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|Articles - May 2014|
|Monday, April 28, 2014|
Page 4 of 5
IV. Silicon Valley humanitarians
Why do investors shy away from mission-driven businesses in the developing world? Ann Mei Chang doesn’t mince words. “You’re working in challenging environments with poor people,” she says. “It’s not a great equation for people who want to invest.”
A former senior engineering director at Google, Chang now holds the title of chief innovation officer at Mercy Corps, the well-regarded, Portland-based aid organization. Mercy Corps has a long history of working on what Chang refers to as “scalable” social ventures — such as microfinance operations that loan small amounts of money to people in poverty. Now Chang aims to bring her “business expertise, a crisper focus and more rigorous methodology” to these efforts.
Getting investors onboard is part of that project. Enter the Mercy Corps Venture Fund, a Chang-led initiative aimed at attracting early-stage funding to social ventures in the developing world. The fund is seeking a $10 million raise, with about a dozen projects currently under review. “The focus is about creating a business model that can be self-sustainable,” says Chang. “We want to be very rigorous about the projects that look most promising. Only after we prove the model can work can we look at investors.”
One possible candidate is MiCRO, a natural-catastrophe microinsurance startup Mercy Corps launched, along with a local microfinance institution, Fonkoze, and the global reinsurer Swiss Re. Following a pilot project in Haiti, the company plans to add hundreds of thousands of clients over the next five years, emerging with the first global- insurance product that can mitigate natural-disaster losses faced by the poor in Africa, Asia and Latin America.
The Mercy Corps Venture Fund capitalizes on two simultaneous trends: On the nonprofit side, there is growing concern about the limitations of the traditional grant model, in which aid programs receive large amounts of money but often serve a limited number of people. Meanwhile, a new crop of investors, especially in the tech sector, are looking for outside challenges and opportunities. Silicon Valley executives have amassed enormous fortunes, Chang observes. “They are starting to say, ‘I have more money than I need; how can I make the world a better place?’”
In recent years, tech leaders have taken a more aggressive stance on a range of public-policy issues, including immigration reform and government surveillance; in April, executives from Apple, Google and others collectively announced their opposition to the Keystone XL Pipeline. Silicon Valley entrepreneurs can be cynical about USAID projects, says Chang. But incubating a small business and taking it global — “that’s a language they understand.” And while Chang acknowledges some services will always require a subsidy — “the public good of having people vaccinated is high enough, you don’t want to rely on people actually paying” — she says other projects, like financial services and urban sanitation, are well suited to a market intervention.
Mercy Corps, which in April announced a new board member, Gisel Kordestani, former director of new business development at Google, is moving more formally into that space. Says Chang: “We want to figure out how to bring the best practices of Silicon Valley to the NGO sector.”
The problem: “Ninety-five percent of our assets sit in investment accounts, and only five percent are used to do grant work. That five percent doesn’t even come close to what we can do to enhance economic development.”
The solution: In January, the trust launched Invest Oregon, an initiative that will redirect a portion of MMT’s approximately $800 million “corpus” to investment vehicles. So far the fund has invested in the Portland Seed Fund and Ecotrust Forest Management.
The takeaway: “In the past we have focused on nonprofits, but we need to look at social outcomes that come from the for-profit side. There’s a great entrepreneurial environment out there, and we need to start interacting in that space.”
Thursday, July 09, 2015
The sweltering weather didn't keep the crowds away. Although the numbers were down slightly from last year, the Oregon Food Bank raised $850,636 to fight hunger. About 80,000 people attended despite temperatures in the upper 90s.
Tuesday, July 28, 2015
BY JASON NORRIS
Uncertainty in Greece and China, along with potential interest rate hikes mean investors are looking at the market and nervously questioning where they should be invested.
Friday, July 17, 2015
Photographer Jason Kaplan takes a look at Murray's Pharmacy in Heppner. The family owned business is run by John and Ann Murray, who were featured in our July/August cover story: 10 Innovators in Rural Health Care.
Friday, August 21, 2015
Renee Spears, founder and owner of Portland-based Rose City Mortgage, is hot to trot to sell pot.
Friday, July 10, 2015
BY JOE CORTRIGHT
The false promise of economic impact statements.
Friday, July 10, 2015
BY AMY MILSHTEIN
When gossip crosses the line.
Thursday, August 06, 2015
Car and ride sharing services have taken urban areas by storm. Low-income and suburban communities are left at the curb.
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Oregon Sick Leave is here, and changes to the federal white-collar worker regulations are on the way. This workshop will prepare you for both. We invite you to participate in an interactive discussion on how to start planning now for the future impact on your operations and finances.
Presented by OEN + CENTRL + YESpdx.
This Roundtable will cover numerous issues under the employer "shared responsibility" rules of the Affordable Care Act, including how to track the "full-time" status of variable-hour employees, temporary or seasonal employees, and employees who experience a change in status or a break in service. Additionally, we will provide a brief overview of Code sections 6055 and 6056, which require most mid-sized and large employers to submit their first information reports to the IRS in early 2016 regarding the health insurance coverage being offered to employees. We invite you to participate in an interactive discussion on how to prepare for the future impact of the shared responsibility rules on your operations and finances.