Warren Buffett and His Gang
What Don Keough, Mel Gibson, and I have in common
“I jumped into a little creek, which became a river that turned into a gulf, which grew into an ocean. All I did was swim.” — Don Keough
Some people leave a hole. Don Keough left a crater. I'll get to the Mel Gibson part shortly.
On September 4, 1926, Donald Raymond Keough was born in Maurice, Iowa. His father was a farmer and cattle rancher who sank his money into the swamp known as the Great Depression. Let's say that Don made up for it.
Keough’s remarkable career began modestly. His stint in the US Navy eventually led to Coca-Cola’s presidency and a board seat next to Warren Buffett. Later in his career, he became chairman of Allen & Co. The storied investment bank hosts the Sun Valley Hollywood celebrity conferences, the only celebrity events covered jointly by Fortune and Vogue. However, Keough never acted like the big shots he hosted, but he sure knew how to schmooze like a slicked back haired Hollywood agent.
When it came to business ethics, Don stuck to the ancient verities. He once confided in me that "When I was an executive, a CFO was the guy who held the bill up to the light to make sure it wasn't a fake. Now they are a profit center." For those who aren't acquainted with financial shenanigans, if Enron, WorldCom, Bear Stearns, Lehman Brothers, and Bernie Madoff had been faithful to Don's vision, the country would be trillions more prosperous.
Even at Allen & Co, he received no compensation for his chairmanship. He was content to use his own money to invest in transactions. He did let on that Herb Allen let him use the jet on weekends. I guess it paid off.
Don was eligible to serve on any board in the land. But over his long career, his main outside directorships were Berkshire Hathaway and The Washington Post. But his favorite was Buffett's company. He described how he and the fabled Oracle of Omaha first met:
When he began his career in Omaha, Warren Buffett was raising money for the fund that would one day become Berkshire Hathaway. Keough was a salesman for Butternut Coffee (which was acquired by Coca-Cola). Warren wasn't rich or famous and had to tap his sisters and friends to invest in his portfolio. Why not ask his neighbor Keough, he reasoned? $10,000 was grub stakes for his brand-new private placement.
In an inspired stroke of due diligence, Keough asked his children what they thought of Mr. Buffett. It just so happened they were playmates of the Buffett family. All of the Keough kids shouted in delight that Mr. Buffett was great and that he would play with them during the day. That was enough to convince Don to keep his wallet in his pocket, as anyone who has time to play with children all day long might not be such a great investment guru. He respectfully declined Buffett's offer.
Years later, Don's punch line was that the investment would be worth over $100 million today. Then he would say, "if any of you know Warren, tell him I'm willing to take the bet now."
Don Keough had a twinkle in his eye, which some chalk up to Irish charm, but frankly, he could have been Greek, Armenian, or Czechoslovakian. Ethnicity wasn’t the issue. Don adored people, and they returned the favor in spades. You would see him at a cocktail party or board meeting, and he would walk up to someone and whisper in their ear while putting his great big paw on their forearm and his other arm around their shoulder. He was like a Labrador Retriever you could not resist. His was a visceral affection, and if he honed in on you, you were his forever. Whatever favor he wanted the answer was, "I’m in."
That’s where Mel Gibson enters the story.
I first met Don at the Irish American Society, a group of successful Irish people from New York. Naturally, Don received the Irish American of the Year award. I spoke with him after the ceremony and admitted that I was not pure but Scottish-Irish. Don responded, "You are on this team even if you aren't in uniform."
So Don Keough made me an honorary Irishman.
Two years later, Don called asking if I would join a trip to help spread the word about the Irish miracle. On our journey, we met Albert Reynolds, the Taoiseach or prime minister. We went on high-tech factory tours during the day and dined on delectable Irish food at night. Then it was story time. Don would ask each of us to share an anecdote, and we would go around the table. As a raconteur, nobody wanted to take on Don because he could read the Yellow Pages and make it humorous. Entering a storytelling contest against Keough would be like a rookie at the Texas Hold Em championships.
On our last day, we ventured out to visit Mel Gibson on the set of Braveheart. When we arrived, Gibson greeted us, hair tied back in a bow as William Wallace. In case there was any question, gleaming teeth and blue eyes reminded us why he was the star, not us. Then Gibson took us around to meet the other members of the cast, Patrick McGoohan, Brendan Gleeson, James Cosmo, and Brian Cox. He served us sandwiches and tea while regaling us with stories about his first significant directorial effort (as well as lead actor). Gibson was Keough's friend, and I don't know what else they might have in common outside their bonhomie and magnetic personalities.
Don never explained the backstory or how he pulled it off. It was just Keough doing his thing. He could put people together better than a matchmaker. His celebrity status didn’t hurt, but Keough never shined it in your eyes. Ask him about his success and he would say, "I never changed.” What did that mean, we said? "In 1950, I jumped into a little creek, which became a river that turned into a lake, which grew into an ocean. All I did was swim."
Warren Buffett expressed the sentiment that speaks for all who knew Don: "You can sum up Don Keough's life in three words: Everybody loved him."
