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 This bullet point is not from me. It is from Julien Fortin, my associate in a new consulting group we are quietly launching. He also found the name of this group, Palaam, meaning bridge in Tamil. But I won't say more now, and just copy/paste what he learnt by reading The Blue Sweater, by Jacqueline Novogratz, Acumen's founder and CEO. He is part of our current "back to basics" effort. Read, interview... to find the way we want to act in this fascinating but confusing BOP universe. So, of course, it doesn t mean that we share all that we read and write in this blog, but that we hear!
A small personal reflexion. The more I read, the more I meet, the more it looks like BOP share a lot with start ups! Immature markets, infinite players trying to find their way because technology is more and more affordable, struggling to find an efficient model, claiming that they found but rarely really sustainable!
General overview The life and work of Jacqueline Novogratz, Acumen’s founder and CEO. An interesting book: the author undoubtfuly managed to create a “successful” organization - that means an organization that is up and running for several years, that is not loosing money and that was involved in a wide spectrum of projects in different fields: health, energy, water, information access... One might agree or not agree about some of her conclusions - but the book is full of case descriptions, successes and failures, and there are probably quite a few things to learn from it. A long description of the Rwandan conflict, though interesting, is the only part of the book that does not really seem to fit with the rest of the content, focused on trying to find an approach to eradicate poverty. The last 40 pages are a bit too much dithyrambic about Acumen fund - but well, she’s selling her organization.
Important points - Forprofit is important in philantropic actions.
- Grant is not as efficient as loans, since the recipients are not involved or held responsible for their usage.
- Non-profit organizations have to be performance-oriented, and use same evaluation and management tools and standards than forprofit.
- Technology is not enough: finance, distribution and marketing is equally important for quality services and products to reach the poor.
- Markets are an important feedback mechanism.
- Necessity to have strong teams on the ground
- Necessity to understand the social environment and stigma attached to certain needs to give the best services (see hearing aid example below).
- Market and philantropy are both important to address the problem of poverty.
Quotes - “ I also began how to reflect on how to build accountability into nonprofit organizations. Donors could convince themselves to give to nonperforming organizations based on hearing a few good stories. The world needed better than that.”
- “We asked the Rwandan women to contribute some of their own money, despite being told by ‘the experts’, who were fare better in theory than practice, that women were too poor to give anything. Though the women didn’t have much, nearly everyone we met donated what they could, helping to build a real partnership with local participation.”
_ “ The stry of the bakery was one of the human transformation that comes with being seen, being held accountable, succeeding. I had the privilege of watching the women acquire a sense of dignity once they were given tools to self-sufficiency, and I learned that languages is perhaps onl half the equation in how people communicate with one another. I discovered the power of creating a business with real accountability. And I learned to be myself and to laugh at myself, to share in the women’s successes, and maybe mot importantly, to listen with my heart and not just my head.”
- “ If the donors had really examined those women’s projects after a year, they would have seen how few successes here had been and might have alredy made the needed course corrections. They certainly could not have justified pouring millions more into the projects. It was too easy to be blindsided by the singing and smiled of happy testimonials of the women. If the women had been given the chance to borrow for a project they belived cold generate income, they would have focused more seriously on the work. A market mechanism would have provided a better feedback loop for both women and donors. Instead, the system festered under low expectations and mediocre results.”
- “Big flows of aid can create as many incentives for corruption and mismanagement as for change. Markets alone won’t solve the problems of poverty. Low-income people are invisible to most entrepreneurs, who don’t see them as paying customers. Poor distribution, lack of infrastructure, and corruption all add up to a a failure of markets to deliver to the poor what they want and need at prices they can afford. What is needed going forward is a philosophy based on human dignity, which all of us need and crave. We can end poverty if we start by looking at all human beings as part of a single globa community that recognizes that everyone deserves a chance to build a life worth living.”
_ “ Just start. Don’t wait for perfection. Just start and let the work teach you. No one expects you to get it right in the very beginning, and you’ll learn more from your mistakes than you will from your early successes anyway. So stop worrying so much and just look at your best bets and go.”
_ “ We had’nt counted on the fact that most individuals are interested not in the technologies themselves but in the services they provide. With cataract surgery, people go from being nearly blind to having sight and being to work again ; that change can be the difference between life and death. Given that a tailor, for example, depends on his eyes for his very livelihood, an investment in sight is worth the price. Most farmers, tailors, shoemakers, and laborers can continue to work, however, with a loss of hearing. This is cmplicted by our human tendency towards vanity: many feel a sense of shame at wearing a hearing aid, wheras no such stigma is attached to glasses. Consequently, individual demand for the [low-cost] hearing aid was low. There was a market for the devices in hospitals [...] but the market among the poor themselves was limited. [...] Price was not the only factor in delivering services to the poor.”
_ “Doing this well requires a certain kind of leadership, one that starts with listening, knows how to collaborate, is not satisfied with easy but incomplete answers, and is driven by finding soutions for those with the least in a single world community.”
- “There is a powerful role both for the market and fr philantropy to play in creating this future. Philantrop alone lacks the feedback mechanisms of markets, which are the best listening devices we have, and yet markets alone to easily leave the most vulnerable behind.”
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