It's Just Lunch

Warren Buffett Becomes a Cheap(er) Lunch Date


Warren Buffett, chairman of Berkshire Hathaway drinks a Cherry Coke during the Berkshire's 2009 shareholder meeting

Photograph by Andrew Harrer/Bloomberg

Warren Buffett, chairman of Berkshire Hathaway drinks a Cherry Coke during the Berkshire's 2009 shareholder meeting

How to explain the dramatic drop in bids for a lunch with billionaire Warren Buffett? An online auction for the chance to break bread with the Oracle of Omaha took in just over $1 million this past week. That’s the lowest price since investor Mohnish Pabrai and two friends won with a $650,100 bid in 2007, and an astonishing 71 percent discount below the $3.45 million paid by last year’s winner for lunch at a Manhattan steakhouse. This year’s winner—one of eight contenders—chose to remain anonymous. Proceeds go to Glide, a San Francisco charity supported by Buffett’s first wife for many years.

“It’s a sad day for Glide and for all of us,” Pabrai said Monday of this year’s more modest auction result. “Our hero got beat down.”

Is the Oracle losing his allure? Has Buffett’s rhetoric about pinching the nation’s richest with higher taxes finally caught up with him and dimmed his allure among the richest investors? Pabrai doesn’t think so, suggesting instead that the previous three auctions have been high-priced anomalies. Ted Weschler, a hedge-fund investor, won in 2010 and 2011 with $2.62 million bids each year; he later closed his fund to work for Buffett’s Berkshire Hathaway (BRK/A).

“You know, Ted has a net worth in the hundreds of millions of dollars. He’s a big philanthropist but quiet about it,” says Pabrai, a money manager in Irvine, Calif. “For him, it was very simple—he was going to keep bidding as long as it took to win, period. And I happen to know the person who was basically the second bidder who lost to Ted. And that person had a very simple goal: Keep the bidding as high as he could.”

Reverend Cecil Williams, Glide’s co-founder, doesn’t see the latest auction as a fund-raising disappointment, he said through spokeswoman Denise Lamott. “They have no theory as to why the results were lower this year than last, but again, they are thrilled with the results of this year’s auction,” Lamott wrote in an e-mail. Buffett plans to participate in the lunch auction again next summer.

Pabrai doubts he’ll bid again, now that he’s on a first-name basis with the world’s third-richest person and socializes with him at Berkshire Hathaway’s annual investor confab in Omaha. “Been there, done that, got the T-shirt,” says Pabrai.

Bachman is an associate editor for Businessweek.com.

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  • BRK/A
    (Berkshire Hathaway Inc)
    • $228000.0 USD
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