Warren Buffett's March Madness Bracket Challenge: What Are the Odds?

The NCAA Men’s Basketball tournament is well known for creating madness among college sports fans. Each year millions tune in to watch the games, with many fans participating in bracket challenges. Bracket challenges have become incredibly popular, with everyone from employers to major sports networks creating their own to see who can pick the tournament champion.

About 10% of Americans fill out some kind of office pool bracket, but the odds of someone picking perfection is far from good. With 319 million people living in the United States, that’s 31.9 million filling out brackets. If those participating each filled two different versions out, that’s 62.8 million brackets. It’s no wonder we don’t see people going flawless, even in years where the favorites hold serve.

Again, these odds are assuming each team in each match up has a 50/50 chance to win. However, that is not reality, either. Especially early in the tournament, the chances of the lower seed team winning is far lower than the higher seeded team.

In 2014, Warren Buffett, the billionaire investor, decided to get in on the action by announcing his own bracket challenge. The payout: correctly guess the winner of each of the tournament’s 63 games and win $1 million every year for life.

In 2018, Berkshire Hathaway’s March Madness contest resulted in eight winners who split the $100,000 consolation prize to get $12,500 apiece. They only had to predict the winners of the 32 first-round games, but they didn't even get that far. When No. 13 Marshall upset No. 4 Wichita State during the first week of March Madness games, the last eight brackets in the contest went down in defeat with the Shockers from Wichita State.

In 2019, Buffett once again offered to pay $1 million a year for life to the winner of his bracket challenge, but he limited participants to employees of Berkshire Hathaway or its subsidiaries, roughly 375,000 people. To be the big winner, an employee would only have to predict the results up to the Sweet 16. Still a massive longshot!

How likely is it that someone could pick a perfect bracket? Not very. During the 2013 tournament, no one who created a bracket on either Yahoo! or CBS picked more than 50 games correctly, and many seemingly perfect brackets turn sour after the second day of the tournament.

The tournament may involve more teams, but brackets only contain 64 teams due to play-in games. To get a perfect bracket a participant would have to pick 63 games correctly (every team that doesn’t win the championship loses one game). Each game has two possible incomes: either Team A wins and Team B loses, or Team B wins and Team A loses. To calculate the total number of ways to fill out a bracket take the total number of possible outcomes for each game (2) and multiply it out 63 times: 2 x 2 x 2….x 2, or 2^63. The odds come in at one in over nine quintillion - odds that don’t seem very promising. Even picking a perfect bracket to the Sweet 16 is extremely difficult at 282 trillion-to-1. The odds of picking a perfect Final Four come in at just over 2.8 quintillion-to-1.

Basketball games are harder to predict than simply flipping a coin, though. Teams in the tournament are assigned a seed, with seeds ranging from 1 to 16. The best teams are given the 1 seed, and the worst teams a 16 seed. The opening games pit seeds against their opposite: a 1 seed plays a 16, a 2 seed plays a 15, etc. History has shown that top seeds don’t lose to bottom seeds often, meaning that the odds of picking one game correctly are actually different than 50/50. This makes calculating the odds of a seeded tournament nearly impossible to figure out, with estimates ranging from 1-in-5 billion to 1-in-128 billion.

Are you filling out a March Madness bracket next year? Better check out Betting On March Madness? Watch Out For The Tax Man.