Insider Monkey is going to make a wild guess here: Warren Buffett won't pay Todd Combs anything near a 2-and-20. He won’t pay him the 2, he won’t pay him the 20, and he won’t pay him 1% of the 2-and-20. He won't pay him anything comparable to the compensations of other better hedge fund managers. Seems as though Warren Buffett doesn't think Todd Combs can generate any meaningful alpha. (Who cares? Warren Buffett himself doesn't have any alpha right now.) There were two other contenders for this position but who took themselves out of the race. Hedge fund manager Li Lu, and another individual whose identity is kept secret. Why would someone not want to work for Warren Buffett? Warren Buffett makes less than $500,000 a year, including the fringe benefits such as company-paid around the clock security. So whoever taking over this job is expected to make that or less, or in other words, measly sums compared to the going rate in the hedge fund industry. In a classic example of adverse selection, hedge fund managers who don’t have any alpha would be more willing to accept Warren Buffett style pay schemes. Todd Combs probably has some alpha (not much, though) but is probably willing to give that up for the reputation of being Warren Buffett’s replacement. After a couple of years, if things don’t work out, he could always launch a multi-billion dollar hedge fund and recoup all the millions he gave up. Still, there is one unanswered question out there: who is the mysterious third candidate? Insider Monkey thinks it's David Einhorn. Here's why: 1. David Einhorn is young at 42, just like Todd Combs. 2. He was born in the Midwest, not far from Omaha (definitely closer than is New York City). A big plus. 3. He's a value investor, just as is Warren Buffett. 4. He's the chairman of Greenlight Capital RE, a reinsurance company. Right in Warren Buffett’s alley. 5. He returned annualized net returns of more than 22% since 1996- after the enormous fees! That's also better than the performance of Warren Buffett in the same time period. The only obstacle we see is that Greenlight has more than $3 Billion in assets under management and Einhorn collects nearly $200 Million before expenses. What Warren Buffett offers is peanuts compared to this. Warren Buffett is not a true value investor but he would never pay anyone $200 million a year for what he could get for free. David Einhorn is simply too expensive for Warren Buffett.