008: Warren Buffett Private Company Investment Case Study

In 1959, Warren Buffett made a personal investment in a private company called Mid-Continent Tab Card Company. He put in 20% of his net worth into this company and received a 16% share. Buffett held on to this investment for 18 years and the compounded annual return was 33%, so this was well-over a 100 bagger investment for Buffett.

I learned about this investment by watching a 2008 talk that Alice Schroeder, author of "The Snowball: Warren Buffett and the Business of Life," gave to the Darden School of business at the University of Virginia. It's a fascinating talk, and there was a lot to learn from it. Her talk got into a ton of interesting things like how Warren Buffett values companies and whether or not he uses a discounted cash flow formula. In this episode I breakdown her talk, Buffett's investment, and the lessons I learned from it.

Thanks for listening and thanks for sharing!

Her talk can be found here - https://afterdinnerinvestor.com/mid-continent-tab-card-company/