TEDGlobal 2007
Jacqueline Novogratz: Patient capitalism
Filmed:
Readability: 3.9
1,360,894 views
Jacqueline Novogratz shares stories of how "patient capital" can bring sustainable jobs, goods, services -- and dignity -- to the world's poorest.
Jacqueline Novogratz - Investor and advocate for moral leadership
Jacqueline Novogratz works to enable human flourishing. Her organization, Acumen, invests in people, companies and ideas that see capital and networks as means, not ends, to solving the toughest issues of poverty. Full bio
Jacqueline Novogratz works to enable human flourishing. Her organization, Acumen, invests in people, companies and ideas that see capital and networks as means, not ends, to solving the toughest issues of poverty. Full bio
Double-click the English transcript below to play the video.
00:26
I really am honored to be here, and as Chris said,
0
1000
2000
00:28
it's been over 20 years since I started working in Africa.
1
3000
3000
00:31
My first introduction was at the Abidjan airport on a sweaty, Ivory Coast morning.
2
6000
6000
00:37
I had just left Wall Street, cut my hair to look like Margaret Mead,
3
12000
4000
00:41
given away most everything that I owned,
4
16000
2000
00:43
and arrived with all the essentials --
5
18000
2000
00:45
some poetry, a few clothes, and, of course, a guitar --
6
20000
2000
00:47
because I was going to save the world,
7
22000
2000
00:49
and I thought I would just start with the African continent.
8
24000
6000
00:55
But literally within days of arriving I was told, in no uncertain terms,
9
30000
4000
00:59
by a number of West African women, that Africans didn't want saving,
10
34000
5000
01:04
thank you very much, least of all not by me.
11
39000
2000
01:06
I was too young, unmarried, I had no children,
12
41000
3000
01:09
didn't really know Africa, and besides, my French was pitiful.
13
44000
4000
01:13
And so, it was an incredibly painful time in my life,
14
48000
3000
01:16
and yet it really started to give me the humility to start listening.
15
51000
5000
01:21
I think that failure can be an incredibly motivating force as well,
16
56000
4000
01:25
so I moved to Kenya and worked in Uganda,
17
60000
3000
01:28
and I met a group of Rwandan women, who asked me, in 1986,
18
63000
3000
01:31
to move to Kigali to help them start the first microfinance institution there.
19
66000
4000
01:35
And I did, and we ended up naming it Duterimbere,
20
70000
4000
01:39
meaning "to go forward with enthusiasm." And while we were doing it,
21
74000
3000
01:42
I realized that there weren't a lot of businesses that were viable
22
77000
3000
01:45
and started by women, and so maybe I should try to run a business, too.
23
80000
4000
01:49
And so I started looking around, and I heard about a bakery
24
84000
2000
01:51
that was run by 20 prostitutes.
25
86000
2000
01:53
And, being a little intrigued, I went to go meet this group,
26
88000
4000
01:57
and what I found was 20 unwed mothers who were trying to survive.
27
92000
5000
02:02
And it was really the beginning of my understanding the power of language,
28
97000
5000
02:07
and how what we call people so often distances us from them,
29
102000
3000
02:10
and makes them little.
30
105000
2000
02:12
I also found out that the bakery was nothing like a business,
31
107000
4000
02:16
that, in fact, it was a classic charity run by a well-intentioned person,
32
111000
4000
02:20
who essentially spent 600 dollars a month
33
115000
4000
02:24
to keep these 20 women busy making little crafts and baked goods,
34
119000
5000
02:29
and living on 50 cents a day, still in poverty.
35
124000
3000
02:32
So, I made a deal with the women. I said, "Look, we get rid of the charity side,
36
127000
3000
02:35
and we run this as a business and I'll help you."
37
130000
3000
02:38
They nervously agreed. I nervously started, and, of course,
38
133000
4000
02:42
things are always harder than you think they're going to be.
39
137000
2000
02:44
First of all, I thought, well, we need a sales team,
40
139000
2000
02:46
and we clearly aren't the A-Team here,
41
141000
2000
02:48
so let's -- I did all this training.
42
143000
3000
02:51
And the epitome was when I literally marched into the streets
43
146000
4000
02:55
of Nyamirambo, which is the popular quarter of Kigali, with a bucket,
44
150000
3000
02:58
and I sold all these little doughnuts to people,
45
153000
3000
03:01
and I came back, and I was like, "You see?"
46
156000
2000
03:03
And the women said, "You know, Jacqueline, who in Nyamirambo is not going to buy
47
158000
4000
03:07
doughnuts out of an orange bucket from a tall American woman?" And like --
48
162000
4000
03:11
(Laughter) -- it's a good point.
49
166000
2000
03:13
So then I went the whole American way,
50
168000
2000
03:15
with competitions, team and individual. Completely failed,
51
170000
3000
03:18
but over time, the women learnt to sell on their own way.
52
173000
4000
03:22
And they started listening to the marketplace,
53
177000
2000
03:24
and they came back with ideas for cassava chips, and banana chips,
54
179000
3000
03:27
and sorghum bread, and before you knew it,
55
182000
2000
03:29
we had cornered the Kigali market,
56
184000
2000
03:31
and the women were earning three to four times the national average.
57
186000
3000
03:34
And with that confidence surge, I thought, "Well, it's time to create a real bakery,
58
189000
4000
03:38
so let's paint it." And the women said, "That's a really great idea."
59
193000
4000
03:42
And I said, "Well, what color do you want to paint it?" And they said,
60
197000
2000
03:44
"Well, you choose." And I said, "No, no, I'm learning to listen.
61
199000
3000
03:47
You choose. It's your bakery, your street, your country -- not mine."
62
202000
3000
03:50
But they wouldn't give me an answer.
63
205000
2000
03:52
So, one week, two weeks, three weeks went by,
64
207000
2000
03:54
and finally I said, "Well, how about blue?"
65
209000
3000
03:57
And they said, "Blue, blue, we love blue. Let's do it blue."
66
212000
2000
03:59
So, I went to the store, I brought Gaudence, the recalcitrant one of all,
67
214000
4000
04:03
and we brought all this paint and fabric to make curtains,
68
218000
4000
04:07
and on painting day, we all gathered in Nyamirambo,
69
222000
3000
04:10
and the idea was we would paint it white with blue as trim,
70
225000
3000
04:13
like a little French bakery. But that was clearly not as satisfying
71
228000
3000
04:16
as painting a wall of blue like a morning sky.
72
231000
3000
04:19
So, blue, blue, everything became blue.
73
234000
3000
04:22
The walls were blue, the windows were blue,
74
237000
1000
04:23
the sidewalk out front was painted blue.
75
238000
3000
04:26
And Aretha Franklin was shouting "R-E-S-P-E-C-T,"
76
241000
4000
04:30
the women's hips were swaying
77
245000
2000
04:32
and little kids were trying to grab the paintbrushes, but it was their day.
78
247000
3000
04:35
And at the end of it, we stood across the street
79
250000
3000
04:38
and we looked at what we had done, and I said, "It is so beautiful."
80
253000
3000
04:41
And the women said, "It really is."
81
256000
2000
04:43
And I said, "And I think the color is perfect,"
82
258000
3000
04:46
and they all nodded their head, except for Gaudence,
83
261000
2000
04:48
and I said, "What?"
84
263000
2000
04:50
And she said, "Nothing." And I said, "What?"
85
265000
2000
04:52
And she said, "Well, it is pretty, but, you know, our color, really, it is green." And --
86
267000
6000
04:58
(Laughter)
87
273000
3000
05:01
-- I learned then that listening isn't just about patience,
88
276000
5000
05:06
but that when you've lived on charity and dependent your whole life long,
89
281000
5000
05:11
it's really hard to say what you mean.
90
286000
2000
05:13
And, mostly because people never really ask you,
91
288000
4000
05:17
and when they do, you don't really think they want to know the truth.
92
292000
3000
05:20
And so then I learned that listening is not only about waiting,
93
295000
3000
05:23
but it's also learning how better to ask questions.
94
298000
4000
05:27
And so, I lived in Kigali for about two and a half years, doing these two things,
95
302000
4000
05:31
and it was an extraordinary time in my life.
96
306000
2000
05:33
And it taught me three lessons
97
308000
2000
05:35
that I think are so important for us today,
98
310000
3000
05:38
and certainly in the work that I do.
99
313000
2000
05:40
The first is that dignity is more important to the human spirit than wealth.
100
315000
4000
05:44
As Eleni has said, when people gain income, they gain choice,
101
319000
4000
05:48
and that is fundamental to dignity.
102
323000
2000
05:50
But as human beings, we also want to see each other,
103
325000
3000
05:53
and we want to be heard by each other, and we should never forget that.
104
328000
4000
05:57
The second is that traditional charity and aid
105
332000
3000
06:00
are never going to solve the problems of poverty.
106
335000
2000
06:02
I think Andrew pretty well covered that, so I will move to the third point,
107
337000
3000
06:05
which is that markets alone also
108
340000
2000
06:07
are not going to solve the problems of poverty.
109
342000
3000
06:10
Yes, we ran this as a business,
110
345000
2000
06:12
but someone needed to pay the philanthropic support
111
347000
5000
06:17
that came into the training, and the management support, the strategic advice
112
352000
3000
06:20
and, maybe most important of all,
113
355000
3000
06:23
the access to new contacts, networks and new markets.
114
358000
4000
06:27
And so, on a micro level, there's a real role for this combination
115
362000
4000
06:31
of investment and philanthropy.
116
366000
3000
06:34
And on a macro level -- some of the speakers have inferred that
117
369000
4000
06:38
even health should be privatized.
118
373000
2000
06:40
But, having had a father with heart disease,
119
375000
2000
06:42
and realizing that what our family could afford
120
377000
4000
06:46
was not what he should have gotten,
121
381000
3000
06:49
and having a good friend step in to help,
122
384000
3000
06:52
I really believe that all people deserve access to health
123
387000
3000
06:55
at prices they can afford.
124
390000
2000
06:57
I think the market can help us figure that out,
125
392000
2000
06:59
but there's got to be a charitable component,
126
394000
2000
07:01
or I don't think we're going to create the kind of societies we want to live in.
127
396000
4000
07:05
And so, it was really those lessons that made me decide to
128
400000
3000
07:08
build Acumen Fund about six years ago.
129
403000
3000
07:11
It's a nonprofit, venture capital fund for the poor,
130
406000
3000
07:14
a few oxymorons in one sentence.
131
409000
2000
07:16
It essentially raises charitable funds from individuals, foundations and corporations,
132
411000
5000
07:21
and then we turn around and we invest equity and loans
133
416000
2000
07:23
in both for-profit and nonprofit entities
134
418000
2000
07:25
that deliver affordable health, housing, energy, clean water
135
420000
4000
07:29
to low income people in South Asia and Africa,
136
424000
3000
07:32
so that they can make their own choices.
137
427000
2000
07:34
We've invested about 20 million dollars in 20 different enterprises,
138
429000
4000
07:38
and have, in so doing, created nearly 20,000 jobs,
139
433000
5000
07:43
and delivered tens of millions of services to people
140
438000
2000
07:45
who otherwise would not be able to afford them.
141
440000
4000
07:49
I want to tell you two stories. Both of them are in Africa.
142
444000
3000
07:52
Both of them are about investing in entrepreneurs
143
447000
2000
07:54
who are committed to service, and who really know the markets.
144
449000
4000
07:58
Both of them live at the confluence of public health and enterprise,
145
453000
4000
08:02
and both of them, because they're manufacturers,
146
457000
2000
08:04
create jobs directly, and create incomes indirectly,
147
459000
3000
08:07
because they're in the malaria sector,
148
462000
2000
08:09
and Africa loses about 13 billion dollars a year because of malaria.
149
464000
5000
08:14
And so as people get healthier, they also get wealthier.
150
469000
4000
08:18
The first one is called Advanced Bio-Extracts Limited.
151
473000
3000
08:21
It's a company built in Kenya about seven years ago
152
476000
2000
08:23
by an incredible entrepreneur named Patrick Henfrey and his three colleagues.
153
478000
4000
08:27
These are old-hand farmers
154
482000
2000
08:29
who've gone through all the agricultural ups and downs
155
484000
2000
08:31
in Kenya over the last 30 years.
156
486000
2000
08:33
Now, this plant is an Artemisia plant;
157
488000
3000
08:36
it's the basic component for artemisinin,
158
491000
2000
08:38
which is the best-known treatment for malaria.
159
493000
2000
08:40
It's indigenous to China and the Far East,
160
495000
4000
08:44
but given that the prevalence of malaria is here in Africa,
161
499000
2000
08:46
Patrick and his colleagues said, "Let's bring it here,
162
501000
4000
08:50
because it's a high value-add product."
163
505000
2000
08:52
The farmers get three to four times the yields that they would with maize.
164
507000
6000
08:58
And so, using patient capital -- money that they could raise early on,
165
513000
4000
09:02
that actually got below market returns
166
517000
2000
09:04
and was willing to go the long haul and be combined
167
519000
4000
09:08
with management assistance, strategic assistance --
168
523000
3000
09:11
they've now created a company where they purchase from 7,500 farmers.
169
526000
4000
09:15
So that's about 50,000 people affected.
170
530000
2000
09:17
And I think some of you may have visited --
171
532000
2000
09:19
these farmers are helped by KickStart and TechnoServe,
172
534000
3000
09:22
who help them become more self-sufficient.
173
537000
2000
09:24
They buy it, they dry it and they bring it to this factory,
174
539000
3000
09:27
which was purchased in part by, again, patient capital from Novartis,
175
542000
4000
09:31
who has a real interest in getting the powder
176
546000
3000
09:34
so that they can make Coartem.
177
549000
3000
09:37
Acumen's been working with ABE for the past year, year and a half,
178
552000
5000
09:42
both on looking at a new business plan,
179
557000
2000
09:44
and what does expansion look like, helping with management support
180
559000
3000
09:47
and helping to do term sheets and raise capital.
181
562000
4000
09:51
And I really understood what patient capital meant emotionally
182
566000
3000
09:54
in the last month or so. Because the company was literally
183
569000
4000
09:58
10 days away from proving that the product they produced
184
573000
4000
10:02
was at the world-quality level needed to make Coartem,
185
577000
4000
10:06
when they were in the biggest cash crisis of their history.
186
581000
3000
10:09
And we called all of the social investors we know.
187
584000
3000
10:12
Now, some of these same social investors are really interested in Africa
188
587000
4000
10:16
and understand the importance of agriculture,
189
591000
2000
10:18
and they even helped the farmers.
190
593000
3000
10:21
And even when we explained that if ABE goes away,
191
596000
3000
10:24
all those 7,500 jobs go away too,
192
599000
4000
10:28
we sometimes have this bifurcation between business and the social.
193
603000
5000
10:33
And it's really time we start thinking more creatively about how they can be fused.
194
608000
4000
10:37
So Acumen made not one, but two bridge loans,
195
612000
3000
10:40
and the good news is they did indeed meet world-quality classification and are now
196
615000
6000
10:46
in the final stages of closing a 20-million-dollar round, to move it to the next level,
197
621000
4000
10:50
and I think that this will be one of the more important companies in East Africa.
198
625000
6000
10:56
This is Samuel. He's a farmer.
199
631000
2000
10:58
He was actually living in the Kibera slums
200
633000
2000
11:00
when his father called him and told him about Artemisia and the value-add potential.
201
635000
5000
11:05
So he moved back to the farm, and, long story short,
202
640000
3000
11:08
they now have seven acres under cultivation.
203
643000
3000
11:11
Samuel's kids are in private school,
204
646000
2000
11:13
and he's starting to help other farmers in the area also go into Artemisia production --
205
648000
6000
11:19
dignity being more important than wealth.
206
654000
3000
11:22
The next one, many of you know.
207
657000
3000
11:25
I talked about it a little at Oxford two years ago,
208
660000
3000
11:28
and some of you visited A to Z manufacturing,
209
663000
2000
11:30
which is one of the great, real companies in East Africa.
210
665000
4000
11:34
It's another one that lives at the confluence of health and enterprise.
211
669000
5000
11:39
And this is really a story about a public-private solution
212
674000
4000
11:43
that has really worked.
213
678000
2000
11:45
It started in Japan. Sumitomo had developed a technology
214
680000
4000
11:49
essentially to impregnate a polyethylene-based fiber with organic insecticide,
215
684000
4000
11:53
so you could create a bed net,
216
688000
2000
11:55
a malaria bed net, that would last five years and not need to be re-dipped.
217
690000
3000
11:58
It could alter the vector, but like Artemisia,
218
693000
3000
12:01
it had been produced only in East Asia. And as part of its social responsibility,
219
696000
4000
12:05
Sumitomo said, "Why don't we experiment
220
700000
2000
12:07
with whether we can produce it in Africa, for Africans?"
221
702000
3000
12:10
UNICEF came forward and said, "We'll buy most of the nets,
222
705000
3000
12:13
and then we'll give them away, as part of the global fund's
223
708000
3000
12:16
and the U.N.'s commitment to pregnant women and children, for free."
224
711000
6000
12:22
Acumen came in with the patient capital,
225
717000
3000
12:25
and we also helped to identify the entrepreneur
226
720000
2000
12:27
that we would all partner with here in Africa,
227
722000
3000
12:30
and Exxon provided the initial resin.
228
725000
3000
12:33
Well, in looking around for entrepreneurs,
229
728000
2000
12:35
there was none better that we could find on earth than Anuj Shah,
230
730000
3000
12:38
in A to Z manufacturing company.
231
733000
2000
12:40
It's a 40-year-old company, it understands manufacturing.
232
735000
3000
12:43
It's gone from socialist Tanzania into capitalist Tanzania,
233
738000
3000
12:46
and continued to flourish. It had about 1,000 employees when we first found it.
234
741000
5000
12:51
And so, Anuj took the entrepreneurial risk here in Africa
235
746000
3000
12:54
to produce a public good that was purchased by the aid establishment
236
749000
5000
12:59
to work with malaria.
237
754000
3000
13:02
And, long story short, again, they've been so successful.
238
757000
3000
13:05
In our first year, the first net went off the line in October of 2003.
239
760000
5000
13:10
We thought the hitting-it-out-of-the-box number was 150,000 nets a year.
240
765000
5000
13:15
This year, they are now producing eight million nets a year,
241
770000
3000
13:18
and they employ 5,000 people, 90 percent of whom are women, mostly unskilled.
242
773000
5000
13:23
They're in a joint venture with Sumitomo.
243
778000
3000
13:26
And so, from an enterprise perspective for Africa,
244
781000
3000
13:29
and from a public health perspective, these are real successes.
245
784000
3000
13:32
But it's only half the story if we're really looking at solving problems of poverty,
246
787000
4000
13:36
because it's not long-term sustainable.
247
791000
2000
13:38
It's a company with one big customer.
248
793000
2000
13:40
And if avian flu hits, or for any other reason
249
795000
4000
13:44
the world decides that malaria is no longer as much of a priority, everybody loses.
250
799000
5000
13:49
And so, Anuj and Acumen
251
804000
3000
13:52
have been talking about testing the private sector,
252
807000
3000
13:55
because the assumption that the aid establishment has made is that,
253
810000
5000
14:00
look, in a country like Tanzania,
254
815000
2000
14:02
80 percent of the population makes less than two dollars a day.
255
817000
2000
14:04
It costs, at manufacturing point, six dollars to produce these,
256
819000
4000
14:08
and it costs the establishment another six dollars to distribute it,
257
823000
5000
14:13
so the market price in a free market would be about 12 dollars per net.
258
828000
4000
14:17
Most people can't afford that, so let's give it away free.
259
832000
2000
14:19
And we said, "Well, there's another option.
260
834000
3000
14:22
Let's use the market as the best listening device we have, and
261
837000
3000
14:25
understand at what price people would pay for this, so they get the dignity of choice.
262
840000
5000
14:30
We can start building local distribution,
263
845000
2000
14:32
and actually, it can cost the public sector much less."
264
847000
4000
14:36
And so we came in with a second round of patient capital to A to Z,
265
851000
4000
14:40
a loan as well as a grant, so that A to Z could play with pricing
266
855000
4000
14:44
and listen to the marketplace, and found a number of things.
267
859000
3000
14:47
One, that people will pay different prices,
268
862000
2000
14:49
but the overwhelming number of people will come forth at one dollar per net
269
864000
4000
14:53
and make a decision to buy it.
270
868000
2000
14:55
And when you listen to them, they'll also have a lot to say
271
870000
3000
14:58
about what they like and what they don't like.
272
873000
2000
15:00
And that some of the channels we thought would work didn't work.
273
875000
4000
15:04
But because of this experimentation and iteration that was allowed
274
879000
3000
15:07
because of the patient capital,
275
882000
2000
15:09
we've now found that it costs about a dollar in the private sector
276
884000
3000
15:12
to distribute, and a dollar to buy the net.
277
887000
2000
15:14
So then, from a policy perspective, when you start with the market,
278
889000
4000
15:18
we have a choice.
279
893000
1000
15:19
We can continue going along at 12 dollars a net, and the customer pays zero,
280
894000
6000
15:25
or we could at least experiment with some of it, to charge one dollar a net,
281
900000
6000
15:31
costing the public sector another six dollars a net,
282
906000
3000
15:34
give the people the dignity of choice, and have a distribution system
283
909000
4000
15:38
that might, over time, start sustaining itself.
284
913000
3000
15:41
We've got to start having conversations like this,
285
916000
2000
15:43
and I don't think there's any better way to start than using the market,
286
918000
4000
15:47
but also to bring other people to the table around it.
287
922000
4000
15:51
Whenever I go to visit A to Z, I think of my grandmother, Stella.
288
926000
7000
15:58
She was very much like those women sitting behind the sewing machines.
289
933000
5000
16:03
She grew up on a farm in Austria, very poor,
290
938000
2000
16:05
didn't have very much education.
291
940000
2000
16:07
She moved to the United States, where she met my grandfather,
292
942000
2000
16:09
who was a cement hauler,
293
944000
2000
16:11
and they had nine children. Three of them died as babies.
294
946000
6000
16:17
My grandmother had tuberculosis, and she worked in a sewing machine shop,
295
952000
3000
16:20
making shirts for about 10 cents an hour.
296
955000
3000
16:23
She, like so many of the women I see at A to Z,
297
958000
4000
16:27
worked hard every day, understood what suffering was,
298
962000
3000
16:30
had a deep faith in God, loved her children
299
965000
3000
16:33
and would never have accepted a handout.
300
968000
3000
16:36
But because she had the opportunity of the marketplace,
301
971000
4000
16:40
and she lived in a society that provided the safety
302
975000
3000
16:43
of having access to affordable health and education,
303
978000
4000
16:47
her children and their children were able to live
304
982000
4000
16:51
lives of real purpose and follow real dreams.
305
986000
3000
16:54
I look around at my siblings and my cousins -- and as I said,
306
989000
4000
16:58
there are a lot of us --
307
993000
2000
17:00
and I see teachers and musicians, hedge fund managers, designers.
308
995000
6000
17:06
One sister who makes other people's wishes come true.
309
1001000
3000
17:09
And my wish, when I see those women, I meet those farmers,
310
1004000
5000
17:14
and I think about all the people across this continent
311
1009000
3000
17:17
who are working hard every day,
312
1012000
2000
17:19
is that they have that sense of opportunity and possibility,
313
1014000
4000
17:23
and that they also can believe and get access to services,
314
1018000
5000
17:28
so that their children, too, can live those lives of great purpose.
315
1023000
4000
17:32
It shouldn't be that difficult.
316
1027000
2000
17:34
But what it takes is a commitment from all of us
317
1029000
4000
17:38
to essentially refuse trite assumptions,
318
1033000
4000
17:42
get out of our ideological boxes.
319
1037000
3000
17:45
It takes investing in those entrepreneurs that are committed
320
1040000
3000
17:48
to service as well as to success.
321
1043000
4000
17:52
It takes opening your arms, both, wide,
322
1047000
3000
17:55
and expecting very little love in return,
323
1050000
3000
17:58
but demanding accountability,
324
1053000
2000
18:00
and bringing the accountability to the table as well.
325
1055000
3000
18:03
And most of all, most of all,
326
1058000
3000
18:06
it requires that all of us have the courage and the patience,
327
1061000
4000
18:10
whether we are rich or poor, African or non-African,
328
1065000
3000
18:13
local or diaspora, left or right,
329
1068000
3000
18:16
to really start listening to each other.
330
1071000
2000
18:18
Thank you.
331
1073000
2000
18:20
(Applause)
332
1075000
10000
ABOUT THE SPEAKER
Jacqueline Novogratz - Investor and advocate for moral leadershipJacqueline Novogratz works to enable human flourishing. Her organization, Acumen, invests in people, companies and ideas that see capital and networks as means, not ends, to solving the toughest issues of poverty.
Why you should listen
Jacqueline Novogratz writes: "I want to build a movement in which we define success based on the amount of human energy we release in the world.
"I started my career on Wall Street and soon discovered that markets are efficient, but by themselves they too often overlook or exploit the poor. So I moved to Rwanda in 1986 to help found the country’s first micro-finance bank. There I saw the humanitarian ethos of philanthropy, and also how often top-down solutions too often create dependency, the opposite of dignity. Through 30 years of working on solutions to poverty, I have come to redefine it for myself, seeing it not as how much income a person earns, but how free they are to make their own choices and decisions, how much agency they have over their own lives.
Acumen was founded to change the way the world tackles poverty in 2001. Our mission was simple – to raise philanthropy and invest it as patient capital – long-term investment in intrepid entrepreneurs willing to go where markets and government had failed the poor. We enable companies to experiment and fail, never wavering from a commitment to stand with the poor, yet understanding that profitability is necessary for sustainable solutions. We’ve invested more than $110M across South Asia, Africa, Latin America and the US, and have seen entire sectors disrupted and hundreds of millions served.
The work also taught that it was critical to invest in talent. To date, we’ve supported nearly 400 Acumen Fellows across lines of race, class, ethnicity, religion and ideology. They are a beautiful group, full of vision and grit, and a determination to do what is right, not easy. The group itself enables individual leaders to endure the loneliness that is part of the work.
And then we measure what matters rather than just what we can count. Take this all together and you see our mission to do what it takes to build a world in which all of us have the chance to dream and to flourish, not from a place of easy sentimentality but through a commitment to using the tools of capitalism and the attributes of moral leadership to focus on doing what it takes, and no less.
Jacqueline Novogratz | Speaker | TED.com