to earn $5,000, or what would be $53,000 today. He stashed the fortune away in his sock drawer.

Alice Schroeder's 2008 biography, "The Snowball: Warren Buffett and the Business of Life," chronicles how these efforts established his money-making mentality long before his net worth swelled to $74 billion.

From that telling, here are the young Buffett's best side hustles.

Warren Buffett drinks several cans of Coke a day.
Contributor | Bloomberg | Getty Images
Warren Buffett drinks several cans of Coke a day.

SELLING GUM AND COCA-COLA

At just 6 years old, Buffett earned his first few cents selling sticks of gum in the neighborhood. He carted Juicy Fruit, Spearmint and Doublemint around on a tray and sold them in packs of five for a nickel. When a woman asked for just one stick, little Buffett refused.

"We don't break up packs of gum — I mean, I've got my principles. I still, to this day, remember Mrs. Macoubrie saying she wanted one stick. They were a nickel and she wanted to spend a penny with me," he tells Schroeder.

But Buffett found the margins to be better selling Coca-Cola door to door in the summer, even at the lake when his family vacationed in Iowa.

DELIVERING THE PAPER

At 13, Buffett took what could have been a mind-numbing job as a paper boy and turned it into a competition with himself. With his father representing a Nebraska district in Congress, Buffett woke up at 4:30 in the morning to deliver copies of The Washington Post, and he challenged himself to find ways to serve each of his five buildings faster.

Then he found ways to track when the houses along his route had magazine subscriptions expiring and sold new subscriptions on the side, along with calendars.

By 15, Buffett had made $2,000 delivering papers. He invested $1,200 of that in a 40-acre farm where he had a profit-sharing agreement with a Nebraskan farmer.

Warren Buffett, left, rides in a golf cart on his way into the Inn for sessions of the Allen & Co. conference in Sun Valley, Idaho.
Matthew Staver | Bloomberg | Getty Images
Warren Buffett, left, rides in a golf cart on his way into the Inn for sessions of the Allen & Co. conference in Sun Valley, Idaho.

STARTING A COMPANY

After he earned enough money working for other people's companies, Buffett began his own.

His first was Buffett's Used Golf Balls. He bought refurbished balls from a man in Chicago at $3.50 a dozen and turned them around for $6.

"He probably got them the way we first tried to get them, out of water traps, only he was better," Buffett tells Schroeder.

SCAVENGING 'LOSING' TICKETS AT THE TRACK

While Buffett was still a kid in Omaha, a friend's mother introduced him to betting at Ak-Sar-Ben, a local horse track. While he was too young to gamble, he wasn't too young to make money on what other people carelessly threw away.

"They call that 'stooping,'" Buffett explains, noting that novices were placing bets at the beginning of racing season. "And they'd think that if your horse came in second or third, you didn't get paid, because all the emphasis is on the winner, so they'd throw away place and show tickets."

He and his friend scoured the stands for discarded tickets amidst the cigarette butts, spilled beer and food scraps.

"It was awful; people would spit on the floor. But we had great fun. If I found any winning tickets, my Aunt Alice would cash them in for us, because they wouldn't cash them for kids."

Eventually, he got his high school golf coach to drive him to some local races where he'd make bets after analyzing race statistics. Once he went alone and bet every race only to continue losing as his emotions got the best of him.

"I'd committed the worst sin, which is that you get behind and think you've got to break even that day," Buffett tells Schroeder. "It was the last time I ever did anything like that."

Warren Buffett, chairman and CEO of Berkshire Hathaway
CNBC | Getty Images
Warren Buffett, chairman and CEO of Berkshire Hathaway

SELLING STAMPS TO COLLECTORS

He set up Buffett's Approval Service, which sold sets of collectible stamps to collectors who lived out of state.

BUFFING CARS

With the help of a friend, he set up Buffett's Showroom Shine, a car-shining business the two young men ran out of his friend's dad's used-car lot. Business turned out to be more trouble than it was worth, however.

Schroeder notes it was abandoned "because it involved manual labor and turned out to be too damn much work."

Warren Buffett.
Chris Goodney | Bloomberg | Getty Images
Warren Buffett.

SETTING UP PINBALL MACHINES IN BARBER SHOPS

When Buffett was 17, he told a friend about an idea with massive potential.

"'I bought this old pinball machine for $25 and we can have a partnership,'" Buffett says in Schroeder's retelling. His friend's side of the deal was to fix it up. Buffett, meanwhile, took care of making the pitch to barbers to let them put the machines in the waiting area in exchange for half the profits.

He claimed to be a representative of the nonexistent "Mr. Wilson's Coin Operated Machine Company."

The idea was a huge success, bringing in $4 in its first night and thrilling the barber. After a week, Buffett walked away with $25 and reinvested it into another machine. He continued until there were seven or eight "Mr. Wilson's machines" making him money around town.