Billionaire investor Warren Buffett just made March Madness a little madder by putting up $1 billion of his own money against anybody picking the perfect bracket. This deal arose when Quicken Loans paid Buffett’s Berkshire Hathaway to insure a $1 billion prize for anybody who can correctly guess all 63 games in the 2014 NCAA tournament. In return, Quicken will be getting email addresses and personal information from the 10 million people who fill out a bracket.
As anybody who’s filled out a bracket knows, it’s insanely difficult to pick enough games to win your 8 or 10-man office pool – let alone pick every Florida Gulf Coast over Georgetown-type upset. Even still, it’s definitely worth entering this bracket contest, given that the winner will be in line for their choice of 40 annual installments of $25 million, or a $500 million lump sum.
We’ve seen a lot of contests offering $1 million for putting together a good bracket, which got us thinking, ‘What is the perfect bracket worth?’ We decided $1 billion seems right for such an impressive feat. It is our mission to create amazing experiences for our clients. This contest, with the possibility of creating a billionaire, definitely fits that bill.
The amount of money that Buffet and his company are being paid to insure this contest hasn’t been disclosed. But if he’s willing to back up a $1 billion prize to the winner, the odds of winning must be pretty low, right? In fact, let’s take a look and see what exactly one’s chances are of taking down this massive payout.
A Billion versus Quintillions
Warren Buffet didn’t get to become the world’s fourth-richest person ($53.5b) by being an idiot. And his company certainly did the math before backing up the $1 billion prize that Quicken Loans is offering. DePaul University math professor Jeff Bergen also did some calculations and put his results on YouTube (see below).
To arrive at your odds of picking the perfect 2014 NCAA tournament bracket, you’d have to multiply 2 by itself 63 times. After doing this, Bergen showed that one’s odds of winning aren’t even in the billions or trillions, they’re in the quintillions! When Bergen took 2 squared by 63, he arrived at the following odds of filling out the perfect March Madness bracket:
1 in 9,223,302,036,854,775,808
Looking at this number, which goes over nine quintillion, it’s plain to see that anybody who knows little about basketball has virtually no chance to win the $1 billion prize. But what about somebody who’s well-versed in college basketball such as a huge fan or sports bettor? According to Bergen’s calculations, a knowledgeable NCAA tournament fan would improve their odds of filling out a flawless bracket to 1 in 128,000,000,000.
But even given these odds, Bergen shows that if all 314 million people in the United States filled out a bracket, there’d be less than a 0.25% chance of somebody winning. Considering the odds, it’s no wonder why the math professor said, “I would say Mr. Buffett’s money is safe.”