Entrepreneurs

How a cold call led to Smith & Wollensky steakhouse hosting Warren Buffett's multimillion-dollar charity lunches

Warren Buffett, one of the most successful investors in the world
Adam Jeffery | CNBC 
Warren Buffett, one of the most successful investors in the world

The atmosphere at Smith & Wollensky steakhouse in midtown Manhattan feels as if it's from another era: The staff wear coats and ties, the napkins are cloth and dishes like fresh shucked oysters and New York cut sirloin steaks are served with table-side grandeur.

It was founded in 1977 by Alan Stillman, who flipped around through a New York City phone book and randomly selected two last names, "Smith" and "Wollensky," to name his eatery.

Given the old school nature of the place, it's no surprise that Stillman used an old school business tactic to get in touch with another entrepreneur who appreciates tradition — billionaire investor Warren Buffett.

Smith & Wollensky steakhouse is photographed on Wednesday, May 9, 2007, in New York. Billionaire Warren Buffett sat down over steaks today with an investor who paid $620,100 for the privilege.
Bloomberg | Getty Image
Smith & Wollensky steakhouse is photographed on Wednesday, May 9, 2007, in New York. Billionaire Warren Buffett sat down over steaks today with an investor who paid $620,100 for the privilege.

In 2000, Buffett began auctioning off charity lunches to raise money for Glide, a charitable organization he became involved with through his late wife, Susie Buffett. The first lunch sold to a tech entrepreneur named Pete Budlong, who donated $25,000 to dine with the Oracle of Omaha. Now in its 19th year, the auctioned lunches go for millions. The bidding for this year's lunch, which closes at 10:30 p.m. EST on Friday, has already surpassed $3.2 million.

When Stillman first heard about Buffett's charity lunches in the early 2000s, he wanted to be a part of it.

"I heard about it. Got his phone number," Stillman tells Business Insider. "That took at least a year to get his phone number because I didn't want to just call up the company." After tracking down his personal number, Stillman gave Buffett a ring.

"He actually answered the phone himself. He said, 'Hi, this is Warren,'" Stillman remembers. "I was, sort of, stumped for words. I couldn't quite believe that I had Warren Buffett on the telephone."

It turned out that Buffett (a known fan of steak) was familiar with the restaurant. While he had the chance, Stillman pitched Buffett an idea: " I wanna donate an additional [amount of money] for you to come to New York and have lunch at Smith & Wollensky and I'm going to give to your favorite charity, Glide."

Within a few seconds, Buffett replied, "You, Mr. Stillman, have a deal. You put it together and I'll be there," according to Business Insider.

Since 2004, Smith & Wollensky has hosted all of Buffett's charity lunches at their New York location, according to a representative for the restaurant, with the exception of 2010 and 2011, when winning bidder Ted Weschler requested to dine at Piccolo's steakhouse in Buffett's home of Omaha, Nebraska. (Buffett was so impressed with Weschler he offered him a job at the second lunch, and Weschler accepted.)

At the New York steakhouse, Buffett orders "a medium-rare steak with hash browns and a cherry coke," according to a 2007 winner of the auction. Smith & Wollensky confirmed the order to CNBC Make It, and added that Buffett's favorite steak is a sirloin. At Piccolo's in Omaha, Buffett is known to order veal with lemon and a root beer float.

Smith & Wollensky steakhouse founder Alan Stillman with Warren Buffett.
Courtesy of Smith & Wollensky
Smith & Wollensky steakhouse founder Alan Stillman with Warren Buffett.

"It is a very exciting day for the restaurant," Smith & Wollensky general manager Roger Morlock tells CNBC Make It.

"The servers that we have, have been waiting on him for quite some years, and our executive chef has been here for over three decades, so for them it's business as usual. But of course we pay special attention to that table."

And Buffett is his usual, down-to-earth self. Says Stillman: "He gets out of a Yellow Cab, and what you see with Warren Buffett is what you get."

Each year, Smith & Wollensky donates at least $10,000 to Glide.

Don't miss: How this business owner landed a job at Berkshire Hathaway from Warren Buffett's famous charity lunch

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