Delve into an insightful conversation with Jacqueline Novogratz, Acumen’s founder and CEO, as she discusses her journey of social entrepreneurship.
Novogratz shares her unique perspective on how humility and audacity can work together to create a significant impact on poverty and inequality.
The discussion also sheds light on the role of storytelling, the power of private-public partnerships, and the potential of impact investing.
The Making of a Social Entrepreneur
Jacqueline Novogratz’s entrepreneurial journey was influenced by her early experiences growing up in a large, low-income family.
Her exposure to the financial exclusion of the less privileged during her banking career motivated her to use financial tools to extend opportunities to marginalized communities.
Transparency in Impact Investing
Novogratz highlights the need for transparency and clarity in measuring impact in the burgeoning field of impact investing.
She warns against the risk of cynicism resulting from a lack of truth and accountability in the sector.
The Role of Private Sector Leaders
Novogratz identifies private sector leaders as key players in addressing major global issues such as poverty, inequality, and climate change.
However, she underlines the importance of partnerships with other stakeholders, including the government, for effective problem-solving.
The Power of Private-Public Partnerships
Novogratz provides the example of Zeraki, a private sector company that is improving public education in Kenya, to illustrate the effectiveness of private-public partnerships in achieving large-scale impact.
Poverty is so much more than income. Poverty is a lack of choice, it’s a lack of opportunity, it’s a lack of agency, it’s a lack of feeling that you can contribute. That’s what dignity is, the opposite, it’s not about wealth, it’s about having that choice, having that agency, having that ability to contribute. – Jacqueline Novogratz
Guidance for Future Leaders
Novogratz advises aspiring leaders to start working on their dreams and learn from the work itself, rather than waiting for ideal conditions or resources.
She encourages them to take steps towards realizing their dreams and solving problems they are passionate about.
Microfinance in Rwanda
Novogratz co-founded the first microfinance institution in Rwanda in 1986, empowering women who had just gained the right to open bank accounts.
However, she recognized that microfinance alone could not eradicate poverty, leading her to pursue an MBA at Stanford to learn how to build larger, job-creating companies.
The Birth of Acumen
Novogratz founded Acumen in 2001 with a vision to balance dignity and capitalism.
Despite initial skepticism, she persisted in her mission to redefine poverty and social entrepreneurship, demonstrating that it is possible to combine the strengths of capitalism with a focus on dignity and agency.
Impact Investing and the Importance of Dignity
Through Acumen, Novogratz has played a pivotal role in the field of impact investing.
She has shown that market forces can be harnessed to extend opportunities to underserved communities, while ensuring dignity and agency are at the forefront of these initiatives.
The Role of Storytelling
Storytelling has been a key factor in Acumen’s growth.
Novogratz emphasizes the power of sharing nuanced stories that inspire change and investing in people to enable them to narrate their own transformative journeys.
Building trust through honesty, capability-building, openness, and active listening has also been crucial.
If you could drive your systems towards dignity, not just profit or not just feel good, touch a lot of people without helping them transform their own lives, maybe we could do a better job. I felt by then, Kathleen, that philanthropy was broken, but so were markets. If we were really focused on solving our biggest problems of poverty, and so many of those solutions are within our hands, so let’s try a new way. – Jacqueline Novogratz
The Balance Between Humility and Audacity
Novogratz underscores the importance of ‘hard-edged hope’ and striking a balance between humility and audacity in building purpose-driven companies.
She shares how this balance has been instrumental in solving large-scale problems, such as bringing electricity to 150 million people.
Embracing the Long-term View
Novogratz stresses that addressing the world’s most pressing problems requires a long-term commitment.
She highlights the need for pioneers to build vertically integrated companies and repair broken systems, as exemplified by Acumen’s Hardest-to-Reach initiative, which aims to bring electricity to the 250 million people still overlooked despite advancements in the sector.
The Emergence of Ecosystems
Novogratz observes that investing in companies over a long period, particularly in a specific geography, can lead to the emergence of an ecosystem.
She cites the significant increase in Kenya’s electrification rate due to such investments as an example of their transformative potential.
