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Chesto Means Business

Warren Buffett offers up management advice to Boston business leaders

Boston Globe managing director Linda Henry interviewed Warren Buffett as part of a HubWeek Curated Conversation at Fenway Park on Thursday.
Boston Globe managing director Linda Henry interviewed Warren Buffett as part of a HubWeek Curated Conversation at Fenway Park on Thursday. Aram Boghosian/HubWeek/HubWeek

Wait for just the right pitch before swinging. Play the game on your terms. Look for the job you would take if you didn’t need a job. Drink lots of soda.

On second thought, maybe strike that last one.

Warren Buffett came to Fenway Park on Thursday, offering up folksy aphorisms, management advice, and a baseball metaphor or two. The Berkshire Hathaway chief executive nursed a bottle of Coca-Cola — both a favorite drink and a favorite stock — as he fielded questions from Boston Globe managing director Linda Henry and several of the Boston business leaders who packed a clubroom overlooking the snow-covered ballfield for the latest HubWeek “Curated Conversation.”

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Henry, whose husband, John Henry, is the Globe’s publisher and principal owner of the Red Sox, teased out some interesting tidbits from the legendary investment whiz about his conglomerate’s two notable local holdings: the Jordan’s Furniture chain and an enigmatic health care startup called Haven.

Buffett praised Haven chief Atul Gawande, who was in the crowd, for the Boston physician’s knowledge of medicine and his ability to be forward-thinking — to envision the next big thing. And Buffett lauded Boston as the right place to run Haven, because of the talent and brainpower here. Buffett started Haven last year with JPMorgan Chase chief executive Jamie Dimon and Amazon CEO Jeff Bezos, with a goal of improving health care costs and outcomes, starting with their collective employee base of 1 million-plus workers.

The launch set off some serious buzz, and more than a little consternation, as health care executives wondered about the potential disruption to the insurance sector — particularly with Amazon involved. Few details have emerged so far, although Bloomberg recently reported that JPMorgan and Amazon began offering Haven health plans to some employees.

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Buffett made it clear that racking up profits is not Haven’s goal. Rather, Buffett wants to “bend the cost curve” for health care.

“It does not have a business objective. It’s got a social objective,” he said of Haven. “Our idea was not to build some big health company and sell insurance to other people. We’re delighted if people copy it if it merits copying. But it’s a very long-term project.”

Also earning praise from Buffett: Eliot Tatelman, the head of the Jordan’s Furniture business that Berkshire acquired in 1999. Buffett talked about the Jordan’s promotion in 2007 that guaranteed free furniture for Sox fans who bought items between March 7 and April 16 if the team won the World Series that year. Nearly 30,000 orders were placed during that stretch. Tatelman bought insurance to cover the potential losses — from Berkshire Hathaway. Berkshire obviously lost that bet. Buffett said: “It cost Berkshire Hathaway $60 million, or something like that.”

Buffett also mentioned Tatelman after HubSpot chief executive Brian Halligan asked what the Oracle of Omaha looks for when evaluating a CEO, such as when he’s considering acquiring a company. The number one trait? “They’ve really got to be in love with the business.”

Buffett singled out Tatelman as a prime example: “Eliot gets excited when he’s opening a new store. He’s not doing it because someone in headquarters told him to.”

Ginkgo Bioworks chief executive Jason Kelly used his shot with Buffett to ask about the merits of stock ownership plans for employees. Buffett responded by saying he’s seen them work tremendously — and terribly, too. A well-defined culture is more important. “The best people don’t work for money,” Buffett said. “They want to be treated fairly.”

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Retired banker Chad Gifford raised the topic of income inequality, telling Buffett that the issue should be addressed with more urgency. Buffett said he considers himself a card-carrying capitalist, but conceded that the free-market system can be brutal. Buffett said he doesn’t think a person’s address, gender, or race — the accident of birth — should determine their future in this country.

One thing became clear: At 89, Buffett has no plans to retire. Each day at work represents a new blank canvas to be painted.

Maybe cola is the elixir of life?

Henry also asked Buffett about his favorite movie (“The Bridge on the River Kwai”), favorite song (Paul Anka’s “My Way”), and book (Benjamin Graham’s “The Intelligent Investor”).

She also queried how often he drinks water (presumably instead of Coke). Almost never, it turns out.

An earlier version of this story misidentified executives in attendance at Thursday’s HubWeek “Curated Conversation.”


Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.