By Erik Holm
June 22 (Bloomberg) -- A chance to break bread with billionaire investor Warren Buffett drew a high bid of $25,400 in the first hours of a five-day charity auction on EBay Inc.
The winner of the 10th-annual fundraiser gets to bring seven friends to a New York steakhouse to query Buffett, the world’s second-richest man, about his business strategy and investment philosophy. Last year, Chinese hedge-fund manager Zhao Danyang won with a $2.11 million bid, three times the previous record for the event. Bidding is set to close June 26.
“If you had a chance to sit down for a meal with Newton or Galileo or Einstein or Gandhi, and spend two or three hours with them, would you do it, and what kind of price tag would you put on that?” asked Mohnish Pabrai, who partnered with fellow investment manager Guy Spier to win the auction with a $650,100 bid in 2007. “I got more than my money’s worth,” he said.
Buffett, the world’s most celebrated investor, transformed failing textile maker Berkshire Hathaway Inc. into a $134 billion company by acquiring out-of-favor securities and businesses in industries ranging from insurance and utilities to candy-making and underwear. Shares of the Omaha, Nebraska-based company traded at about $15 when he took control in 1965. They sell for $87,250 now.
Proceeds from the auction benefit the Glide Foundation, a San Francisco-based charity where Buffett’s late first wife volunteered. Glide, founded in the 1960s by the Rev. Cecil Williams, provides job training, medical care, counseling and other services for the homeless, the HIV-positive and victims of domestic violence.
‘Down and Out’
“He basically built one of the great organizations I’ve seen for helping people that are really down and out,” Buffett said in a Bloomberg Television interview at last year’s lunch. “It takes people who have hit bottom and brings them back. I’ve seen it with my own eyes.”
Glide provides free meals to the needy three times a day. The number of meals it served increased 17 percent in the 12 months ended in May compared with the prior year.
“These times are especially hard for people at the lowest income levels,” Williams said in a statement announcing the latest auction.
Past auction winners include David Einhorn, founder of hedge fund Greenlight Capital LLC, who paid $250,100 in 2003, the first year the bidding was conducted by San Jose-based EBay. Bidders must pre-qualify at GlideLunchWithWarrenBuffett.com. Many bidders wait until the last minutes to avoid driving up the price early.
‘Lots of Ammo’
“I just made sure I had lots of ammo,” said Pabrai of his bidding strategy. “There’s a declining number of lunches left every year, and because Warren’s reputation grows every year, in spite of the financial crisis I would be very surprised if the lunch didn’t go into seven figures this year.”
Pabrai is the founder of Irvine, California-based Pabrai Investment Funds. Spier is principal at hedge fund Aquamarine Funds LLC. Both own Berkshire shares.
Zhao, last year’s winner, will meet Buffett, 78, for lunch this week at Smith & Wollensky on 49th Street in Manhattan. Alan Stillman, the founder of the steakhouse, is donating $10,000 to Glide for the right to host the event.
Glide Lunch With Buffett Results:Related Links
Winner Final Bid
2000 Anonymous $25,000
2001 Anonymous $18,000
2002 Edward Jones Co. and 2 Anonymous $25,000
2003 David Einhorn, Greenlight Capital $250,100
2004 Jason Choo, Singapore $202,100
2005 Anonymous $351,100
2006 Yongping Duan, California $620,100
2007 Mohnish Pabrai, Guy Spier, Harina Kapoor $650,100
2008 Zhao Danyang $2,110,100
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