Andrew Grove is angry. Not about his life, not about his career. About those things he tends to be analytical, reflective. No, Andy Grove is angry with philanthropy—his own, yes, but also the field in general. And he thinks other donors should be angrier, too.
His early years might well have made him angry. András István Gróf was born in 1936 to a Jewish family in one of Budapest’s middle-class neighborhoods. By the age of 20, he had survived a devastating bout with scarlet fever, lived under a Hungarian fascist dictatorship, hidden from the Nazis during German military occupation, survived the Siege of Budapest by the Red Army, endured an increasingly repressive Stalinist regime, and fled his homeland during an uprising put down by Soviet tanks. In his memoir, Swimming Across, he does not seem particularly angry about any of this. But he has never returned to Hungary.
A 20-year-old Gróf thus made his way to America, where he soon took the name Andrew Grove. Within 10 years of crossing the Austrian border, he graduated first in his engineering class from the City College of New York, earned a Ph.D. in chemical engineering from the University of California, published the still-authoritative Physics and Technology of Semiconductor Devices, relocated his parents to the Bay area, and took a job with Fairchild Semiconductor.
In 1968, Mr. Grove participated in the founding of Intel. He became its president in 1979, its chief executive officer in 1987, and its chairman from 1998 until 2005. During his tenure as CEO, Intel became the world’s largest semiconductor chip manufacturer, with a 4,900 percent increase in market capitalization—from $4 billion to $197 billion—making it, for a time, the world’s most valuable company. Time magazine named him Man of the Year in 1997. But “anger” is not the word to describe his career. “Paranoia” is. At Intel, he developed a management philosophy captured in the title of his 1996 book, Only the Paranoid Survive.
But “angry” may be exactly the right word to describe his philanthropy. Mr. Grove funds the causes that make him angry. Frustrated by the slow pace of medical research, and unnerved by his own diagnoses with prostate cancer and Parkinson’s, he has committed tens of millions of dollars to translational research in cancer and neurodegenerative diseases. Aroused by the suffering of refugees, he supports and serves on the board of overseers of the International Rescue Committee. And angered by the state of vocational education in America, he has worked long and hard to make school-to-career education more available and more attractive.
Philanthropy recently spoke to Mr. Grove about his work in vocational education.
PHILANTHROPY: Are people ever surprised that Andrew Grove—accomplished physicist, technological pioneer, leading corporate strategist—is involved with promoting vocational education?
MR. GROVE: If people were to think that way, they would be misunderstanding my biography. Expecting people to do their job without tools, training, and respect, and then expecting them to come up with meritorious results, is unfair and so wrong that it can be really annoying. I don’t think people are created equal, but everybody’s work intersects with other people’s work. For all of us to work, to produce, everybody has to be trained in their part and become competent in their part. Imposing upon the total workforce elitist considerations is just—to put it in engineering terms—terrible systems thinking.
PHILANTHROPY: Speaking of systems thinking, you were famous at Intel for your management philosophy that “only the paranoid survive.” By that, you meant that a business must always be hyper-attentive to possible threats and opportunities. Is such paranoia a helpful mindset for a philanthropist?
MR. GROVE: Yes, it is, in the following sense. It’s very hard to shape inanimate material into semiconductors or pharmaceuticals. Nature constantly wants to derail your experiment. The only thing that’s harder than shaping inanimate material is trying to shape animate material—and most difficult of all is trying to shape the activities of people. Then it is not just nature that is trying to derail you; people themselves do a pretty good job of it. If you feel strongly toward achieving something through philanthropy, I think what I call paranoia—a deep suspicion about all of the many things that can go wrong—is necessary.
PHILANTHROPY: Are you as paranoid about vocational education as you were about business?
MR. GROVE: The details are of course different, but in this way, they are very similar. Paranoia in management involves trying to anticipate who intentionally or unintentionally will slow you down, or who will derail you. Usually this attitude is not taught in school, which is why I wrote my book. Now, as for vocational education, do you recall the words of the presidential report on education [A Nation at Risk] from 1983? It started out by saying, “If an unfriendly foreign power had attempted to impose on America the mediocre educational performance that exists today, we might well have viewed it as an act of war.” Is this paranoia?
Well, the same thing applies to vocational education—only doubly so. Most people don’t even realize the need for more highly trained workers. The assumption remains that technical education is for less intelligent people. The first item cut from educational budgets is vocational education. People are required to be suitably trained for their work requirements, and yet the classes that are required for this are cut to the bone. In some instances, students are halfway through the course when funding is cut and then they are sent home. We create a damned obstacle course for people who want to work!
"Philanthropists tend to be so pleased with themselves that they are prone to self-congratulation. Rather, they should be angry—and let their anger guide their giving."
PHILANTHROPY: In Only the Paranoid Survive, you write that “nobody owes you a job.” You describe how sudden changes can “sweep through your industry and engulf the company you work for. Who knows if your job will even exist and, frankly, who will care besides you?” If vocational education is a form of deep training within a specific field, and if specific fields can disappear overnight, aren’t you better equipped for disruptive market forces with a traditional four-year liberal arts degree?
MR. GROVE: No. What you describe represents a generalized belief in the goodness of a liberal arts education. Its source is probably Plato. If you assess the usefulness of a liberal arts degree at Time Zero—graduation—what is it? You have taken one survey course in this subject and another survey course in that subject, and the topics covered probably could have been taught in high school. With a liberal arts degree you will not become obsolete—because there’s nothing for you to be obsolete from.
Now, compare that training to the kind of skills that you teach to an EMT [emergency medical technician]. An EMT’s skills are unlikely to be obsolete as a general art, especially if he or she undertakes continuing education and keeps up with new technologies as a matter of routine. The same is true of nurses, of electricians, of firemen, and of radiology technicians.
PHILANTHROPY: Of course, some people would dispute the idea of a crisis in vocational education altogether. It’s not hard to imagine an economist saying, “If the supply of skilled labor gets too low, demand will be high and wages will adjust. As wages increase, we will see more carpenters or welders or nurses. This is a problem for which free markets provide a solution. It’s not a problem that philanthropy needs to address.” How would you reply to that?
MR. GROVE: I suspect that economists who think this way dropped out of their freshman physics class before they could master the complexities of dynamics. There is a time-dimension involved in the adjustment of one system to another. And by the time a supply-and-demand imbalance develops in one area of the economy, you can be very much out of phase with what is happening elsewhere. In physics, the equivalent would be unstable oscillations; in medicine, it would be heart palpitations. Economists don’t bother with that. They take one picture in a steady state, and another picture in a steady state, and somehow they think nature will smooth everything out. Often it does, but just as often it does not.
PHILANTHROPY: And how would you respond to someone making the opposite case, someone who says, “We need to create a government program to mediate this disequilibrium within the market.” Is that really an improvement?
MR. GROVE: Well, what you propose will never become a reality because enough people will wave their hands and shout, “Central planning! Managed economy! Communism!” That will derail the attempt to introduce a government solution. By the way, I do not disagree with that objection. In my book [Swimming Across], I tell the story of how under communism I could never buy the photographic paper that I needed in the summer until winter came, and vice versa. Central planning manufactured what it could produce efficiently at a given time—never mind the demand, even when it was relatively predictable. So I have a strong suspicion that a central agency cannot resolve this problem either. But that doesn’t mean that the free-market feedback mechanism that you described a moment ago works either.
PHILANTHROPY: I suppose that brings us to private philanthropy. Can you tell me about your efforts to make vocational or school-to-career education more available and more attractive?
MR. GROVE: We fund scholarships for students at community colleges and in other vocational programs. The value of the scholarships ranges from $500 to $5,000 per year, depending on the type of training and needs of the student. The people for whom we provide support are not those who intend to transfer to four-year universities. Rather, we are funding scholarships for those students who intend to enter a career immediately upon completion of their studies. Our program has changed over time but we have been giving these kinds of scholarships for more than a decade, and have typically given more than 100 scholarships per year.
PHILANTHROPY: What do you know today that you wish you had known 10 years ago, when you were getting started?
MR. GROVE: From the beginning, we realized that this was a serious problem; there was no question about that. But I completely underappreciated how deep the problem was. We therefore started up naïvely, believing that by funding this scholarship we would create enormous demand. We worked on the assumption that if we provided the money, people would come. They would want to be on their own two feet and they would quickly find their field of choice. In order to achieve that goal, the program initially focused on high school students who were planning to go on to community college or private vocational school. Eventually, we gave up on that particular population—high school students. Now we support some programs at community colleges, and some at nonprofits that are doing career training, principally among adult students.
PHILANTHROPY: Can I ask why you stopped offering scholarships to high school students?
MR. GROVE: As we progressed with high school students, we found that we could not get enough of the right candidates. One of the things I had a great deal of trouble with was finding ways to reach the people we wanted to reach. We could not attract the most qualified students, since virtually everybody who was deemed talented was pointed in the direction of a four-year college degree. So the students who would end up in the scholarship program often lacked other options and therefore not surprisingly had not very good completion rates. We were putting money and support systems into the scholarship program but its graduation rates were not significantly better than the unsatisfactory rates at community colleges in general. I felt like we were putting millions of dollars on the floor and people wouldn’t come pick them up.
PHILANTHROPY: Why is that?
Photo by Marvin Fong/The Plain Dealer
MR. GROVE: I don’t think that I have a simple answer. In many ways, of course, it was a reflection of the cultural bias against vocational education. Eventually, after perhaps five years of trying different things, we said we can’t overcome all the things we’re up against in the high school setting. The students don’t think highly of it as a pathway; the educators don’t think highly of it as a pathway; the parents don’t think highly of it as a pathway. But there are community colleges and nonprofits out there that appreciate the value of vocational education. With some help and some scholarship money, they can get students on their way, so we help them to do that. Our program is now focused at a small number of community colleges and some nonprofits.
PHILANTHROPY: Were you working with regular public high schools?
MR. GROVE: Yes, characteristically large California high schools, in areas that were economically less wealthy.
PHILANTHROPY: Did you ever consider opening a charter school?
MR. GROVE: At the time we started this, we wanted it to become a viable option in a mainstream educational context. Siphoning it off to a special place would not have accomplished that.
PHILANTHROPY: So now you work with community colleges?
MR. GROVE: Yes. Even here it is quite frustrating. In California’s community colleges, only one in four students gets the degree or certification they are seeking within six years. The reason is not that people are dragging their feet. First of all, they need to work while they are in school. Second, many of them need remedial education. Third, they can’t get the required classes and counseling they need—and that was before the budgetary cuts of the current year. Partly for this reason, we also fund scholarships for private vocational training institutes.
A related issue is the capacity of a community college to take recent high school graduates and get them through the program. Students need help navigating their way. So for high school students entering community college, we directed 20 to 30 percent of our funding to support systems. I don’t know whether the system is overly complicated as compared to what it might be, or whether the students—even the ones who have earned a scholarship—are less able to stand on their own two feet than they should be. In either event, they need a lot of handholding when they get there so they don’t get lost. And when we started working on this initiative, I was very reluctant to go into the handholding business. I did not want to spend money that otherwise would have gone to the scholarships. I was obnoxious—righteously obnoxious—saying that it’s a school problem and they should solve it.
PHILANTHROPY: Do you have plans to expand the program?
MR. GROVE: Originally, yes. This was the theory: When we are demonstrably efficacious with this program, we’ll let the world know, and they’ll come and replicate it throughout the United States. Then we took the first step and fell on our face. People didn’t come. The capacity of the schools to run the program was not there. We could not marshal others’ efforts with a program that wasn’t successful. Several times, I wanted to give up the whole thing.
Actually, we did have two replications—one in Sonoma and one in Oregon, both started by colleagues of mine. The Sonoma project shut down after a few years but the Oregon replication is still running. I was so excited about two replications that I began to dream up plans for national franchising and putting together how-tos and this and that. Then I almost fell out of bed.
By 2005, however, we were considering a plan to shrink and possibly terminate the program. Ultimately we decided that we would hang in there, but we have given up on the idea that it’s going to be picked up and replicated—at least for now.
Paranoia in management involves trying to anticipate who intentionally or unintentionally will slow you down, or who will derail you.
PHILANTHROPY: Did you find that it was a lack of interest among other philanthropists, a lack of interest among educators, or a lack of interest among students—or was it all of the above?
MR. GROVE: All of the above. When we started the programs, the lack of interest among other philanthropists was almost 100 percent, although that has since changed somewhat. As for the schools, community colleges are measured by how many students transfer to four-year universities. And the students who came to the program were not the ones we were trying to reach. Can I add one more thought about our decision to fix the scholarship program instead of getting rid of it?
PHILANTHROPY: Of course.
MR. GROVE: It turned out to be somewhat right. In actuality, the program is better than it has ever been. But it’s still not what we dreamt it would be when we started. We had a notion that we would be successful and therefore people would come to us, imitate us, and pour their resources into programs like ours. That has not happened. The previous several decades have driven a value system into colleges. It is like a headwind, and it’s very hard to go against the headwind. With enough resources, I suppose it might be possible to ignore this value system, but it would take massive amounts of money. The status quo is very strong. Almost nobody appreciates the importance of the problem. Do you know who recognizes it?
MR. GROVE: The previous Governor of California.
PHILANTHROPY: Yes. I seem to recall that Gov. Schwarzenegger endorsed a number of the vocational training initiatives in California public schools.
MR. GROVE: In a word, yes. But he got caught in an economic downdraft and failed to change things significantly. But it was interesting to have an immigrant Governor—one who comes out of the European and specifically the Germanic tradition of skilled apprenticeships, which is similar to vocational training—so he got it. I am unaware of anyone else who would be willing to press the issue with, say, President Obama.
PHILANTHROPY: Is that what success would look like to you—getting the issue in front of policymakers? What do you think is a maximal realistic goal, given your resources?
MR. GROVE: Funding 100 scholarships annually is achievable. If I were to dream, I could envision a series of circumstances that would make a well-established program like this attractive to others. If that were to happen, we would gladly cooperate with them, but I have lost my expectations for achieving anything much larger than our current program. I don’t think our approach is anywhere near becoming a dominant philosophy.
PHILANTHROPY: Is there anything that you’ve learned in your experiences working with vocational education that you’ve been able to apply to your giving elsewhere?
MR. GROVE: Yes. The learning goes to the philosophical underpinnings of philanthropy in America. I don’t think we should take on a program unless it is in an area that the government does not serve or unless we can clearly do a better job than the government. The government gives me a relief from my taxes in order to encourage me to spend it on philanthropy. I am spending money that the government allows me to keep, which means that I have a responsibility to use the money more effectively than the government would. The alternative is for me to pay my taxes and let the government allocate the money in whatever manner it chooses. So philanthropists must do a better job than the government, given a realistic assessment of the government’s performance, either in the choice or in the execution of their programs. The government is not doing a good job in vocational education. We can expect ourselves to do better.
PHILANTHROPY: You mention the philosophical underpinnings of American philanthropy, which raises an interesting point. You arrived in America as a young man, a refugee who escaped from behind the Iron Curtain during the Hungarian Revolution. Was there ever a moment when you first recognized American philanthropy and appreciated how different it was from the communist regime under which you had been living in Hungary?
MR. GROVE: I did not think of issues like that for the next 40 years. To give you an example, when I first arrived in America, the IRC [International Rescue Committee] spent a fair amount of money on me. The organization had sponsored my visa and arranged for my transportation to America, and after I arrived, it provided me with vouchers for a dental examination, new eyeglasses, and a hearing aid. In Hungary, I had tried several Russian-made hearing aids, but they were ugly, bulky, and didn’t work. In America, the IRC paid over $300 in 1956 [roughly $2,400 in 2011] to buy me a new model. I found this very remarkable. So I started supporting the IRC from the time I first went to work. But I didn’t think about the larger picture until decades afterwards. It wasn’t profound thinking followed by activity. Rather, for a long time, it was activity—first receiving, later giving—without much profound thinking.
PHILANTHROPY: It sounds like you instinctively took to a number of American practices without any kind of theoretical framework.
MR. GROVE: Yes. There is something to that. And actually, to this day, I grumble about various aspects of philanthropy without having a larger theoretical framework.
PHILANTHROPY: What sort of thing do you grumble about?
MR. GROVE: Philanthropists tend to be so pleased with themselves that they are prone to self-congratulation. Rather, they should be angry—and let their anger guide their giving.
PHILANTHROPY: It’s not often that you hear calls for “angrier” philanthropy.
MR. GROVE: This is actually a corollary of my earlier point. Consider the following. Even if the government has large programs with many decades of experience in these areas, its programs are not usually run by people who are passionate about the work. That’s where private funding can be different—it can provide that extra amount to make something successful. But this can only happen if we funders devote our personal energy to the causes we are pursuing. If we have accumulated the means to do this in the first place, we have presumably been successful in some area of enterprise—and if we have been successful in one area, we may be able to bring those skills to another area. But we are only likely to do that if we are sufficiently irate, upset, devoted, passionate, and emotionally committed to the subject. And I don’t think that is what’s happening.
PHILANTHROPY: How so?
MR. GROVE: The large, established foundations are run by 20-plus-person boards. They are consensus-minded caretakers. Gray, low-profile, competent, not passionate—that is how they appear to me. This is a broad generalization, of course. But in my view, there are no causes to which these foundations are committed with a passion, in a way that I would describe as angry. They’re unlikely to go against the grain, they’re unlikely to go after orphan projects—they’re just not likely to do anything like that.
For example, in a large fundraising campaign for a university or a medical center, it is always easier to get money for a building than for a project. There’s no controversy about the value of a building. But there’s often controversy about projects. There are setbacks, there are complications, there is frustration. People shy away from that. “Life is too short,” they say to themselves. I prefer to do something that needs to be done. And I invest as much of myself as I can. Sometimes I contribute one way, sometimes another way, and if I don’t succeed, it wasn’t because I didn’t try.
PHILANTHROPY: Given the level of personal involvement you’re describing, how would you like people to remember you in, say, 100 years?
MR. GROVE: [laughs] I don’t care.
PHILANTHROPY: I take it you don’t intend to create a perpetual foundation.
MR. GROVE: We will be out of business 25 years after my wife and I are dead.
PHILANTHROPY: What do you wish for your foundation in the future?
MR. GROVE: I want the surviving management and board to be passionate, committed—and angry.