The surprising lesson this 25-year-old learned from asking Warren Buffett an embarrassing question

This 25-year-old learned a tough business lesson from Warren Buffett
This 25-year-old learned a tough business lesson from Warren Buffett

Dubbed "Woodstock for Capitalists," the annual Berkshire Hathaway shareholder meeting attracts shareholders and spectators alike, looking to glean insight from the investment firm's billionaire chairman Warren Buffett and longtime vice-chairman Charlie Munger.

The highlight of the three-day extravaganza is a six-hour question-and-answer session, in which tens of thousands vie for the chance to ask the legendary investors questions.

Alex Banayan was lucky enough to be one of those select few. But the 25-year-old learned a crucial lesson when Buffett's answer to his query wasn't what he'd expected.

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Warren Buffett is worth $75 billion but says he would be 'very happy' with way less

In his book "The Third Door," Banayan recounts his seven-year quest to uncover how the world's most successful people launched their careers. He interviewed icons like Maya Angelou, Steve Wozniak and even Buffett's close friend Bill Gates, but securing a one-on-one interview with the investor appeared to be impossible.

His luck seemed to change when he met a man — who he refers to in the book by the pseudonym "Dan Babcock" — at a Summit Series event. Babcock claimed that he had worked for Buffett for seven years, and shared with Banayan what he said was the greatest piece of advice he ever received from the billionaire.

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First, he told Banayan to write a list of 25 things he wanted to accomplish in the next 12 months, and then to circle the five that he wanted to do over the next three months. Next, he said to copy those five things onto a second sheet of paper and to cross them off the first list of 25.

Babcock said to title the list of five "The Priority List" and the list of 20 "The Avoidance List."

"[He] told me that was Mr. Buffett's secret," Banayan tells CNBC Make It. "The secret to being world-class was prioritizing your desires."

Armed with this new insight, Banayan renewed his quest to speak with Buffett, sending flowers to his assistant, relentlessly emailing his office and even asking Gates' team to put him in contact with the investor — to no avail.

That's when I found out the whole thing was fake.
Alex Banayan

Buffett did respond to Banayan with a handwritten note, but the billionaire was much too busy to meet him in person. Undaunted, Banayan booked a trip to Omaha, Nebraska with a small group of friends to attend the 2013 Berkshire Hathaway shareholders meeting.

His plan was to ask Buffett a question during the Q&A portion. Since he wasn't a shareholder or a journalist, Banayan had to enter a lottery system.

The odds of being selected were extremely low — only 30 people out of 30,000 attendees were going to be selected to ask questions, a volunteer told him. But another volunteer pulled him aside and told him that certain stations had far fewer lottery entries than others. If Banayan dropped his ticket into one of those buckets, his chances would skyrocket. Banayan followed her advice and was chosen as a winner.

Hours later, the spotlight flashed on Banayan as he introduced himself, stated where he was from and said:

"Mr. Buffett, I've heard that one of your ways of focusing your energy is that you write down the 25 things you want to achieve, choose the top five and then avoid the bottom 20. I'm really curious how you came up with this and what other methods you use for prioritizing your desires?"

Buffett chuckled, responding, "Well, I'm actually more curious about how you came up with it." The audience erupted in laughter.

Buffett proceeded to explain that both he and Munger live very simple lives, and are not disciplined enough to approach decision-making in that way. "I can't recall making a list in my life," said Buffett.

Banayan was stunned. "I could feel my cheeks turning red and I walked away in defeat and humiliation, so confused why Warren Buffett would lie like that," he says.

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But a friend suggested that perhaps it was Babcock who was the liar. "That's when I found out the whole thing was fake," says Banayan. "Someone who I trusted, someone who I saw as a mentor wasn't who they said they were."

Even though he felt angry and betrayed, Banayan says he learned a critical life lesson: "Some people in the business world aren't exactly who they say, and it's up to you to trust your intuition and look out for the red flags."

Banayan says he was so focused in his dogged pursuit of Buffett that he didn't take the time to look into Babcock's background, second-guess some of the dubious advice that he received or notice that certain parts of Babcock's story didn't add up.

"Because I was so desperate ... I never was able to see him for what he truly was," says Banayan. "Desperation clogs intuition."

Banayan still has yet to speak with Buffett, but hopes that one day he'll have the opportunity to tell the legendary investor about the unexpected lesson he learned after his fateful shareholders' meeting appearance.

Video by Richard Washington

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