Long-term Lessons from Warren Buffett’s Greatest Investments
Like all investors, I follow Warren Buffett closely, and when I was younger, he was essentially the person who made investing a more open topic to discuss. So, in this post, I decided to reaad into a few of his greatest investments and attempt to find some insights or stories behind those investments. Ideally, by writing this, perhaps I can find a great investment down the road or you can, too. Without a doubt, a key takeaway here is his simple approach — did he like the product himself? Did it make sense to him? If he answered yes to this, it would appear he’d then start his due diligence journey.
Now, here are the lessons and investments:
The Coca-Cola Investment (1988)
How he found it:
Buffett loved Coca-Cola from childhood and admired its global brand power. Literally, it was as simple as that. In 1988, under CEO Roberto Goizueta, Coca-Cola became a cash-generating machine after streamlining its operations.
Why Buffett bought it?
He invested $1 billion, seeing it as a company with a simple, scalable business and enduring global demand.
What Buffett learned?
It became one of Berkshire Hathaway’s most successful investments, showcasing the power of aligning with timeless consumer habits. As he would later say:
“If you gave me $100 billion and said take away Coca-Cola’s leadership, I’d give it back and say it can’t be done.”
The GEICO Investment (1976)
How he found it:
Buffett had long admired GEICO, learning about it as a young man from his mentor, Ben Graham. When GEICO faced financial trouble in the 1970s, its stock price collapsed and he had already known about its business and services. He was ready when it crashed.
Why Buffett bought it?
Buffett invested $2 million, believing in GEICO’s unique direct-to-customer model and its cost advantages.
What Buffett learned?
The investment grew exponentially, and GEICO became a cornerstone of Berkshire. It taught him to back businesses with enduring competitive moats during crises. As he would later say:
“The extraordinary low cost is the key to GEICO’s success and to its future. The company has a huge competitive advantage that will last for decades to come. Low costs permit low prices, and low prices attract and retain good policyholders.”
The American Express Investment (1964)
How he found it:
American Express faced a crisis when the “Salad Oil Scandal” threatened its solvency. This was one of the largest crises in American Expresses career as a public company. Buffett saw its core charge card business as intact despite market fears and decided to take advantage of the market fear.
Why Buffett bought it?
He invested $13 million, betting on the company’s strong brand and customer trust. This was just the start.
What Buffett learned?
The investment paid off hugely, reinforcing his belief in buying strong businesses during temporary crises. Also, it later inspired one of his most famous quotes ever:
“Be fearful when others are greedy and greedy when others are fearful.”
I hope you enjoyed this post on Medium! Be sure to follow me for more and I have more posts and plans in 2025. Stay tuned!
