Warren Buffett Hires Yet Another Virtual Unknown As His Potential Successor

By: EW News Desk Team   Date: 13 September 2011

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13 September 2011

Warren Buffett’s Berkshire Hathaway Inc. announced yesterday that it had hired 50-year-old Ted Weschler, a hedge fund managing partner from Charlottesville, Virginia, to help oversee the company’s equity portfolio.

The selection of Weschler, a managing partner of Peninsula Capital Advisors, is the most recent move to prepare Berkshire for the day when Buffett, 81, will no longer run the company.

According to the Wall Street Journal, Weschler ran his US$2 billion Peninsula Capital Advisors out of a small office that he shares with a receptionist and one analyst in a pedestrian mall in downtown Charlottesville, upstairs from a New Dominion Bookshop.

The virtual unknown is said to share similar traits to Buffett including a “straight-shooter” attitude, as well as “a philanthropic bent and a fondness for basic businesses.”

“When you meet Ted, you just know right away that he's a straight shooter and you can trust him," said Robert Johnson, a senior managing director at the CFA Institute in Charlottesville. "Ted's also incredibly hard-working, and the hours that he puts in are above and beyond—14 hours might be kind of a light work day. Being able to train for a marathon while working those hours shows his discipline. I think that kind of dedication and perseverance carries over to other areas of his life."

Weschler becomes the second new hire personally hand-picked by the Oracle of Omaha himself to join a new investment team that is likely to succeed the 81-year-old octogenarian. Last year, Berkshire hired Todd Combs, another fairly unknown hedge fund manager from Florida, to help oversee some of the company’s investments. Accordingly, reports indicate that a third member for the team may be sought to replace Buffett in the future.

“One of the things that Buffett is looking for is some really good talent that’s probably under the radar screen,” said David Rolfe, chief investment officer of Berkshire investor Wedgewood Partners Inc., to Bloomberg.

The decision to hire relative-unknowns also come in the wake of the resignation of David Sokol, once deemed to be Buffett’s heir-apparent, who was implicated in an insider trading scandal that sullied the company's squeaky clean image.

Buffett is said to have met Weschler through two charity auctions, whereby Weschler had donated US$2.6 million each time in order to have lunch with Berkshire CEO. Weschler is also said to be a known philanthropist, having donated to numerous local charities in his community, as well as being involved in numerous organisations and events including Habitat for Humanity and the construction of a school in Haiti.

Still despite being given the opportunity of a lifetime, Fortune reports that Weschler had taken a few weeks before accepting Buffett’s offer.

"I very much wanted him to do it, but I didn't expect to get very far with the idea," Buffett told Fortune. "Ted will no doubt make a lot of money at Berkshire. But he was already making a lot of money with his fund -- you can get an idea of that from the size of his Glide bids -- so money wasn't a reason for him to come."


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