Monthly Archive for May, 2011

From The Economist

Asked to pen an endorsement for Paul Allen’s new autobiography, Bono, a well-known musician, declares that the co-founder of Microsoft’s “…intellect and generosity of spirit are there on every page”. He is only half right. “Idea Man” does provide plenty of insights into the ways in which Mr Allen has helped revolutionise everything from software to space travel. But its pages are also permeated by a bitterness towards Bill Gates, the man with whom he created a company that transformed the world of technology. Indeed, there are enough sour grapes in these pages to fill an entire vineyard.

The irony is that the primary focus of Mr Allen’s resentment—his co-founder’s intense competitiveness—is also one of the things that propelled Microsoft to greatness. That trait, and the tension that it provoked between the two men, is evident from the time they meet at school. Mr Allen describes how Mr Gates became apoplectic when a practical joke he played on Mr Allen backfired. In another vignette, he portrays his pal sweeping the pieces off a chessboard in fury when he lost yet another game to Mr Allen.

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From Saki Knafo, The Huffington Post

Yesterday morning, thousands of shareholders of Berkshire Hathaway, one of the world’s most well-regarded companies, flocked to a convention hall in Omaha, Nebraska, for a meeting with their venerated leader, Warren Buffett.

Over the course of his long and extremely lucrative career, Buffett has built a reputation for himself as a paragon of integrity and virtue, and the annual meeting of his company’s shareholders has come to resemble a sort of beatification ceremony, if you can imagine a religion in which the same person is beatified year after year. Buffett has called the gathering the “Woodstock of Capitalism,” nicely evoking both the massiveness of the crowd and the blissed-out vibe that pervades it. The vibe going into this year’s convention, however, was different.

The trouble began about five months ago, when David Sokol, a top lieutenant in Berkshire Hathaway, persuaded Buffett to take over a chemical-products manufacturer called Lubrizol. Buffett later said that he had initially been cool on the idea, and it’s hard not to wonder if something Sokol told him bothered him on some level, even an unconscious one. At some point in their conversation, Sokol had mentioned that he owned personal stock in Lubrizol (his lawyer says that Buffett was in fact informed of this not once but twice), yet he didn’t say how much he owned or how he’d come to own it.

As it turned out, Sokol had come to own the stock only a few weeks before, after learning about Lubrizol through a group of investment bankers who suggested that Berkshire look into buying the company. And as it also turned out, he’d come to own a lot of it — ten million dollars worth, to be exact. In other words, Sokol bought the shares knowing there was a chance he could convince Buffett to take over the company, which would almost certainly make the stocks’ value shoot up.

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