This is a powerful article (The Rise of the Rest; Newsweek - May 3) by Acumen advisor Fareed Zakaria, who argues there is a case for real optimism in the world. In fact, he believes – as do I – that we are living in one of the most important moments in history.  There is less violence today, more resources, and more interdependence than ever before.  The key challenge for the United States will be to recognize the changing nature of a world where there are many players – and the wonderful benefits that can come of that.

For Acumen, our challenge is to help “push the inevitable”, as John Gardner used to say, and identify and scale those innovations that help all people on earth gain access to the goods and services they need to solve their own problems.  Through our work, we can be a further reminder that we are a single world, each of us dependent on the action – and inaction – of players all across the globe; and that we have the collective opportunity to solve those problems of poverty that most vex our ability to leave peacefully and prosperously.

I urge you to take a few minutes and read this article.

Editor’s Note: We received this appeal from Acumen Fund ally Cameron Sinclair, the co-founder and executive director of Architecture for Humanity, a charitable organization which seeks architecture and design solutions to humanitarian crises and provides design services to communities in need. We have re-posted his appeal in an effort to spread the word about this latest disaster.

It has been less than 24 hours since Cyclone Nargis hit the heart of Myanmar (Burma). Government figures have reported 15,000 dead but reports claim it is now 22,000 and in the coming days it may move closer to 50,000. While the media will focus its attention on the loss of life there will be millions displaced in the coming weeks and like most natural disasters no plan for long term sustainable reconstruction. Large aid agencies like Oxfam and Care will be knee deep in immediate delivery of aid however how will the country respond to the long term strategy need to rebuild the country.

We are currently reaching out to our community. We will need to raise a minimum of $10,000 to provide design services to communities affected by the disaster. This is a small start, but could affect tens of thousands of those displaced.

Find out more and donate at the Architecture for Humanity web site.

Last week, I attended a session of the NYU Reynolds Program series “Social Entrepreneurship in the 21st Century,” with speaker Paul Farmer (our own CEO, Jacqueline Novogratz, spoke in an earlier session). Farmer is a physician-anthropologist who co-founded Partners in Health, a non-profit providing health care service to poor in various parts of the world (including Haiti, Rwanda, Peru, Russia, Lesotho and Malawi). Partners in Health is also a leading public health research and advocacy organization.

Dr. Farmer coined his talk an ‘insider’s critique’ of social entrepreneurship, and started by wondering whether he was in fact a social entrepreneur. Does he, by his own definition, bring real innovation to solving big problems? What’s so innovative about what he does? Partners in Health basically says that poor people deserve basic health services and then makes it happen. Farmer thinks that access to those services should be a right enjoyed by all people. However, the fact is that most of the world’s poor don’t have access to basic health needs – even defined by mid-19th century standards: clean water, food, sanitation. (Amartya Sen might describe these deprivations as “unfreedoms.”)

According to Farmer, the efforts of most social entrepreneurs are falling short – despite the best of intentions. Their innovations are not reaching the people they are designed to help. Much hard work is being done, but it is scattershot. He asks the questions: are we innovating merely for the sake of innovating? Are we targeting the right problems? Answering himself, he argues that we must keep our innovations grounded in solving the problems of the poor.

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Pangea Day is an international event that will bring the world together through film.

In a world where people are often divided by borders, difference, and conflict, it’s easy to lose sight of what we all have in common. Pangea Day seeks to overcome that - to help people see themselves in others - through the power of film. (Watch Pangea Day organizer Jehane Noujaim’s TED Talk about the concept; Noujaim is a 2006 TED Prize winner.)

Live events in Cairo, Kigali, London, Los Angeles, Mumbai and Rio de Janeiro will be linked for a program of powerful films, live music, and visionary speakers including Queen Noor of Jordan, CNN’s Christiane Amanpour, musician/activist Bob Geldof, and Iranian rock phenom Hypernova. Pangea Day is a live broadcast - in seven languages - featuring powerful films, visionary speakers and inspiring music that will reach millions of people worldwide through public and private gathering places and through the Internet, television, digital cinemas and mobile phones.

Join members of the Acumen Fund team at The Paley Center for Media – a great venue for Pangea Day. Starting on Saturday, May 10 from 2:00 to 6:00 pm, the entire Pangea Day will be broadcast live. Don’t miss this opportunity to gather together locally and connect with the international community (through media) globally.

The Paley Center for Media is located on 52nd Street between 6th and 5th Avenue. Pangea Day is a free event - typical admission charges to the Paley Center do not apply, just remember to mention ‘Friends of Pangea Day’ when you arrive. We hope to see you there on Saturday! And if you’re not based in New York (or if you won’t be here on Saturday), please be sure to check out the Pangea Day web site, where information on thousands of venues can be found with just a few clicks.

As I turned the corner, it appeared almost out of nowhere - a monument to the successes (and failures) of capitalism - the New York Stock Exchange. I had ventured downtown to attend the premiere of Carol Pineau’s new documentary, Africa Investment Horizons, which was being screened inside the Exchange. As first impressions go, you could do no better: it’s impossible not to take Africa’s investment potential seriously when you’re talking about it inside the center of the financial universe.

Even the security line was interesting: long but vibrant, an impromptu salon of Africanists, investors, expatriates and activists, all of whom share a passion for the business of Africa. Not surprisingly, I saw a number of base of the pyramid allies: Liz Wald, of EDI Imports; Emeka Okafor, of TED and Timbuktu Chronicles fame; Joy Sun, COO of Market for Change. This was going to be a good event.

Before screening the movie, we heard from Carol Pineau, its director. Pineau’s previous film, Africa: Open for Business, came out in 2006 and served to shine a spotlight on the quantity and quality of business opportunities in Africa. (Both high, by her estimation, and underexploited.) That conclusion was a natural starting point for Africa Investment Horizons: if there were high-quality, under-exploited business opportunities in Africa, wouldn’t that be a recipe for solid returns?
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This past Tuesday in New York, Acumen Fund hosted a breakfast featuring Aun Rahman, our Pakistan Country Director and longtime Acumen Fund employee. The event began with Omer Imtiazuddin – Acumen’s health portfolio manager – introducing Aun. Before joining Acumen Fund, Aun worked for five years in economic and strategy consulting at Charles River Associates in Boston, specializing in financial modeling and quantitative analysis. Aun joined Acumen in 2003 as a Fellow, working for 18 months our investee, Saiban, to structure and incubate an affordable commercial housing project in Lahore and to develop the organization’s management information systems.

In 2005, he became Acumen Fund’s Country Manager in Pakistan. Originally from Karachi, Aun came to the United States to attend the University of Chicago, where he earned a BA in Economics. At the conclusion of his introduction, Omer remarked how he and Aun actually went to school together (in grade six) but only realized their shared history upon joining Acumen Fund. It is indeed a small world.

Aun began his talk by giving a demographic overview of Pakistan. Seventy percent of Pakistanis earn less than $2/day; fifty percent of the urban population lives in slums; seventy percent of Pakistanis don’t have access to clean drinking water. Not only that, but recent commodity price increases have put a squeeze on the purchasing power of the poor, exacerbating some of these (older) figures.

After his overview, Aun began the heart of his presentation by talking about Saiban, an incremental housing model targeting the urban slum population. The poor aren’t offered housing options in the current economy – it’s too expensive, on the wrong time schedule, and scarce. To address these issues, Saiban has developed a model based on the informal housing sector. Specifically, Saiban works with people in low-income communities who build their homes over a four or five year period – not a traditional housing or real estate model.

Acumen became involved to help Saiban accelerate and scale up the incremental housing process. When we came in, Aun notes, it was already a holistic business – they weren’t just building homes, but also the infrastructure, and facilitating financing and land purchase as well. Acumen’s assistance came in the form of a $300,000 grant/loan in 2005, as well as the services of Aun (Fellow, 2004) and Jawad (Fellow, 2007) working directly with Saiban’s team.

As far as impact, Aun displayed a slide noting that there are 22,000 residents living in 2 communities built by Saiban. There are schools, mosques, stores as well as a range of utility services (water, electricity, sanitation, etc.). Finally, and perhaps most interestingly, there’s a formal mortgage financing scheme for the poor – a first in Pakistan.
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Congratulations to Acumen Fund friend and ally Martin Fisher, who today was named the winner of the Lemelson-MIT Award for Sustainability.  Fisher - who co-founded KickStart - will be awarded $100,000 for his work developing a low-cost irrigation pump and the business ecosystem to design, produce, sell and repair them in base of the pyramid communities.

Media coverage of Fisher’s award is widespread; the Boston Globe has a good article on the announcement, and PopSci makes a mention as well.

To celebrate, be sure to watch “Don’t Wait for the Rain,” a social marketing rap video produced about KickStart’s signature MoneyMaker pump.

Editor’s note: Batool Hassan recently joined Acumen Fund’s Pakistan office as a Knowledge & Communications Consultant. She recently completed her Masters of International Affairs from SIPA, Columbia University, and moved to Karachi late last year. Batool has microfinance consulting experience and has worked in the US consumer banking sector.

A recent article published in the World Bank’s Development Outreach, “Microfinance: Climate Change Connections,” discusses the potential relationship between microfinance and climate change. It highlights an interesting link between innovations in environment-friendly products and how microfinance can facilitate access to these products for the base of the pyramid (BoP).

The article points out that many members of the microfinance community have often viewed environmental concerns as a ‘luxury’ their low-income clients can ill-afford to consider.

But recent partnerships between renewable energy companies and microfinance institutions point to possible collaborations that will allow low-income households to gain access to cleaner/renewable energy technologies.
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I have had the privilege of interning with Helen Ng, Acumen Fund’s Housing Portfolio Manager, for the past couple of months, and I wanted to share some perspectives with you. I hail from the private sector and am currently a business school student at Columbia here in New York City. It’s been a fantastic ride here at Acumen Fund, and an eye-opening one at that.

One thing that I learned quickly was that Acumen Fund truly embraces the importance of addressing problems faced by the BoP with a business mentality. When we look at potential deals, the first litmus test is always: “is this an economically-viable business model?” With several ex-Wall Street-ers at Acumen, concepts such as cash flow and ROI invariably work their way into discussions about potential and current investments. And for the strategy buffs out there, frameworks such as Porters Five Forces are tools that are helpful in vetting triple-bottom line businesses as well!

This type of analytical rigor is part and parcel of a disciplined portfolio evaluation process. I sat in on a portfolio review session recently, and was blown away by the team’s in-depth, holistic approach to evaluating portfolio investments. Not only were topics such as management quality and barriers to entry discussed (areas that any VC would lay awake at night thinking about), but an investment’s ability to generate knowledge for the BoP development space is valued highly as well. And that’s what I appreciate so much about my Acumen experience. The billions of poor who subsist on less than $4 a day are treated as partners and shareholders. All major decisions are made with the BoP in mind.

Outside of Acumen, I am busy finishing up my first year at Columbia Business School. Students are incredibly in tune with new development models, as pioneered by visionaries such as Acumen. In fact, students recently launched Microlumbia, the first microfinance fund of its type initiated by any business school program. The fund will make its first investment in the near future, so stay tuned for more.

Dorah’s Senye Clinic in Kibera has a new addition today: A small refrigerator that allows her to add immunizations to her list of services.

“I’ve always had to send customers to immunize their children elsewhere,” Dorah describes. “No smart business-person sends customers away.”

With limited resources, Dorah has to work extra hard to meet customer demands. But she continues to find innovative ways to meet her customers needs. And they respond … Dorah is one of the most successful franchisees in the network.

I arrive to Senye today just in time to see Grace bring her 2 month old son to the clinic. Grace could take Trevor down the road for free immunizations, but chooses to pay the small fee at Senye because: 1) Dorah met her demand and 2) Dorah provides unmatched customer service. Despite 12 hour days and a long commute, Dorah treats her customers with dignity, personal attention, and quality care.

Even in a resource-constrained environment, basic business principles remain true: Meeting customer demand and providing quality service means happier and more loyal customers. Grace & Trevor will be back in a month for their next check up.

(This post first appeared on the Acumen Fund Fellows’ blog, Immersion)

Yesterday in New York, I had the pleasure of attending a round table organized by the Council on Foreign Relations entitled The Commercialization of Microfinance: The Good, The Bad and The Ugly. Moderated by CFR Senior Fellow Isobel Coleman, the discussion featured comments from Mary Ellen Iskenderian (of Women’s World Banking) and Roshaneh Zafar (of the Kashf Foundation.)

I arrived early, set up my laptop and grabbed a bite to eat (if you’re curious, the CFR building is beautiful and they do a good lunch spread). Before I was through my sandwich, the room had filled to capacity and CFR staffers were scrambling to set up overflow seating – there’s clearly a lot of interest in the recent controversy surrounding microfinance. It was quickly apparent that women outnumbered men in the audience by a ratio of about 2:1 – interesting, though not completely unexpected given the importance of women in microfinance and the fact that the speakers and moderator are all women.

Coleman kicked off the session with brief introductions and quickly segued into the topic at hand – the good, bad and ugly of microfinance. She stated – without dissent – that microfinance now finds itself at an inflection point. On the one hand, there have been calls for microfinance not to profit off the backs of the poor, notably in the New York Times’ coverage of Compartamos’ IPO. On the other hand, those who know microfinance realize that it can’t scale – from 100 million clients today to its potential market of 4 billion – without the capital markets, and the formality capital markets require.

I thought Coleman did a good job setting the stage here. From my perspective as a quasi-insider, there wasn’t much new – but it is important to say nonetheless. Microfinance can and will go one of two directions, and it’s pretty clear that there are strong arguments being made by advocates on either side.

Mary Ellen Iskenderian was next to speak. She is President and CEO of Women’s World Banking (WWB), the world’s largest network of microfinance institutions and banks. Iskenderian leads the WWB global team, based in New York, providing hands-on technical services and strategic support to more than 50 top-performing microfinance institutions and banks around the world. Iskenderian told us that WWB’s network MFIs have a total portfolio value of $1.4 billion and an average loan size of just $500. Those MFIs serve roughly 9 million clients and there are another 14 million clients served through WWB affiliate banks. Of WWB’s 23 million clients, approximately 70 percent are women.

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What’s big, red and innovative all over? No, it’s not Clifford’s supremely creative cousin – it’s Entrepreneurship@Cornell. A university-wide initiative, Entrepreneurship@Cornell is unique in bringing together students, faculty, alumni and outside experts across a range of sectors (hospitality, biotech, real estate, venture capital, law and more were all represented at the event I attended last week). Other universities could learn from Cornell’s approach – a truly multidisciplinary program is hard to find in academia, so kudos to the Big Red for getting this one right.

I went to Ithaca last Thursday and Friday to participate in Entrepreneurship@Cornell’s annual celebration. The 2 day event featured a gala dinner, entrepreneur expo and – of course – panel sessions. Thankfully, the panel session in which I participated was well organized and expertly moderated. (No coincidence here: the organizers – Steve Wang and Sara Standish – are Johnson School students and the moderator was Mark Milstein, a heavy hitter in the BoP space.)

I thought Sara and Steve did a particularly good job finding representatives from distinct stages of the BoP continuum. First to speak was Fernando Lima, founder of Florestas and a New Ventures entrepreneur. Fernando holds a Ph.D. in economics from the University of Barcelona and has worked for many years in finance – but his passion is personal care products. Specifically, Fernando is all about certified-organic products whose ingredients are sourced from Brazilian cooperatives. Florestas’ new line – Ikove – just attained nationwide distribution through Whole Foods, which is the holy grail for any start-up company in the organics sector.

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