Acumen Fund founder and CEO Jacqueline Novogratz hits the What’s Next Lecture Series
It really could have been worse: A high school freshman wearing an old blue sweater from childhood arrives at school only to be taunted by a nemesis for the garment’s constricting fit. The girl consequently abandons the sweater in a Goodwill donation pile and returns to the other perils that wait in the realm of teens.
Enter Jacqueline Novogratz: international banker turned socially conscious founder and CEO of the nonprofit venture capital firm Acumen Fund. The old blue sweater is the beginning of her story. About 10 years after the disposal of the sweater, Novogratz had left her career on Wall Street and was in Rwanda working to start the country’s first micro finance bank with a small group of women.
“I was jogging through the streets and low and behold, 10 yards in front of me I see a little boy, a pip-squeak, knobby kneed, wearing my sweater, ” recalls Novogratz, who will share this story with the Santa Cruz community at the Oct. 19 installment of the What’s Next Lecture Series. “I run up to the child, grab him by the collar, turn it over, and there’s my name.” The story of the blue sweater is demonstrative for Novogratz of “how interconnected we are, how our action and inaction can impact people we may never know, and never meet, everyday of our lives around the world.”
Under her initiative, the Acumen Fund was set into motion in 2001. This nonprofit venture capital fund has been employing imaginative business solutions and partnerships to solve issues of poverty across the globe. It has invested more than $60 million in initiatives that have provided access to clean water, healthcare, affordable energy, housing and agricultural services to low-income clients in India, Pakistan, and East Africa.
The Fund distinguished itself from other global poverty eradication efforts with something called “patient capital,” which suited it well for an international market. This model is characterized by a greater risk tolerance, expanded time horizons for capital return, opposition to sacrificing the needs of the consumer for the sake of shareholders, and extensive support of the business management. The Fund believes that these factors unite to allow the success of small-scale entrepreneurs that are serving people on an individual level. It is because of the low income markets they are working under that their environments are often full of corruption, and devoid of roads and electricity. It also means they are often pioneering new markets.
“We are building a global community of emerging leaders that believe in creating a more inclusive world through the tools of both business and philanthropy,” says Novogratz.
Because of the use of patient capital, essentially all of the investments the Acumen Fund participates in are traditionally considered “risky.” Although there is a significant risk factor, where losses are a reality and a “necessary part of the learning process,” says Novogratz, the Acumen Fund is not handing these investments out indiscriminately.
“In choosing investments, we look for demonstration of clear social impact with the potential to reach millions of people,” she says. “Our investees are committed both to scaled social impact as well as financial sustainability. Financially, we seek to make back the money we’ve invested in our companies at a minimum.” Success and failure are measured along both social and financial trajectories.
While the potential for failure is always present, the Acumen Fund has experienced a vast array of success. Consider d.light, an international consumer products company that manufactures and sells affordable, quality solar lights to places without access to reliable electricity. With investment from the Acumen Fund at its start in 2008, d.light has expanded to serve more than three million people in more than 40 countries— including India, Tanzania and Kenya.
On Oct. 19, the What’s Next Lecture Series will bring Novogratz to Santa Cruz to discuss her book “The Blue Sweater: Bridging the Gap Between the Rich and the Poor in an Interconnected World.” Through this New York Times bestselling book, Novogratz challenges readers to rethink their impact on the Earth and how they tie in on a global scale through her personal account of a pursuit to understand global poverty.
Novogratz will be opening her lecture at the UC Santa Cruz Music Center Recital Hall beginning at 7:30 p.m. General admission is $8 in advance and $15 at the door; student tickets are $2 in advance and $5 at the door. The Acumen Fund will be celebrating its 10-year anniversary this November, and Novogratz will comment on the expansions planned for the Fund and how anyone can get involved in “changing the way the world tackles poverty.”
To learn more about What’s Next or to buy tickets to What’s Next lectures, visit whatsnextlectures.com.