U.S./world – Global portfolio – Connecting donors

By Todd Cohen

A new nonprofit fund is looking for investors who want to make a global difference.

In partnership with the Cisco Foundation in San Jose, Calif., the Rockefeller Foundation in New York has hatched the new fund, which will raise money from high-tech and high-net-worth donors, and from other foundations, and invest in a portfolio of nonprofits and commercial firms throughout the world dedicated to making change happen.

The new Acumen Fund aims to launch its initial portfolio this fall, focusing on health and communications, specifically on technologies with the promise of improving the lives of poor people in developing countries.

“What we’re trying to find are those innovations around the world that, with a small amount of private investment, can catalyze major public change,” says Jacqueline Novogratz, Acumen’s chief executive officer.

Like a mutual fund, Acumen will charge investors a fee to cover expenses. It has secured commitments of $8.5 million to subsidize operations for five years until it fully covers its costs through investor fees.

Acumen aims to develop technology-based tools to measure the impact of its investments and help build a network of investors dedicated to innovative change.

“The power of the portfolio approach is that it enables us to take the best of the nonprofit and for-profit sectors,” says Novogratz. “It also allows us to balance risk among the investments we make, which allows for greater learning and overall impact for the individual investor.”

Acumen initially is looking for philanthropists each willing to invest $100,000 over several years. The fund hopes to recruit wealthy donors through a series of private meetings and, later, by direct retail marketing to more modest investors and through partnerships with financial institutions and corporations with employee contribution plans.

Technology will play a pivotal role at Acumen, which expects to spend roughly $150,000 to create a Web site. The site is being built by Infosys, a firm in Bangalore, India.

Acumen also will move by the end of the summer from Rockefeller’s headquarters in midtown Manhattan to its own offices on Wall Street, overlooking the historic Trinity Church – a location that Novogratz says is intended to underscore the fund’s mission.

“What Acumen Fund is trying to do is balance intellect and compassion for greater wisdom in philanthropy,” says Novogratz, who previously was manager of special projects at Rockefeller.

In that job, she created and directed two big initiatives – The Philanthropy Workshop, an intensive course for philanthropists in the United States and Argentina, and The Next Generation Leadership Program, which aims to build a core of 21st Century leaders committed to social change.

More than a year in the making, Acumen is modeling itself on venture capital funds but also wants to be deliberate and take however much time it needs to create the portfolio, metrics and technology that will succeed, Novogratz says.

Acumen, for example, initially intended to create and launch five portfolios at once but decided instead to create a single portfolio to test and demonstrate its outcome-based and collaborative strategy, and then add other portfolios over time.

Rather than looking for demonstration projects that deliver services, Acumen’s first portfolio will aim to invest in innovative technologies or surgical techniques, such as low-cost hearing aids or intraocular lenses that cure cataract blindness.

“We’re at a time in the world where the proliferation of wealth is so extraordinary,” Novogratz says. “At the same time, we are seeing this increasing disparity of wealth, not only in this country, but between countries. And there’s incredible innovation around the world in solving problems.

“What we’re trying to do is link individuals who are really serious about using their money to effect change with those innovations, and support that relationship by measuring the change, feeding back and  building networks of people around that change.”

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