#91 Jim Clayton (Sold to Warren Buffett)

**David Senra** (0:00)
Jim, this is Warren Buffett. I read your book over the weekend, and I enjoyed it very much. You did a good job on it. I followed your company for several years and congratulate you on taking it to the top of the industry. Give me a call. I'd like to get your views on the industry.
So that is a voicemail, that's an excerpt from the book that I read this week, which is First A Dream by Jim Clayton. And that's actually a voicemail Warren left Jim after somebody gifted the book I have in my hand to Warren. He read it over the weekend, like he just said, and he winds up buying, after reading the book, he winds up buying Jim's business for 1.7 billion in cash. And so Warren told this story while I was going through, a few weeks ago I released a podcast on, I read every single shareholder letter that Warren Buffett has ever written so far. It's like 54 years. So while I was doing that, Warren talked about reading the book and then buying the company. And I thought, okay, well, that's a no brainer. If Warren Buffett read this book, recommended it, and not only did he recommend it, then he goes and spends 1.7 billion of his own money on the guy's company. There's obviously a benefit to me reading it and then telling you what I learned by reading it. Before I jump into the rest of the book, I need a favor from you. If you leave a review for this podcast, take a screenshot and email it to me at foundersreviews at Gmail. And I'll send you a private feed of seven podcast episodes that I've done that are available nowhere else. And if you're listening to this on Overcast, all you have to do is press that star that's on every episode. So this episode or any other episode that you happen to enjoy, that you'd recommend, press the star, it'll change colors. All you have to do is send me a screenshot of that to foundersreviews at gmail.com, and I'll send you the private link as well. Okay, so let me go ahead and jump into this book. And I'm gonna spend a lot of time talking about his early life. Because, well, let me not run over my own points here. Let me just go ahead and get into it.
We start at the very beginning of the book, and this is Jim writing. He says, the country was in the depths of the Great Depression, four years running with no signs of letting up when I was born on a dirt farm in Tennessee. The region was ailing anyways, even without a depression, and we surely lived in one of the poorest parts.
Dad was a sharecropper, farming on the halves, which meant that the landowner furnished the land and half the mules, seed, and equipment. We sharecroppers supplied the sweat and energy to plant, cultivate, and harvest the crops. The landowner received half of the harvest.
And this is a very important sentence that Jim realized. Sharecropping was a tradition dating back to colonial times, and there is no known record of a sharecropper getting rich. So just how poor was Jim and his family when he was born? Well, this is how his dad paid the doctor to have Jim delivered.
Dad paid the good doctor two chickens, three gallons of shelled corn, and one home-cured country ham to bring me into the world. The year before, he and mother grossed only $100 the whole year, so there wasn't a whole lot of cash to go around.
Now, I want to tell you a little bit about the environment, like the house that he grew up in. It was 600 square feet, a log cabin, no electricity, no running water, a tin roof, and no bathroom. There was no insulation to speak of, so the cabin was like an icebox in the winter and an oven in the summer. The main room served as our bedroom, where all four of us slept about eight feet apart on two beds.
There was no bathroom. In fact, we didn't even have an outhouse.
During the cold months, we'd bring out the thunder bucket, which was kept under our parents' bed.
You can imagine what that was used for. Someone had to empty it out every morning.
So I'm going to pause right here, and I just want to bring up two things to you that I think are very important. One, he goes from these living conditions to the Forbes 400 list. And when the sales completed to Warren Buffett, he personally clears something like 400 or 500 million dollars. So he goes from his parents making $100 a year and having to essentially go to the bathroom in a bucket to being one of the wealthiest people on the planet. So he has a very inspiring story. The second thing, which I find remarkable, and I found out when I got to the end of the book, was this book is self-published.