Warren Buffett — the legendary investor, chairman of Berkshire Hathaway and the world’s richest man — not only agreed to cooperate on a biography, he handpicked his biographer, Alice Schroeder, an esteemed and trusted former insurance industry analyst and a managing director at Morgan Stanley, to write it. He then offered her perhaps the greatest and most courageous gift of all: unprecedented access to his business, family, friends and his life, spending thousands of hours in intimate conversation with her. The result is “The Snowball: Warren Buffett and the Business of Life,” Schroeder’s fully rendered portrait of Buffett’s life and a history of his values, strategies and ideas. An excerpt.

Chapter two: Sun Valley
Idaho, July 1999

The press quickly recognized Warren Buffett as he stepped out of his SUV. “The DNA of the conference had him built into it,” said his friend Don Keough, chairman of Allen & Co.  Most of the press people liked Buffett, who went out of his way not to be disliked by anyone. He also intrigued them. His public image was that of a simple man, and he seemed genuine. Yet he lived a complicated life. He owned five homes but occupied only two of them. Somehow he had wound up having, in effect, two wives. He spoke in homely aphorisms with a kindly twinkle in his eye and had a notably loyal group of friends, yet along the way he had earned a reputation as a tough, even icy dealmaker. He seemed to shun publicity yet managed to attract more of it than almost any other businessman on earth. He jetted around the country in a G-IV, often attended celebrity events, and had many famous friends, yet said that he preferred Omaha, hamburgers, and thrift. He spoke of his success as being based on a few simple investing ideas and tap-dancing to work with enthusiasm every day, but if that was so, why had nobody else been able to replicate it?

Buffett, as always, gave the photographers a willing wave and a grandfatherly smile as he walked by. They captured him on film, then began peering at the next car.

The Buffetts drove around to their French-country-style condominium, one of the coveted Wildflower group next to the pool and tennis courts, where Herbert Allen housed his VIPs. Inside, the usual loot awaited them: a pile of Allen & Co. SV99 logo jackets, baseball caps, zip fleeces, polo shirts — every year a different color — and a zippered notebook. Despite his fortune of more than $30 billion — enough to buy a thousand of those G-IVs parked out at the airport–Buffett liked few things more than getting a free golf shirt from a friend. He took the time to look carefully through this year’s swag. Of even more interest to him, however, was the personal note that Herbert Allen sent to each guest — and the perfectly organized conference notebook that explained what Sun Valley had in store for him this year.

Timed to the second, organized to the hilt, crisp as Herbert Allen’s French cuffs, Buffett’s schedule was laid out hour by hour, day by day. The notebook spelled out the conference speakers and topics — until now a closely guarded secret — and the luncheons and dinners that he would attend. Unlike the other guests, Buffett knew much of this in advance, but he still wanted to see what the notebook had to say.

Herbert Allen, the so-called “Lord of Sun Valley” and the conference’s quiet choreographer, set the tone of casual luxury that pervaded the event. People always cited him for high principles, brilliance, good advice, and generosity. “You’d like to die with the respect of somebody like Herbert Allen,” a guest gushed. Afraid of being disinvited to the conference, those who voiced any criticism rarely went beyond vague hints that Herbert was “unusual,” restless, impatient, and possessed of an oversize personality. Standing in the shadow of his tall, wiry frame, one had to strain to keep up with the words that crackled forth like machine-gun fire. He barked questions, then cut off respondents mid-sentence, lest they waste a second of his time. He specialized in saying the unsayable. “Ultimately Wall Street will be eliminated,” he once told a reporter, although he ran a Wall Street bank. He referred to his competitors as “hot-dog vendors."

Allen kept his firm small, and his bankers staked their own money on their deals. This unconventional approach made the firm a partner rather than a mere servant to its clients, who were the elite of Hollywood and the media world. Thus, when he played host, his guests felt privileged, rather than like captives pitched by salesmen at every turn. Allen & Co. arranged a detailed social agenda every year built around each guest’s personal network of relationships — which the firm understood — and the new people that Allen’s majordomos felt each should meet. Unspoken hierarchies dictated the distances of the guests’ condominiums from the Inn (where meetings were held), which meals the guests were invited to attend, and with whom they would be seated.

Buffett’s friend Tom Murphy referred to this kind of event as “elephant-bumping.” “Anytime a bunch of big shots get together,” says Buffett, “you can get people to come, because it reassures them if they’re at an elephant-bumping that they’re an elephant too."

Sun Valley was always very reassuring, because unlike most elephant bumps, one could not buy one’s way in. The result was a sort of faux democracy of the elite. Part of the thrill of coming was to see who was not invited, and, more thrilling still, who was disinvited. Yet within their stratum, people did develop genuine relationships. Allen & Co. fostered conviviality through lavish entertainment, beginning on the first evening, when the guests donned Western gear, climbed into old-fashioned horse-drawn wagons, and followed cowboys up a winding trail past a natural stone spire onto Trail Creek Cabin meadow. There, Herbert Allen or one of his two sons greeted the guests as the sun began to set. Cowboys entertained the children with rope tricks near a large white tent bedecked with urns of scarlet petunias and blue sage, while the Sun Valley old guard reunited and welcomed new guests as they stood side by side in line, plate in hand, for a buffet of steaks and salmon. The Buffetts usually ended the evening sitting with friends around the bonfire beneath the star-dappled western sky.

The frolicking continued on Wednesday afternoon with an optional and very mild white-water paddle down the Salmon River. On this trip relationships blossomed, for Allen & Co. orchestrated who sat where on the bus to the embarkation point as well as on the rafts. The river guides steered through the mountain valley in silence, lest they interrupt conversations and disturb budding alliances. Spotters hired from the local population and ambulances lined the route in case someone tumbled into the freezing water. The guests were handed warm towels as soon as they put down their paddles and stepped out of the rafts, then served plates of barbecue.

Those not rafting could be found fly-fishing, horseback riding, shooting trap and skeet, mountain biking, playing bridge, learning to knit, studying nature photography, playing Frisbee with the ubiquitous canine conference guests, ice-skating on the outdoor rink, playing tennis on perfect clay courts, lounging at the pool, or golfing on immaculate greens, where they rode in carts stuffed full of Allen & Co. sunscreen, snacks, and bug spray. All the entertainment flowed quietly, seamlessly, whatever was needed appearing unasked, supplied by a seemingly inexhaustible staff of almost-invisible yet ever-present Allenites in SV99 polo shirts.

It was the babysitters, however, a hundred-some good-looking, mostly blond, deeply tanned teenagers in these same polo shirts and matching Allen & Co. backpacks, who were Herbert Allen’s secret weapon. As the parents and grandparents played, the sitters saw to it that each Joshua and Brittany was accompanied by his or her own playmate for whatever activity they chose — a tennis clinic, soccer, bicycling, kickball, a wagon ride, a horse show, ice-skating, relay races, rafting, fishing, an art project, or pizza and ice cream. Each babysitter was personally selected to ensure that every child always had such a wonderful time that they would beg to come back year after year — while at the same time delighting their parents with occasional glimpses of the very, very attractive young person who was allowing them to spend days of guilt-free time with other adults.

Buffett had always been one of the most appreciative of Allen’s beneficiaries. He loved Sun Valley as a family vacation, for left to his own devices at a mountain resort with his grandchildren, he would have been at a complete loss for what to do. He had no interest in outdoor activities other than golf. He never went skeet shooting or mountain biking, thought of water as “a prison of sorts,” and would rather go around handcuffed than ride on a raft. Instead, he slipped comfortably into the center of the elephant herd. He played a little golf and bridge, including a standing golf game with Jack Valenti, president of the Motion Picture Association of America, for a dollar bet, and a bridge game with Meredith Brokaw, and otherwise spent his time socializing with people like Playboy CEO Christie Hefner and computer hardware CEO Michael Dell.

Often, however, he disappeared for long periods into his condo overlooking the golf course, where he read and watched business news in the living room seated next to an enormous stone fireplace.  He barely noticed the view of pine-covered Baldy, the mountain outside his window, or the bank of blossoms like a Persian palace rug: pastel lupines and sapphire delphiniums towering over poppies and Indian paintbrush, crisp blue salvia and veronica nestled among the stonecrop and hens-and-chicks. “The scenery is there, I guess,” he said. He came for the warm atmosphere Herbert Allen had created.  He liked being with his closest friends: Kay Graham and her son Don; Bill and Melinda Gates; Mickie and Don Keough; Barry Diller and Diane von Furstenberg; Andy Grove and his wife, Eva.

But above all, for Buffett, Sun Valley was about reuniting with his whole family during one of the rare times most of the family spent together. “He likes us all being in the same house,” says his daughter, Susie Buffett Jr. She lived in Omaha; her younger brother, Howie, and his wife, Devon — missing this year — lived in Decatur, Illinois; while their younger sibling, Peter, and his wife, Jennifer, lived in Milwaukee.

Buffett’s wife of 47 years, Susan, who lived apart from him, had flown in to meet them from her home in San Francisco. And Astrid Menks, his companion for more than twenty years, remained at their home in Omaha.

On Friday night, Warren donned a Hawaiian shirt and escorted his wife to the traditional Pool Party on the tennis courts next to their condo. Most of the guests knew and liked Susie. Always the star of the Pool Party, she sang old-fashioned standards by the light of tiki torches in front of the illuminated Olympic pool.

This year, as the cocktails and camaraderie flowed, the babble of a barely comprehensible new language — B2B, B2C, banner ads, bandwidth, broadband — competed with the sounds of Al Oehrle’s band. All week long a vague sense of unease had drifted through the lunches and dinners and cocktails like a silent fog amid the handshakes, kisses, and hugs. A new group of recently minted technology executives, filled with an unusual swagger, introduced themselves to people who had never heard of them a year before. Some displayed a hubris that was at odds with Sun Valley’s usual atmosphere, where a determined informality reigned and Herbert Allen enforced a sort of unwritten rule against pomposity, on penalty of banishment.

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