Robert Kiyosaki

Robert Kiyosaki
Born	April 8, 1947 (1947-04-08) (age 63) Hilo, Hawaii, United States
Occupation	Investor, entrepreneur, author, motivational speaker
Spouse(s)	Kim Kiyosaki

Robert Toru Kiyosaki (born April 8, 1947) is an American investor, businessman, self-help author and motivational speaker. Kiyosaki is best known for his Rich Dad Poor Dad series of motivational books and other material published under the Rich Dad brand. He has written 15 books which have combined sales of over 26 million copies.^[1] Although beginning as a self-publisher, he was subsequently published by Warner Books, a division of Hachette Book Group USA, currently his new books appear under the Rich Dad Press imprint. Three of his books, Rich Dad Poor Dad, Rich Dad's CASHFLOW Quadrant, and Rich Dad's Guide to Investing, have been on the top 10 best-seller lists simultaneously on The Wall Street Journal, USA Today and the New York Times. Rich Kid Smart Kid was published in 2001, with the intent to help parents teach their children financial concepts. He has created three "Cashflow" board and software games for adults and children and has a series of "Rich Dad" audio cassettes and disks. He also publishes a monthly newsletter.^{[citation needed]}

[edit] Personal life

A fourth-generation Japanese American, Kiyosaki was born and raised in Hawaii. He is the son of the late educator Ralph H. Kiyosaki (1919–1991). After graduating from Hilo High School, he attended the U.S. Merchant Marine Academy in New York, graduating with the class of 1969 as a deck officer. He later served in the Marine Corps as a helicopter gunship pilot during the Vietnam War, where he was awarded the Air Medal.

Kiyosaki left the Marine Corps in 1975 and got a job selling copy machines for the Xerox Corporation. In 1977, Kiyosaki started a company that brought to market the first nylon and Velcro "surfer" wallets. The company was extremely successful at first but eventually went bankrupt. In the early 1980s, Kiyosaki started a business that licensed T-shirts for Heavy metal rock bands. In 1997 he launched Cashflow Technologies, Inc.^[2] which owns and operates the Rich Dad^[3] and Cashflow^[4] brands.

[edit] Family

He is married to Kim Kiyosaki. He has one sister, Emi Kiyosaki, a Tibetan Buddhist nun and known by the name Ven. Tenzin Kacho. He has co-authored one book with her.^[5]

[edit] Teachings

A large part of Kiyosaki's teachings focus on generating passive income by means of investment opportunities, such as real estate and businesses, with the ultimate goal of being able to support oneself by such investments alone. In tandem with this, Kiyosaki defines assets as things that generate cash inflow, such as rental properties or businesses—and liabilities as things that use cash, such as houses, cars, and so on.

Kiyosaki stresses financial literacy as the means to obtaining wealth. He says that life skills are often best learned through experience and that there are important lessons not taught in school. He says that formal education is important, but is not enough as it is an Industrial Age idea.

Kiyosaki often refers to "The Cashflow Quadrant," a conceptual tool which he developed to categorized the four major ways income is earned. Depicted in a diagram, this concept entails four groupings, split with two lines (one vertical and one horizontal). In each of the four groups there is a letter representing a way in which an individual may earn income. The letters are as follows.

• E: Employee — Working for someone else.
• S: Self-employed or Small business owner — Where a person owns his own job and is his own boss.
• B: Business owner — Where a person owns a business to make money.
• I: Investor — Investing money in order to receive a larger payout in the future.

[edit] Rich Dad brand

[edit] Books

Kiyosaki is best known for his book Rich Dad, Poor Dad, the #1 New York Times bestseller. Kiyosaki followed with Rich Dad's CASHFLOW Quadrant and Rich Dad's Guide to Investing. He has now had at least a dozen books published. The best known of these include:

• Cashflow Quadrant: Rich Dad's Guide to Financial Freedom (2000)
• Rich Dad's Guide to Investing: What the Rich Invest in, That the Poor and the Middle Class Do Not! (2000)
• Rich Kid, Smart Kid (2001)
• Rich Dad's Prophecy (2002)
• Why We Want You To Be Rich (2007, with Donald Trump)
• The Business School

[edit] Games

Kiyosaki stresses the value of games, particularly Monopoly, as tools for learning basic financial strategies such as "trade four green houses for one red hotel." Kiyosaki has created several games to reinforce the information in his books.

• Cashflow 101
• Cashflow 202
• Cashflow for Kids
• Cashflow The E-Game
• Cashflow 202 The E-Game

[edit] Appearances

[edit] PBS

Several local stations of the Public Broadcasting Service (PBS), including WTTW of Chicago, KAET of Phoenix, KOCE of Orange County, California, WLIW of the New York/New Jersey area, and WGBH of Boston, have featured Kiyosaki during fund-raising drives. During this television special, Rich Dad's Guide to Wealth with Robert Kiyosaki, he provides viewers with financial education, as opposed to academic or professional education.

[edit] News

Kiyosaki has been seen giving financial advice on various network television news channels.

[edit] New York City's Madison Square Garden (October, 2002)

This speech was the subject of a CNN story.^[6]

[edit] CBC Marketplace

The Canadian Broadcasting Corporation consumer affairs program Marketplace aired a documentary piece on Kiyosaki on Jan 29, 2010. It includes interviews with Kiyosaki.^[7]

[edit] Financial advice

[edit] Mutual funds

Kiyosaki wrote in one column that investors in any mutual fund with a 2.5% annual fee would, over a long time period, surrender 80% of the earnings to the fund.^[8] Kiyosaki expanded on his criticism of mutual funds in another column by stating they are for "losers."^[9] He has drawn much criticism for comparing investing in mutual funds to playing the lottery, and for discouraging 401(k) investing, contrary to the advice of most professional financial advisers.^[10] In contrast to these statements, Kiyosaki wrote in his book Prophecy that while mutual funds are not great investments, they remain one of the few acceptable investment vehicles available to those who will not educate themselves financially.

Kiyosaki's criticisms are supported by the founder of the mutual fund Vanguard, John C. Bogle. In a Frontline episode titled "401(k)s: The New Retirement Plan, For Better or Worse", Bogle stated that management fees and trading costs gobble up approximately 2.5% of an investor's annual returns and approximately 80% of an investor's long term gains. He says management costs reduce the value of a $1,000 investment over 65 years from approximately $140,000 at 8% compounded annually to a mere $30,000 at 5.5% compounded annually. Bogle's solution is to utilize index funds, which charge as little as 0.09%, to substantially reduce or eliminate management fees.^[11]

[edit] Criticism and controversy

Kiyosaki's books and teachings have been criticized for focusing on anecdotes and containing little in the way of concrete advice on how readers should proceed.^[12] Kiyosaki responds that his material is meant to be more of a motivational tool to get readers thinking about money, rather than a step by step guide to wealth. He also says the books are supposed to be "interesting" to people, which precludes involving a lot of technical material.^[13]

ABC ran a 20/20 segment on May 19, 2006 in which Kiyosaki was to advise three entrepreneurs on how to make money. They were given $1000 and 20 days to try and make the most money possible. One earned a return of 24%, the second earned a return of 54% and gave it all to charity, and the third lost 100% because she invested in machines that could not be delivered in 20 days. The contestants alleged that Kiyosaki never gave concrete advice. "All he [Kiyosaki] does is, I guess, is open your mind to the possibility. He doesn't tell you how to do it." Kiyosaki responded that failure is important to learning.

[edit] Partial bibliography

• If You Want to Be Rich & Happy: Don't Go to School? : Ensuring Lifetime Security for Yourself and Your Children (1992). ISBN 0-944031-38-2.
• Rich Dad, Poor Dad - What the Rich Teach Their Kids About Money - That the Poor and Middle Class Do Not! (first published in 1997), by Robert Kiyosaki & Sharon L. Lechter. Warner Business Books. ISBN 0-446-67745-0.
• Cashflow Quadrant: Rich Dad's Guide to Financial Freedom (2000). ISBN 0-446-67747-7.
• Rich Dad's Guide to Investing: What the Rich Invest in, That the Poor and the Middle Class Do Not! (2000). ISBN 0-446-67746-9.
• The Business School for People Who Like Helping People (2001) - endorses multi-level marketing.
• Rich Dad's Rich Kid, Smart Kid: Giving Your Children a Financial Headstart (2001). ISBN 0-446-67748-5.
• Rich Dad's Retire Young, Retire Rich (2002). ISBN 0-446-67843-0.
• Rich Dad's Prophecy: Why the Biggest Stock Market Crash in History Is Still Coming… and How You Can Prepare Yourself and Profit from It! (October, 2002). Warner Books, Incorporated. ISBN 0-641-62241-4.
• Rich Dad's The Business School (2003)
• You Can Choose to be Rich (2003) 12-CD Audio series with booklet.
• Who Took My Money (2004)
• Rich Dad, Poor Dad for Teens (2004)
• Rich Dad's Before You Quit Your Job : 10 Real-Life Lessons Every Entrepreneur Should Know About Building a Multimillion-Dollar Business (2005). ISBN 0-446-69637-4.
• Rich Dad's Escape from the Rat Race - Comic for children (2005)
• Rich Dad's Increase Your Financial IQ: Get Smarter with Your Money (2008)
• Rich Dad's Conspiracy of the Rich: The 8 New Rules of Money (September 21, 2009). ISBN 0446559806 (free online edition)

Cash Flow Quadrant – Robert Kiyosaki

"20/20" Challenges Three Contestants to Turn a Profit in 20 Days (A TV Program - Source ABC News)

How easy is it to make money? If someone handed you $1,000 and gave you 20 days to turn a profit, would you have any idea where to start? "20/20" challenged three would-be entrepreneurs to find out. To give them guidance we brought in famous get-rich guru Robert Kiyosaki to offer them his secrets for money-making success.

Will Julie, Cheryl or James succeed in "20/20's" entrepreneur challenge?

(ABCNEWS)

Kiyosaki is one of the hottest financial advisers today. His 18 books have sold some 26 million copies. The first title in the "Rich Dad, Poor Dad" series has been on The New York Times Best Seller List for five years, and has sold more than 11 million copies.

Kyosaki says his books can put ordinary people on the fast track to a life like his -- working for themselves, not someone else. He says there are four basic types of people: workers, small-business owners, investors and entrepreneurs. If you want to make money, Kyosaki says, invest in real estate or start a business. "I don't like being told what to do and kissing you know what to get up the corporate ladder," he said.

But does Kiyosaki's method -- short on specifics but long on pep talks and salesmanship -- work? We decided to put the guru to the test with our would-be entrepreneurs: Cheryl, an ad sales rep and amateur theater stage manager from Queens, N.Y.; Julie, a store construction coordinator and new mother from Minneapolis, Minn.; and James, a father of four and school counselor from Tulsa, Okla.

Nine Out of 10 Fail

The three came to New York for a crash course from the master.

Kiyosaki personally challenged the contestants: "I want to find out who among you has the most potential of becoming a great entrepreneur," he told them.

The objective was simple: Take $1,000 in cash and see who could make the most money in 20 days.

Here were the ground rules: Choose any venture, as long it's legal and ethical, and don't tell anyone it's being done for a TV program. Any profits they make, they could keep.

Kiyosaki was careful to lower expectations. He told "20/20" he wouldn't be surprised if all three of the contestants failed to make a profit or even lost all their money.

"I hate to say it, but nine out of 10 do fail. The thing I always say to people is this: If you avoid failure, you also avoid success."

Who Will Win the "20/20" Challenge?

With the clock ticking, all three went to work. Cheryl decided on party planning, throwing a fundraiser for a nonprofit theater company. She used its mailing list, in return, for a split in the profits.

Halfway across the country, James had a direct, simple plan. "What I'm going to do is buy boxes of candy, put it into jars and sell it for a profit," he said.

He, too, chooses charity as a selling tool, promising customers he'll split any profits with the Tulsa public schools.

Julie from Minneapolis is off to a much slower start. The entire first week ticks by as she struggles for an idea. Finally, she begins the second week with a decision.

"I'm going to go into over-the-counter medical vending," she said.

She spends our $1,000, and then adds another $1,000 of her own money to buy 10 vending machines that sell small packets of aspirin and other drugs. The machines are only in a brochure; she has to start making sales calls without a product to show. She is in trouble.

Before the contestants know it, the 20 days are half over, and "20/20" asks Kyosaki to give each a midterm checkup. None of the contestants have any real cash in their hands yet.

Julie's up first, and Kiyosaki is not sympathetic.

"When do you expect these vending machines to come in? Because you have a deadline," he says.

Her answer is not good. "I think they will come next week."

Kiyosaki says Julie is out of time already, and will not recover before the contest is up.

"You're going to lose this whole thing," he tells her.

It's then that Julie points out the most frustrating part of the exercise: Kiyosaki never gives the contestants any detailed help.

"I still wish I had more information on how to sell better," she says.

It's not much better for James, the recipient of the next checkup phone call. He is making money, but he is giving it away to charities almost as fast as he collects it.

Kiyosaki is flabbergasted. "You're giving the money away," he asks, adding, "Now why are you doing that? You can't take care of charity unless you take care of yourself first."

Back in New York City, party planner Cheryl also gets a stern warning from Kiyosaki. "I would say right now you have an emergency on your hands. And I would start promoting heavily because this is the last shot you got," he says.

Cheryl takes the pep talk to heart and steps it up, inviting friends and imploring them to bring others.

While she is stressed when her party starts out dangerously slow, by night's end Cheryl brings in a profit.

So how did they do? Julie's reckoning comes first. The vending machine business never got off the ground. She lost our $1,000 and $1,000 of her own and didn't sell any machines before the deadline. Kiyosaki criticized Julie for being unrealistic.

"You have to deliver on time and you have to come within budget," he tells her.

Then came James. He actually made a $540 profit. Again, however, he gave it all away. Kiyosaki was unimpressed. "You gave away 100 percent of it? Pay yourself first. If the business is weak, everything else loses," he says.

And that brings us to the winner of our little contest: Cheryl.

Her party turned out to be a moderate success and left her with a profit of $243.

Teaching People to Learn from Failure

Two out of the three contestants actually made a profit. So how did Kiyosaki do? Was he much help?

Julie was not convinced. "All he does is, I guess, open your mind to the possibility. He doesn't tell you how to do it," she says.

So we asked Kiyosaki straight up: In your books and in your speeches, the seminars, you're not really giving a road to follow these things and you'll become rich?

His answer was straight too. "No," he says.

He's a motivational speaker, hoping to educate novices in the world of business -- not a strict how-to-get-rich guy.

And what did he teach our contestants? Kiyosaki says they learned to fail. He says they also learned that desire is 99 percent of the process.

But doesn't everyone want to get rich? Aren't there specific instructions in his books?

"I try and tell them that there is no answer, there's only a mistake. When I lost my first company at the age of about 29, it was painful. But, in retrospect, it was the best thing that ever happened to me because that's when I really learned what I needed to learn."

Which led to my final question for the biggest self-help book salesman in the United States today.

If I read your books, what am I going to come away with that's going to help me get rich?

His answer: "Start a part-time business and make as many mistakes as you possibly can while you still have your daytime job."

Which begs the question: Does anyone really need 18 books to learn to fail?

Posted via email from Prashannth.V

Warren Buffett

Warren Buffett
Buffett speaking to students from the University of Kansas School of Business, May 6, 2005
Born	Warren Edward Buffett August 30, 1930 (1930-08-30) (age 79) Omaha, Nebraska, U.S.
Nationality	American
Alma mater	University of Pennsylvania University of Nebraska–Lincoln Columbia University
Occupation	Chairman & CEO of Berkshire Hathaway, Investor
Salary	US$100,000[1]
Net worth	▲US$47 billion (2010)[2]
Spouse(s)	Susan Thompson Buffett (1952–2004) (deceased), Astrid Menks (2006–)[3]
Children	Susan Alice Buffett, Howard Graham Buffett, Peter Andrew Buffett

Warren Edward Buffett (pronounced /ˈbʌfɨt/; born August 30, 1930) is an American investor, industrialist and philanthropist. He is one of the most successful investors in the world often called the "legendary investor Warren Buffett"^[4][5], he is the primary shareholder, chairman and CEO of Berkshire Hathaway.^[6] He is consistently ranked among the world's wealthiest people and currently the third wealthiest person in the world as of 2010.^[7][8]

Buffett is called the "Oracle of Omaha"^[9] or the "Sage of Omaha"^[10] and is noted for his adherence to the value investing philosophy and for his personal frugality despite his immense wealth.^[11] Buffett is also a notable philanthropist, having pledged to give away 85 percent of his fortune to the Gates Foundation. He also serves as a member of the board of trustees at Grinnell College.^[12]

Early life

Buffett was born in Omaha, Nebraska, the second of three children and only son of Leila (née Stahl) and businessman/politician Howard Buffett.^[13]

Buffett began his education at Rose Hill Elementary School in Omaha. In 1942 his father was elected to the first of four terms in Congress and after moving with his family to Washington, D.C., Warren finished elementary school, attended Alice Deal Junior High School, and graduated from Woodrow Wilson High School.^[14]

Even as a child Buffett displayed an interest in making and saving money. He went door to door selling chewing gum, Coca-Cola, or weekly magazines. For a while he worked in his grandfather's grocery store. While still in high school, he carried out several successful money-making ideas: delivering newspapers, selling golfballs and stamps, and detailing cars among them. Filing his first income tax return in 1944, Buffett took a $35 deduction for the use of his bicycle and watch on his paper route.^[15] In 1945, in his sophomore year of high school, Buffett and a friend spent $25 to purchase a used pinball machine, which they placed in the local barber shop. Within months, they owned several machines in different barber shops.

Working with Benjamin Graham

He tried to get a position with Graham’s firm and was at first unsuccessful. He finally got the job and, as he generously acknowledges, learned a lot about stock investment from The Master.

Graham eventually retired and Buffett started a limited partnership in Omaha, using capital contributed by family and friends. The partnership was a great success and Buffett is said to have averaged an annual rate of return for the partnership in excess of 23 per cent, far in excess of the market.

Benjamin Graham (1894–1976)

Phil Fisher (1907–2004)

Buffett entered college in 1947 at the Wharton School of the University of Pennsylvania (1947–49). After two years he transferred to the University of Nebraska–Lincoln, where in 1950, at the age of nineteen, he finished his studies for a B.S. in Economics.^[16]

Buffett enrolled at Columbia Business School after learning that Benjamin Graham (author of "The Intelligent Investor" - one of his favorite books on investing) and David Dodd, two well-known securities analysts, taught there. He received a M.S. in Economics from Columbia Business School in 1951.

In Buffett’s own words:

Buffet also attended the New York Institute of Finance.

Buffett and Charlie Munger

Buffett struck up a friendship with Charles T Munger, a lawyer and investor and Charlie Munger eventually joined Warren at Berkshire Hathaway as his Vice-Chairman, alter ego, and friend. Warren Buffett is always the first to acknowledge the contribution that Charlie Munger has made to Berkshire Hathaway. (Listen to an interview with Charlie Munger, or read our biography)

Under Buffett and Munger, Berkshire Hathaway has become an investment giant that wholly owns a number of successful companies that include:

• Geico Corporation
• Nebraska Furniture Mart
• See’s Candy Shops

Warren Buffet, the man

Warren Buffett, the man, is just as hard to define as Warren Buffett, the investor. He projects a homespun frugality but one suspects that he plays his personality as close to the chest as he does his investment secrets. He always claims that it is his partner, Charlie Munger, who keeps his feet planted firmly in the ground.

Warren Buffet has become a legend and is generally ranked, along with his mentor, Benjamin Graham, first in a stellar cast of investors that includes Peter Lynch, John Neff, and Philip Fisher.

Career

Buffett was employed from 1951–54 at Buffett-Falk & Co., Omaha as an Investment Salesman, from 1954–1956 at Graham-Newman Corp., New York as a Securities Analyst, from 1956–1969 at Buffett Partnership, Ltd., Omaha as a General Partner and from 1970 – Present at Berkshire Hathaway Inc, Omaha as its Chairman, CEO.

In April 1952, Buffett discovered Graham was on the board of GEICO insurance. Taking a train to Washington, D.C. on a Saturday, he knocked on the door of GEICO's headquarters until a janitor allowed him in. There he met Lorimer Davidson, Geico's Vice President, and the two discussed the insurance business for hours. Davidson would eventually become Buffett's life-long friend and a lasting influence ^[19] and later recall that he found Buffett to be an "extraordinary man" after only fifteen minutes. Buffett graduated from Columbia and wanted to work on Wall Street, however, both his father and Ben Graham urged him not to. He offered to work for Graham for free, but Graham refused^[20]

Buffett returned to Omaha and worked as a stockbroker while taking a Dale Carnegie public speaking course.^{[citation needed]} Using what he learned, he felt confident enough to teach an "Investment Principles" night class at the University of Nebraska-Omaha. The average age of his students was more than twice his own. During this time he also purchased a Sinclair Texaco gas station as a side investment. However, this did not turn out to be a successful business venture.

In 1952^[21] Buffett married Susan Thompson and the next year they had their first child, Susan Alice Buffett. In 1954, Buffett accepted a job at Benjamin Graham's partnership. His starting salary was $12,000 a year (approximately $97,000 adjusted to 2008 dollars). There he worked closely with Walter Schloss. Graham was a tough man to work for. He was adamant that stocks provide a wide margin of safety after weighting the trade-off between their price and their intrinsic value. The argument made sense to Buffett but he questioned whether the criteria were too stringent and caused the company to miss out on big winners that had more qualitative values.^{[citation needed]} That same year the Buffetts had their second child, Howard Graham Buffett. In 1956, Benjamin Graham retired and closed his partnership. At this time Buffett's personal savings were over $174,000 and he started Buffett Partnership Ltd., an investment partnership in Omaha.

In 1957, Buffett had three partnerships operating the entire year. He purchased a five-bedroom stucco house in Omaha, where he still lives, for $31,500. In 1958 the Buffett's third child, Peter Andrew Buffett, was born. Buffett operated five partnerships the entire year. In 1959, the company grew to six partnerships operating the entire year and Buffett was introduced to Charlie Munger. By 1960, Buffett had seven partnerships operating: Buffett Associates, Buffett Fund, Dacee, Emdee, Glenoff, Mo-Buff and Underwood. He asked one of his partners, a doctor, to find ten other doctors willing to invest $10,000 each in his partnership. Eventually eleven agreed, and Buffett pooled their money with a mere $100 original investment of his own. In 1961, Buffett revealed that Sanborn Map Company accounted for 35% of the partnership's assets. He explained that in 1958 Sanborn stock sold at only $45 per share when the value of the Sanborn investment portfolio was $65 per share. This meant that buyers valued Sanborn stock at "minus $20" per share and were unwilling to pay more than 70 cents on the dollar for an investment portfolio with a map business thrown in for nothing. This earned him a spot on the board of Sanborn.

Path to wealth

In 1962, Buffett became a millionaire, because of his partnerships, which in January 1962 had an excess of $7,178,500, of which over $1,025,000 belonged to Buffett. Buffett merged all partnerships into one partnership. Buffett invested in and eventually took control of a textile manufacturing firm, Berkshire Hathaway. Buffett's partnerships began purchasing shares at $7.60 per share. In 1965, when Buffett's partnerships aggressively began purchasing Berkshire, they paid $14.86 per share while the company had working capital of $19 per share. This did not include the value of fixed assets (factory and equipment). Buffett took control of Berkshire Hathaway at the board meeting and named a new president, Ken Chace, to run the company. In 1966, Buffett closed the partnership to new money. Buffett wrote in his letter:

unless it appears that circumstances have changed (under some conditions added capital would improve results) or unless new partners can bring some asset to the partnership other than simply capital, I intend to admit no additional partners to BPL.

In a second letter, Buffett announced his first investment in a private business — Hochschild, Kohn and Co, a privately owned Baltimore department store. In 1967, Berkshire paid out its first and only dividend of 10 cents. In 1969, following his most successful year, Buffett liquidated the partnership and transferred their assets to his partners. Among the assets paid out were shares of Berkshire Hathaway. In 1970, as chairman of Berkshire Hathaway, Buffett began writing his now-famous annual letters to shareholders.

However, he lived solely on his salary of $50,000 per year, and his outside investment income. In 1979, Berkshire began the year trading at $775 per share, and ended at $1,310. Buffett's net worth reached $620 million, placing him on the Forbes 400 for the first time.

As a billionaire

In 2006, Buffett announced in June that he gradually would give away 85% of his Berkshire holdings to five foundations in annual gifts of stock, starting in July 2006. The largest contribution would go to the Bill and Melinda Gates Foundation.^[22]

In 2007, in a letter to shareholders, Buffett announced that he was looking for a younger successor, or perhaps successors, to run his investment business.^[23] Buffett had previously selected Lou Simpson, who runs investments at Geico, to fill that role. However, Simpson is only six years younger than Buffett.

In 2008, Buffett became the richest man in the world dethroning Bill Gates, worth $62 billion according to Forbes,^[24] and $58 billion according to Yahoo.^[25] Bill Gates had been number one on the Forbes list for 13 consecutive years.^[26] In 2009, Bill Gates regained number one of the list according to Forbes magazine, with Buffett second. Their values have dropped to $40 billion and $37 billion respectively,^[27] Buffett having (according to Forbes) lost $25 billion in 12 months during 2008/2009.^[28]

Berkshire Hathaway

Measured by market capitalization in the Financial Times Global 500 Berkshire Hathaway as of June 2009 was the eighteenth largest corporation on earth.^[29]

Buying Berkshire Hathaway

Buffett, after several years, decided to wind up the partnership, returning the lucky investors their capital and their share of the profits, and bought an interest in Berkshire Hathaway, a textile company, giving his original investors the the chance to invest. The smart ones did so.

Buffett’s early days at Berkshire Hathaway were not great. The company was in an industry facing real challenges from exports and high manufacturing costs. Warren Buffett had not, however, forgotten what he had learned under Graham, and arranged for the company to buy out two Nebraska insurance companies.

This was the start of Buffett’s interest in insurance and the rise to financial fame of both himself and Berkshire Hathaway. The insurance game is a hard one but under Buffett, the company has become, not only a successful share investor, but a leading provider of insurance.

Acquisitions

In 1973, Berkshire began to acquire stock in the Washington Post Company. Buffett became close friends with Katharine Graham, who controlled the company and its flagship newspaper, and became a member of its board of directors.

In 1974, the SEC opened a formal investigation into Warren Buffett and Berkshire's acquisition of WESCO, due to possible conflict of interest. No charges were brought.

In 1977, Berkshire indirectly purchased the Buffalo Evening News for $32.5 million. Antitrust charges started, instigated by its rival, the Buffalo Courier-Express. Both papers lost money, until the Courier-Express folded in 1982.

In 1979, Berkshire began to acquire stock in ABC. Capital Cities' announced $3.5 billion purchase of ABC on March 18, 1985 surprised the media industry, as ABC was some four times bigger than Capital Cities was at the time. Berkshire Hathaway chairman Warren Buffett helped finance the deal in return for a 25 percent stake in the combined company.^[30] The newly merged company, known as Capital Cities/ABC (or CapCities/ABC), was forced to sell off some stations due to FCC ownership rules. Also, the two companies owned several radio stations in the same markets.^[31]

In 1987, Berkshire Hathaway purchased 12% stake in Salomon Inc., making it the largest shareholder and Buffett the director. In 1990, a scandal involving John Gutfreund (former CEO of Salomon Brothers) surfaced. A rogue trader, Paul Mozer, was submitting bids in excess of what was allowed by the Treasury rules. When this was discovered and brought to the attention of Gutfreund, he did not immediately suspend the rogue trader. Gutfreund left the company in August 1991.^[32] Buffett became Chairman of Salomon until the crisis passed; on September 4, 1991, he testified before Congress.^[33]

In 1988, Buffett began buying stock in Coca-Cola Company, eventually purchasing up to 7 percent of the company for $1.02 billion. It would turn out to be one of Berkshire's most lucrative investments, and one which it still holds.

In 1998, he acquired General Re (Gen Re), (in a rare move, for stock). In 2002, Buffett became involved with Maurice R. Greenberg at AIG, with General Re providing reinsurance. On March 15, 2005, AIG's board forced Greenberg to resign from his post as Chairman and CEO under the shadow of criticism from Eliot Spitzer, attorney general of the state of New York. On February 9, 2006, AIG and the New York State Attorney General's office agreed to a settlement in which AIG would pay a fine of $1.6 billion.^[34] In 2010, the federal government settled with Berkshire Hathaway for $92 million in return for the firm avoiding prosecution in an AIG fraud scheme, and undergoing 'corporate governance concessions'. ^[35]

In 2002, Buffett entered in $11 billion worth of forward contracts to deliver U.S. dollars against other currencies. By April 2006, his total gain on these contracts was over $2 billion.

In 2009, Warren Buffett invested $2.6 billion as a part of Swiss Re's raising equity capital.^[36][37] Berkshire Hathaway already owns a 3% stake, with rights to own more than 20%.^[38]

In 2009, Warren Buffett acquired Burlington Northern Santa Fe Corp. for $34 billion in cash and stocks. Alice Schroeder author of Snowball stated that a reason for the purchase was to diversify Berkshire Hathaway from the financial industry.[3]

Late 2000s recession

Buffett ran into criticism^[39] during the subprime crisis of 2007–2008, part of the late 2000s recession, that he had allocated capital too early resulting in suboptimal deals. “Buy American. I am.” he wrote for an opinion piece published recently in the New York Times.^[40]

Buffett has called the 2007—present downturn in the financial sector "poetic justice".^[41]

Buffett's Berkshire Hathaway suffered a 77% drop in earnings during Q3 2008 and several of his recent deals appear to be running into large mark-to-market losses.^[42]

Berkshire Hathaway acquired 10% perpetual preferred stock of Goldman Sachs^[43]. Some of Buffett's Index put options (European exercise at expiry only) that he wrote (sold) are currently running around $6.73 billion mark-to-market losses.^[44] The scale of the potential loss prompted the SEC to demand that Berkshire produce, "a more robust disclosure" of factors used to value the contracts.^[44]

Buffett also helped Dow Chemical pay for its $18.8 billion takeover of Rohm & Haas. He thus became the single largest shareholder in the enlarged group with his Berkshire Hathaway, which provided $3 billion, underlining his instrumental role during the current crisis in debt and equity markets.^[45]

In October 2008, the media reported that Warren Buffett had agreed to buy General Electric (GE) preferred stock.^[46] The operation included extra special incentives: he received an option to buy 3 billion GE at $22.25 in the next five years, and also received a 10% dividend (callable within three years). In February 2009, Warren Buffett sold part of Procter & Gamble Co, and Johnson & Johnson shares from his portfolio.^[47]

In addition to suggestions of mistiming, questions have been raised as to the wisdom in keeping some of Berkshire's major holdings, including The Coca-Cola Company (NYSE:KO) which in 1998 peaked at $86. Buffett discussed the difficulties of knowing when to sell in the company's 2004 annual report: "That may seem easy to do when one looks through an always-clean, rear-view mirror. Unfortunately, however, it’s the windshield through which investors must peer, and that glass is invariably fogged".^[48] In March 2009, Buffett stated in a cable television interview that the economy had "fallen off a cliff... Not only has the economy slowed down a lot, but people have really changed their habits like I haven't seen". Additionally, Buffett fears we may revisit a 1970s level of inflation, which led to a painful stagflation that lasted many years.^[49][50]

In 2009, Buffett divested his failed investment in ConocoPhillips, saying to his Berkshire investors "I bought a large amount of ConocoPhillips stock when oil and gas prices were near their peak. I in no way anticipated the dramatic fall in energy prices that occurred in the last half of the year. I still believe the odds are good that oil sells far higher in the future than the current $40-$50 price. But so far I have been dead wrong. Even if prices should rise, moreover, the terrible timing of my purchase has cost Berkshire several billion dollars".^[51]

2009 - Proposed merger with the Burlington Northern Santa Fe Railway (BNSF), to close upon BNSF shareholder approval in 1Q2010. This deal is valued at approximately $34 billion and reflects an increase of a previously existing stake of about 22%.

2009 Verisk stock acquisition- before Verisk (ISO [Insurance Services Office]) went public, Buffett owned about 5%. When Verisk went public in May 2009, Buffett purchased 6% more of Verisk.

Personal life

Buffett married Susan Buffett née Thompson in 1952. They had three children, Susie, Howard, and Peter. The couple began living separately in 1977, although they remained married until her death in July 2004. Their daughter, Susie, lives in Omaha and does charitable work through the Susan A. Buffett Foundation and is a national board member of Girls, Inc. In 2006, on his seventy-sixth birthday, Warren married his never-married longtime-companion, Astrid Menks, who was then sixty years old. She had lived with him since his wife's departure in 1977 to San Francisco.^[52] It was Susan Buffett who arranged for the two to meet before she left Omaha to pursue her singing career. All three were close and holiday cards to friends were signed "Warren, Susie and Astrid".^[53] Susan Buffett briefly discussed this relationship in an interview on the Charlie Rose Show shortly before her death, in a rare glimpse into Buffett's personal life.^[54]

Warren Buffett disowned his son Peter's adopted daughter, Nicole, in 2006 after she participated in the Jamie Johnson documentary, The One Percent. Although his first wife had referred to Nicole as one of her "adored grandchildren",^[55] Buffett wrote her a letter stating, "I have not emotionally or legally adopted you as a grandchild, nor have the rest of my family adopted you as a niece or a cousin." He signed the letter "Warren." ^[56][57][58]

His 2006 annual salary was about $100,000, which is small compared to senior executive remuneration in comparable companies.^[59] In 2007, and 2008, he earned a total compensation of $175,000, which included a base salary of just $100,000.^[60][61] He lives in the same house in the central Dundee neighborhood of Omaha that he bought in 1958 for $31,500, today valued at around $700,000 (although he also does have a $4 million house in Laguna Beach, California).^[62] In 1989 after having spent nearly 10 million dollars^[63] of Berkshire's funds on a private jet, Buffett sheepishly named it "The Indefensible". This act was a break from his past condemnation of extravagant purchases by other CEOs and his history of using more public transportation.^[64]

He remains an avid player of the card game bridge, which he learned from Sharon Osberg, and plays with her and Bill Gates.^[65] He spends twelve hours a week playing the game.^[66] In 2006, he sponsored a bridge match for the Buffett Cup.

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Bill Gates

Bill Gates
Bill Gates at the World Economic Forum in Davos, 2007
Born	October 28, 1955 (1955-10-28) (age 54) Seattle, Washington, USA
Residence	Medina, Washington, USA
Nationality	American
Alma mater	Harvard University (dropped out in 1975)
Occupation	Chairman of Microsoft (non-executive) Co-Chair of Bill & Melinda Gates Foundation Director of Berkshire Hathaway CEO of Cascade Investment
Net worth	▲US$53 billion (2010)[1]
Spouse(s)	Melinda Gates (1994–present)
Children	3
Parents	William H. Gates, Sr. Mary Maxwell Gates,
Signature
Website Bill Gates

William Henry "Bill" Gates III (born October 28, 1955)^[2] is an American business magnate, philanthropist, and chairman^[3] of Microsoft, the software company he founded with Paul Allen. He is consistently ranked among the world's wealthiest people^[4] and was the wealthiest overall from 1995 to 2009, excluding 2008, when he was ranked third.^[5] During his career at Microsoft, Gates held the positions of CEO and chief software architect, and remains the largest individual shareholder with more than 8 percent of the common stock.^[6] He has also authored or co-authored several books.

Gates is one of the best-known entrepreneurs of the personal computer revolution. Although he is admired by many, a number of industry insiders criticize his business tactics, which they consider anti-competitive, an opinion which has in some cases been upheld by the courts (see Criticism of Microsoft).^[7][8] In the later stages of his career, Gates has pursued a number of philanthropic endeavors, donating large amounts of money to various charitable organizations and scientific research programs through the Bill & Melinda Gates Foundation, established in 2000.

Bill Gates stepped down as chief executive officer of Microsoft in January 2000. He remained as chairman and created the position of chief software architect. In June 2006, Gates announced that he would be transitioning from full-time work at Microsoft to part-time work and full-time work at the Bill & Melinda Gates Foundation. He gradually transferred his duties to Ray Ozzie, chief software architect and Craig Mundie, chief research and strategy officer. Gates' last full-time day at Microsoft was June 27, 2008. He remains at Microsoft as non-executive chairman.

Early life

Gates was born in Seattle, Washington, to William H. Gates, Sr. and Mary Maxwell Gates, of English, German, and Scotch-Irish descent.^[9][10] His family was upper middle class; his father was a prominent lawyer, his mother served on the board of directors for First Interstate BancSystem and the United Way, and her father, J. W. Maxwell, was a national bank president. Gates has one elder sister, Kristi (Kristianne), and one younger sister, Libby. He was the fourth of his name in his family, but was known as William Gates III or "Trey" because his father had dropped his own "III" suffix.^[11] Early on in his life, Gates' parents had a law career in mind for him.^[12]

At 13 he enrolled in the Lakeside School, an exclusive preparatory school.^[13] When he was in the eighth grade, the Mothers Club at the school used proceeds from Lakeside School's rummage sale to buy an ASR-33 teletype terminal and a block of computer time on a General Electric (GE) computer for the school's students.^[14] Gates took an interest in programming the GE system in BASIC and was excused from math classes to pursue his interest. He wrote his first computer program on this machine: an implementation of tic-tac-toe that allowed users to play games against the computer. Gates was fascinated by the machine and how it would always execute software code perfectly. When he reflected back on that moment, he commented on it and said, "There was just something neat about the machine."^[15] After the Mothers Club donation was exhausted, he and other students sought time on systems including DEC PDP minicomputers. One of these systems was a PDP-10 belonging to Computer Center Corporation (CCC), which banned four Lakeside students—Gates, Paul Allen, Ric Weiland, and Kent Evans—for the summer after it caught them exploiting bugs in the operating system to obtain free computer time.^[16]

At the end of the ban, the four students offered to find bugs in CCC's software in exchange for computer time. Rather than use the system via teletype, Gates went to CCC's offices and studied source code for various programs that ran on the system, including programs in FORTRAN, LISP, and machine language. The arrangement with CCC continued until 1970, when the company went out of business. The following year, Information Sciences, Inc. hired the four Lakeside students to write a payroll program in COBOL, providing them computer time and royalties. After his administrators became aware of his programming abilities, Gates wrote the school's computer program to schedule students in classes. He modified the code so that he was placed in classes with mostly female students. He later stated that "it was hard to tear myself away from a machine at which I could so unambiguously demonstrate success."^[15] At age 17, Gates formed a venture with Allen, called Traf-O-Data, to make traffic counters based on the Intel 8008 processor.^[17] In early 1973, Bill Gates served as a congressional page in the U.S. House of Representatives.^[18]

Bill Gates' mugshot from a traffic violation in 1977

Gates graduated from Lakeside School in 1973. He scored 1590 out of 1600 on the SAT^[19] and enrolled at Harvard College in the autumn of 1973.^[20] While at Harvard, he met Steve Ballmer, who later succeeded Gates as CEO of Microsoft, and computer scientist Christos Papadimitriou, with whom he wrote a paper about pancake sorting.^[21] He did not have a definite study plan while a student at Harvard^[22] and spent a lot of time using the school's computers. He remained in contact with Paul Allen, joining him at Honeywell during the summer of 1974.^[23] The following year saw the release of the MITS Altair 8800 based on the Intel 8080 CPU, and Gates and Allen saw this as the opportunity to start their own computer software company.^[24] He had talked this decision over with his parents, who were supportive of him after seeing how much Gates wanted to start a company.^[22]

Microsoft

BASIC

MITS Altair 8800 Computer with 8-inch (200 mm) floppy disk system

After reading the January 1975 issue of Popular Electronics that demonstrated the Altair 8800, Gates contacted Micro Instrumentation and Telemetry Systems (MITS), the creators of the new microcomputer, to inform them that he and others were working on a BASIC interpreter for the platform.^[25] In reality, Gates and Allen did not have an Altair and had not written code for it; they merely wanted to gauge MITS's interest. MITS president Ed Roberts agreed to meet them for a demo, and over the course of a few weeks they developed an Altair emulator that ran on a minicomputer, and then the BASIC interpreter. The demonstration, held at MITS's offices in Albuquerque, was a success and resulted in a deal with MITS to distribute the interpreter as Altair BASIC. Paul Allen was hired into MITS,^[26] and Gates took a leave of absence from Harvard to work with Allen at MITS in Albuquerque in November 1975. They named their partnership "Micro-Soft" and had their first office located in Albuquerque.^[26] Within a year, the hyphen was dropped, and on November 26, 1976, the trade name "Microsoft" was registered with the Office of the Secretary of the State of New Mexico.^[26] Gates never returned to Harvard to complete his studies.

Microsoft's BASIC was popular with computer hobbyists, but Gates discovered that a pre-market copy had leaked into the community and was being widely copied and distributed. In February 1976, Gates wrote an Open Letter to Hobbyists in the MITS newsletter saying that MITS could not continue to produce, distribute, and maintain high-quality software without payment.^[27] This letter was unpopular with many computer hobbyists, but Gates persisted in his belief that software developers should be able to demand payment. Microsoft became independent of MITS in late 1976, and it continued to develop programming language software for various systems.^[26] The company moved from Albuquerque to its new home in Bellevue, Washington on January 1, 1979.^[25]

During Microsoft's early years, all employees had broad responsibility for the company's business. Gates oversaw the business details, but continued to write code as well. In the first five years, he personally reviewed every line of code the company shipped, and often rewrote parts of it as he saw fit.^[28]

IBM partnership

In 1980, IBM approached Microsoft to write the BASIC interpreter for its upcoming personal computer, the IBM PC. When IBM's representatives mentioned that they needed an operating system, Gates referred them to Digital Research (DRI), makers of the widely used CP/M operating system.^[29] IBM's discussions with Digital Research went poorly, and they did not reach a licensing agreement. IBM representative Jack Sams mentioned the licensing difficulties during a subsequent meeting with Gates and told him to get an acceptable operating system. A few weeks later Gates proposed using 86-DOS (QDOS), an operating system similar to CP/M that Tim Paterson of Seattle Computer Products (SCP) had made for hardware similar to the PC. Microsoft made a deal with SCP to become the exclusive licensing agent, and later the full owner, of 86-DOS. After adapting the operating system for the PC, Microsoft delivered it to IBM as PC-DOS in exchange for a one-time fee of $50,000. Gates did not offer to transfer the copyright on the operating system, because he believed that other hardware vendors would clone IBM's system.^[30] They did, and the sales of MS-DOS made Microsoft a major player in the industry.^[31]

Windows

Gates oversaw Microsoft's company restructuring on June 25, 1981, which re-incorporated the company in Washington state and made Gates President of Microsoft and the Chairman of the Board.^[25] Microsoft launched its first retail version of Microsoft Windows on November 20, 1985, and in August, the company struck a deal with IBM to develop a separate operating system called OS/2. Although the two companies successfully developed the first version of the new system, mounting creative differences undermined the partnership. Gates distributed an internal memo on May 16, 1991, announcing that the OS/2 partnership was over and Microsoft would shift its efforts to the Windows NT kernel development.^[32]

Management style

From Microsoft's founding in 1975 until 2006, Gates had primary responsibility for the company's product strategy. He aggressively broadened the company's range of products, and wherever Microsoft achieved a dominant position he vigorously defended it.

As an executive, Gates met regularly with Microsoft's senior managers and program managers. Firsthand accounts of these meetings describe him as verbally combative, berating managers for perceived holes in their business strategies or proposals that placed the company's long-term interests at risk.^[33][34] He often interrupted presentations with such comments as, "That's the stupidest thing I've ever heard!"^[35] and, "Why don't you just give up your options and join the Peace Corps?"^[36] The target of his outburst then had to defend the proposal in detail until, hopefully, Gates was fully convinced.^[35] When subordinates appeared to be procrastinating, he was known to remark sarcastically, "I'll do it over the weekend."^[3][37][38]

Gates's role at Microsoft for most of its history was primarily a management and executive role. However, he was an active software developer in the early years, particularly on the company's programming language products. He has not officially been on a development team since working on the TRS-80 Model 100 line, but wrote code as late as 1989 that shipped in the company's products.^[37] On June 15, 2006, Gates announced that he would transition out of his day-to-day role over the next two years to dedicate more time to philanthropy. He divided his responsibilities between two successors, placing Ray Ozzie in charge of day-to-day management and Craig Mundie in charge of long-term product strategy.^[39]

Antitrust litigation

Bill Gates giving his deposition at Microsoft on August 27, 1998

Many decisions that led to antitrust litigation over Microsoft's business practices have had Gates' approval. In the 1998 United States v. Microsoft case, Gates gave deposition testimony that several journalists characterized as evasive. He argued with examiner David Boies over the contextual meaning of words like "compete", "concerned" and "we".^[40]BusinessWeek reported:

Early rounds of his deposition show him offering obfuscatory answers and saying 'I don't recall,' so many times that even the presiding judge had to chuckle. Worse, many of the technology chief's denials and pleas of ignorance were directly refuted by prosecutors with snippets of e-mail Gates both sent and received.^[41]

Gates later said that he had simply resisted attempts by Boies to mischaracterize his words and actions. As to his demeanor during the deposition, he said, "Did I fence with Boies? ... I plead guilty. Whatever that penalty is should be levied against me: rudeness to Boies in the first degree."^[42] Despite Gates's denials, the judge ruled that Microsoft had committed monopolization and tying, and blocking competition, both in violation of the Sherman Antitrust Act.^[42]

Appearance in ads

Gates appeared in a series of ads to promote Microsoft in 2008. The first commercial, co-starring Jerry Seinfeld, is a 90-second talk between strangers as Seinfeld walks up on a discount shoe store (Shoe Circus) in a mall and notices Gates buying shoes inside. The salesman is trying to sell Mr. Gates shoes that are a size too big. As Gates is buying the shoes he holds up his discount card, which uses a slightly altered version of his own mugshot of his arrest in New Mexico in 1977 for a traffic violation.^[43] As they are walking out of the mall, Seinfeld asks Gates if he has melded his mind to other developers, after getting a yes, he then asks if they are working on a way to make computers edible, again getting a yes. Some say that this is an homage to Seinfeld's own show about "nothing" (Seinfeld).^[44] In a second commercial in the series, Gates and Seinfeld are at the home of an average family trying to fit in with normal people.

Post-Microsoft

Since leaving Microsoft, Gates continues his philanthropy and, among other projects, purchased the videos rights to the Messenger Lectures series titled The Character of Physical Law, given at Cornell University by Richard Feynman in 1964 and recorded by the BBC. The videos are available online to the public at Microsoft's Project Tuva.^[45][46]

In April 2010, Gates was invited to visit and speak at the Massachusetts Institute of Technology where he asked the students to take on the hard problems of the world in their futures.^[47][48]

Personal life

Bill and Melinda Gates, June 2009.

Gates married Melinda French from Dallas, TX on January 1, 1994. They have three children. The Gates' home is an earth-sheltered house in the side of a hill overlooking Lake Washington in Medina. According to King County public records, as of 2006 the total assessed value of the property (land and house) is $125 million, and the annual property tax is $991,000.

His 66,000 sq. ft. estate has a 60-foot swimming pool with an underwater music system, as well as a 2500 sq. ft. gym and a 1000 sq. ft. dining room.^[49]

Also among Gates's private acquisitions is the Codex Leicester, a collection of writings by Leonardo da Vinci, which Gates bought for $30.8 million at an auction in 1994.^[50] Gates is also known as an avid reader, and the ceiling of his large home library is engraved with a quotation from The Great Gatsby.^[51] He also enjoys playing bridge, tennis, and golf.^[52][53]

Gates was number one on the "Forbes 400" list from 1993 through to 2007 and number one on Forbes list of "The World's Richest People" from 1995 to 2007 and 2009. In 1999, Gates's wealth briefly surpassed $101 billion, causing the media to call him a "centibillionaire".^[54] Since 2000, the nominal value of his Microsoft holdings has declined due to a fall in Microsoft's stock price after the dot-com bubble burst and the multi-billion dollar donations he has made to his charitable foundations. In a May 2006 interview, Gates commented that he wished that he were not the richest man in the world because he disliked the attention it brought.^[55] Gates has several investments outside Microsoft, which in 2006 paid him a salary of $616,667, and $350,000 bonus totalling $966,667.^[56] He founded Corbis, a digital imaging company, in 1989. In 2004 he became a director of Berkshire Hathaway, the investment company headed by long-time friend Warren Buffett.^[57] In March 2010 Bill Gates was dropped down to the 2nd wealthiest man.

Philanthropy

Gates (second from right) with Bono, Queen Rania of Jordan, British Prime Minister Gordon Brown, President Yar Adua of Nigeria and other participants in a 'Call to Action on the Millennium Development Goals' during the Annual Meeting 2008 of the World Economic Forum in Davos, Switzerland.

Gates began to realize the expectations others had of him when public opinion mounted that he could give more of his wealth to charity. Gates studied the work of Andrew Carnegie and John D. Rockefeller and in 1994 sold some of his Microsoft stock to create the William H. Gates Foundation. In 2000, Gates and his wife combined three family foundations into one to create the charitable Bill & Melinda Gates Foundation, which is the largest transparently operated charitable foundation in the world.^[58] The foundation is set up to allow benefactors access to how its money is being spent, unlike other major charitable organizations such as the Wellcome Trust.^[59][60] The generosity and extensive philanthropy of David Rockefeller has been credited as a major influence. Gates and his father have met with Rockefeller several times and have modeled their giving in part on the Rockefeller family's philanthropic focus, namely those global problems that are ignored by governments and other organizations.^[61] As of 2007, Bill and Melinda Gates were the second most generous philanthropists in America, having given over $28 billion to charity.^[62]

The foundation has also received criticism because it invests the assets that it has not yet distributed with the exclusive goal of maximizing the return on investment. As a result, its investments include companies that have been criticized for worsening poverty in the same developing countries where the Foundation is attempting to relieve poverty. These include companies that pollute heavily and pharmaceutical companies that do not sell into the developing world.^[63] In response to press criticism, the foundation announced in 2007 a review of its investments to assess social responsibility.^[64] It subsequently cancelled the review and stood by its policy of investing for maximum return, while using voting rights to influence company practices.^[65]

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