Notes and Takeaways From the 2022 Berkshire Hathaway Annual Meeting
This writeup will be about my weekend in Omaha, Nebraska for the Berkshire Hathaway Annual Meeting. It is a departure from my usual focus on businesses and other topics that I’ve written about thus far, but I feel it is both interesting and worthy of your attention. There is no analysis in this writeup. These are only my notes and takeaways.
Friday 4/29/2022
· I woke up feeling very excited even though I didn’t get a lot of sleep. This weekend will be my first annual meeting of any kind. I feel like a kid again. Haven’t had this feeling in quite some time.
· Fight was scheduled to leave at 9:10 AM. I left my house just after 7AM and didn’t get to the airport until almost 8:20. You may be thinking that I live far from the airport, but it is less than ten miles away. There was an accident on the Tri-Borough Bridge and I had to deal with that classic MTA efficiency. At the end of the day, it only cost me $2.75 to get there. I refuse to pay the ~$50 Uber fare.
· I flew out of Terminal D at LaGuardia Airport. The bus driver drove right past the terminal and stopped at Terminal C because of construction. I was then instructed to walk back to Terminal D from Terminal C which took another five minutes at a brisk pace. It’s never easy in the Big Apple.
· I rapidly went through security thanks to TSA Pre-Check. I highly recommend this if you don’t have it already. You get through most security checkpoints in 5-10 minutes. I made it to the gate with about 30 minutes left before boarding. While sitting in the gate area I overheard a trio of finance workers bad mouthing their fellow employees before wishing each other the best as they went their separate ways.
· I walked closer to the gate with about 10-15 minutes left before boarding. I encountered a group of six guys who all had labeled duffle bags from the same fund. I assumed that they worked there, but one can never be sure. One of them was wearing a Wharton hat that looked older than me. It was at this precise moment in time that I knew I was at the right gate.
· I saw a lack of Gucci loafers. I was genuinely surprised by that. Also, the flight was not full. This makes me think that the New York City finance/investor crowd either doesn’t like going to Omaha or flies private. Plane departed 15ish minutes late. Again, classic New York City. The departure from LaGuardia never gets old. It has short runways, so the pilots accelerate the plane as rapidly as possible to get it airborne.
· The lady sitting next to me on the plane was Chinese, used to work in finance and now runs a startup. Literally couldn’t have been any nicer. She said she was going to the meeting by herself. Her friends wanted to make the trip, but they’re going to rely on her feedback from the meeting first before deciding to go next year. We first started talking about ourselves and moved on to how expensive hotel rooms were. Prices were outrageous. The cheapest rooms were going for a few hundred dollars a night. AirBNB’s weren’t much cheaper unless you were willing stay almost an hour outside of Omaha. We also talked about her portfolio for a while and the recent drawdown in technology stocks. Upon landing she was surprised at how green and open the area around Omaha was. I informed her as politely as I could that this is what a huge section of the country looks like.
· Flight itself was smooth and we made up for the delay. The plane arrived right on time. I really appreciate that airlines have figured out that it’s better to under-promise and overdeliver on flight times. +1 for them.
· Upon deplaning and walking through the terminal I and a CNBC reporter got caught behind the same group of guys with the labeled duffle bags. The reporter and I gave each other a look and smirk although I don’t know if it was to acknowledge the rolling roadblock, the fact that we both walk fast due to living in New York City or some combination of both.
· Finding an Uber at the Omaha airport wasn’t easy. You had to leave the terminal, go to a parking garage and then make your way to the ground floor. After ordering the Uber you had to select which pick up point you were at as there were several in the surrounding area. I couldn’t figure this out but luckily the app ended up doing it for me. The Uber was $12 and took less than 15 minutes to get from the airport to the hotel I was staying at. The driver talked about how Uber was giving drivers the shaft because they don’t incentivize them to go to the airport anymore.
· Hotel check in was smooth and the room was ready. There was only one bed, so I had to get a rollout mattress which wasn’t ideal. I didn’t really fit on it, but I made it work. I didn’t pay for the hotel room so who am I to complain?
· I was fiending for a cheeseburger and asked the front desk for a recommendation. They sent me to a place called the Tap Room. Upon arrival they had a note on the door stating that they were experiencing “technical difficulties” and were closed for lunch. Bummer.
· I went next door to a placed called Gandolfo’s which claimed to be a New York style deli. Their menu which is linked here had a lot of New York City themed sandwiches. They even had pastrami. I ordered the sandwich named after the restaurant. It consisted of turkey, cheddar cheese, lettuce tomato, marinated mushrooms, mayonnaise, oil and vinegar on hero roll. I hadn’t really eaten up until that point and to quote Spike Spiegel, “They say hunger is the best spice.” That sandwich didn’t stand a chance.
· After finishing lunch and returning to the hotel I called around to every steakhouse that I could find in downtown Omaha. They were all booked until after 9 PM which wasn’t surprising. The hostesses in Omaha seemed a lot nicer than the one’s here in New York City. They were all polite and kind. There weren’t a lot of dining options in Omaha besides bar food and steakhouses which also wasn’t surprising.
· My stepdad, whom I was going to the meeting with, landed around 6 PM and came to the hotel not long after. I missed out on shopping at the Berkshire exhibits at the convention center. I couldn’t get in because my stepdad had the shareholders badges which were required for entry. I was able to go to the exhibits on Saturday during the lunch break, but only for 30 minutes or so.
· We ended up walking towards the CHI Health Center which is where the Berkshire meeting is held and figured there would be some place along the way where we could find something to eat. We ended up at a sports bar called Addy’s. It wasn’t busy so we sat ourselves at a table. I finally found that cheeseburger I was looking for. It and the beers I had hit the spot. Not the healthiest way to begin your weekend, but what can you do?
· We then made our way to DJ’s Dugout which as you may have guessed is also a sports bar. It’s a cool space and rather large. The NFL draft was going on and there was hardly anybody in there which I was okay with. I’m not a huge fan of crowds especially at sports bars. We asked the waitress why it was so quiet on a Friday night and she said they were in between their big events. College basketball season was over and the College World Series hadn’t started yet. She said the place is usually rocking on the weekends. The weather was also terrible. It stormed for a large portion of the night. The weather on Saturday wasn’t much better. It rained in the early afternoon, barely got to 50 degrees and was quite windy.
· It was a wrap after DJ’s. One thing I didn’t realize was that the Berkshire Meeting had two sessions. One is in the morning and the other is in the afternoon. I had no idea that this was the case. I’ve always watched the livestream of the meeting in afternoon and was totally unaware of the morning session. I wish I knew that before I downed my second Cuba Libre. Luckily, I was able to fall asleep shortly after getting back to the hotel.
Saturday 4/30/2022
· Woke up at 8AM with a hangover. That was not how I wanted to start off my Saturday. I found out a day or two before the meeting that people line up to get in just after midnight. I appreciate Buffett and Munger as much as the next person, but I need my sleep.
· Showered, got ready and met my stepdad downstairs for breakfast around 8:45. I made quick work of breakfast and we were on our way to the meeting. One thing that stood out on the way there and the night before was that there didn’t seem to be a lot of people in Omaha. I saw hardly anyone on the street or in restaurants and bars. I couldn’t figure it out, but it just seemed like there should be more people after hearing about how many other Buffett groupies make the pilgrimage every year.
· We talked right into the CHI Health Center and I showed my shareholder badge along with the CLEAR app which was the verification required to get in. There was no line. This was another indication that there weren’t a ton of people there for the meeting. I showed the app to a security person who didn’t scan it. He looked at the app for less than five seconds and said I was good to go. One could have easily faked their way into the meeting if they wanted to.
· We walked in and found a couple of seats in the upper level of the arena and waited for Buffett and Munger to arrive. It was maybe 2/3rds full. I saw reports saying that there were 30,000 people in attendance. I’d take the under on that one. There might have been 15,000 people.
· The Berkshire movie started not long after we sat down. I’ve heard about the movie before and was excited to see it. It ended up being a bunch of commercials for businesses that Berkshire either owns outright or stock in. They had a few other vignettes which were parodies of famous movies and tv shows. They were funny considering Buffett is 91 and Munger is 98.
· One thing that I recognized almost immediately was the feeling of the meeting. It felt like I was in a cult or at one of those megachurches in the Deep South. In the Berkshire movie Munger said the annual meeting has turned in to a celebration and I think he’s spot on. Everyone was there to bask in Berkshire Hathaway’s and Buffett’s glory.
· Major shoutout to the guy in my row who housed a family sized popcorn by himself. #America
· During the lunch break we went to the convention center for some shopping. This was one of my favorite parts of the trip. I got to see a glimpse of the Berkshire empire even if it was only for a short time. The merchandise for sale wasn’t very cheap, but Buffett didn’t become a billionaire by offering discounts.
· I managed to get a copy of Pre-Suasion by Robert Cialdini. I read his book Influence and thought it was fantastic. I still think it’s fantastic by the way. I try and read it at least once a year. The other books that I wanted to buy were sold out. Caesars Palace Coup by Max Frumes and Sujeet Indap was on Charlie Munger’s reading list this year. I read the book back in February and thought it was excellent. Check it out if you liked Barbarians at the Gate.
· Other highlights from the convention center were taking a picture with the Geico gecko, going to the Brooks pop up shop and seeing the NetJets exhibit. The seating section of one of the NetJets was on full display. Very cool.
· I also came across the ISCAR booth, but it was tiny. It’s probably my favorite Berkshire subsidiary. It is a tooling company based in Israel. They make all kinds of tools for CNC machines. I am fascinated by what they do. I read through their magazine, brochures and catalogues every year. You can find links to them here.
· For the afternoon session I met up with someone from a discord server than I’m in. He goes to the meeting every year. I met him upstairs in the convention center in an overflow room for people who can’t get seats in the arena. There was maybe 50 people in there. I asked him why there were so many empty seats. He said the attendance seemed way down this year. He thought it was partially due to COVID. Some people refused to get vaccinated while others were concerned about getting COVID at the event. Kind of funny how that works.
· My list of favorite quotes from the meeting:
o “We have an extreme aversion to losses with your money.” – Warren Buffett
o “The world is mildly ridiculous.” – Charlie Munger
o “I don’t know about you, but I’m a slightly better person than I was when I was 17.” – Charlie Munger
o “The best investment by far is in yourself.” – Warren Buffett; this was my favorite quote of the weekend
o Buffet asked Munger if it was wise to criticize people and the response was, “Probably not, but I can’t help myself.”
o “A relative absence of bureaucracy has done wonders for Berkshire.” – Charlie Munger
o “You’d think that if you’re smart then you could do things you aren’t interested in, but you can’t.” – Charlie Munger
· At the conclusion of the afternoon session, I met up with my stepdad at DJ’s Dugout again. We didn’t want to stay for the shareholder proposals. We had a drink, went back to the hotel to drop off our stuff and went to a panel discussion hosted by Willow Oak Asset Management. It was a nice event and the first one if its kind that I had ever been to. Per the same guy that I met up with for the afternoon session, he said that a lot of the networking events turn in to sales pitches for the company that hosts them, so I became a little bit skeptical about what was about to happen. Luckily, we were able to get in even though they were at capacity. The event included the guys from the Focused Compounding podcast. They along with the three other panelists talked about different things going on in the financial world. I thought it was going to be more about what stocks the panelists were buying and selling, but at least it was not a product pitch. We stayed for an hour and tried going to see the guys from the Acquirer’s Multiple Podcast. I went to the location they said they were at, but I couldn’t find anyone. It was almost 7PM at this point so it made sense that they were gone by then.
· After that we braved the dreary conditions and rolled into a steak house. It looked nice on the inside at first glance. There was hardly anyone there which seemed odd given the crowd that was in town for the weekend. We thought we found a secret spot. Boy, were we wrong about that one. My stepdad and I ordered steaks and mashed potatoes. The waitress was really nice, but didn’t write down our order. When the food came out, she ended up dropping off a filet mignon for me which looked delicious, but it wasn’t what I ordered. It then took another 10-15 minutes to get the New York Strip that I originally requested. I also was missing a fork and the waitress jokingly said that I was going to have to eat with my hands because they didn’t have any forks available. Pretty tone deaf. The steak was good, but buttery.
· We developed a theory as to why no one was in there. The service nor the food were very good especially for the prices they charged. They even had temporary tables in the restaurant which looked cheap and took away from the ambiance of the place. We concluded that it was a self-selection thing. That place should’ve been rocking for the Berkshire Meeting. Everyone else must’ve figured out that this is the steak house that you don’t go to. In their defense, I’ve found that being overly critical usually isn’t the best decision. Maybe I should chalk it up to them having a bad night. It happens from time to time. So much for finding a secret spot though.
· After dinner we were wiped out and went to bed not long after getting back to the hotel.
Sunday 5/1/2022
· My stepdad woke up at the crack of dawn and was gone just after 8AM to catch his flight.
· My flight wasn’t until after 12PM so I had some time to relax and enjoy breakfast. The breakfast at the Doubletree in downtown Omaha was solid especially at its $15 price point. I recommend it if you’re ever in town.
· After breakfast I showered, packed up my stuff, checked out and caught the shuttle from the hotel to the airport. The driver drove the shuttle van at a rapid pace. I laughed at how fast he was going. He got us to the airport in 7 minutes. Anyone running a race team in the Omaha area should seek out his services.
· I’ve heard and read about the “networking and marketing” opportunities that are available at the Berkshire meeting. I’m skeptical of anything labeled as a “networking and marketing” opportunity because it usually devolves into a sales pitch. Also, I didn’t network with anyone at the Willow Oak Asset Management meeting, so I thought the opportunity was gone. I told you that to tell you this…
· A little backstory, within the last six months or so I’ve come across some interesting microcap ideas in Australia thanks to the discord server that I’m in. The best one that I’ve come across is Kelly Partners Group. It’s an accounting roll up with high returns on capital and a long growth runway. Here is an excellent writeup on the business and here is a link to their most recent investor presentation. It’s over an hour long, but worth it. For the record, Brett Kelly, the CEO, says his business is not a roll up. He makes his case as to why he believes it is not a roll up starting at 14:56 mark of the investor presentation video. I think his business is a roll up that happens to have the best kind of operational and incentive structure. It’s kind of semantics at the end of the day in my opinion. The point is that he has a great thing going.
· I made my way to the gate with just under an hour left before boarding. Just before I went to sit down, I saw Mr. Kelly sitting by the gate and I went over to introduce myself. For the next 30 minutes or so we talked about the meeting (he got in line at 2AM), Mungerisms (Charlie Munger sayings and wisdom), Kelly Partners Group growth, why he’s bullish on it, etc.
· During the conversation he said his current goal is to become the 10th largest accounting firm in Australia. He thinks he can get there because there is over 10,000+ potential other firms that he could acquire but focuses on the top 10% of them. He thinks that he could acquire 10% of the top 10% meaning he has roughly 100 acquisition targets as of now. He also stated that he wants to stick to smaller acquisitions because those are the sweet spot for his business.
· An interesting insight during our conversation was about the accounting business itself. Mr. Kelly said that he has worked in the accounting industry since he was 18. He talked about how businesses aren’t just spreadsheets and there’s a certain type of person that works in each industry. He went to talk about how the accounting profession usually attracts a certain type of personality and those that run accounting firms usually do so in similar ways. This kind of industry knowledge is an advantage for Mr. Kelly, Kelly Partners Group as a whole and their shareholders.
· A second interesting insight was about mastering the Kelly Partners Group acquisition process. Mr. Kelly talked about having dinner with Roger Federer in Australia. ***Big league flex.***
· During the dinner Federer talked about how he focuses solely on playing tennis and how he studies the surfaces he plays on to adjust his game and equipment accordingly. He asked Federer about how he makes those amazing shots during matches and he said it basically boils down to instinct and repetition from practice. He made that shot thousands of times before the match started. He said that talking to Federer was like talking to a master of a craft. Mr. Kelly went on to say that he wants Kelly Partners Group to get to this same level of mastery when making acquisitions and they’re constantly working to improve it.
· Lastly, he let me know that William Thorndike is a shareholder which was news to me. Mr. Kelly interviewed Mr. Thorndike late in 2021. In the interview Mr. Thorndike talks about why he is a shareholder and a host of other topics. The video can be seen here:
· So back to the “networking and marketing” thing, I’m not saying it will happen, but I know that it CAN happen. There is a close to 0% chance that I would have ever spoken to Mr. Kelly besides going to the Kelly Partners Group annual meeting down in Australia.
· If you’re reading this Mr. Kelly, I sincerely thank you for your time. It meant a lot and I will not forget it.
· After the conversation was over, the plane boarded and it was delayed because the overhead bins were full of carryon bags. I had to check my bag to LaGuardia and wait for it at baggage claim when we landed.
· The flight back to New York took off late and landed right on time just like the flight on Friday. I got my bags almost immediately upon arriving at baggage claim. This might be a first in the history of LaGuardia.
· I had to schlep back to Terminal C to catch the bus.
· The ride back to the apartment was much quicker and smoother than the ride to the airport. Minimal traffic.
· I ended my weekend with an absolutely delicious chopped cheese from the local deli.
· I would recommend going to Omaha if you’re thinking about it.
· Successful weekend and bucket list item crossed off.
· Looking forward to returning to Berkshire Hathaway Annual Meeting in the years to come.
Final Takeaways
· I liked Omaha even if it is a small city without world class dining options. It’s like Indianapolis in that it’s relatively fun and knows exactly what it is. It doesn’t try to be something it’s not and I appreciate that.
· I’ve never seen so many Patagonia vests in one place in my entire life. I thought there were a lot on the island of Manhattan, but the Berkshire meeting takes the cake. Patagonia should have a pop-up store with several embroidering machines ready to stitch “FUND NAME XYZ X BERKSHIRE HATHAWAY ANNUAL MEETING”. Imagine how much money they could make from a status symbol like that. The possibilities are endless.