The other was Norton Dodge, an economics professor at St. Mary’s College of Maryland who became known for collecting Soviet dissident art and died in November 2011. His father, Homer Dodge, invested $120,000 in a partnership in 1956. The investment gave Buffett the capital he needed to get off the ground, according to Schroeder.
“Homer almost single-handedly made Buffett,” she said in an interview.
An investment of $10,000 in one of Buffett’s three initial partnerships would have grown to $172,953 by the time the partners’ money was distributed in 1970, according to data compiled by Bloomberg based on partnership performance published in investor letters.
The partners at that point were offered pro-rated stock in Berkshire, which was thinly traded and controlled by Buffett. There also were two other illiquid holdings, Diversified Retailing Co. and Blue Chip Stamps Co., which were eventually merged into Berkshire.
$120,000 Investment
In a Dec. 26, 1969 partnership letter, Buffett said that he expected to pay partners 64 percent of their investment in cash and the balance in stock. Partners could sell their Berkshire shares back to Buffett, hold them, or buy more. Buffett provided one of history’s most-valuable stock tips when he said he planned to buy more Berkshire and Diversified stock.
“I am very happy to have a material portion of my net worth invested in these companies on a long term basis,” he said in the letter. “Obviously, I think they will be worth significantly more money five or ten years hence.”
One investor who received stock was Homer Dodge, a physicist who built the University of Oklahoma’s physics and astronomy department, which today is named for him.
Dodge showed up at Buffett’s Omaha house with a canoe strapped to the roof of his car, according to Schroeder’s book. Buffett set up a partnership with Dodge’s $120,000 investment.
‘Weird Stuff’