Trott on the march: is he Buffett's chosen successor?

Banker's exit from Goldmans fuels speculation about Berkshire's future

Warren Buffett says you could torture him, and he still wouldn't tell. The world's most famous investor, the Sage of Omaha, has chosen his successors, the duo who will take over at the helm of the Berkshire Hathaway business empire, but he's not saying who it is. He's being astute, as ever. Watch how power and influence drains away from a second-term president, for example, or from a British prime minister who declares he'll stick around for only a while longer. But it cannot stop Mr Buffett's legion of followers from guessing.

After all, Mr Buffett is 78.

The topic will no doubt be on the minds of many of the 30,000 Berkshire Hathaway investors who are expected to make the annual pilgrimage to Omaha, Nebraska, for the company's shareholder meeting in May. And Mr Buffett will no doubt point them to his latest statement on the matter – in his letter to them last month, when he said "all candidates currently work for or are available to Berkshire and are people in whom I have total confidence" – and then say no more.

Except that this time, there has been a big flurry of speculation about one name in particular, a certain Byron Trott, who just quit as head of the Midwestern office of Goldman Sachs, in Chicago. Mr Trott is "a rare investment banker who puts himself in his client's shoes", Mr Buffett has said, praise indeed from a man who is normally disdainful of "the priesthood of finance" and bankers out for a fast buck. Mr Trott is setting up on his own, creating a new merchant bank called BDT Capital Partners, and Mr Buffett likes him so much he is buying into the company.

The two men share a Midwestern background and sensibility, hailing from a part of the US that usually spurns the flash of the West Coast or the cut-throat instincts of the East. It is in these roots that you can find the origins of Mr Buffett's own homespun wisdom, and they are why he has not ever moved from his native Omaha, despite turning Berkshire into one of the world's largest companies, spanning insurance, energy and consumer goods, and with stock market investments in some of the most famous brands on the planet.

In Chicago, Mr Trott is most famous as a workaholic, jetting around the 13 states in his purview and leaving voicemail messages for clients in the middle of the night. Aged 50, after more than half a lifetime at Goldman Sachs, he is finally going to tap an extraordinary Rolodex of uber-rich contacts for himself rather than the firm.

Investment bankers are the diplomats of finance, always searching for a deal that will make all the parties happy, and Mr Trott is the quintessential middleman. He is well-connected, discreet and eminently trustworthy, and he speaks his mind.

His first job for Goldman was as a stockbroker for wealthy clients, a job that put him into the orbit of the wealthy families of the Midwest – the Mars and Wrigley families, whose confectionery companies he helped to merge last year, or the Pritzker family behind the Hyatt hotels chain, on whose board he sits.

Whether it is watching the Chicago Bears American football team from a box at the city's Soldier Field, or advising the Art Institute of Chicago how to manage its funds, or sitting on the board of trustees of his alma mater, the University of Chicago, he intertwines fun and philanthropy with hobnobbing with the great and good. When he stumped up $14,000 (£10,000) for tickets to the David Letterman show and a posh dinner in New York, it was all in aid of one of Chicago's most prestigious ballet companies.

Even his political donations look astute. Whilst he has given most money to the Republican party, he has attended fundraisers for politicians on both sides of the aisle and of both hues in presidential races. Perhaps most notably, he was backing Barack Obama as far back as 2003, a year before the wannabe Senator for Illinois had made that career-changing appearance at the Democratic convention.

His one piece of flash is a giant home on the shore of Lake Michigan, built from scratch to a Robert Stern design. The three-acre parcel of land alone cost him $11.4m, and the house boasts a pool, a boathouse and numerous porches.

So far, so banker. What marks him out, at least according to Mr Buffett, is his smarts, an ability to see deals from both buyer and seller's point of view. For Mr Trott, unlike most, has a business background of his own, stretching back into his teens. At about the same age as Mr Buffett was hawking pinball machines to local businesses, the young Byron Trott borrowed $30,000 from his father to launch a clothing shop for the teenagers of his native Union, Missouri, a small town near St Louis. "There was no local place for kids to buy clothes other than Wrangler jeans and overalls," he would say later. At university, he did it again, selling sportswear.

Mr Buffett became close to him earlier this decade, after Mr Trott brought Berkshire Hathaway a trio of acquisitions that turned out very nicely for all sides, after which the Sage of Omaha wrote: "He understands Berkshire far better than any investment banker with whom we have talked and – it hurts me to say this – earns his fee."

The Berkshire faithful measure the fortunes of Mr Buffett's likely heirs according to the amounts of praise he lavishes on them in his long annual letter, so Mr Trott has been on the radar since that mention in 2003. He is intensely private and protective of his family, though, so may well prefer to stay behind the scenes, unlike the gregarious Mr Buffett. Much could also depend on the progress of his new business venture, prospects for which look strong.

And we should end on a word of wisdom from the Sage's most recent letter. "I also want to assure you that I have never felt better. I love running Berkshire, and if enjoying life promotes longevity, Methuselah's record is in jeopardy."

The contenders: Four who could take over Buffett's mantle

Ajit Jain

When Ajit came to Berkshire in 1996, Mr Buffett wrote: "I did the logical thing: I wrote to his parents in New Delhi and asked if they had another one like him at home."

Mr Jain runs Berkshire's reinsurance arm, one of the world's biggest insurers of insurance companies, with a team of just 31 people.

Richard Santulli

NetJets is one of Mr Buffett's favourite firms, offering fractional ownership of private jets to not-quite-super-rich Americans. Mr Santulli invented the concept, founded the company and still runs it under the Berkshire umbrella, after selling out to his most famous customer.

David Sokol

The 52-year-old David Sokol is one of the most feted corporate bosses in the US, having been chief executive and now chairman of the energy firm MidAmerican since 1989, turning it into one of the most powerful in the land. His charity work mentoring students endears him to Mr Buffett.

Tony Nicely

Chief executive of Geico, Berkshire's insurance arm, Olza "Tony" Nicely is bookies' favourite to take over as chief executive of the parent. He is loyal to Geico to the point of obsession, and has a youthful ambition despite his 64 years. Mr Buffett notes that "Tony feels Geico is just getting started".

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
ebooksNow available in paperback
Life and Style
tech
News
The 67P/CG comet as seen from the Philae lander
scienceThe most important scientific breakthroughs of 2014
Arts and Entertainment
Ian McKellen as Gandalf in The Hobbit: The Battle Of The Five Armies
film
Arts and Entertainment
Sarah Koenig, creator of popular podcast Serial, which is to be broadcast by the BBC
tvReview: The secret to the programme's success is that it allows its audience to play detective
News
Ruby Wax has previously written about her mental health problems in her book Sane New World
people
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Services Manager - (communications, testing, DM)

£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas