Jeff Raikes to Head Gates’ Huge Charity

Jeff Raikes, former president of the Microsoft Business Division (MBD), will retire in September just in time to take over the reins of the Bill and Melinda Gates Foundation.

Raikes, who has been with the software company for 26 years, was personally hired away from Apple Computer by now-CEO Steve Ballmer in 1981. Over the years, he has been credited with spawning the Microsoft Office business productivity applications, which quickly grew into one of the company’s two main cash cows.

His retirement, which was announced in January, coincides with the pending switch of current foundation head Patty Stonesifer to a new – as yet undefined – role at the organization. Stonesifer also spent eight years as a Microsoft executive before becoming the foundation’s first CEO.

The foundation today has an endowment of $37.3 billion and has committed more than $16 billion in grants worldwide, including projects focusing on stopping preventable childhood diseases in developing economies as well as on developing an effective malaria vaccine.

With more than 500 employees, the Seattle-based foundation is comprised of three program groups: Global Health, Global Development, and the U.S. Program, each led by a president.

At Microsoft, Raikes is being replaced by an executive from outside the company’s ranks — Stephen Elop, who until his hiring by Microsoft in January, was chief operating officer (COO) at Juniper Networks.

Help with Silverlight?

Elop was previously president of worldwide field operations for Adobe Systems, a role he got when Adobe bought out his former company, Macromedia, in 2005, where he was president and CEO. It is thought that his experience with Flash will help Microsoft get a leg up with its emerging Silverlight technology.

MBD is one of three product divisions in Microsoft’s current organization. The other two are the Platforms and Services Division, headed by president Kevin Johnson, and the Entertainment and Devices Division, led by president Robbie Bach.

Besides heading MBD, which included responsibility for both Office and the Microsoft Dynamics branded products, Raikes served as senior vice president of Microsoft North America. He was also group vice president of Microsoft’s worldwide sales and support. Raikes, who is one of Microsoft’s largest individual shareholders with more than 5 million shares, is also one of the co-owners of the Seattle Mariners professional baseball team.

The Bill and Melinda Gates Foundation has the largest endowment of any charity – consisting of contributions by the Gates family as well as friend Warren Buffett, who committed most of his over $30 billion fortune in 2006. Bill and Melinda Gates were named – along with U2 singer Bono – Time magazine’s “Person of the Year” in 2005 for their charitable work. Bill Gates has announced that he will retire from day-to-day activities at Microsoft as of the end of June to concentrate full-time on the foundation as well.

Since its formation in 1997, the foundation has done a good job of avoiding the pitfalls that it might have fallen into in deciding what to focus on, said one analyst.

“The business model is different, but Bill is applying the lessons he learned in the software business to the philanthropic business,” Dwight Davis, vice president at Ovum, told

Davis said that choosing someone with Raikes’ business skills who is already well known to the foundation’s founders, to run the organization is likely a good move.

“Raikes is a pretty talented guy,” Davis said.

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