What lessons can we learn from someone with a multi-billion-dollar fortune?

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Patricia Sellers, editor-at-large for Fortune magazine has written an inspirational and thought-provoking article about Melinda Gates and her perspective on Bill, working with Warren Buffett, and giving away their billions.

Just so you understand what, exactly, we’re talking about, let me note:

The Bill & Melinda Gates Foundation has assets of $37.6 billion, making it the world’s largest. In that total is $3.4 billion that Warren Buffett has already given, and still to come are nine million Berkshire Hathaway B shares, currently worth $41 billion, that he has pledged to contribute in coming years. Assuming that Berkshire (BRKA, Fortune 500) shares continue to rise and that the Gateses continue to bestow their own wealth on their foundation, Melinda and Bill will very likely give away more than $100 billion in their lifetimes. Already the foundation has disbursed $14.4 billion - more than the Rockefeller Foundation has distributed since its creation in 1913 (even adjusted for inflation).

Anything to be learned from someone like Melinda?

Here are a few of my take-aways:

Early on [Melinda] and Bill agreed to focus on a few areas of giving, choosing where to place their money by asking two questions: Which problems affect the most people? And which have been neglected in the past? . . . So while they don’t give to the American Cancer Society, they have pumped billions into the world’s deadliest diseases - most importantly AIDS, malaria, and tuberculosis - and failing public high schools in the U.S. And while Bill is drawn, naturally, to vaccine research and scientific solutions that may be decades away, Melinda is interested in alleviating suffering right now.

Key points:

Focus.
Just a few causes.
You have to say “no” to some very good causes if you’re going to focus.
Look to both the short- and long-term.

The Gateses’ latest mission, which developed out of a trip Melinda took to Kenya two years ago, is to recreate for Africa a green revolution similar to the program that increased crop yields in Latin America and Asia beginning in the 1940s. In 2006 the Gates Foundation formed a $150 million alliance with the Rockefeller Foundation. “Melinda is a total-systems thinker,” says Rockefeller president Judith Rodin. “She and Bill dive into issues. They care deeply, deeply, deeply about making a difference, but they don’t get starry-eyed. They demand impact.”

Take-aways:

Sometimes you have to go on-site in order to learn what the real needs and opportunities are.
Seek to maximize impact through strategic alliances or “gearing.” (Sarita and I are nowhere hear being able to team up with other foundations. But we have been able to initiate some matching-grant offers for a number of our favorite charities. These kinds of offers can make a dramatic difference in the giving patterns a charity might otherwise see.)
Dont get starry-eyed. Demand impact. And accountability.

Bono, the rock star-humanitarian who is . . . a friend of the Gateses, . . . calls their relationship “symbiotic.” Noting Bill’s fierceness, Bono says, “Sometimes I call him Kill Bill. . . . [P]eople like him . . . sweep ourselves into a fury at [things we care about]. What we need is a much slower pulse to help us be rational. Melinda is that pulse.”

Balance!
- If you’re a “feeler,” team with someone who is more rational.
- If you’re a “rationalist,” team with a “feeler.”

At 43 new small high schools [in New York City] funded by the Gates Foundation, graduation rates are 73%, compared with 35% for the schools they replaced. The Gateses’ partner here happens to be Joel Klein, who led the government’s antitrust case against Microsoft a decade ago and now runs New York City’s public schools. Klein appreciates the irony of their alliance, calling the progress “a tribute to Bill.” . . . Melinda won’t say a word about the tension that stemmed from that period. “That’s part of our relationship that I need to keep private,” she says. But clearly she helped her husband get his head around the notion of working with Klein. “This is one of the great things about Bill,” she says. “Bill looks forward.” Buffett observes, “When Bill gave $50 million to New York City schools with Joel Klein in charge, I thought, ‘This guy can rise to the occasion.’”

Whoa! Tears, anyone?!? Forgiveness?!? Grace?!?

Take-aways:

Forgive.
Be careful what you say today. Hard as it may be to imagine, you may want to be partners tomorrow.
Always look forward. Learn what you can from the past, of course. But strive toward the future.

Buffett had planned to hold onto his money until his death, but he changed his mind after his wife, Susie, died in 2004. In the spring of 2006, after lots of hinting, he broke the news to Bill [that he wanted to donate to the Gates foundation].

Buffett, who requires that the Gateses spend his annual contributions in full the following year, has given them just one piece of advice: “Stay focused.” He considers the Gateses “the perfect solution,” he says, because they are experts in philanthropy and also because he sees himself in Bill and his late wife in Melinda. “Bill is an awkward guy. He’s lopsided, but less lopsided since he’s with Melinda,” he says. “Susie made me less lopsided too.” Perhaps proving the point, Bill is quite touching when he explains his delight in disbursing Buffett’s billions. “Warren knows how lucky I am to have Melinda. It makes him look back at his time with Susie and wonder what it would have been like to be doing the giving with Susie.”

Why wait till you die to give it away?
Why not participate in the joy now, while you’re alive?
Do it while you and your life partner are both present to balance each other out.
Aim for annual giving targets.

The Gates children [two daughters, ages 5 and 11, and a son, 8] are reaching the age where they want to understand their parents’ passions. In 2006, Melinda and Bill took the two oldest children to South Africa, showing them slums and an orphanage in Cape Town. But the value of their work is often difficult to translate. A few years ago when they showed a documentary about polio, the kids asked about a crippled boy featured in the film: “Did you help that kid? Do you know the name of that kid? Well, why not?” On and on. “We don’t know that boy,” Melinda told the children, “but we’re trying to help lots of kids like him.” Bill’s explanation: “I’m in wholesale. I’m not in retail!”

There comes a point where one does have to transfer one’s giving from “retail” to “wholesale.”
Embrace your unique position (”wholesale” or “retail”) wherever you are at the moment.
It is almost never too early to begin sharing your passion and vision with your children.
Get your children involved in your passions.
Part of your legacy is–or, certainly, ought to be–your vision, passion, mission, purpose.

While [Bill] and Melinda plan to give away 95% of their wealth in their lifetimes, they have not yet decided how much of what’s left will go to the children. Melinda says they will follow Warren Buffett’s philosophy: “A very rich person should leave his kids enough to do anything, but not enough to do nothing.”

Exactly right: If you have the funds, Give your kids enough to do something significant, but not so much that they are tempted to do nothing.
Give it away during your lifetime.

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This entry was posted on Tuesday, May 6th, 2008 at 2:28 pm and is filed under charity, giving, kids, legacy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.