Bill and Melinda Gates

William Henry Gates III (1955- ) earned his tremendous wealth as software engineer, co-founder (with friend Paul Allen) and chief executive officer of Microsoft (one of the largest technology corporations). Making a tremendous impact on philanthropy, Gates and his wife have given $24 billion to the Bill & Melinda Gates Foundation. The foundation's focus includes global health and population control programs, increased library technology, minority scholarships, and education reform. It has had tremendous impact on AIDS in Africa, and health care and immunizations in developing countries.

Authored by Crystal Jones

Biographical Highlights

Bill and Melinda Gates are co-chairs and trustees of the largest independent charitable foundation in the world. The foundation, currently endowed at $39.6 billion, gave grants totaling $3.9 billion to various projects throughout the world in 2015. They intend to give away the vast majority of their accumulated wealth (Becraft, 2014). It states on their website that Bill and Melinda are "impatient optimists working to reduce inequity." Prior to their status as philanthropists they both enjoyed lucrative and fulfilling careers at Microsoft, the company founded by Bill Gates and Paul Allen in 1975 that made the computer something every person is able to use. Melinda French Gates was the general manager of information products at Microsoft and oversaw 300 employees before she met and married Bill Gates (Sellars, 2016). 

Historic Roots

William Henry Gates III, or Bill Gates, was born in 1955. His father, William Henry Gates II (1925-present) made his living as an attorney, and Mary Maxwell Gates (1929-1994), was a schoolteacher. When his father's practice became very successful, Mary left the classroom and became engaged in civic work in and around Seattle, Washington. While growing up Gates' parents exposed him and his two sisters to a wide variety of activities related to their volunteer activities and engaged them, at a very young age, in discussions about how decisions were made at these organizations (Becraft 2014).

In 1968, Gates had his first programming experience at Lakeside High School in Seattle, Washington (a private school in Bellevue, Seattle). Gates and his friend, Paul Allen had access to a computer that had recently been invented and the teachers let the students take the lead in learning to use this new technology. Gates and Allen mastered this technology and started making money writing computer code for the school and companies in the Pacific Northwest (Becraft 2014). As a senior, Gates applied to three colleges: Harvard, Yale, and Princeton. He was accepted to all three, and chose Harvard. It is said that Allen warned him, "there are going to be some guys at Harvard who are smarter than you, " and Gates replied, "'No way! No way!'"(Isaacson 2013).

Allen dropped out of college and moved to Cambridge during Gates' time at Harvard. With access to a computer created for use by the U.S. government that was housed at Harvard, they set out to write software that would make it possible for hobbyists to create their own programs on a computer called Altair. After two years at Harvard, Gates dropped out to continue his partnership with Allen. They wrote an interpreter for the programming language known as BASIC that would run on Altair’s Intel 8080 microprocessor. It would become the first commercial native high-level programming language for a microprocessor. In other words, it would launch the personal computer software industry (Isaacson 2013).

Melinda French was born in 1964. Her father was an aerospace engineer and her mother was a stay-at-home mom who regretted the fact that she was not able to attend college. French attended Ursuline Academy, an all-girls Catholic high school in Dallas. Her math and computer science teacher, Susan Bauer, recalls that every day French had a new goal ranging from running a mile to learning a new word. Her senior year in high school, 1982, she was chosen to be the Valedictorian and her philanthropic roots were expressed in her speech: "If you are successful, it is because somewhere, sometime, someone gave you a life or an idea that started you in the right direction. Remember also that you are indebted to life until you help some less fortunate person, just as you were helped"(Sellars 2016).

French was accepted at Notre Dame but decided to attend Duke University in Durham, North Carolina, earning her Bachelor's of Arts degree in business, computer science and engineering (McGoey, 2015, p 116). She later earned a Master's in Business Administration from Duke's Fuqua School of Business in 1987. After graduate school, she began her career as a marketing manager for Microsoft working with the product we now know as Microsoft Word (Sellars 2016).

In 1993 Gates and French had been dating for over 5 years when they decided to get married. They started talking about giving Gates' money away by creating a foundation because his worth had reach $7.3 billion at this time, but he was not interested in another "entity." Gates' mother, Mary, was fighting breast cancer prior to their marriage and she wrote a letter to French with advice about marriage and life that said, "From those to whom much is given, much is expected." Bill Gates and Melinda French were married in 1994. Soon after the wedding, Mary Gates died and the Gates's endowed a $10 million scholarship at the University of Washington in her name (Sellars 2016). Twelve months after the wedding , Bill and Melinda established the William H. Gates Foundation, financed through a gift of $94 million. Run by Gates' father, William, this foundation had two main priorities: community development in the Pacific Northwest and improving global health. In 1997, the Gates's expanded into education. Through a gift of $200 million, they established a second fund, the Gates Library Foundation built on an earlier program initiated at Microsoft-donating personal computer software to libraries. In 2000, with the help of his father, chief executive officer of the William H. Gates Foundation, and Patty Stonesifer, chief executive officer of the Gates Library Foundation, Bill and Melinda merged these two foundations into one entity, named it the Bill and Melinda Gates Foundation (BMGF) and committed $16 billion making it one of the largest foundations in the world (McGoey 2015).

Importance

Bill Gates will go down in history as one of the most innovative and important businessmen in the technology industry because he revolutionized the way we use computers for business and personal use. In addition to creating many of the office products we use to write papers and create spreadsheets, Microsoft, under Bill Gates' leadership, created the first gaming consuls, the X-Box and X-Box 360 that are enjoyed by families throughout the world (Bill Gates 2013).

Forbes argues that Melinda Gates has become the most powerful person on the planet whose singular focus is women and girls. She believes that the most pressing issue of our time is ending poverty in the world and we must put women and girls at the center because poverty is sexist (Howard 2015).

Through the foundation, Melinda, a Duke University Trustee, has been very generous to her alma mater by giving over $105 million for grants and endowment support. From 2002 through 2015 the foundation has provided key support to help the Duke Global Health institute; DukeEngage, a summer civic engagement program that pairs students with American and foreign nonprofits or non-government organization; and they have donated several million for financial aid to undergraduates and business school students. They also established the French Family Science Center, a 280,000-square-foot-building that is home to state-of-the-art research laboratories for chemistry and biology and it is named for Melinda Gates' family (Duke Forward 2015).

A recent report released by a U.K. based organization Global Justice Now, closely examines BMGF operations and reveals that the foundation’s influence on global health initiatives is greater than any other donor country including Belgium, Canada, Denmark, Ireland and Italy (Parpia 2016). By providing nearly 44 percent of international grant dollars, BMGF is shifting the global discourse on philanthropy (Moran 2014). In 2003, the foundation started the Grand Challenges for Global Health (GCGH), an initiative that was greatly influenced by the UN Millennium Development Goals created in 2000. The National Institute of Health, supplemented the GCGH with increased funding of approximately $1 billion for global health issues, evidence of the effect of BMGF on the U.S. Federal Government's funding priorities (Matthews 2008). The foundation has been praised for directing massive amounts of money into public health policy initiatives and scientific research on issues that forward the personal vision and social reform goals of Bill and Melinda Gates. The Gates's have become dominant figures in international giving influencing the philanthropic priorities and behaviors of national and international institutions (Moran 2014).

They have also influenced other private philanthropists. In 2010, the Gates's teamed with Warren Buffett and challenged the wealthiest people in the world to commit at least half of their accumulated wealth toward philanthropic initiatives creating the Giving Pledge (link to briefing paper) (McGoey 2015).

Ties to the Philanthropic Sector

Having created the "nation's largest philanthropic trust," Bill Gates continually strives to donate money and time for some of the world's most urgent issues (Gates & Gates 2003). His focus on education, health care, and access to information and technology are driven not only by his own interests but also by the needs of the international community.

Gates created multiple foundations to deal with and address these needs. Early in his career, he founded the William H. Gates Foundation. Soon after, an initiative within the Microsoft Corporation was created to connect libraries to the Internet and other resources, an initiative called "library online." The Gates Library Foundation was soon created to advance the library systems across the world. The last foundation created was the Gates Learning Foundation. This foundation sought to advance learning for people of all ages.

With the help of his father, chief executive officer of the William H. Gates Foundation, and Patty Stonesifer, chief executive officer of the Gates Library Foundation, Bill and Melinda Gates consolidated these foundations. With the formation of the Bill & Melinda Gates Foundation, as it is called today, Gates displayed an understanding that structural changes must be made to efficiently address the changing needs of the community. His interest in helping the global community through time and money, have made him an undying philanthropist.

Modeled on the early twentieth-century independent foundations established by Carnegie, Rockefeller, Sage and later Ford, BMGF is one of a few large-scale foundations today, such as the Andrew Mellon Foundation, MacArthur Foundation and the David and Lucile Packard Foundation, that are characterized by perpetual endowments, a large bureaucratic organizational structure and an emphasis on diverse programs. Similar to BMGF, these foundations have internationally based regional offices, which contribute to their tremendous influence on private philanthropy in global governance (Moran 2014).

Key Related Ideas

Since 2006 the foundation has been organized around three principal areas: the United States Program, the "priority areas" of which are education, U.S. libraries, the Pacific Northwest; the Global Development Program, which incorporates "financial services for the poor," "policy and advocacy" and "agricultural development"; and the Global Health Program, which has been the most active distributing some $13 billion in grants since 1994 (Moran 2014).

Melinda and Bill Gates, along with Bono, were named persons of the year by Time magazine in 2015 because they offered a new way of looking at poverty in the world. Some consider them philanthrocapitalists because they apply business management efficiency to philanthropy by leveraging their money to address as many people as possible (Bill Gates 2013).

Important People Related to the Topic

Paul Allen: co-founder of Microsoft, has been Bill Gates' friend since middle school. Together, the men's work shaped the early technology industry and became partners in the largest corporation in the world. Years ago, Allen left Microsoft to begin business and technology ventures of his own. In his own right, Allen has also become a leading philanthropist. He began a set of charitable organizations in the early 1990s to make grants to "innovative arts, medical and charitable groups in the Pacific Northwest whose work created positive change in their communities" (PGA Foundations 2003). Recently, added foundations focused on forest protection, music and virtual education, thus bringing its number to six foundations in the PGA (Paul G. Allen) Foundations group.

Warren Buffett: Warren Buffett is one of the biggest contributors to the Bill & Melinda Gates Foundation. Since joining the Giving Pledge in 2006, he has promised to give away at least 99%of his fortune during his lifetime, and has already donated an estimated $31 billion to the foundation (Morell 2014). Along with Bill and Melinda Gates, Buffett is a foundation trustee. As the chairman and chief executive officer of Berkshire Hathaway Inc., Buffett's wealth is built from investing in a broad range of companies, from See's Candies to Geico Insurance to Fruit of the Loom. He attended the Wharton School at the University of Pennsylvania and received his bachelor's degree from the University of Nebraska. In 1951, he earned a master's degree in economics from Columbia University (BMGF).

Susan Desmond-Hellmann: As Chief executive officer of the BMGF since 2014, Dr. Desmond-Hellmann leads the organization’s vision for "a world where every person has the opportunity to live a healthy, productive life"(BMGF). Prior to joining the Gates Foundation, Dr. Desmond-Hellmann was the first female Chancellor at the University of California at San Francisco and before that she spent the majority of her career as an oncologist, researching and creating anti-AIDS therapies for pharmaceutical companies Genentech and Bristol-Myers Squibb. She grew up in Reno, Nevada and received her medical training at the University of Nevada (Holmes 2014).

William H. Gates II: Bill Gates' father, has been an influential person in his life. He instilled public values and commitment to community in Bill from his childhood. A long-time supporter of the United Way as an efficient vehicle for philanthropic giving, Gates passed on this belief to his son whose contributions to the organization have been large and consistent. The senior Gates also continues his own philanthropic mission as chief executive officer of the Bill & Melinda Gates Foundation. Through this work he directs the foundation while keeping his son's vision for the future intact.

The "Microsoft Millionaires" have also benefited from Gates' creativity and innovation. There were hundreds of individuals who cashed in their stock options to become millionaires. Mike Harrington and Gabe Newell are two of the individuals who cashed in their stock. Instead of retiring (or buying farms and restaurants like some of their cohorts), these twenty-five year-old software developers created a company to produce action games for computers (GameSpot 2003). Many of the millionaires could not stand to retire at such a young age, so they are still working hard at things they love to do.

Patty Stonesifer: Patty Stonesifer, Melinda Gates' boss while at Microsoft, joined Bill and Melinda in 1997 to launch the Gates Library Foundation which, in 2000, merged with the William H. Gates Foundation to create the Bill & Melinda Gates Foundation. Stonesifer served as volunteer Chief Executive Officer for over 10 years and oversaw a $38.7 billion endowment fund, distributing over $2 billion a year to support vulnerable populations in the United States and globally. Under her direction, the foundation led the way in building and backing public-private partnerships to achieve a wide range of goals, from research and development for new malaria vaccines to improving both the measurement and visibility of high school graduation rates in the United States. In 2009, she left BMGF and today, she serves as a volunteer in the role of President and Chief Executive Officer of Martha’s Table a nonprofit organization created to provide a safe place for children to eat and read after school and receive family support services. Among her many leadership roles in the corporate and nonprofit sector, Stonesifer was appointed in 2010 by President Obama to serve as the Chair of the White House Council for Community Solutions and she served as a member of the U.S. delegation to the United Nations General Assembly Special Session on HIV/AIDS. Prior to joining the Gates Foundation, she spent two decades working in technology, with her final role as Senior Vice President at Microsoft Corporation, leading the Consumer and Interactive Products Division. Stonesifer is a graduate of Indiana University, and has received honorary doctorate degrees from Indiana University, Tufts University, and Rensselaer Polytechnic Institute (Martha's Table). 

Related Nonprofit Organizations

The Eli and Edythe Broad Foundation: http://broadfoundation.org/

This foundation was started by the personal wealth of Eli and Edythe Broad. The website outlines three investment areas: The Broad Center, which develops leaders to help transform America’s urban public schools; The Broad Institute, a global leader in genomics; and The Broad, a museum in downtown Los Angeles devoted to showcasing great contemporary art. The Broads have invested more than $4.1 billion in these causes (The Broad Foundation). Their backing lends a measure of clout, political credibility, and favorable media attention to any program or strategy they anoint as a "model." (Klonsky, 2011)

GAVI Alliance: http://www.gavi.org/ 

Formerly called the Global Alliance for Vaccines and Immunization, the Gates's helped start this organization in 2000 with donations of $1.5 billion. GAVI has 17 government partnerships and the European Union and has distributed vaccines to 138 million children in 70 of the world's poorest countries (Sellars 2016). Widely seen as the most successful and effective global health public-private partnerships, which provides greater access to immunizations in low- and lower middle-income countries. GAVI has received commitments totaling $2.5 billion from BMGF and is an ambitious effort to disseminate and "improve access to new and underused vaccines to children in low-income countries"(Moran 2014).

Walton Family Foundation: http://www.waltonfamilyfoundation.org

Started by Walmart Founders, Sam and Helen Walton, the Walton Family Foundation has over $2 billion in assets. Forbes has pegged the Waltons as the world’s richest clan, having amassed their wealth from a very successful retail enterprise. They are reported to have a combined net worth of  $138.6 billion (Walton Family Foundation). Second only to BMGF they are the largest philanthropic supporter of primary and secondary education in the United States, the third is the Eli and Edythe Broad Foundation (McGoey 2015). The Walton Family Foundation is committed to investing in programs that will make a positive, long-term difference in three main areas of focus: K-12 Education: Empowering parents with quality school choices; Environment: Protecting natural resources and building economies; Home Region: Measurably improving the quality of life in their home region of Arkansas and the Mississippi Delta. As Sam and Helen Walton’s grandchildren seek to make their philanthropic mark, the foundation will spend $2.2 billion in those areas over the next five years, or an average of $440 million a year (Walton Family Foundation).

 

Reflection Questions:

Why do you think Bill and Melinda Gates decided to give so much of their money away instead of leaving it to their children?

How do you think Bill and Melinda each influence the foundation? How might they differ in their priorities?

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This paper was developed by students taking a Philanthropic Studies course taught at Grand Valley State University and the Lilly Family School of Philanthropy.