On October 12, 2008, Alice Schroeder stopped in at the Bookworm in Omaha to talk about The Snowball: Warren Buffett and the Business of Life. Not only was she in Buffett’s hometown, speaking to an audience that likely knew his legend as well as anyone, but this also came just as the American financial system teetered on the brink of disaster.
What follows is Schroeder’s own account of how she came to be entrusted with telling Buffett’s story — and what she hopes readers take away from it. Along the way, she also touches on her relationship with Buffett, the spark that set the book in motion, the all-important subject of risk management, and the psychological toll of writing a biography this definitive and consuming.
And, as ever, Schroeder’s Buffett is nothing like the folksy, uncomplicated caricature that so many people carry around in their heads.
Alice Schroeder: I am so honored to be here.
I am also a little nervous because this is the toughest crowd I’ll probably ever face. I’ve been interrogated by Dennis Kneale on CNBC’s Power Lunch, I’ve testified before a congressional committee, but the home audience in Omaha, Nebraska — of Warren Buffett’s hometown and place of birth — is definitely something else.
What I’d like to do today is just take a few minutes to introduce how I came to write this book, a little bit about the process of writing it and how Warren and I worked together, and then how it affected me and changed my life. And, then, I’ll take questions for a while afterwards.
I was a Wall Street analyst. I came to Wall Street in 1993.
In 1998, after five years on the Street, I had the chance to meet Warren Buffett when his company Berkshire Hathaway bought General Re, which was a stock that I was following. At the time, all the other insurance analysts decided that they would not follow Berkshire Hathaway. It was complicated, it was big, the stock didn’t trade, it didn’t do investment banking business — but I like challenges and Berkshire was a big, complicated, interesting company, so I decided that I would follow the stock.
I was the only analyst who made that decision.
At the time, Warren Buffett read my research. He said he liked the way I think, he liked the way I write, and he called me and asked me to be the only analyst on Wall Street that he would talk to about Berkshire Hathaway.
As a result, over a five year period, I got to know him and his business. I would come out to Omaha about once a year and we would have a meeting for an afternoon. I have raced through the Nebraska Furniture Mart with him, trying to keep up with his pace, which — some of you may know — he’s a very fast walker. I got to go to Borsheims. And then we talked on the phone periodically.
From the very first report that I wrote on Berkshire Hathaway, he called me on the phone after he read it and he said, “You have an unusual mind. This is very insightful. Maybe you should be doing something else.”
