Acumen Fund on the Verge
photo: JB Reed/Flickr

I met Jacqueline Novogratz in Vancouver, British Columbia last fall, at the same conference where I interviewed Adele Diamond and Matthieu Ricard. Sitting at the same dining table of ten, she became the center of conversation. I found her authenticity and passion magnetic, even as I labored to follow the discussion about business models and venture capital. Then, in the following weeks and months, I saw the Acumen Fund mentioned in commentary after commentary, singled out as a star in a new generation of social entrepreneurship.

The work Jacqueline Novogratz is doing is influential, and potentially transformative, to some of the world’s most entrenched issues of poverty and inequality. It is a young, somewhat experimental venture. But it is one catalyst in evolving our understanding and practice of foreign aid and international development. On this program last year, the Kenyan writer Binyavanga Wainaina described the debilitating effect of growing up surrounded by the most well-intentioned Western aid projects that defined him in terms of his poverty and his deficits — in terms, that is, of what he lacked and what they could provide.

In more recent months, the Zambian economist Dambisa Moyo has risen to the spotlight as part of a new generation of African economists who are calling, somewhat controversially, for an outright end to traditional Western aid. She and others argue that aid has kept leaders of developing countries focused on courting foreign donors and has fed corruption. They insist that a future beyond poverty demands that governments instead become accountable exclusively to their own people, creating infrastructures for basic services and nurturing indigenous creativity and enterprise. They point out that, since 1970, $500 billion of Western aid to the African continent has not yielded an overall rise in well-being commensurate with dollars given. Similarly and tragically, the massive devastation of the Haiti earthquake has laid bare a fragile infrastructure and degree of poverty that have persisted despite the small island country having one of the world’s largest per capita populations of Non-Governmental Organizations (NGOs).

I am not suggesting that all aid is bad. In the wake of our program with Binyavanga Wainaina, listeners who have been part of the universe of aid and development wrote to us about the hard truths they recognized in his perspective, while also pointing us to organizations that are making a difference with a wide range of approaches. Jacqueline Novogratz insists that traditional top-down aid is one of the most effective models when it comes to the eradication of disease, such as smallpox. And the necessity of massive humanitarian aid to keep people alive, fed, and sheltered after a natural disaster like that now unfolding in Haiti is undeniable.

The Acumen Fund is building a new paradigm — philanthropic venture capital. Working with entrepreneurs on the ground in places like Kenya, Tanzania, Pakistan, and India, the Fund invests in for-profit projects that bring basic services such as clean water, maternal health care, and ambulance services to people who make less than four dollars a day. During our conversation, she tells about one of Acumen’s longest-running and most successful investments in Water Health International, a company based in India that started with one entrepreneur and a technology for making water clean. It has now opened nearly 300 plants and is providing 400,000 people with clean water for the first time.

As I read Jacqueline Novogratz’s thought-provoking memoir, The Blue Sweater, and drew her out in conversation, I was struck by the qualities of character that equip her for this particular work. She is attentive to the beauty and meaning human beings continually create even in the harshest of circumstances. She has a vision for possibility where other eyes become fixed on obstacles. There is also a deep, surprisingly overt spiritual aspect to the way she talks about the Acumen Fund’s work. At its last annual meeting, she urged her investors — who include hedge fund managers, Google’s charitable arm, and the Gates and Rockefeller Foundations — to nurture “sharp financial edges with strong spiritual underpinnings.”

The Acumen Fund runs a Fellows Program, which draws around 600 applicants annually from 60 countries. In 2009, 59 applicants came from Pakistan alone. And the reading list these Fellows are given is as much about the cultivation of morality, character, and spiritual depth as it is about the cultivation of profitable markets.

Finally, in Jacqueline Novogratz’s “moral imagination” — a phrase she uses with relish — I find intriguing echoes of qualities that I’ve encountered lately in many of my conversations with new leaders from many different disciplines: qualities of listening, of attention, of curiosity. I love this counsel she internalized from the public policy guru John Gardner, one of her teachers and mentors at Stanford Graduate School of Business, and I will pass it on to my children: It is far more important to be interested in the world than to be an interesting person. She even speaks of “the market as a listening device.”

Patient Capitalism in Context with Chris FarrellThis raised some questions for my producers and me, as it did for listeners who’ve followed us on Facebook and Twitter, where we circulated this quote before the program was produced. I also sat down and posed some of these questions to Chris Farrell, American Public Media’s chief economics correspondent, to get a sense of what patient capitalism looks like to thinkers in the more traditional financial world. Jacqueline Novogratz’s vision and practice have spurred my own “curiosity over assumptions” about the moral potential of markets in the 21st-century world, and this is something I’m glad to ponder.

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