Melinda French Gates’ $12.5 Billion Creates Path to Unrestricted Giving

(Bloomberg) -- After her divorce from Jeff Bezos in 2019, MacKenzie Scott changed the game of billionaire philanthropy, writing huge checks to small charities at a breakneck pace from her newly independent $36 billion fortune.

Now, the philanthropy world is hoping for another seismic shift from Melinda French Gates, who’s armed with $12.5 billion to deploy for her own charity work independent of the Bill & Melinda Gates Foundation.

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French Gates will get that vast sum directly from her ex-husband, Microsoft Corp. co-founder Bill Gates, after leaving the Gates Foundation next month. It’s still not clear when or in what form she’ll receive those billions, and representatives for French Gates declined to elaborate.

But that hasn’t slowed the speculation.

“I’m excited,” said Latanya Mapp, chief executive officer of Rockefeller Philanthropy Advisors. “She’s a good friend of MacKenzie, so all we can hope for is more of that kind of thinking, like we trust our partners. We know how little goes to domestic grassroots women’s organizations.”

French Gates, 59, spent more than two decades helping build the Gates Foundation — which will change its name after she leaves in June — into one of the biggest and most influential charities in the world. In 2024 alone, the foundation’s budget is $8.6 billion, dispersing money to its 42 program strategies, including global health and gender issues, which is French Gates’ flagship cause.

Mapp said she suspects French Gates only stayed at the Gates Foundation for three years after the couple’s 2021 divorce because she wanted to expand its gender program. Soon after announcing their divorce, the Gateses said they were committing $2.1 billion to advance gender equality.

French Gates helped build up “real infrastructure and a place for gender there,” Mapp said. “I don’t think this was an ‘I woke up this weekend and I decided to leave’ kind of decision.”

Pivotal Ventures

In 2015, French Gates started a charitable limited liability company called Pivotal Ventures, which uses grants as well as venture capital to focus on empowering women, including getting more females into technology jobs and elected to public office. Pivotal has committed $1 billion to “expanding women’s power and influence” in the US, according to its website.

Some see French Gates taking a more political turn after the US Supreme Court overturned Roe v. Wade. In her note on X announcing her departure, she wrote, “This is a critical moment for women and girls in the US and around the world — and those fighting to protect and advance equality are in urgent need of support.”

Ben Soskis, senior research associate at the Urban Institute, said French Gates possibly wants to focus her energy on Pivotal because of its form. An LLC “has more freedom to give to politics and to make for-profit investments than does a private foundation,” said Soskis, who has received Gates Foundation funding.

In 2022, French Gates started an offshoot called Pivotal Philanthropies Foundation with $626 million in assets. A spokesperson for Pivotal said the foundation form “gives [French Gates] the ability to support more organizations aligned with Pivotal’s mission to advance social progress.”

To put the scale of French Gates’s new power into context, her foundation — if starting from scratch with $12.5 billion — would be the sixth-largest in the US, according to Elizabeth Dale, associate professor of public affairs and nonprofit leadership at Seattle University.

The Pivotal foundation made $8.8 million in grants in 2022, including $500,000 to Me Too International to “strengthen the capacity of a global and survivor-led movement against sexual violence,” and $75,000 to Neo Philanthropy Inc. to “raise public awareness for women of color transforming democracy.” The biggest grants were $2 million — a small amount compared with the tens of millions of dollars Scott sometimes gives at a time. One of the groups that received $2 million was Allied Media Projects, to support the Decolonizing Wealth Project, “a racial equity education program.”

MacKenzie Model

Edgar Villanueva, CEO of the Decolonizing Wealth Project, said the way Pivotal does its funding is closer to the MacKenzie Scott model. While Scott is prone to catch nonprofits by surprise with huge checks and little in the way of reporting requirements or spending restrictions, the Gates Foundation is known to be more bureaucratic, he said.

“Gates can be very rigid and require a lot from grantees in terms of reporting and data,” Villanueva said. “Pivotal has really been more of the model of a co-investor, taking bets on communities and not requiring the most in terms of reporting.”

MacKenzie Scott

French Gates and Scott, 54, have worked together before. In 2020 they partnered on the Equality Can’t Wait Challenge, which made calls for pitches on how organizations should spend $10 million to speed up women’s empowerment. The pair, along with other partners, are now funding the initial $45 million for construction of a parks improvement plan in Seattle.

Scott, who didn’t respond to a request for comment, has a fortune of $38.5 billion, according to the Bloomberg Billionaires Index. French Gates has a net worth of $13.4 billion.

Mapp said she hopes the women will collaborate more and is excited to see how this chapter of French Gates’ independent giving will play out.

“She can be more risky, she can be louder and she can be more uninhibited because she’s not beholden to the bureaucracy,” Mapp said. “We’ll hopefully see more of her working with MacKenzie.”

Villanueva agrees. “I see her teaming up more with MacKenzie Scott,” he said. “I’ve been a big fan of how MacKenzie does her giving.”

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