Rethinking Social Investments: Unreasonable Institute

TorontUnreasonableo I’ve confessed before that after watching the dissolution of ACORN in the US, I’m now obsessed with self-sufficiency.  Philanthropy is too risk adverse and governments are too political vulnerable to be stable funding sources for progressive work.  All of which made me eagerly read the piece in the Business section of the New York Times by Hannah Seligson on the Unreasonable Institute and its young 25-year old founder, Daniel Epstein.  The name seems to have been taken from a George Bernard Shaw quote that “All progress depends on the unreasonable man.”

Ironically, the Unreasonable Institute itself though turns out to be supported by foundations and donations.  They bring wannabe entrepreneurs into Boulder, Colorado for an intensive 6-week program for 26 folks in figuring out how to raise private capital to support social response businesses providing solutions in the developing world.  I will overlook the fact that capacity building in for-profit sector and hopefully successful and profit making business ideas are being nurtured by private philanthropy, which means that while the Unreasonable Institute is promoting entrepreneurship, they are depending on donations for the Institute’s existence and for attendees who are raising money themselves to be able to get to Boulder.  Investors and business have no shame.

Nonetheless, Epstein is both unreasonable and right in developing a program to expand the base to support creative solutions in international work!  ACORN International’s experience dovetails precisely with his analysis.  Funders don’t take many domestic risks, and they are going to take proportionately less risks in international work (see a longer argument in Global Grassroots:  International Perspectives on International Organizing www.socialpolicy.org).

The story Seligson reported on Ben Lyon in Kenya who has started something called Kopo Kopo Inc which has devised “a mobile payment app that helps people make purchases in areas where banks don’t exist or where fees are too high for the poor to open accounts.”  Those areas are everywhere!  Count on the fact that ACORN Kenya will track him down to help in Korogocho…how about something for remittances Kopo Kopo?

On some of the others, who can tell?  More troubling was whether or not investors are really ready to buy, which also unfortunately agrees with our experience as well as we have tried to pitch recycling business models in Dharavi (Mumbai) and other cities as well as proven fundraising programs that are easily adaptable to developing megacities.  An investment director at something called the Investor’s Circle, which finances “businesses with a social or environmental impact” still seemed skeptical based on the distances and the payout possibilities.

Whatever?  If we are going to get traction, we are going to have to move a different direction.   While I’m trying to get my arms around a coffee house and bio-diesel operation, I can guarantee its high risk and hard to make happen, but what choices do we really have?

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