Article — From the January 2010 issue
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Article — From the January 2010 issue
Among the many attempts to duplicate the room on the fourteenth floor is a closet-sized space above Penn Station, with one narrow window overlooking midtown Manhattan. Taped to the wall are two inspirational quotes, one from Warren Buffett (“We don’t have to be smarter than the rest. We have to be more disciplined than the rest”) and one from Buffett’s indispensable right hand, Charles T. Munger (“Hard work, honesty, if you keep at it, will get you almost anything”). This room is the headquarters of an investment partnership called Dardashti Capital. The firm’s founder and sole employee is twenty-six-year-old Shai Dardashti, who bought his first Class B shares ten years ago, with a few thousand dollars of bar mitzvah money. There was nothing sporting about the way Shai talked about his fund, none of the arousal that proximity to capital can incite. Instead, Shai seemed awed, almost burdened, by the size of the responsibility he had taken on.
“This room is my bubble, my sanctuary,” he told me. “The answer is cutting away the noise. I sit alone in a room, waiting for the obvious, reading annual reports. There’s no one yelling or screaming. I sit here, go through stuff, absorb information, and try to come up with three or four good ideas a year.”
Years before Buffett acquired control of Berkshire Hathaway (then a textile business), he, like Shai, invested the money of his friends and family in private partnerships that followed the “value investing” style developed by Buffett’s early mentor, Benjamin Graham. Contrary to the notion of perfectly efficient markets, the value investor believes stock prices are set by the capricious sentiments of a mostly ignorant herd. The task of the value investor is to ignore the tumultuous swings in price and focus on “intrinsic value,” the present value of all future profits. The value investor, then, is a dedicated transcendentalist. He believes the true value of a thing is definite, invisible, and knowable only through private reflection.
“This is what’s cheap but good,” Shai said, clicking on an Excel spreadsheet of his own devising, fed by data from his broker.
“This is what’s trading for less than cash.” He clicked again. “And this?” He clicked one last time. “This is everything that exists.”
When we first spoke on the phone, Shai urged me not to present him as Warren Buffett in miniature. “It’s not appropriate or accurate. I look at what he’s done for inspiration, but there’s no comparison.” The Buffett phenomenon, he went on to explain, has no precedents or heirs. It is utterly unique. “Warren Buffett won’t happen again. The combination of the right time and right place, the incredible performance, the ethics, the intellectual generosity. There will never be another Aristotle, another Einstein, another Buffett. This happens only once.”
Less than an hour after our first phone call, Shai sent me three emails, replete with bulleted action items and illustrious cc’s. Among these emails was an introduction to Guy Spier, an investor who (along with another fund manager) paid $650,100 in a charity auction to have lunch with Buffett in 2008. At the time, Spier’s fund had more than $100 million in assets, but it had suffered mightily during the previous year. Spier was eager to help me, calling a few days later with advice on gaining entry to the fourteenth floor.
“Dear Mr. Buffett,” began Spier’s impromptu pitch, “I came to the Berkshire meeting with a hunch that there’s a better way to do capitalism. After meeting dozens if not hundreds of your ambassador-disciples, I’m now sure there’s a better way. You and Mr. Munger have figured it out. I want to use this article to make the case to the American people. I could make the case so much more strongly if I had five minutes of your time.” A letter like this, he said, would raise my chances of an audience from 2 percent to 5 percent.
The next time I saw Shai was in the hallway of the Omaha Doubletree, half an hour before the beginning of the 2009 Yellow BRKers reception. He and his mother stood over a white-clothed table, inserting hundreds of paper nametags into plastic holders. Inside the Midlands Room, Sherrie Gregory dressed the tables with chocolate coins and Wizard of Oz figurines. “This is Marsha,” she said, introducing me to a woman whose gleaming smile I recognized from DVDs of previous Yellow BRKer events. Like young Buffett, forever changed by the boyhood discovery of Dale Carnegie’s How to Win Friends and Influence People, Marsha is a fire hose of charm, blasting through rope lines, embarrassment, and anything else designed to impede universal intimacy among strangers.
“Oh, so you’re a vir-gin,” said Marsha, almost singing, when Sherrie told her that this was my first Berkshire meeting. “I met two virgins on the plane. We had a real good time.” I began hoping that this year’s Yellow BRKer meeting would be the wildest yet. The DVDs Sherrie lent me depicted bacchanal receptions at which drunken, costumed BRKers scandalized their bland surroundings with bawdy Berkshire-themed standards:
At Dairy Queen sharing blizzards for two.
I flashed my Fruit of the Loom thong just for you.
You never get your briefs in a crunch.
The fearless leader of the Yellow BRKer bunch.
We’ll always love you, the leader of the pack.
But as 2009’s attendees began to gather, picking up their nametags and circulating among the bowls of strawberries and Chex Mix, it became apparent that the Yellow BRKer reception had, like Burning Man and Sturgis before it, fallen victim to its own reputation. The Dionysian “capitalist Woodstock” had mellowed into an alumni mixer. The older shareholders hung back and renewed old acquaintances while the younger ones partook in vigorous round robins, pushing blogs, books, funds, and job searches. “Normalcy,” said Sheldon Wasserman, when I asked him what made this community special. Soon Lyle McIntosh, a corn and soybean farmer who bought his Class A shares in the mid-1980s, walked up to the podium. The networking continued at a steady hum as he told the story of presenting Warren Buffett with an antique pinball machine. Behind him sat a giant yellow hat on a table. No one had thought to put it on.
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