Two or three decades ago some free local newspapers instituted something called “voluntary pay,” in which they asked their readers to put money in an envelope enclosed in the paper – and assured them they would continue to receive the paper whether they ponied up or not. This was an interesting strategy, one which made no sense to me and whose results were so sufficiently modest that the idea never caught on with the industry.
Read MoreI’m excited by the possibilities of the marketplace to unleash economic creativity that can work for the public good as well as for personal enrichment. “Impact investing” – which seeks out people and companies whose goal is to make a positive social and environmental impact as well as a good return – is a still-small but growing movement. It operates at all levels, from large corporations to small garages, and it is predicated on the belief that the best long-term investments will be those that are driven by more than money. For me the excitement comes from someone like Shiv Rajendran, who is converting used electric-car batteries into sources of power for India’s rural schools; from a company like Oliberte in Addis Ababa, the world’s first fair-trade-certified shoe company, creating “a sustainable brand supporting workers’ rights in sub-Saharan Africa”; a community lender like the Contact Fund, “built on a vision that private capital can be leveraged to make high-impact community investments in New York City” – and the hundreds of mostly young people now in Detroit (which is trying to become “the Silicon Valley for entrepreneurs”) who are teeming with ideas that will help revitalize the city. Some of these ideas will flourish. Most will fail. But the real question is whether collectively they can build a more inclusive and less exploitive system of capitalism. It’s a long shot. But I’m betting they can.
(Full disclosure: I’m a very small investor in Oliberte and Contact Fund.)
Correction: Friday’s post inadvertently listed the Koch Brothers’ net worth as $85.8 million. It is, of course, $85.8 billion. I apologize for the three-zeros rounding error.
While Ted Cruz makes headlines trying to bring down the government, I turn to people who are building things. This week in Louisville, Kentucky, nine entrepreneurs, some of them very young, presented their ideas to a group of investors. Both entrepreneurs and investors are part of a growing movement called “impact investing”, in which profitability is one criterion in a business that also addresses social and environmental issues – the so-called “triple bottom line”. The focus of the three-day event, presented by Village Capital, is the intersection of energy and agriculture, and its goal is to encourage entrepreneurs who address major societal problems.
The ideas have been imaginative, grounded and exciting for me: an insect-monitoring device that reduces pesticide use; a precision irrigation system; a plan to repurpose “gray water” for urban hydroponic growers; platforms to determine shellfish size before harvesting, streamline solar panel installations and lower costs for electricity consumers in East Africa; a battery that will double the energy and life of current batteries at half the cost.
My two favorites are a patent-pending technology to measure crop-water use over an entire field and a plan to turn old electric car batteries into low-cost power packs for schools in rural India, where electricity is both expensive and unreliable. “Why,” asked company founder Shiv Rajendran, “should dreaming be a privilege?”
I believe in a positive government, but I am certain that America’s future has more to do with nine idealists in Louisville than Ted Cruz’s claptrap on Capitol Hill.