Stanford business school grad Jacqueline Novogratz has earned global renown for her work as a venture capitalist. As it happens, the ventures she capitalizes don’t build better mousetraps. Rather, they seek to build a better world, free from poverty, disease and social injustice.
Novogratz is founder and CEO of Acumen, which has invested more than $135 million in hundreds of innovative startups, most of them in developing nations and all in service to the nonprofit’s tagline “Changing the way the world tackles poverty.”
Her friend, Danny Grossman, CEO of the S.F.-based Jewish Community Federation, describes Novogratz as a “changemaker, a movement builder and a moral leader,” which is why he was happy to join her for a Feb. 17 webinar titled “Moral Leadership in Imperfect Times.”
The one-hour conversation was part of the Day of Philanthropy Festival, a series of free, online programs that started Jan. 15 and has one more to go, “The Main Event” on March 10. The Federation’s Day of Philanthropy is usually an in-person, one-day event, but the pandemic forced organizers to call an audible this year.
Grossman started out by asking Novogratz how she became inspired to start Acumen in 2001. Recounting her tenure working for a major Wall Street bank, she said she witnessed “how markets too often exploit or overlook the poor.” After helping found Rwanda’s first microfinance bank, she concluded that “the opposite of poverty isn’t wealth. It’s dignity, choice and opportunity.”
By founding Acumen, she determined it was not only possible but imperative that business direct some of its energy and resources “in service of good. For me it was also in service of the poor.”
Novogratz, 59, devised the concept of “patient capital,” which means investing philanthropic dollars for up to 25 years in transformative startups in India, Pakistan, Africa, Latin America and the United States. As the Acumen website puts it, “Rather than giving philanthropy away, we invest it in companies and change makers.”
The companies run the gamut from organic coffee microfarms to affordable housing construction to agricultural training programs. Acumen gives the startups not only operating capital but also “management experience, the premise [being] we would see outside social returns,” Novogratz said.
She cited a Palo Alto-based startup called D. Light, which launched in 2006 to replace dirty, dangerous kerosene lighting (prevalent in the developing world) with inexpensive and efficient solar lights. Thanks to a capital infusion from Acumen, along with some managerial guidance, D. Light has brought safe, clean solar lighting to 100 million people in need and offset more than 23 million tons of carbon emissions, according to the Acumen website.
“We became the largest off-grid energy investor in the world,” she added.
As Grossman guided the conversation on the theme of moral leadership, Novogratz argued for a reframing of “the systems in which we operate that have been so driven by money, power and fame.” She called for a new “system that dares to put our shared humanity in the center. To build that, it’s time to reimagine all of our current institutions. We don’t have a road map for how to recreate them, but we can build a moral compass, a new set of practices and skills.”
Although she is not Jewish, Novogratz said her decades of friendship with Grossman have given her a glimpse into the charitable habits of the Jewish community. And she wasn’t shy about offering a critique.
“We make one-year grants rather than five-year,” she said. “We make program grants rather than unrestricted. If we recognize that trust is the rarest currency and we focus on using our financial support to enable that, we could do so much more. And then if we use our social capital, our networks and talents, then philanthropy starts to get redefined. We have big problems to solve.”
Novogratz is married to Chris Anderson, a global-issues-oriented entrepreneur who, after taking over the TED Conference in 2002, turned TED Talks into an internet-era sensation.
Based in New York, Novogratz has enjoyed the many privileges of American life, but her track record shows she meant it when she said, “I don’t want to live in a world that sees the poor as hungry mouths to feed, but rather as human beings just like us. If we could unleash their potential, imagine the life we could live together.”