In India recently to launch Acumen’s India Fellows Program, Novogratz talks to Forbes India about the importance of leadership in impact investment, and the challenges of working in India. Excerpts:
Q. What is Acumen’s model for creating leaders?
We started in 2001 with the idea that there was a better way to look at philanthropy. We look at long-term patient capital. By 2006, we saw it takes more than capital to build long-term solutions to poverty. We were building companies and what often prevented them from scaling up was the middle management level that was so difficult to hire for, particularly if [the companies] were out in rural areas where no one wanted to live.
We experimented with the idea of Global Fellows and we only take 10-12 a year, but we get 1,100-1,200 applications from 100-plus countries. Jawad Aslam, a Pakistani-American, went to Pakistan to build the first for-profit sustainable housing project for the poor. Tricia Morente came to work for a year at Life Spring, a maternal health care hospital in Hyderabad, when there was one hospital, and ended up staying for two-and-a-half years as the head of marketing. She helped grow it
to nine and [then] 12 hospitals.
Now she’s back in the US working with the Institute for Healthcare Improvement (IHI) Open School at Harvard; with Atul Gawande [a surgeon, writer and public-health researcher], she’s created a website which allows philanthropists to provide monies for the very poor who can’t afford a Life Spring or other low-cost solutions. There are now 80 Global Fellows.
About 4-5 years ago, we were hearing the same thing from our regional advisors: We need more local talent. At the Regional Fellows level, we take 20 for each class; they stay on their full-time roles, most already in the social impact space. While they come together five times through the year—it’s more of an executive MBA type programme. They take classes in values from me as well as some of the technical capabilities needed to scale up social enterprises to serve low-income people. We’re in our first year in India. They will then join the Pakistan and East Africa fellows [and in 2015, the West Africa and Latin America fellows] to form a global cohort.
The collaboration is already happening, which is not something I was prepared for. In East Africa, we have a Regional Fellow working on low-income housing who has reached out to our Pakistani Global Fellow who now sits on this board as an advisor. I met an Indian Fellow working in education who reached out to a Pakistan Fellow also working in online education before he’d even started. The Global Fellows get deeply embedded in our investee companies and the regional ones are building the pipeline for the future.
Q. Why is leadership so important in the impact investment space?
In the impact investment space, everyone laments this lack of leadership. But everywhere I go I see these amazing young leaders. Maybe the problem is we’re not investing in them and giving them the hard skills. This is patient capital for human capital. NGO work is often hard and thankless. We’re hoping to build a community that young leaders can lean on and learn from. We have a fellow who grew up in one of Kenya’s slums—musically gifted and a natural organiser. Because of the fellowship, he got the idea from a coffee shop in New York called Think Coffee. ‘What if you created Think Breakfast for kids in the slums, with pushcarts serving really affordable, healthy breakfast?’ Because of the ecosystem around him, he’s working with Global Fellows, Regional Fellows, team members and advisors who have to go to the slums with him to understand how people make decisions.
Our companies need help with supply chain, marketing and talent. The young ones often don’t have the specific skills our companies need. What’s fascinating is, our Global Fellows come in, in their early 30s, with serious skills. At the regional level, a number of fellows are already managers in companies. Kirti Vardhana, for example, is a manager for LabourNet, which does vocational training.