By J.F. McKenna
Hey, Cleveland, take advantage of the “halo effect” that comes courtesy of investor Warren Buffett and his Berkshire Hathaway group.
Berkshire Hathaway—aka Buffett and partner Charlie Munger—announced this week its $9.7 billion purchase of Cleveland’s Lubrizol Corp. Lubrizol’s getting picked by Berkshire Hathaway is the corporate equivalent of having Prince Charming swing by in his carriage for Cinderella. For the celebrated Oracle of Omaha, an incorporated Cinderella has to be not only pretty but also “pure of heart.” If you like, call it “storybook value.”
“Lubrizol,” Buffett said, “is exactly the sort of company with which we love to partner— the global leader in several market applications run by a talented CEO, James Hambrick.”
This industrial Cinderella’s minions—aka the rest of us in C-Town—should bathe themselves in the celestial glow. Everyone from Mayor Jackson to the Kamms Corners entrepreneur should be proclaiming, “See, Cleveland is still a great business town, with great businesses large and small. Warren Buffett knows it.”
That’s exactly what Israel did when Sir Warren made a pilgrimage to the Middle East to purchase Iscar Ltd. in 2006. Until then, even a global manufacturing giant such as Iscar had been routinely written off because of location. Iscar’s HQ is just a rocket’s length away from the Lebanese border; before Berkshire Hathaway’s arrival on the scene, many investors hadn’t seen the value of investment in the Middle East.
Not Buffett. He is one of the richest businessmen in the world because he recognizes value, in a business and in the people surrounding it. At an informal press conference in Chicago in 2006, I heard Buffett and Iscar CEO Eitan Wertheimer explain why a bridge between Omaha and Tefen was a smart move.
Buffett noted that he and his partner were “good at spotting unusually good businesses run by unusually good people” and that Iscar exemplified just such a business. “Iscar is the prototype,” said Buffett, whose 2006 personal wealth of $47 billion attested to an enviable grasp of markets with stable futures. “When Charlie and I dream, we dream about companies like Iscar.”
And now Cleveland-based Lubrizol is no longer a Berkshire Hathaway dream, but a reality.
Memo to the rest of Cleveland: Celebrate this new dream-come-true and leverage it to create more dreams. Start by adopting the Buffett aphorism that has long graced Berkshire Hathaway’s own website: If you don’t know jewelry, know the jeweler. Tell the world.
Cleveland is a community of innovative entrepreneurs, ready and willing to make jewels for the world.
With a boost such as Sir Warren has handed Lubrizol, it’s time for Clevelanders to dream Cinderella-like dreams as they toil diligently at their workbenches.
J.F. McKenna is a veteran business journalist and communications specialist. As editor of Tooling & Production magazine, he covered Berkshire Hathaway’s acquisition of Iscar Ltd. in 2006. Visit his profile at LinkedIn.