Entrepreneurship and the World's Poor

(Alice Garrard is a staff writer for Philanthropy News Digest. This is her first post for PhilanTopic.)

Some people know the words; some people know the words and music. The latter can be said of Acumen Fund founder and CEO Jacqueline Novogratz, who spoke earlier today at an Aspen Institute-sponsored book chat here in New York City. More than ten years in the writing and just published, Novogratz's new book, The Blue Sweater: Bridging the Gap Between Rich and Poor in an Interconnected World, is already a popular topic of conversation -– and not just because its author is a born storyteller.

An avowed idealist in her twenties and now again in her forties, Novogratz fervently believes that individuals have it in themselves to change the world. At the same time, the realist/businesswoman in her tempers that idealism with the knowledge that we can't solve all the world's problems at once. Rather, we have to balance the audacity to think we can with humility about how we're going to get there. And that, says Novogratz, means that entrepreneurs have to be willing to focus on the "bottom of the pyramid" -- the roughly four billion people who live on less than $2 a day -- while their backers have to bring real money to the table.

Novogratz acknowledges that there are limitations to both charity and the market, including tradeoffs between efficiency, control, and equity. At the same time, the financial crisis has created a once-in-a-generation opportunity for leaders to rethink what it would take to extend the benefits of the global economy to the world's poorest. As she has traveled, Novogratz said, she has met bright young people wherever she goes who are determined to create change and make the world a better place. Yet more often not they have abandoned the traditional philanthropic route in favor of a more entrepreneurial, business-oriented approach to problem solving. To illustrate her point, Novogratz mentioned that she and her colleagues have been inundated by three thousand resumes for two jobs currently open at the Acumen Fund.

What to do with all this uptapped energy and optimism? Novogratz suggests creating a global Peace Corps. But "don’t cut it off at 25," she adds. "Let the 55- and 65-year-olds be part of it."

As for Acumen, even in this bleak economic climate its portfolio remains healthy at $40 million. And while the fund's customers may only make $4 or $5 a day, most are building good credit. Let's face it, Novogratz said, "you don’t have major mortgage markets in East Africa, India, or Pakistan."

All in all, a stimulating morning and a very inspiring woman.

To learn more about developing entrepreneurship among the world's poorest, pick up a copy of The Blue Sweater. And to read an extended excerpt from the book (courtesy of McKinsey & Company), click here.

-- Alice Garrard

Comments

[Dave Mattozzi]

Thanks for the info.