On the Money

Make billions, then give it away: Gates, Buffett talk philanthropy

Billionaires Unite!
Billionaires Unite!

Bill and Melinda Gates and Warren Buffett have amassed huge fortunes that they're determined to give away through the Bill and Melinda Gates Foundation.

Since joining forces in 2006 when Buffett pledge the majority of his wealth to the organization, this trio has worked on improving global social issues such hunger, poverty, HIV and family planning.

"It's pretty phenomenal that right as we had learned a lot of things, when we were building up our capacity, that we got this doubling of capacity so that, things like agriculture and malaria eradication over time," said Microsoft founder and Gates Foundation co-chair Bill Gates.

"We were able to be unbelievably ambitious," the technology icon, who is worth an estimated $80 billion, told CNBC's "On the Money" in a recent interview.

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Berkshire Hathaway CEO Warren Buffett has donated nearly 185 million shares of Berkshire Hathaway "B" shares to the foundation, a market value of roughly $15.1 billion, and plans to provide gifts annually throughout his lifetime. It's a commitment that might not have happened if they'd never crossed paths.

"With me, it started on July 5, 1991, and Bill was reluctant to meet me, but we hit it off," Buffett said. "And then we've had a lot of good times since."

Warren Buffett, Melinda and Bill Gates discuss philanthropy.
Lacy O'Toole | CNBC

Gates Foundation co-chair Melinda Gates said: "It's funny. I tease Bill because there came a point in our life where it seemed like Omaha was always on the way to or from the East Coast. So I used to tease him because he would come through Omaha so much just to see Warren."

Even with vast resources and high-profile relationships at their disposal, attempting changing the world isn't easy. In fact, one specific initiative has had a rocky start.

Two years ago, Melinda began a project to give women in developing countries access to contraceptives and education on family planning. The initiative sparked controversy in the U.S., but Melinda believed in "educating them [women] and then letting them make that decision for themselves because, if they can space and time the births of their children, the women are healthier, as are the children."

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According to the Gates Foundation, there are over 220 million women in developing countries who don't want to get pregnant but lack access to birth control. The foundation, which has already allocated $560 million toward the cause, has a goal that aims to provide access to 120 million women and girls by 2020.

It's a project that Buffett thinks "took guts" to do, and "could change the world."

Flavored condoms?

Another way they're changing the world is through innovation. A project close to Bill's heart is the foundation's Grand Challenges, which solicits ideas from the world's best scientists to tackle issues that affect the world's poorest people. In 10 years, it has awarded 1,689 grants.

What has been his favorite challenge?

"One that got more headlines, it's one of about 80 that we've done, but we solicited the idea of a new condom that was less unattractive," said Gates, laughing.

"I remember once, early after we [Bill and Warren] met, that the Buffett Foundation was accused of funding a cherry-flavored condom and it turned out they were guilty."

Omaha's Oracle denounced the idea—to a certain extent.

"Never should have done it. It should have been strawberry!" Buffett said.

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