How Mentors like Jack Byrne Helped Shape Our Investment Process

Portfolio Managers John Gillespie, Kevin O’Brien and Jason Kish recently sat down and answered 11 questions regarding the team’s unique value-investing philosophy as well as lessons learned from past experiences. Here’s an important one regarding mentorship:

John, you have often mentioned your mentor, Jack Byrne. Who was he and why was he important to you?

John: As Warren Buffett repeatedly called him, Jack Byrne was “The Babe Ruth of Insurance.” I met Jack in 1980 when I went to work for Geico where Jack was the CEO (and Berkshire Hathaway the largest shareholder) who had saved the company from bankruptcy five years earlier. In 1985, Jack teamed up again with Warren to extract Fireman’s Fund Insurance out of American Express, in what was then the largest IPO in history. Jack spectacularly guided that company (eventually the name was changed to White Mountains Insurance Group) from 1985 until he passed in 2013.

I worked for Jack at Geico from 1980-84 as a human spreadsheet before leaving to earn my MBA at Stanford. After Stanford, I spent 11 years at T. Rowe Price in Baltimore where I owned stock in Fireman’s Fund.

When I struck out on my own to start Prospector Partners, Jack put me in business by pledging the first $20 million to manage. I became a director on the White Mountains board and joined “the Jack show” for the next 15 years.

Through my two stints with Jack, I learned the most enduring lessons of my business career. These included bedrock business principles such as:

• Underwriting comes first
• Maintain a disciplined balance sheet
• Invest for total return
• Think like an owner

Jack also taught by example how to instill a winning culture in an organization: pay for performance, debate everything with spirit and passion, work hard but always have fun, and empower your team to do your job better than you could yourself.