The Bill & Melinda Gates Foundation was formally established in the summer of 1999. The new organization consolidated previous activities dating back to 1994, including family giving, the William H. Gates Foundation, the Microsoft Corporation's "Libraries Online" initiative, the Gates Library Foundation and later Gates Learning Foundation. With an endowment estimated at more than $22 billion in early 2000, it ranked as the largest philanthropic trust in the United States. Its contribution strategy focuses on global health and population control programs, libraries and access to information technology, education reform and minority scholarships, and a wide range of Pacific Northwest institutions and programs.
A Family Tradition
Although unprecedented in its scale, the Bill & Melinda Gates Foundation represents a continuation of a family tradition of community involvement and giving established by Bill Gates' mother Mary Gates (1930-1994), a former school teacher. Bill Gates's first significant contribution was a $12 million gift made in 1991 to help endow a molecular biology research lab at the University of Washington.
In 1994, the family established the William H. Gates Foundation, guided chiefly by the senior Gates, with a single staff person, Suzanne Cluett. His daughter, Kristi Blake, served as accountant. After Mary Gates's death in 1994, Bill and Melinda Gates endowed a $10 million University of Washington scholarship program in her name. She is also memorialized by a new science building on the UW campus.
Medication, Information, Education
The elder Gates became a major supporter of the Seattle-based Program for Appropriate Technology in Health (PATH), founded by Dr. Gordon Perkin to promote health care strategies targeted to serve women and children in poor nations. The report of the 1994 International Conference on Population and Development, held in Cairo, Egypt, became an unofficial blueprint for much of the Gates Foundation's subsequent activities in supporting coordinated Third World efforts for population control, immunization, and health care delivery.
The following year, the Microsoft Corporation launched its "Libraries Online" initiative in partnership with the American Library Program. Over the following 18 months, Microsoft donated software and $17 million to some 200 U.S. libraries. The program was coordinated by Patty Stonesifer (b. 1957).
In 1996, Bill and Melinda Gates also pledged $12 million toward construction of a new law school building at the University of Washington. Thus, by 1997, the Gates philanthropic philosophy had evolved three primary themes -- Third World health care, library and information technologies, and education -- which would be woven into coherent organizational strategies over the next several years.
Moving Toward a Single Structure
On July 23, 1997, Bill and Melinda Gates announced creation of a new Gates Library Foundation, endowed with a personal gift of $200 million. Stonesifer left Microsoft to manage this expanded program.
The W.H. Gates Foundation was also active with major grants to the United Nations, PATH, schools, and local recipients. Its 1998 Annual Report listed gifts of $133 million for medical and population programs, $122 million for education, $42 million to facilities and programs in the Pacific Northwest, and $60 million to various "special projects" and annual appeals such as the United Way. In December 1998, Bill and Melinda Gates also made a special contribution of $20 million to support the Seattle "Libraries for All" construction program approved the previous month.
In January 1999, the W. H. Gates Foundation's endowment more than doubled to $4.2 billion thanks to another large gift from Bill and Melinda Gates. At the same time, the Gates Library Foundation was reorganized as the Gates Learning Foundation to reflect a broader interest in information and education systems.
Giving It All Away?
A series of large and high profile gifts sparked speculation about the future of the Gates's philanthropy, whose endowment then ranked sixth worldwide. An article in The Times of London misquoted the elder Gates as stating that Bill and Melinda planned to give away their entire fortune (the newspaper filed a retraction), but the scale of their beneficence was already historic.
After weeks of rumors, creation of the Bill & Melinda Gates Foundation was formally confirmed on August 22, 1999. The total endowment of $17 billion was donated in the form of Microsoft stock, later converted into other assets by Foundation staff to insulate the organization both from the corporation and from the vagaries of the stock market.
The new foundation consolidated the existing W. H. Gates and Gates Learning Foundations under the direction of the senior Gates and Stonesifer. Major programmatic divisions were formed for global health, education, and library and information systems, directed respectively by Dr. Perkin and Dr. William Foege, Tom Vander Ark, and Richard Akeroyd.
Over the course of 1999, the new Foundation announced new multimillion-dollar gifts to support minority scholarships, education reform, and women's and children's vaccination and other health programs in the Third World. On January 24, 2000, Bill and Melinda Gates sweetened the pot with another $5 billion, making their foundation the "nation's largest philanthropic trust" (B&MGF press release, January 24, 2000).