David Gottesman, a Top Buffett Investor and Friend, Dies at 96

(Bloomberg) — David Gottesman, a friend of Warren Buffett for six decades whose early investments in Berkshire Hathaway Inc. made him a billionaire, has died. He was 96.

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He died on Wednesday, according to First Manhattan Co., the New York City investment manager he founded. No cause was given.

Gottesman, known as Sandy, was a senior managing director and portfolio manager at First Manhattan, which today manages more than $20 billion of client wealth. He was also, decades ago, “one of the first Wall Street professionals to recognize Buffett’s talents,” Jeff Matthews, founder of hedge fund Ram Partners LP, wrote in Pilgrimage to Warren Buffett’s Omaha (2008). “The respect was mutual; when Buffett closed his partnership in 1969, he recommended that his investors consider investing with Gottesman.”

Gottesman had 6,402 Class A shares of Berkshire Hathaway, or 1% of the total, as of March, according to data complied by Bloomberg. The only person to hold more A shares was Berkshire chairman Buffett, with almost 39%. Gottesman’s net worth was about $2.9 billion as of June, according to the Bloomberg Billionaires Index.

Buffett and Gottesman were friends since 1962. Buffett included Gottesman among the dozen or so investors he invited to a January 1968 meeting with his mentor, Benjamin Graham.

By then, Graham, considered the father of value investing, was retired from Columbia University, and Buffett was seeking advice on how to handle a floundering stock market, Janet Lowe wrote in her 1996 book, Benjamin Graham on Value Investing.

The group — which also included Charles Munger, who would become Buffett’s No. 2 at Berkshire Hathaway, and William Ruane, co-founder of Wall Street’s Ruane, Cunniff & Goldfarb and of that firm’s Sequoia Fund — continued to meet regularly and became known as Buffett Inc.

“At the start of it, we talked about stocks,” Gottesman told the BBC in 2009. “We talked about what are good businesses, what are bad businesses, things like that. Today we’re talking about things like inflation and philanthropy and what are some of the mistakes we’ve made, what are some of the important things we should be thinking about as far as the government is concerned, in taxation or regulation.”

Berkshire Director

Gottesman was elected a Berkshire Hathaway director in November 2003 when the board increased the number of seats to 11 from nine.

David Sanford Gottesman was born on April 26, 1926. His father, Benjamin, was treasurer and vice president of Hudson Trading Co. His mother, Esther, was a leader in the World Zionist Organization and helped acquire the Dead Sea Scrolls for Israel, according to her 1997 obituary in the New York Times.

Both his parents were long active at Yeshiva University in New York, and Gottesman served as chairman of its board of trustees.

He graduated from Trinity College in 1948 and earned his master’s in business administration from Harvard University in 1950. That year he married his wife, Ruth, and they had three children, Robert, Alice and William.

In 2008, Gottesman and his wife donated $25 million to Yeshiva University’s Albert Einstein College of Medicine, with $15 million of that going to create the Ruth L. and David S. Gottesman Institute for Stem Cell Biology and Regenerative Medicine. Ruth Gottesman was a longtime professor of pediatrics at the college.

The family also gave away millions through a private foundation. The Gottesman Fund reported distributing $26.2 million in cash and securities in 2019, the last year for which a report is available.

“Beyond his investing acumen, Sandy was known for his integrity, intellectual curiosity and his extensive philanthropy,” First Manhattan said on its website, in announcing his Gottesman’s death. “His ability to mentor those around him to professional and personal excellence and his commitment to the highest ethical standards forged the culture on which First Manhattan prides itself today.”