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Friday, December 01, 2006

Venture Capitalist

I wonder just how many of you read this:

“My mind has ranged far and wide this past week, across great swaths of time and a skull’s worth of topics…glorious past meals, family, friendships, unrequited love, war, venture capitalism, divorce and…letting go.”

…and thought…huh?...venture capitalism!?!

Seems kinda out of place, doesn’t it? It isn’t. Believe it or not, I’ve been spending a great deal of time thinking about venture capitalism lately. Seriously.

Let me explain.

Here I am, sitting atop Maslow’s Mountain, wondering about “self-actualization.” Wondering about doing “good.” Pondering abstract thoughts about living an “authentic” life. Pondering about making
a difference.” Mulling about love, charity and the human condition. There’s a swirl, a maelstrom, in my head. In this time of personal “troubles” all I know is that I want to do “good.” I seek redemption. I seek to please someone…anyone. How shall I do that?

I think I know.

* * *

I’ve been most fortunate. Although I’ve failed in SO many things, although I’ve completely, utterly, failed in love…I’ve continued to be a successful investor. Really. In the past year, I’ve watched my net worth increase by a sizeable amount. I’m not bragging. In fact, I’m thunderstruck. I’ve discovered the truth in that old adage: “The rich get richer…”

Funny thing, though. I don’t care. I really, truly, absolutely DO NOT CARE. My ex will benefit. I’m happy for her. I will have more than I need, more than I want. Money, these days, feels like poison. I’m so tired, sick and disgusted by the seemingly perpetual fight for dollars that the lawyers have been waging (to their respective benefit). I am truly sick and disgusted.

I want to live a modest, simple life (and I shall). I am not comfortable living an affluent life. Affluence seems foreign to me. Dangerous. Destructive. Corrosive. I shall have a simple home. I will be a humble teacher. I shall be a repentant soul. I will put my money to good use.

I will be a venture capitalist. Yup. That’s right. I will be a venture capitalist.
* * *

Just so you know, I was thrilled, absolutely thrilled, to learn that Muhammad Yunus was awarded the Nobel Peace Prize this year. Have you heard the name? A pity if you have not.

Muhammad Yunus is a banker. A very successful banker. He is the head of the Grameen Bank in India. He is also an extraordinary human being. He is a hero to me (and I have very…very…few heroes).

Mr. Yunus asked a simple question: “Why do we lend money only to the rich…and not the poor, the very people who need money the most?” From that simple, humble, logical question came a new way of doing business: “micro-credit” (a.k.a. “micro-finance”). It has been a breathtaking success. The Grameen Bank, to date, has lent several billion dollars to individuals as venture capital, allowing those people to start businesses, new enterprises and start-up ventures that raised their standard of living, brought them out of poverty, provided jobs for others.

These loans have been small, no more than several thousand dollars each, at most, but…they have made all the difference in the world. And the amazing thing is: not a single loan has gone into default! Really. Donald Trump has declared bankruptcy, what? Twice? Trump has stiffed his creditors for billions. Yet, he’s an American hero. Sorry. Count me out. Mr. Yunus is my hero. He has lent billions to the poorest of the poor, and he has been repaid every cent…plus interest. And in so doing, he has lifted millions of people out of abject poverty.

It’s breathtaking.

Here’s what the Nobel Prize Committee said about Mr. Yunus and the Grameen Bank:

“Muhammad Yunus has shown himself to be a leader who has managed to translate visions into practical action for the benefit of millions of people, not only in Bangladesh, but also in many other countries. Loans to poor people without any financial security had appeared to be an impossible idea. From modest beginnings three decades ago, Yunus has, first and foremost through Grameen Bank, developed micro-credit into an ever more important instrument in the struggle against poverty. Grameen Bank has been a source of ideas and models for the many institutions in the field of micro-credit that have sprung up around the world.

Every single individual on earth has both the potential and the right to live a decent life. Across cultures and civilizations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development.

Micro-credit has proved to be an important liberating force in societies where women in particular have to struggle against repressive social and economic conditions. Economic growth and political democracy can not achieve their full potential unless the female half of humanity participates on an equal footing with the male.

Yunus's long-term vision is to eliminate poverty in the world. That vision can not be realised by means of micro-credit alone. But Muhammad Yunus and Grameen Bank have shown that, in the continuing efforts to achieve it, micro-credit must play a major part.”

Mr. Yunus is a personal hero of mine. And I have money, too. I will, henceforth, be a venture capitalist.

The Evangelicals preach that we should tithe 10% to the “Church.” More often than not, the “Church” is a corporation, a private enterprise, a sweet, sweet lifestyle for some fake “Man of God,” (i.e., "false prophet"). A pox on them. A pox on all of that. I do not wish to finance mansions, private jets, fancy rainments, mega-churches (with shopping arcades and ice-cream parlors, even!). But I WILL tithe. This Thanksgiving, I vowed…to myself…and, now, to you…that I will tithe at least 10% of my good fortune to my fellow human beings. I vow to share my good fortune with the far less fortunate.

I will tithe to humanity.

I vow to become a venture capitalist (and a damn good one, at that).

Furthermore, as the loans are repaid with interest, I will reinvest all monies in additional ventures. I will let the money grow and grow and grow to the benefit of the poor who strive so hard to make a life for themselves and others.

I will be a venture capitalist and I will be damn proud of that.

Here’s the thing. It’s SO easy!!!!! Did you know that a blessed collection of individuals banded together in San Francisco to create a venue for offering micro-loans to worthy individuals? Yup. A few truly blessed human beings did just that. They banded together, created a network, and harnessed technology to give all of us a chance to become venture capitalists! They created an organization called Kiva. Here is a link to their site

I hope that at least some of you nameless, faceless (but absolutely beloved) readers take the time to visit Kiva. I hope at least some of you decide to share your personal good fortune with others who seek to make a better life, a better world for himself/herself/others. I hope that both you and they will prosper!

I hope we can all become successful venture capitalists.

* * *

(OK, OK, I’m stepping off my soapbox, now…)

* * *


Blogger soul_rebel said...

I like the idea of microcredit too, but there is an oft overlooked side of the Grameen story.

It should be noted that while its recovery rate is good for a company that deals only in high-risk loans, it's overstated in a way that wouldn't fly on a U.S. balance sheet. The bank accepts massive amounts of subsidies and grants ($1.5bil from the Gates Foundation most recently) that are inaccurately used to counter its losses on paper. There are a handful of governments that donate annually too, and it's unlikely that the bank would float without the help.

But as a pseudo-charity, I don't find much wrong with the donations. I could do without the muddy reporting though.

The other point that's often brought up, mainly by locals, is that a huge percentage of the loans aren't put toward investment, but rather toward consumption...which feeds a nasty debt trap. I think it would be an impossible stretch to say the bank is harming society, but numbers seem to support an even push at the macro level.

I do like that they deal primarily to women though. Gender equality is one of the big lessons up-and-comings need to learn in order to advance economically. Grameen is certainly helping in that respect.

As I said in the beginning, I like microlending and applaud Yunus for dealing in what was previously thought to be an impossibly risky social segment. That said, I'm not convinced it works at every rung of the macroeconomic economic ladder, or that it can stand up without a charity crutch. I have faith in the power of intelligence though and am sure it will be tweaked into something great with time.

Fri Dec 01, 03:26:00 AM  
Blogger Jonas said...

Thanks for your thoughts, Reb. I have not looked into Grameen's balance sheets, nor shall I. I am far more drawn to the Kiva model of micro-lending. It offers the lender-recipient a direct, highly personal, experience. Kiva operates mostly in Africa, but is expanding its network as resources allow. It represents a breath-taking application of technology to the benefit of humanity.

I've not read Yunus' book, but I hope to get to it sometime. The power of his simple, but revolutionary, commitment to micro-lending inspires me.

Fri Dec 01, 11:33:00 AM  
Blogger eleanor said...

you're both so cute.

if you get right ramped up about tithing, feel free to tithe something my way. I'm down to my last $100 (again) and about to head back to Australia. The disintegration (sad, slow) of my relationship is making it hard to be in island paradise with the one you love but can't commit to going out with.

That said, I'm still trying to find a way to fund an internship with the Education Development Centre, in Thailand on their Tsunami Livelihoods, Better Factors and HIV/AIDS education programs.

It's based in Bangkok, so you'd be welcome to visit.

All sponsorship welcome.

PS Jonas, your reflections on the interconnecting stories from your family's past(present) are moving. I'm going to read them slowly another time.

I'm so indebted to the Governor's internet account, I'm going to have to enrol to vote. Several times.

PPS don't start me on my microfinance opinion. Microfinance and gender in particular. However this project has a microfinance component too.

Tue Dec 05, 09:56:00 PM  
Blogger Jonas said...

Nothing I'd like more, Eleanor, than to get your opinion on microfinance and gender. I'm intrigued already.

If you're relocating to Australia, please send me your new address. I still have a book to send. I trust it will be simpler to send it to you there than to PNG.

Tue Dec 05, 11:01:00 PM  
Anonymous Anonymous said...

At some point a few years ago while i spilled money around (not that i was filthy rich)...I found myself with a pack, a car and nothing more...except a 3 yr old who was my boss, working on a farm in NZ picking apples with wild peacocks. I went from luxury hotels to sleeping in my car. It was the most freeing experience of my life.

Fri Dec 08, 10:22:00 PM  
Blogger Jonas said...

Interesting comment, NotFearing. I know what you mean. I grew up poor...very poor. My personal resources have grown over the years, and I'm not poor any more. The thing is, though, I'm still the same person. The things that I value and cherish most in my life have little to do with money (although money makes lots of things easier). I'm also wise enough to know that I'm not particularly wise, that I've made skads of mistakes; despite all that, the Fates smiled at me a certain way (but not in others). I've always been inclined to share. Sharing more is a good thing. Having more means far, far less.

Fri Dec 08, 10:40:00 PM  

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