Richard Klausner Spends to Save Lives

Resources for the Future
The world's wealthiest foundation is located in the Seattle area, but not on Microsoft's Redmond campus. Situated on Lake Union near downtown, the Gates Foundation occupies an unmarked building, a former check-processing plant that, like the nonprofit itself, is evolving. The renovation of the building is still under way. Everything about the place feels understated, starting with the lack of signage out front. Inside, the decor is minimalist and mostly modern. There is no massive staff to tackle the organization's truly massive goals. There are 220 staffers, 20 of whom work in global health. That's approximately 4,700 people fewer than Klausner had as director of the National Cancer Institute, one of the largest research-and-health agencies in the world. But no matter. When the Gates Foundation called, he jumped at the opportunity.

"For a long time, I've had a love for how science and technology can be integrated with public policy to solve unbelievably difficult and important problems about the human condition," he says. At the NCI, he revived cancer research in this country and beyond, steering it in a groundbreaking direction. By focusing on the molecular and genetic makeup of cancer cells, researchers now have a better understanding of the disease and have dramatically improved the capacity for diagnosis and treatment.

When Klausner interviewed for the new position, he was reminded by cochair and president Patty Stonesifer that the Gates Foundation was a young organization, albeit one that had experienced explosive growth. It took off in 1999, when the Gateses combined two much smaller foundations. The Gates Learning Foundation, started in 1997, focused on education and operated out of an office located above a pizza restaurant. The William H. Gates Foundation, started in 1994 in Bill Gates Sr.'s basement, focused on global health. The result of the marriage of these two nonprofits, the Bill & Melinda Gates Foundation, had grown to $21 billion by January 2000.

Nearly three years later, the organization is still figuring out how to have the greatest impact, given its tremendous resources. In April, the global-health staff developed a set of guiding principles to articulate its grant-making strategy, focusing on three primary areas: HIV/AIDS and tuberculosis, infectious diseases and vaccines, and reproductive and child health. Klausner's job is to take that "30,000-foot view" and to turn abstract goals into effective grants. "That's the hard part," he says, "I find it intellectually challenging."

The foundation receives around 3,000 formal grant requests every month in addition to lots of less-formal pitches. The global-health staffers develop and review the proposals and submit their top picks to Klausner and cochairs Stonesifer and Bill Gates Sr. for approval. On major grants, "the benefactors," as the staffers refer to Bill and Melinda Gates, make the ultimate call.

"A well-written grant is a beautiful thing," Klausner says. "You have a really smart person saying, 'I have this idea.' It's a wonderful story." Klausner relishes problem solving -- the tougher the better. He's energetic, inquisitive, and analytical, and he examines proposals from various angles, listening to his colleagues' perspective and asking all sorts of questions: What about this? Or this? Is this really the best approach?

Sharing his decision-making process with the staff is crucial in demonstrating the philosophy and priorities of the foundation. For Klausner, the process doesn't end with the decisions on grants. Soon, the senior leadership team will meet regularly to discuss proposals that didn't make the cut.

"It's an opportunity to ask, 'What's our thinking about turning this down? Are we missing something important here?' " Klausner says. "You need to be structured in how you pay attention, and you need to learn from your experiences," he says. "We need to function as our own historians."

Every six weeks or so, Klausner meets with Microsoft's legendary founder to discuss existing grants, strategize about new partnerships, and review some grants. "So far, the education seems to be going both ways," says Klausner. "I've come away saying, 'Why didn't I think of that?' " The meetings with Gates reinforce one of Klausner's theories about productive group discussions: There is value in including nonexperts. Because they don't have any preconceived notions about research, they often ask new questions and generate new ideas.