The Billionaire Who Wasn't (47 page)

“Chuck Feeney made a judgment about Frank, and it was hard for him to let go of it,” said Tom Mitchell. “That is his way. He is very loyal. And the disillusionment was correspondingly great.”

Atlantic Philanthropies reached a settlement with Connolly, following which the Centre for Public Inquiry ceased its existence. Some 100 files of potential investigations went out the window, said Connolly. The whole episode was unfortunate, remarked John Healy, in that it concentrated on one unsuccessful initiative of the Atlantic Philanthropies. Feeney had by this stage overseen gifts totaling more than $1 billion for good causes on the island of Ireland, but his philanthropy had mostly been anonymous and many Irish people now associated him only with the controversy over Connolly.

“I think we have made 3,000 grants, so I suppose there is a scope for one of them to go sour,” Feeney mused in his apartment in San Francisco one rainy day the following January. Connolly failed to convince him that he was not “the guy down in Colombia . . . there for no good purposes.” He reflected that he might have gone further into the situation when Charles Lewis of the Washington Center for Public Integrity refused to meet Connolly, and looked at the allegations being made before starting up the Irish center. “We certainly won't venture into that area again,” he said. As for the negative political and media comments, he said, “I'm a tough nut. I can put those things aside.”

CHAPTER 30

Charity Begins at Home

By the start of the twenty-first century, Chuck Feeney had made a measurable impact on several countries. He and his secret giving were becoming known in ever-widening circles abroad. He was less well known in the United States, the country where he devoted most of his giving, despite the surge of publicity in 1997 when he was unveiled as a big-time secret philanthropist. By 2006, Feeney had given more money to American causes—$1.7 billion—than to all other countries combined, the biggest portion to higher education and research. The sheer size of the United States meant that the impact of his foundation's giving was proportionately less on a national scale than in smaller countries. But the impact on one single institution was enormous. From the time he started his philanthropy, Chuck Feeney directed over $600 million to Cornell University. No other American university has ever received such a sum from a single alumnus.

Up to the early 2000s, Feeney was always referred to at Cornell University as the Anonymous Donor, or AD. Cornell, however, was the one place in America where AD's identity was an open secret. If someone gave anonymously to Cornell, people not supposed to be in the know would say, “Oh! Chuck Feeney!” “As time went on it was done with a nudge and a wink,” said Frank Rhodes. “That became a little bit uncomfortable, a little bit absurd for some people, but to begin with it was taken very seriously. The nudge and wink meant that the “anonymous donor” became a kind of formula in the foundation world for Atlantic Philanthropies, and yet with a
perfectly straight face you had to be careful to say that you didn't know who it was.”

Feeney's request for anonymity set him apart from other big donors to Cornell, such as Class of '55 alumnus Sanford I. Weill, the former chairman and CEO of Citigroup, who made donations to the medical school and hospital approaching $200 million and for which he is commemorated by the Weill Cornell Medical College. Duffield Hall at Cornell is named after software millionaire David A. Duffield of California, who made a gift of $20 million to build a laboratory complex. Feeney's name did not appear on any of the many buildings he funded at Cornell, though he did once honor his old friend Bob Beck by funding the $16-million state-of-the-art Robert A. and Jan M. Beck Center at the Hotel School.

Ernie Stern, the fund-raiser for the Cornell Class of '56, believes that there is a connection between Feeney's drive to increase alumni giving at the start of his philanthropic work in the early 1980s and the enormity of subsequent gifts like that from Sandy Weill. “Sandy Weill was Class of '55,” said Stern. “They were a nowhere class. Who the hell cares that the Class of '56 gave X million dollars? Well, the Class of '55 cares. And the Class of '57 cares. Competition is a wonderful motivator. It's completely stupid when you think about it. It's nuts. But it works. Everybody looked at our class, said, well they can do it, we can do it. I know it sounds kind of immature or nonsensical but I take it seriously. Cornell has now reached a level of giving by its alumni never before achieved. Last year [2004] Cornell raised $350 million and it was No. 3 in the U.S., and No. 1 among alumni givers in the nation, and I attribute that in some measure to this gradual year-after-year thing started by our class.”

Feeney's insistence on anonymity was highly unusual. Only 1 percent of American givers ask to remain anonymous. Many rich Americans compete to make the most money, like the technology entrepreneur Jim Clark, who once aspired, unsuccessfully, to have more money than anyone else in the world. Feeney got involved with Clark in one of the biggest gifts ever made to Stanford University in California. In October 1999, Clark, the founder of Netscape, Silicon Graphics, and Healtheon, announced that he would donate $150 million to Stanford University for a new research hub to be called the James H. Clark Center. It was the largest single gift pledged to Stanford since its founding in 1891. The inventor said he felt indebted to the university for what it had given him: As a professor at Stanford in the early 1980s,
he had been allowed to explore the technologies that he would later develop so profitably in the private sector. The university had made him rich, and he wanted to return the favor.

The San Jose
Mercury News
enthused that Jim Clark “eroded the stereotype of stingy Silicon Valley tycoons” with his “jaw-dropping” $150-million contribution for the center, which would be at the heart of a biomedical engineering and sciences project known as Bio-X.

Amid the flurry of glowing media testimonials, no one was aware that Chuck Feeney had agreed quietly to contribute $60 million to the project. Feeney had been an anonymous donor to Stanford since 1996—his son Patrick was a student there, and Chuck had been contacted in 1994 as a parent by Stanford's vice president for development, John Ford, who had no idea at the time whom he was asking for money—and he had already made two gifts totaling $65 million for Stanford research projects. Feeney met Clark at a lunch at the home of Stanford's president, John Hennessy, in March 2001. Chuck found him strange. He got a feeling that Clark was a one-time contributor, making a splash. “We like the project you are doing, and we would be happy to contribute to it,” he told Clark, who responded, “Fine, as long as I can retain the rights to my name.” Feeney replied, “Be our guest.”

Six months later, after Clark had paid $60 million of his $150 million pledge, he dropped a bombshell on Stanford. He told Hennessy and Ford that he wanted to “suspend” payment of the remaining $90 million to protest the way President George W. Bush was limiting human embryonic stem-cell research, part of the intended purpose of the center. President Bush had said on August 9, 2001, that federal funding would only be available for stem-cell research using cell cultures established before that date. Hennessy was bewildered. Why would Clark want to punish the university—which had taken the lead in stem-cell research—for President Bush's controversial decision? They pleaded with him to reconsider. Clark relented a little. He told them he would pay $30 million of the $90 million outstanding, but he was adamant he would not pay any more.

The university had no legal redress. It preferred to trust donors to honor their promises rather than make them sign binding pledges. Stanford had to scramble to get the last $60 million to complete the Bio-X Center's development.

The Bio-X Center was opened in October 2003 to widespread acclaim for its architectural merits. Despite reneging on $60 million of his $150-million
commitment, the inventor retained the naming rights. The visiting public is today informed that the James H. Clark Center was completed “thanks to the enormous generosity of Jim Clark and Atlantic Philanthropies.”

Feeney's total giving to Stanford at the time Clark pulled out amounted to $125 million, $35 million more than Clark gave, making him one of the top five givers in Stanford's history, but nothing is named after him, as he wished. It equaled the Annenberg Foundation's record 2001 gift of $125 million to the University of Pennsylvania, which was hailed by the
Chronicle of Philanthropy
as the largest sum given by a private foundation to a single American university. At the time, Feeney's even greater giving to Cornell was still a secret.

Impetuous withdrawals of funding are rare but not unknown in philanthropy. In June 2005, Larry Ellison, the CEO of Oracle and Clark's onetime rival, pledged $115 million to Harvard to fund the Ellison Institute for World Health. It was to be the biggest gift ever to the Ivy League university, far outweighing the largest previous donation of $70.5 million from John Loeb, the former U.S. ambassador to Denmark. One year later, Ellison, with a net worth of $16 billion and fifteenth place on the
Forbes
rich list, announced that he had changed his mind, because of the departure of Harvard president Larry Summers, whose concept the project was. Twenty researchers, three top academics, and managerial staff, who had already been hired, were told to find other work.

Many of Atlantic Foundations' gifts in the United States arose from the initiatives, in the early years, of Ray Handlan, president of the Atlantic Service Company, and after 1993 of his successor, Joel Fleishman. But on his frequent commutes between New York and San Francisco, Feeney was always on the lookout for his own “new new thing.” When spending a few weeks in San Francisco in 2004, he learned of a problem faced by the University of California at San Francisco (UCSF). In 2003, it had received a $35-million gift from property developer Sanford Diller for the construction of the Helen Diller Family Cancer Research Building at UCSF- Mission Bay. The university had to raise a balance of $40 million, and for over a year struggled to find it. Feeney sat down with the development officer and asked for the list of wealthy San Francisco people. He pointed to the name of venture capitalist Arthur Rock. What about him? Rock had just given $25 million to Harvard, he was told. “That just proves he has $25 million to give,” said Feeney. “Why not offer him a challenge grant? If Rock
puts up $20 million, Atlantic will match it with $20 million.” Not only did Rock agree, he put his gift up to $25 million when the cost rose $5 million because of the delay. “That's what happens if you screw around a couple of years,” said Feeney. “You get inflation.” In March 2007, Atlantic gave the university its biggest cash gift ever—$50 million for a cardiovascular research center and clinic.

Feeney also relied on a network of contacts to identify good and worthy causes in the United States, and he was constantly reading local newspapers, listening to news, and studying reports. A major grant was as likely to flow from a page Feeney tore from a magazine as from a consultation with a research institute director. Few magazines survived Chuck's attention intact, and no university president was immune from the prospect that a nondescript man in blazer and aloha shirt, carrying his papers in a plastic bag, would one day walk into their office and ask how they were doing. Sometimes small academic institutions got as much, or more, of his attention and time as Ivy League universities. This was the case with Chaminade University, a tiny Catholic college nestled on the slopes of Kalaepohauku overlooking the Pacific Ocean just outside Honolulu in Hawaii.

When Dr. Mary Civille (Sue) Wesselkamper became the first woman president of Chaminade in 1997, she found the university was run down and that the undergraduate population, many from the original Hawaiian population and from the Pacific Islands, had declined to about 660. “The financial situation was much worse than I or the board imagined,” she said. “We were very close to bankruptcy.” When she appealed for help to the founding Marianist Order based at the University of Dayton, Ohio, they sent Brother Bernard Ploeger to be her vice president and to sort out the finances. He told her, “Your worst fears are realized, the institution is unraveling.” Dayton paid $4.3 million to eliminate operating debt, but the fundamental problems of outdated facilities and substandard student accommodation remained unsolved.

A few months later, a taxi drove up the steep driveway that curved between the neglected campus buildings. “The most unassuming man stepped out and wanted to know everything about the university,” said Wesselkamper. “I took him on the tour. He even wanted to see the bathrooms in the residence hall. He said, ‘I'll be back to you.'”

Feeney had been on one of his periodic business trips to Honolulu and had heard about Chaminade's woes from a friend. After his tour of the campus,
he invited Sue Wesselkamper to New York to meet Harvey Dale. “We have a general rule we don't do religious giving, and Harvey is always strong on those kind of things,” said Feeney—who had already bent the rule with a $2-million gift to a Benedictine monastery in Ireland for library development. In New York, Wesselkamper explained that they had a two-tier system of a lay governing board and religious corporate board. Dale asked for a clearer separation from the religious side. “She came away from the meeting thinking, “We are small potatoes! I couldn't go to the Marianists and say we wanted to separate from them.”

Feeney asked Wesselkamper to compile a strategic plan for the university, which she and Brother Bernard did. They sent Feeney the plan. “Most people would just take it and leaf through it,” she said. “Chuck actually read the whole thing, and it was a hefty document.”

“All of a sudden, later in 1998, Chuck comes into the office again—we had much older furniture then, and he sat on this bumpy couch—and he said, ‘I really like what you are doing for students here. I want to help you get started.' I brought up the separation issue and he said, ‘I think we can work this out.' He said, ‘I'm going to give you a check for $3 million.' I asked him: ‘Could you say that again?' Then he handed me a check for $3 million.”