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More 'Patient Capital' for Social Ventures
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Lucius
Nov 7, 2009 2:46 AM GMT
Social entrepreneurs, help us serve you!
Share your wisdom with us here: http://bit.ly/zjMQV
(please cut and paste the link into a new window.)
Thanks for your time.
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Olga
Apr 27, 2009 2:53 AM GMT
Even though one can argue that â??an increasing number of venture investors hunting for small companies that could yield social benefitsâ?? is a result of the many societal pressures where not carrying about systemic impacts is not an option, I would want to interpret John Tozziâ??s outlook as optimistic as he describes social missions as â??selling pointsâ?? and say that investors care about social missions. The perceptions are changing as we approach poverty as an asset we can develop and as we consider the bottom of the pyramid as a potential high yielding investment and not as a charity cause. It is encouraging to think of business as being philanthropic first, environmentally aware second and financially selfish last.
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Sara
Apr 26, 2009 6:05 PM GMT
TBL Capital general partner, Mark Finser, states that the company invests in companies that will be â??game-changers.â?? This term is particularly interesting and appropriate; disruptive innovation is a key part of entrepreneurship endeavors.
In regards to social entrepreneurship, non-profits can be innovative when appropriate, but the more important reason for existence is that they satisfy social needs and provide services not provided by for-profits. It is understandable why venture capitalists are interested in â??game changers,â?? but hopefully social ventures that are not disruptive by definition are able to receive funding, as well.
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Christina
Apr 25, 2009 12:03 AM GMT
Does the Acumen Fund make investments â??based more on their social impact than on financial return?â?? Last time I checked they utilized the best available charitable option (BACO), not a social versus financial comparison. In the articleâ??s scenario, the Acumen fund DID choose the option that made them the most financial return; at the expense of possibly helping the lowest of the pyramid. By investing in A to Z Textile Mills, they made these nets available to Africans, but it is important to address, which Africans utilized these nets? The Acumen Fundâ??s calculations themselves only attribute 50% of those mosquito nets going to the bottom of the pyramid. Furthermore, with most people in the world living on less than $2 a day, the â??low costâ?? of $5 for a malaria net means the difference between starving for three days to pay for that net or contracting the #1 killer in Africa. Would the African people be better served by an NGO who provided that net free of charge?
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Asia
Apr 23, 2009 11:49 PM GMT
I agree that social VCs do not need to tradeoff financial returns for social benefits because helping people can happen at the same time as gaining profit. Although some people, including myself, believe that there is no need for a tradeoff because in some cases, we are able to see that the lives of the people have improved because of financial growth. Nevertheless, how do we determine the non-financial success? How can we measure the social benefit to know if it is equivalent to the financial benefit? It is difficult to measure the non-financial benefits because the methods used to measure have their flaws and are not easily quantifiable. Also, we do not know if the standards used to measure the success are reliable for each case. If the results are from surveys, are they biased? Or if they are statistics data, do they include all participants or only a selected number of individuals.
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J. Green
Apr 19, 2009 5:25 AM GMT
This article confuses a socially responsible entrepreneur and a social entrepreneur. While patient capital is required for clean energy to produce returns for the socially responsible entrepreneur, the patient is the capital for social entrepreneurs; Roger L. Martin and Sally Osberg wrote a Stanford review dedicated to the definition of the Social Entrepreneur; â??the social entrepreneurâ??s value proposition targets an underserved, neglected or highly disadvantaged population that lacks the financial means or political clout to achieve the transformative benefit on its own.â?? Martin and Osberg go on to state the consequence of not making the distinction; â??â?¦we fear that the indiscriminate use of the term may undermine its significance and potential importance to those seeking to understand how societies change and progress. Social entrepreneurship is as vital to the progress of societies as is entrepreneurship to the progress of economiesâ?¦â?? Please make the distinction between socially responsible entrepreneurs and social entrepreneurs; it will alleviate some of the confusion and mitigate ethical issues if these terms can be disentangled.
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Kelsi Boyle
Apr 9, 2009 11:55 PM GMT
True, the sprouting up of business that combines high return with outside impact is rapidly increasing. Investors recognize the benefits of diversifying their portfolios with mission-based investments these days. But I'm glad this article touches on one issue that is still a bit hazy: the exit.
Meredith Walters describing socially-responsible exits as in the "experiment stage" is quite accurate. We hope to dig into this issue a bit deeper at the Investors' Circle Spring Conference in a couple of weeks. Can mission really be preserved once a company goes public? What are our other options? What constitutes a "Sell Out"?
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James G.
Apr 9, 2009 11:55 PM GMT
This is a great story. Due to the decreasing cost of technology, more people are able to jump into the social entrepreneurship arena.
James
Foodarity.com
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return to story
More 'Patient Capital' for Social Ventures
All Reader Comments
page 1 of 1
Lucius Nov 7, 2009 2:46 AM GMT Social entrepreneurs, help us serve you! Share your wisdom with us here: http://bit.ly/zjMQV (please cut and paste the link into a new window.) Thanks for your time.
Link to this comment
Olga Apr 27, 2009 2:53 AM GMT Even though one can argue that â??an increasing number of venture investors hunting for small companies that could yield social benefitsâ?? is a result of the many societal pressures where not carrying about systemic impacts is not an option, I would want to interpret John Tozziâ??s outlook as optimistic as he describes social missions as â??selling pointsâ?? and say that investors care about social missions. The perceptions are changing as we approach poverty as an asset we can develop and as we consider the bottom of the pyramid as a potential high yielding investment and not as a charity cause. It is encouraging to think of business as being philanthropic first, environmentally aware second and financially selfish last.
Link to this comment
Sara Apr 26, 2009 6:05 PM GMT TBL Capital general partner, Mark Finser, states that the company invests in companies that will be â??game-changers.â?? This term is particularly interesting and appropriate; disruptive innovation is a key part of entrepreneurship endeavors. In regards to social entrepreneurship, non-profits can be innovative when appropriate, but the more important reason for existence is that they satisfy social needs and provide services not provided by for-profits. It is understandable why venture capitalists are interested in â??game changers,â?? but hopefully social ventures that are not disruptive by definition are able to receive funding, as well.
Link to this comment
Christina Apr 25, 2009 12:03 AM GMT Does the Acumen Fund make investments â??based more on their social impact than on financial return?â?? Last time I checked they utilized the best available charitable option (BACO), not a social versus financial comparison. In the articleâ??s scenario, the Acumen fund DID choose the option that made them the most financial return; at the expense of possibly helping the lowest of the pyramid. By investing in A to Z Textile Mills, they made these nets available to Africans, but it is important to address, which Africans utilized these nets? The Acumen Fundâ??s calculations themselves only attribute 50% of those mosquito nets going to the bottom of the pyramid. Furthermore, with most people in the world living on less than $2 a day, the â??low costâ?? of $5 for a malaria net means the difference between starving for three days to pay for that net or contracting the #1 killer in Africa. Would the African people be better served by an NGO who provided that net free of charge?
Link to this comment
Asia Apr 23, 2009 11:49 PM GMT I agree that social VCs do not need to tradeoff financial returns for social benefits because helping people can happen at the same time as gaining profit. Although some people, including myself, believe that there is no need for a tradeoff because in some cases, we are able to see that the lives of the people have improved because of financial growth. Nevertheless, how do we determine the non-financial success? How can we measure the social benefit to know if it is equivalent to the financial benefit? It is difficult to measure the non-financial benefits because the methods used to measure have their flaws and are not easily quantifiable. Also, we do not know if the standards used to measure the success are reliable for each case. If the results are from surveys, are they biased? Or if they are statistics data, do they include all participants or only a selected number of individuals.
Link to this comment
J. Green Apr 19, 2009 5:25 AM GMT This article confuses a socially responsible entrepreneur and a social entrepreneur. While patient capital is required for clean energy to produce returns for the socially responsible entrepreneur, the patient is the capital for social entrepreneurs; Roger L. Martin and Sally Osberg wrote a Stanford review dedicated to the definition of the Social Entrepreneur; â??the social entrepreneurâ??s value proposition targets an underserved, neglected or highly disadvantaged population that lacks the financial means or political clout to achieve the transformative benefit on its own.â?? Martin and Osberg go on to state the consequence of not making the distinction; â??â?¦we fear that the indiscriminate use of the term may undermine its significance and potential importance to those seeking to understand how societies change and progress. Social entrepreneurship is as vital to the progress of societies as is entrepreneurship to the progress of economiesâ?¦â?? Please make the distinction between socially responsible entrepreneurs and social entrepreneurs; it will alleviate some of the confusion and mitigate ethical issues if these terms can be disentangled.
Link to this comment
Kelsi Boyle Apr 9, 2009 11:55 PM GMT True, the sprouting up of business that combines high return with outside impact is rapidly increasing. Investors recognize the benefits of diversifying their portfolios with mission-based investments these days. But I'm glad this article touches on one issue that is still a bit hazy: the exit. Meredith Walters describing socially-responsible exits as in the "experiment stage" is quite accurate. We hope to dig into this issue a bit deeper at the Investors' Circle Spring Conference in a couple of weeks. Can mission really be preserved once a company goes public? What are our other options? What constitutes a "Sell Out"?
Link to this comment
James G. Apr 9, 2009 11:55 PM GMT This is a great story. Due to the decreasing cost of technology, more people are able to jump into the social entrepreneurship arena. James Foodarity.com
Link to this comment
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