How Warren Buffett became one of the world’s most famous investors

Warren Buffett announces his retirement

At the end of a long question-and-answer session, in a mid-sized American city, a 94-year-old man announced that he would retire at the end of the year. The people in the room gave him a round of applause.

But this was no ordinary retirement announcement. The man on stage was Warren Buffett, widely regarded as one of the most skilled investors ever to live. And the crowd? They were 40,000 people who had come to Omaha, Nebraska, to hear his investing wisdom at the Berkshire Hathaway Corporation’s annual meeting. And they knew that they were witnessing history. A remarkable chapter in the history of business was about to close.

Berkshire Hathaway Corporation traces its roots to the late 1800s. It made cotton textiles, mostly for clothing and industrial use. In 1962, an outside investor in his thirties started buying shares in the company. He believed it was undervalued and mismanaged—and three years later, he took full control.

That investor was Warren Buffett. But soon after taking over, he realized that Berkshire Hathaway, as a textile manufacturer, had no future. He said he felt like the dog who finally caught the car—and didn’t know what to do next. Making textiles—fabric or cloth—in the United States was no longer competitive, not with cheaper labor available overseas. And the business was a money pit, requiring constant investment for little return. So Buffett closed the textile mills and turned Berkshire Hathaway into a holding company.

And he would remain CEO of that holding company for six decades. Berkshire would be the vehicle he used to amass one of the world’s greatest fortunes—and to make his many followers and acolytes rich too.

A holding company is exactly what it sounds like: a large company that owns, or “holds,” other businesses or shares in them. As a holding company, Berkshire didn’t make anything itself. Instead, Berkshire became the vehicle that Buffett used to invest in other companies.

He followed a value investing approach. He didn’t chase hot and rising stocks; he didn’t follow the latest trends. No, he focused on buying good companies at a fair price. Buffett once said he’d rather buy a good company at a fair price, than a fair company at a good price. He was a voracious reader—not just of financial statements, but also company reports and newspapers. He said knowledge builds up over the years just like compound interest.

He looked for businesses with predictable earnings, strong brands, and capable management. He also took a long-term approach. Many investment managers have to return money to their investors after five or ten years. But Buffett said his favorite holding period was “forever.” He wanted to buy good businesses that would pay off over the long run.

Some of his best investments were in steady companies in boring industries. One of his best investments was in Coca-Cola, which he has owned since 1988. Other good investments have been American Express, the insurance company GEICO, and the BNSF railway. He has had a few misses over the years. He admitted he overpaid for Kraft Heinz, and he said he regretted investing in the airline industry.

Buffett often went against the crowd. He’s not a big investor in technology, saying he doesn’t understand it well enough. And whenever the crowd is moving in one direction, Buffett asks if the other direction might not be a better long-term move. One of his favorite quotes goes like this: “Be fearful when others are greedy, and greedy when others are fearful.”

It all added up to a legendary investing career. Since 1965, Berkshire Hathaway’s stock price has grown at about 19 percent per year, compared to about 10 percent for the market overall during that time period. Many investors struggle to beat the market consistently, year-in and year-out. Buffett not only did that, but his company nearly doubled market returns over a sixty-year period.

And Berkshire didn’t just make Warren Buffett rich. It’s a public company, so it has public stockholders. Buffett was working for them. A $1,000 investment in Berkshire in 1965 would be worth over $30 million today. A lot of people can call themselves millionaires because they owned shares in Buffett’s company.

You can imagine, then, that people would want to hear what such a successful investor has to say. And Warren Buffett was never stingy with his wisdom. Although Berkshire Hathaway is just a holding company, it is publicly traded, so it has to release an annual report and hold an annual meeting. One of the most-anticipated parts of the annual report is Buffett’s letter to shareholders.

He writes the letter himself, and in it, he describes his view of the market and his thinking for the year to come. His tone is simple and honest, and the letter includes personal reflections, humor, storytelling, and wisdom. The letters are studied in business schools for their investment lessons and commentary on the economy.

Most company annual meetings are a formality, but Berkshire’s annual meeting is a massive annual investing conference. It’s been called “Woodstock for Capitalists.” People from around the world go to Omaha, Nebraska, Berkshire’s headquarters, to listen to the panel discussions and get a glimpse of Omaha’s most famous resident.

And it was at that annual meeting in 2025 that Buffett announced his retirement. He said he would step down as CEO at the end of the year. The crowd of spectators was shocked: very few people knew Buffett’s retirement announcement was coming.

The company will get a new CEO in 2026, but the world of investing will never be the same. Warren Buffett is the world’s most famous investor—because of his success, yes, but also for his personality.

Jeff’s take

Warren Buffett’s personal fortune is worth about $166 billion today—that makes him the fifth-richest person in the world, according to Forbes magazine, which estimates these things. Most of the names at the top of those ‘richest person’ lists are company founders—Bill Gates, Jeff Bezos, Larry Ellison, Mark Zuckerberg, Elon Musk. Warren Buffett is the only investor at the top of that list.

So what’s going to happen to his $166 billion fortune when he dies? He’s going to give it all away. He doesn’t believe in inherited wealth. He said his kids will get enough money so they can do anything—but not nothing.