After the sudden departure of its CEO, Schmidt Futures is spinning out and sunsetting a dozen programs, including its prestigious partnership with the White House.
By Sarah Emerson and David Jeans, Forbes Staff
In September, ahead of a meeting of the UN Security Council, Eric Schmidt, the billionaire and former Google CEO, was scheduled to discuss his company’s involvement in a new partnership to funnel corporate aid to humanitarian disasters that Schmidt Futures had been working on for almost a year.
Support from Schmidt Futures was a crucial stamp of approval for the initiative: The company has become a powerful conduit to government agencies, pouring its roughly $400 million annual budget into matters spanning national security, public health and technology research. Schmidt’s attendance had been publicly touted in UN promotional materials for the event, and the Albanian ambassador to the UN Ferit Hoxha had told reporters beforehand that the billionaire would be there, along with Mastercard’s CEO.
But days before the event, UN organizers learned that Schmidt wouldn’t be speaking, nor would anyone from Schmidt Futures, according to two people familiar with the matter. (A Goldman Sachs executive took his place). What many attendees didn’t know was that Schmidt Futures was planning to end its backing of the program, referred to internally as the “Crisis Response Initiative,” before it even launched.
The Crisis Response Initiative is one of more than a dozen programs that Schmidt Futures has either placed under review, is spinning out or is in the process of sunsetting — including high-profile partnerships with the White House and Oxford University’s Rhodes Trust — according to seven people connected to the company and internal communications obtained by Forbes. These changes have also resulted in layoffs, according to multiple sources in a position to know.
“It’s all so embarrassing, we work with heads of state, governments, and have to close things down,” a current Schmidt Futures employee said. And “at a dime it can all be dropped?”
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In a statement, spokesperson Matthew Hiltzik said on behalf of Eric Schmidt, his wife Wendy and Schmidt Futures that the company “has launched more than 100 programs and is now completing a thorough five year review of its operations and impact.” The review has led to “a recent restructuring” and “a new leadership structure, which also includes both expansion and sunsets of various initiatives.” He said Schmidt Futures plans to announce new initiatives in 2024.
Hiltzik said Schmidt “was never confirmed” for the UN event due to a “prior commitment.” (A spokesperson for the Albanian Mission to the UN, which hosted the UN Security Council event, declined to comment.)
The disruption to its programs and agency relationships punctuates a messy period of upheaval at Schmidt Futures, which was cofounded in 2017 by Eric and his wife, Wendy Schmidt. In addition to the layoffs, Forbes has also learned that its founding CEO, Eric Braverman, left the organization in August after an internal investigation conducted by Schmidt’s family office, Hillspire LLC. Forbes was unable to determine the investigation’s cause and outcome. But in August, Eric and Wendy notified employees that Braverman had departed Schmidt Futures, according to an email obtained by Forbes.
At the time, the Schmidts publicly thanked Braverman for his tenure at the organization, and said they would fund a new charity he was launching called Telescope. But current and former employees told Forbes that Braverman was not allowed to say goodbye to colleagues; sources told Forbes that approximately half a dozen employees resigned in the aftermath of his departure.
The Schmidts declined to comment on Braverman’s exit. Braverman also declined to comment.
“It’s all so embarrassing, we work with heads of state, governments, and have to close things down.”
Now, the fates of two pillars of Braverman’s legacy at Schmidt Futures are uncertain. The Quad Fellowship, a partnership with the White House to provide grants to students in multiple countries that President Biden once lauded for its support of “the next generation of scientists and technologists who will build the future,” is among the initiatives being cut from its roster. And a global talent and networking program for teenagers called Rise, the organization’s anchor program with the Rhodes Trust, which as recently as last month committed to giving its young grantees scholarships and mentorship for “opportunities that allow them to work together to serve others over their lifetimes,” is currently under review, according to multiple people familiar with the matter. The Rhodes Trust did not respond to a comment request; the White House declined to comment on the Quad Fellowship.
“We’ve known for a bit that programs were going to be sunsetted, but it was unclear which ones, and who has job security,” another current Schmidt Futures employee told Forbes. “It feels like the company is entirely subject to Eric and Wendy’s whims.”
Since 2006, Eric and Wendy Schmidt have managed their fortune through their family office, Hillspire LLC; Forbes estimates that Schmidt is worth nearly $20 billion. Schmidt Futures is registered as a private company, and is funded through the Schmidts’ nonprofit arms, including the Eric and Wendy Schmidt Fund for Strategic Innovation, a private foundation that received $358.5 million from the couple in 2021, according to that year’s tax filing. The Schmidts have publicly committed more than $2 billion to philanthropic efforts, including funds in their foundation that haven’t yet been distributed.
“Philanthropy’s biggest challenge is time. What we’ve learned over the last dozen years is it takes time to get results.”
The Schmidts launched Schmidt Futures as Eric prepared to leave Alphabet, where he stepped down as executive chairman in 2018 after having served as CEO for a decade until 2011. The couple tapped Braverman, who was president of Hillspire at the time, and had previously led the Clinton Foundation, to run it. “Philanthropy’s biggest challenge is time,” Wendy Schmidt said when the commitment was first announced. “What we’ve learned over the last dozen years is it takes time to get results.”
Under Braverman’s leadership, the company’s goal was to seek and fund ambitious tech, science and social projects. Most recently, that included ex/ante, a new VC fund recently spun out of Schmidt Futures to invest in startups focused on privacy and security. It would also build a global braintrust through initiatives like Rise, the flagship program of the Schmidts’ $1 billion philanthropic commitment to supporting talent across the world. In doing so, it built close ties with the White House — ties which have drawn scrutiny.
Last year, staff at the White House’s Office of Science and Technology Policy (OSTP) complained about conflicts of interest with Schmidt Futures, Politico reported. Schmidt Futures indirectly funded the salaries of two OSTP science advisors; two others were Schmidt Futures fellows; and at least one Schmidt Futures executive worked as an unpaid consultant to the White House office. At the time, the White House told Politico there was nothing unusual about its ties to Schmidt; Schmidt Futures refuted the report in a press statement, claiming that the article was “unsubstantiated.” A White House official told Forbes that “neither Eric Schmidt nor Schmidt Ventures exert influence on policy matters. Any suggestion otherwise is false.”
Meanwhile, as the company grew, Eric Schmidt dedicated less time to Schmidt Futures, and more resources to expanding other sectors of his empire, according to four people familiar with his involvement. He co-wrote a book with Henry Kissinger, The Age of AI, and held high-profile government advisory roles, including chair of the National Security Commission on Artificial Intelligence. He also was deeply involved as chairman of a tech accelerator called Steel Perlot, which he launched with a woman he was dating, entrepreneur Michelle Ritter, and where he serves as chairman (the billionaire has long had publicly reported extramarital relationships).
A Forbes report last month documented how Schmidt had committed $100 million to Steel Perlot in 2021, before it ran into cash flow issues a year later. At times, Ritter would work from the Schmidt Futures offices in New York, prompting some employees to question the optics of Schmidt’s girlfriend’s presence at an organization co-led by his wife. In a statement provided by a spokesperson, Ritter said she “has never had a role at Schmidt Futures. She stopped by their office to work a handful of times.”
Earlier this year, Schmidt assured workers that his company would continue to grow. At a town hall meeting in late Spring, Braverman and Schmidt stood before employees and announced that Schmidt Futures would be doubling its budget. But months later, Braverman was gone, and the programs he’d championed were on the chopping block — even Quad, one of Schmidt’s philanthropic moonshots.
Correction: An early version of this story mistakenly implied that Schmidt Futures was shutting down.