I Travelled To Omaha To See Warren Buffett In Person, and This Is How It Went

Right after Portland, we woke up early to catch our flight to Omaha, Nebraska. I had expectations that Omaha was going to be a lot quieter. When we reached there, I was surprised. It was actually a lot of fun!

We visited Costco to try its legendary hotdog and pizza. 

Since we bought a Chick-fil-A takeaway earlier, we brought it into Costco as well. We decided to eat the Chick-fil-A and Costco food together. 

While eating at our table, a Costco staff named Adam approached us. I thought he would chase us out for consuming outside food.

Instead, Adam broke into a smile and said, “Those are good, huh? I really love the nuggets from Chick-fil-A as well.” 

That brought us relief. 

He could have stared at us and chased us out. He chose a friendlier approach. Subsequently, he also told us to shop more at Costco. Because of his friendly interaction with us, if I had a Costco membership card, I would shop there instantly. He was winning our support and it reflected well on his employer Costco too.

Next, we visited the Nebraska Furniture Mart. It’s the company that Warren Buffett bought from Rose Blumkin in 1983 with a mere handshake. I was in awe of the entire place. It wasn’t just a single building on its own. It was a cluster of buildings well-spaced out with ample car parks in between. Each building was clearly categorised into Electronics, Kitchen, Homeware, Flooring, and so on. 

The success of Nebraska Furniture Mart lies in its honest pricing, wide selection, and in-store experience. Customers feel like they’re getting a good deal each time they purchase something.

At this point, there are some similarities between Nebraska Furniture Mart and Costco. Both companies utilise this playbook called scaled economics shared. 

It’s a term coined by a successful investor called Nick Sleep. This means that as a company grows, it will have better negotiation power with its suppliers in terms of selection, payment terms, and prices.

When better terms are extracted from its suppliers, a company can pass these savings down to its customers. In return, customers will get a good deal and buy more from that company.

Increasingly, this is what I have been seeing in a lot of distributors and retailers. The source of their profitability is never coming from the expense of over-charging their customers. It is always from operating very efficiently and thinking about how they can give their customers a better deal.

Our usual mental model is to select companies with high-profit margins, but this makes companies vulnerable to other companies trying to steal their customers with lower pricing.

However, when a business earns from huge volumes instead of fat profit margins, it’s difficult for new competitors to come in.

Wise, a money remittance business, is also adopting this playbook. In their press releases, they are proud of showing how their fees have gotten cheaper with every quarter. This means customers are getting more value and paying lesser. In return, these customers are happy to transact more with Wise compared to other competitors. This improves Wise’s business moat.

My Experience at the 2022 Berkshire Hathaway Annual Meeting

A day before the Berkshire Hathaway annual shareholder meeting, we went to the bazaar fair. There, I bumped into a few investors like billionaire Mario Gabelli, fund manager Tom Russo, author William Green, and fund manager Mohnish Pabrai.

We exchanged a few pointers about the economy and the stock market.

I can only imagine that many people went up to them requesting to take photos throughout the entire day. Yet none of them were impatient. They spent time being interested in people who approached them and had conversations as well.

I believe one of their secrets to success is humility. In this business of investing, we cannot afford to be arrogant or assume we know everything. It’s an expensive price to pay if we do not get our analysis right.

On a separate note, I also do not think anyone is truly self-made in this world. All of us got to where we are through someone lending a helping hand to us at some point in our lives. Understanding this is so important because it helps us to connect more with people.

Before the day ended, I had dinner with Gautam Baid, the author of the international best-seller “The Joys of Compounding”. There was a lot of wisdom in his sharing as well.

Now, the actual day of the Berkshire Hathaway’s meeting.

Before I entered the convention center, I spoke to a few investors who were queuing with me. Many were there because they bought the Berkshire stock decades ago, and they shared stories of how the returns from the stock helped to pay for their children’s education and whatnot.

I had positive goosebumps hearing those stories.

Inside the center, when Warren Buffett and Charlie Munger arrived, the energy was electrifying. Everyone broke out in rapturous applause – a nod to the tremendous success of Berkshire Hathaway. It felt surreal being in the same room with Warren Buffett, Charlie Munger, Tim Cook, Bill Gates, and others who were successful in their own right.

There were also teenagers, grandparents, kids, and young couples. Everyone who was present was there to learn how to become a better investor and get updates on Berkshire Hathaway.

I live-tweeted the entire meeting – you can find the entire thread here. 

The Berkshire Hathaway meeting was a once-in-a-lifetime experience for investors like myself, and I thoroughly enjoyed myself there. After Omaha, we flew to New York, where we met some members of our investing community and managed to do some shopping for our family and friends.

For the next few weeks, I will be consolidating my learnings and sharing them with my community members. Now that I’m back home, I’m really looking forward to interacting with them after being away for close to two weeks!