NEW YORK (Reuters) - The annual charity auction of a steak lunch with billionaire investor Warren Buffett, which raised a record $2.11 million last year, is off to a strong start.
The high bid was $70,100 as of 5:05 p.m. EDT Monday in the 10th annual fundraiser, which began Sunday on eBay Inc’s website. Four bidders have so far made a total of 28 bids, after bidding began at a starting price of $25,000. The auction ends June 26.
As in recent years, the winner and up to seven friends may dine with the world’s second-richest person at the Smith & Wollensky steakhouse in New York.
The auction benefits the Glide Foundation, a nonprofit in San Francisco’s Tenderloin district that offers housing, job training, health and child care, and meals for the poor.
It was unclear how the recession will affect this year’s bidding. In previous auctions, a flurry of activity typically drove the winning bid higher in the last couple of hours.
“You have clashing dynamics: in this economy, there is a heightened sense of rationality where people won’t spend huge amounts of money, juxtaposed with the prospect of auction fever and competitive arousal where irrational bidding could take place,” said Jonathan Carson, chief executive of BiddingForGood.com, an online charity auction platform.
“In the Buffett case,” he added, “I would think the latter is likely to continue. It is unlikely, though, that any bidder will mortgage his future for the sake of a lunch.”
Zhao Danyang, who runs the Pureheart China Growth Investment Fund in Hong Kong, won last year and is scheduled to dine with Buffett on Wednesday.
The previous auctions raised more than $4.2 million for Glide. Buffett was introduced to the nonprofit by his first wife, Susie, who died in 2004. The first three auctions were held live. Winning bids soared when they moved online in 2003.
The auction is a key source of funding for Glide, which has seen demand for its services jump 20 percent in the last year.
“People have said to us as they line up, they had jobs most of their lives and now they don’t,” said Rev. Cecil Williams, Glide’s founder. “It makes them feel like they don’t count. The money from the auction can help pick them up.”
According to Forbes magazine, Buffett is worth about $40 billion. He built his fortune through Omaha, Nebraska-based Berkshire Hathaway Inc, his insurance and investment company valued at about $133 billion.
Berkshire Class A shares closed Monday down $740 at $86,510 on the New York Stock Exchange.
Reporting by Jonathan Stempel; editing by John Wallace, Gary Hill