Warren Buffett, the 93-year-old billionaire and CEO of Berkshire Hathaway Inc., is as famous for his less-than-healthy dietary choices as his investment success.
He’s known for drinking five cans of Coca-Cola daily, which he says makes up about 25% of his daily calorie intake, according to a 2015 Fortune interview.
From Pepsi to Coca-Cola:
Buffett’s investment strategy often involves buying into brands he enjoys, leading to stakes in See’s Candies, Dairy Queen, Apple, and Coca-Cola, with his investment in the beverage giant at $23 billion in value.
Buffett’s preference for Coca-Cola came later in life; he was a dedicated Pepsi drinker for five decades.
The Influence of Friendship and Sampling:
The backstory of Buffett’s switch was detailed in the book “The Deals of Warren Buffett Volume 2: The Making of a Billionaire.” Don Keough, who lived across the street from Buffett in Omaha, Nebraska, played a crucial role in this transition.
In 1960, Buffett approached Keough with a business proposition, asking for a $10,000 investment in his new partnership. Keough, hesitant because of Buffett’s non-traditional employment, then passed on the opportunity, later recounting to Michael Eisner, “I didn’t have it, but I could’ve borrowed it from my dad.
But can you imagine giving $10,000 to a guy who doesn’t get up and go to work in the morning?” According to the book, this hesitance resulted in a missed chance to be part of what could have been a $93 million investment by 2018.
After Coca-Cola acquired Keough’s company in 1964, his career flourished, eventually becoming president and COO.
In 1985, recognizing Buffett’s preference for Pepsi, particularly Pepsi-Cola Cherry, Keough took a pivotal step. He sent Buffett samples of Cherry Coke, enticingly referred to as the “nectar of the gods.” This act swayed Buffett’s soft drink allegiance and cemented Cherry Coke as the official beverage of the Berkshire Hathaway annual meetings.
Just a year later, in 1986, Buffett declared: “After 48 years of commitment to another soft drink, your chairman, in an unusual display of behavioral flexibility, has converted to the new Cherry Coke. Henceforth, it will be the official drink of the Berkshire Hathaway annual meeting.”
Investment in Coca-Cola, Blending Personal Preference with Financial Wisdom:
Buffett’s subsequent investment in Coca-Cola, which began with purchasing $1.3 billion worth of its stock between 1988 and 1994, was influenced by a personal liking for the product and its strong fundamentals.
Berkshire Hathaway now owns 400 million Coca-Cola stock shares, which is around 8% of the company’s stock stock.
