March 2008

For me last week, it was a week of reunions, inspiration, and hope. We kicked it off with the 2008 Fellows’ Mid Year Meeting. The 3-day reunion allowed us to reconnect as a group, discuss challenges the fellows face in the field, share success stories, brainstorm solutions, support the fellows’ career development and - perhaps most importantly - just be together.

We designed the Acumen Fund Fellows Program to provide much-needed support to our investees, and to build leaders to push the sector forward. It is our sincere hope that they will do it together and support each other for many years in the future. As such, ensuring that the fellows grow as a cohort is an important dimension for us as an organization.

The importance of community was never more front and center than during the Skoll World Forum, on which Ann, Brian and Jacqueline have already commented. Session topics ranged social entrepreneurs’ engagement with governments to the role of women in our work to post-conflict environments to more operational topics, such as metrics, where Brian was a panelist.

One session in particular stood out – Replication and Scale. I had just come from a 3-day session where the fellows talked at length about the challenges they – and the entrepreneurs – face when it comes to scale and replication. From recruiting to business development and fundraising to defining distribution models like franchising, the issues that Chuck Slaughter of Living Goods, Martin Burt of Fundacion Paraguaya, and Dorothy Stoneman of YouthBuild discussed resonated quite closely with what the fellows struggle with as they too face similar challenges with our entrepreneurs.

I had the privilege of participating in a panel during this week’s Skoll World Forum about performance measurement. Called Mirror, Mirror On The Wall What’s the Impact of This All?, I was joined by Joe Madiath of Gram Vikas, Jeroo Billimoria of Aflatoun, David Bonbright of Keystone and Fay Twersky of the Bill and Melinda Gates Foundation. I think that, in the past five years, there has been a remarkable convergence among both funders and practitioners in our community regarding the need to develop rigorous performance metrics. Thankfully, there’s also an emerging consensus around the need to be careful about how much impact can be attributed to our various programs.

Roger Martin, Dean of the Rotman School of Management and a Skoll Foundation Board Member summarized the areas of convergence on the panel with the three P’s: positive, precision and pluralist. All five of us agreed that you should not measure if it does not add (positive) value. Too much time and energy is wasted on evaluations that don’t add real insight and distract from program execution. Joe and Jeroo both spoke of how real time information helps them manage their programs, and how their staff and partners have come to find real value in measuring. Whether it is Joe’s ability to claim that a $1 investment in sanitation and water infrastructure leads to a $10 return of community value, or whether it is Jeroo convincing her Aflatoun partners that real time information allows for them to improve and innovate their financial literacy programs, metrics must and can add value.

From positive to precision: as Fay pointed out, the field needs to be very careful about impact measures that require careful framing, controlled research and counterfactuals, versus measures of outputs (number of houses built, liters of clean water sold). A narrow focus on outputs, however, can shift the focus from the measurement of broader, system -wide change we are seeking to have. Then again, one needs to think with precision about what systems our programs are seeking to change and how.

Finally, pluralist: metrics need to account for the voices of the voiceless. As David Bonbright argued, measurement systems need to allow for the recipients of programs or services to be part of the feedback loop.

All in all, it was quite an event – kudos to the organizers!

Thursday afternoon of the Skoll World Forum also offered so many interesting panels that the choice of which to attend was hard. Editor’s note: this was not the first time Ann had a hard choice of panels this week. I buzzed between a panel called “Mirror, Mirror on the Wall, What’s the Impact of this All?” which tackled social impact and metrics to track it (Acumen’s Chief Investment Officer, Brian Trelstad, was a panelist) and another called “Addressing the Talent Gap,” on which Acumen’s Talent Manager, Deepti Doshi, was a panelist.

Marc Freedman, CEO of Civic Ventures, was also on the Talent panel and described his organization’s initiatives redirecting mid- to late-career executives in the private sector to work with social entrepreneurs and innovators addressing pressing issues. Civic Ventures has an innovative Senior Fellows program which selects high performing baby boomers and places them with NGOs or social entrepreneurs for a year. Half of the stipend is paid by the NGOs and half by the Fellow’s corporation. Freedman passionately described the Fellows as folks who feel “midlife is getting to the top of the ladder and finding it was leaning against the wrong wall.”

Through the first 2 days, the Forum’s highlight was definitely the evening speech by former U.S. President Jimmy Carter. He is 84; witty, erudite and humble all at the same time. He described responding to Jeff Skoll’s invitation with the question: what is a social entrepreneur? Jeff responded “you are one, Mr. President.”

I had the honor to play a small part in the last session of the Skoll Foundation’s World Forum this year.

The first speaker, Paul Collier - author of The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It - is a longtime hero and advisor to Acumen Fund. He spoke of the need to move beyond thinking about the bottom billion as consumers of products but rather as producers. He went on to talk about the need to think in broader terms about bringing a combination of business skills, public finance to enable the business environment, and real and concerted public action to bear. Mr. Collier also discussed the critical need to focus on job creation and on bringing affordable basic services like water, healthcare, housing, energy and education to the poor. It was thrilling to hear him, and I could only feel pushed to get better and smarter in taking our models for service delivery - and job creation - to scale, in part, through more effective partnerships with governments and philanthropies.

Paul Farmer - founder of Partners in Health and an eloquent advocate for human rights and public health - spoke of the need to focus more on social justice issues, to realize we are truly one world now and that the rich need to change if the poor are ever to have a chance. The clinic he is building in Rwanda is world class and, most important to Paul himself, brings dignity to the low-income members of the community it serves.

Last week, 600 individuals — including a number of leading professionals from India who sacrificed their Holi, Easter, Eid Milad and/or Navroz holidays with their families – gathered in Philadelphia for the 12^th annual Wharton India Economic Forum. This conference was founded in 1996 by then-Wharton student, Vinnie Badinehal, now Managing Director at Merrill Lynch (the lead sponsor for the conference), who recognized the value of a shared dialogue on the opportunities and challenges in India, long before India was in the media spotlight.

What was perhaps most exciting to me, as an Acumen Fund team member, was that every panel - not just the development panel - talked about the need for more inclusive growth in India, to take into account the 70 percent of the population that lives in villages or the 80 percent of the population that still lives under $1 a day - to enable the provision of basic services like clean water, affordable healthcare, and education.

Tejpreet Chopra of General Electric in India, discussed the challenge – faced by all companies in India – of bringing down the price of their products/services to a level that is affordable to a majority of Indians. It’s certainly a challenge that Acumen Fund and our entrepreneurs also confront, and we think sharing knowledge of what works and doesn’t in these markets is key to overcoming the distribution and pricing challenges that stand in the way of people having affordable access to basic services.

Thursday morning’s break-out panels were difficult to choose among. I had every intention of visiting several, but ended up staying the full two hours at the panel called “Hybrid and For-Profit Business Models,” moderated by David Brancaccio, host and senior editor of NOW on PBS.

The room was packed. Tina Seelig, Executive Director of the Stanford Technology Ventures program talked about an international competition in which business school teams are given 5 days and one Post-It pad to come up with a project that “creates value” under any definition. 95% of the projects submitted were social enterprises.

We also heard from Tralance Addy, President and CEO of Waterhealth International (WHI), an Acumen investee. Tralance described a dam - built 40 years ago in his home country of Ghana - which displaced thousands of people during construction. Those people are still waiting for drinkable water today and the government is still debating what to do about it. This kind of paralysis inspired Tralance’s commitment to private-sector solutions.

The opening session of the Skoll World Forum last night was a terrific reminder of the value of bringing different perspectives together and having the chance to stop and listen and reflect on the work that we do. The two most memorable speakers in the formal program, in my opinion, were Phil Hope, the Minister of the Third Sector in the UK, and Karen Tse, of International Bridges to Justice, a network of legal clinics and public defenders working for judicial reform around the world.

The Minister’s comments were the most forward thinking and provocative about the social enterprise that I had heard from an elected official: he talked about how social enterprises can tap into capital markets, how we might be able to create a social stock exchange, and the need for more transparency and accountability in thinking about impact.

Karen Tse was talking on a panel about how to navigate across cultures; she commented that the oversimplification of cultural difference often leads to mistaken assumptions. For example, she said that as an Asian woman, she often found the overt biases working in Asia to be easier to overcome than the subconscious biases she faces in the West, or that there are in fact some universal principles of justice that we should not be afraid of promoting globally. She reminded us that she and her colleagues view compassion and recognizing our interconnectedness as the essential tools to being personally effective in this work.

And of course, the value of any conference is who you meet in the halls and at the receptions. There are many personal friends, friends of Acumen Fund, and new faces who are on a shared journey of inquiry about how to make social enterprises more effective. More later.

I like late March. Here in New York - and in Washington, where I used to live - late March is when spring starts to take hold, bringing longer, warmer days. It’s also when the annual Skoll World Forum takes place, bringing a breath of fresh air to cloudy, rainy England (apologies for the weather metaphor). For a review of Forums past, check out Jacqueline’s blog post from 2006 and Kevin Jones’ guest post on NextBillion from 2007.

I sincerely hope for good weather in Oxford this week, since a number of my Acumen Fund colleagues (and numerous allies from throughout the ‘base of the pyramid’ community) will be attending the Forum. Then again, rain might be for the best - that way, no one is tempted to spend time outside, away from the excellent sessions. I am particularly impressed with this year’s lineup, and its theme: social entrepreneurship: culture, context and social change.

If I had to choose, here are some of the sessions I would mark on my planner as “must-see.” Unfortunately, some of them are being held simultaneously…so be sure to check out posted synopses online (see below for more info on blogging at the Skoll World Forum.)

When talking with people inside the “base of the pyramid” (BoP) community, I often hear strong opinions about how BoP ventures should be set up. Some people strongly support registering these ventures as for-profit entities, while others maintain that BoP activities can start out as non-profits and transition into formal businesses later.

There is no one answer, and this is not a straightforward discussion. The legal and financial implications of a for-profit vs. non-profit organization are myriad, and I don’t claim to understand them all by any means.

Thankfully, a new article in the Stanford Social Innovation Review explores the tension between for-profit, non-profit and hybrid structures. The Funding Gap - written by Jeff Hammaoui, Eliot Jamison and Michael Chertok - explores the social enterprise capital market and how the BoP community can address recurring legal, financial and funding issues associated with it.

Today marks the 16th annual observance of World Water Day, as designated by the United Nations in the afterglow of the 1992 Rio Earth Summit. Thankfully, World Water Day is more than just a random entry in the “did you know” section of your day planner; it is well-publicized, discussed and observed around the world. Building on that, we at Acumen Fund thought it would make sense to review what’s going on this year.

For an excellent overview, check out Greg Lamb’s article in the Christian Science Monitor. Lamb mentions a number of critical statistics and reports; this is a good place to start.

In the blogosphere, Acumen Fund ally GOOD Magazine is dedicating their blog to World Water Day today. Check it out. (And – if you haven’t already – subscribe; your 20 bucks goes straight to Acumen! Besides, it’s a good read…no pun intended.)

Over on TreeHugger, correspondent Lloyd Alter focuses on World Water Day’s 2008 theme: sanitation. In a nod to archived blog posts, I wrote about the “base of the pyramid” penalty and water last year on NextBillion.net. The numbers may have changed slightly since then, but the message remains the same: low-income customers remain critically underserved and generally face incredible price premiums when it comes to water.

We have a deal!

With those words, Kofi Annan announced recently that Kenya’s leaders had agreed to share power in a coalition government. I was on my way back from Embu when the radio DJ interrupted Rihanna’s “Umbrella” - a favorite here - to announce the news. My taxi driver, Samuel, pulled over and gave me a big hug and we both got choked up. “At last,” he said with a huge grin. After weeks of anxiously watching violence and then negotiations, celebration erupted in the streets and bars of Nairobi and Kisumu.

Spirits are generally high at the moment, though not everyone is celebrating yet. I sent my friend Alex an IM: “Good news?” “I’ll believe it when I see it,” he replied. The 2-page document signed by Kibaki and Odinga is big on symbolism, but not on details of the way forward. It remains to be seen if the two men, who ran on very different platforms, will be able to agree on anything. And as a colleague pointed out: “What makes you think Kibaki will follow through this time?” (Kibaki backed out on a power-sharing agreement with Odinga in 2002.)