Buffett’s life and personality are filled with contradictions: the man who loves making money yet doesn’t care about spending it; the billionaire who believes rich people should pay taxes; the seemingly reclusive person who seeks the media limelight; the principled man who had, in effect, two wives; the icy dealmaker who seems genuine and is liked by everyone.
I dug into reconciling these seemingly irreconcilable facets of his personality and learned many intriguing little details. Buffett grew up at the racetrack handicapping horses, and odds-making permeates all his business decisions. It let him avoid the mistake made by those who bought mortgage derivatives: reaching for small gains at the risk of a catastrophic loss because the loss isn’t likely on any given day.
And yet, when the odds were right, he concentrated his bets so much that it would terrify most people – for example, putting 75 percent of his net worth in GEICO as a young man. He had a high confidence about GEICO’s odds, and an even higher confidence in himself. Even on the remote chance that he was wrong about GEICO, he knew he was young enough and smart enough to start over and still get rich.
In this way Buffett was a prodigy, yet he suffered from such severe social anxiety as a child that he set out to conquer it through study. He learned maxims like “give people a fine reputation to live up to” from a Dale Carnegie book, took these rules to heart and refined them into a sophisticated set of behavior modifications based on incentives. From then on, Buffett would praise people lavishly, set high aspirations for them, and ignore them when they behaved against his wishes. He almost never criticized anyone. It worked, and he became one of the best managers and networkers I have ever seen in business.
The time I spent with Buffett let me analyze and understand the roots of his success, the unusual way of thinking about business and relationships that made him more than just the burger-chomping billionaire. The mystery and intrigue of the ukulele-playing, Coke-swigging business titan had always been intriguing; it was when Buffett pulled back the curtain and revealed himself that his true magic came to light.