With a net worth of $58.5 billion and an awe-inspiring track record of successful investment, Warren Buffett has become a mentor to aspiring investors the world over. But Buffett was once a young investor himself; even the Oracle of Omaha was in need of guidance from his own mentor early in his career.
Warren Buffett’s Mentor
Warren Buffett was interested in investing from a young age, and as a college student at the University ofNebraska he discovered a book that changed his life: The Intelligent Investor by Benjamin Graham. “I thought then that it was by far the best book about investing ever written,” he said in recent years. “I still think it is.”
Buffett became determined to meet his mentor, even travelling to Washington DC one day to visit the office of GEICO Insurance, where he’d heard Graham was chairman (Graham was out, since it was the weekend).
He enrolled in Graham’s course at Columbia Business School, and began to learn the fundamentals of investing. Buffett later recalled how impressed he was that a successful investor, who had no need to work as a teacher, gave his time to pass on his ideas to students. “He is the reason I went to that school for post-graduate work. I’ve long forgotten what I did with the master’s degree I was awarded; I’ve never forgotten Ben.”
When Buffett graduated and asked his mentor for a job at his Wall Street firm, however, Graham initially said no. Buffett went back to Omaha, but kept on sending investment ideas to Graham, and a few years later Graham gave him a job. A year later, he retired and left Buffett in charge.
The influence of Graham on Buffett can be measured in several ways. It’s shown in the fact that he gave his son Howard the middle name “Graham” in honor of his mentor. Or you could look at what Buffett says about Graham:
“To me, Ben Graham was far more than an author or a teacher. More than any other man except my father, he influenced my life.”
“I knew Ben as my teacher, my employer, and my friend … If clarity of thinking was required, there was no better place to go. And if encouragement or counsel was needed, Ben was there. Walter Lippmann spoke of men who plant trees that other men will sit under. Ben Graham was such a man.”
But perhaps the biggest sign of Graham’s influence is in Buffett’s investing style. The principles of patient, long-term value investing that Graham taught the young Buffett at Columbia University back in 1950 are what he has used for the past half a century to amass that fortune. Although he’s made some modifications over the years, he frequently cites Graham whendescribing his own investing philosophy:
“The basic ideas of investing are to look at stocks as business, use the market’s fluctuations to your advantage, and seek a margin of safety. That’s what Ben Graham taught us. A hundred years from now they will still be the cornerstones of investing.”
Just like all of the other famous protégés we’ve featured so far, Buffett has also taken the opportunity to “pay it forward” by mentoring someone else. You’d expect Buffett’s protégé to be quite successful, and you’d be right: it’s Bill Gates.
Lessons from Buffett and Graham
Here’s what we can learn from the story of Warren Buffett’s mentoring experience:
- Protégés can play an active role in seeking out the mentor they want.
- Good mentors love to help others: Graham was teaching at Columbia purely for the love of it, not out of any financial need or to help his career, and mentored the young Buffett for the same reason.
- Sometimes persistence pays off for protégés.
- The lessons protégés learn from their mentors can still have an impact long after the mentoring relationship has ended.
- Protégés often take the opportunity to mentor others, passing on the benefits of what they received from their own mentors.
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