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50% for Colombia

The current level of economic inequality is one of the starkest things that stood out from the inspiration phase & our video chat with Grameen Caldas: Colombia has the most unequal distribution of resources in Latin America (Gini coefficient of .587 in 2009, with almost 50% living below poverty, and the top 10% making >80X what the bottom 10% makes ). Thus, there’s a huge opportunity to encourage wealthy Colombians to use their good fortune to help those less fortunate.

Photo of Vincent Cheng
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50% for Colombia: Imagine if a group of wealthy, popularly admired Colombians jointly took a public pledge to invest at least 50% of their wealth in social businesses to improve the wellbeing of their fellow Colombians, shared stories about what causes they’re supporting & why, and then invited their peers to do the same. As word of mouth & media coverage spreads about this inspiring movement, taking this pledge becomes a signifier of both achievement & compassion, something that people aspire towards, and thus more & more investment is put into Social Businss.


Potential Founding Pledgers:

  • Luis Carlos Sarmiento: multi-billionaire (1 of 2 Colombians on Forbes wealthiest list); banking, real estate, & telecom mogul; partnered with Professor Yunus & Grameen Bank to create Grameen Aval Colombia to provide small loans to Colombia’s poor.
  • Julio Mario Santo Domingo: multi-billionaire (1 of 2 Colombians on Forbes wealthiest list); controls >100 companies (including major TV network, newspaper, & magazine); founded philanthropic foundation to benefit Colombia’s social development, named to honor father.
  • Shakira: $140 million net worth; highest selling Colombian singer ever; founded Pies Descalzos Foundation that runs schools in Colombia for poor children; co-founded ALAS Foundation with influential artists, leaders, & business leaders to help children in Latin America, UNICEF Goodwill Ambassador, numerous benefit concerts.
  • Juanes: singer with most Latin-Grammy Awards (17), established Mi Sangre Foundation to help victims of land mines in Colombia, international anti-land mine activist.
  • Juan Pablo Montoya: crossover race car winner on Formula One, ChampCar, Indicar, GrandAm, & Nascar; started Formula Smiles Foundation to improve wellbeing of disadvantage children in Colombia through sport & education.
  • Sofia Vergara: actress/tv host/model/entrepreneur; founded nonprofit Peace& Hope for the Children of Colombia that’s helped thousands of children & donated a pediatric cancer pavilion; supporter of Sueños sin Fronteras (Dreams Without Borders) that encourages and provides post-orphanage financial support for Colombian orphans to pursue education;owns production company Latin World Entertainment & socially conscious fashion line “Vergara by Sofia” that has generated ~1,500 jobs in Colombia.
  • Julio Sánchez Cristo:famous Colombian investigate journalist, interviewer, and radio presenter, often exposing those in power taking advantage of the less fortunate. Helps promote & organize various social causes.


~60 Billionaires already pledged >$125 Billion: In the US, “The Giving Pledge” ( http://givingpledge.org/ , http://en.wikipedia.org/wiki/The_Giving_Pledge ) has successfully achieved these results through a public pledge to donate at least 50% of wealth to philanthropy (can be within lifetime or after death). It began with the 2 wealthiest people in the US, Warren Buffet (Berkshire Hathaway) & Bill Gates (Microsoft), and now includes many other well-known individuals including Mark Zuckerberg (Facebook), Michael Bloomberg (Mayor of New York City), George Lucas (Star Wars, Indiana Jones), Jeffrey Skoll (eBay), Ted Turner (CNN, TNT), Steve Case (AOL), Barron Hilton (Hilton Hotels), Bernard Marcus (Home Depot), Tom Managhan (Domino’s Pizza), various other Entrepreneurs, Executives, Venture Capitalists, Private Equity, Investment Bankers, Hedge Fund, etc.


More Resources for Social Impact, Sooner & More Sustainably: By asking for social business investments, instead of charitable donations, 50% for Colombia could potentially garner greater financial resources towards social impact. More people would be likely to devote more of their wealth to social causes now, rather than say in their will, because they 1) know their investment is being used to create effective, efficient, self-sustainable social businesses, as opposed to just throwing more money at the problem, 2) feel more secure about rainy days (and providing for potential family needs), as they view their investment as an “holding asset”, rather than simply giving money away (e.g. for Grameen no-interest loans, the principal is still potentially available through repayment down-the-line), and 3) are likely to continue recycling/reinvesting their “holding assets”/ returns into social businesses.


Involving Traditional Business: Colombian companies could also be encouraged to join the pledge (though probably at a different % level), demonstrating their commitment to the community, and benefitting from the resultant goodwill.


Going Global: After refining the model in Colombia, this could also be scaled to encourage individuals around the world to become part of the “Grameen Global Group”. After all, the Chinese government actually began calling on China’s billionaires to increase their giving since The Giving Pledge went public, and now The Giving Pledge Members are actually in talks with billionaires around the world (from Europe to Asia) about this.


How About Non-Billionaires: A pledge from billionaires can inspire other wealthy people to do the same. It may also increase social business investing from regular folk as well, which could be facilitated by this related concept: /open/how-might-we-improve-health-care-through-social-business-in-low-income-communities/concepting/social-business-microinvesting-markets



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Photo of Johan Löfström

I am thinking about some sort of clever incentive to be put in place when the messages of the loan-repayments are dropping into the lenders account. I mean it have become really trendy with second hand clothing, or pre-owned, pre-used, pre-worn or whatever you like to call it.

"Here is the latest repayments, but we know a person that would benefit from lending that same $ from you once more"..."The same bucks can help another lender start another small-business"... "so before you order the transfer of it back to your bank account, check out our current list of fund-seekers" (i am not there yet, someone else can probably make it perfect in the local dialect of colombian spanish)

Photo of Vincent Cheng

Yes, Johan, notifications would be great nudge! On another level, the default could be set for repayments to be automatically reinvested in social businesses, unless the social investor opts to withdraw. This is sort of the way it's setup on my Kiva account for instance. When the principal is repaid, that money is not automatically withdrawn, but instead is retained within the Kiva account to be reinvested and I get an email inviting me to choose a reinvestment. For another example, for my DonorsChoose balance (say you pledge to donate to a project but it didn't get funded, or you've setup automatic recurring donations), if I don't choose a particular project within a certain amount of time, the default is for this balance to be donated to whatever DonorsChoose deems to be the highest need.

Photo of Johan Löfström

Yes of course. great idea, to make the automatic model a re-loan. but to keep notifications as a way for lenders to keep track on the progress, and to show them the names of the new borrowers of the same $.

Making options for the investors to choose from a long list of prefferred projects : Farming, renewable energy, education...

and another way to prevent people from withdrawing their savings in a temporary financial crisis or similar would be if a bank or credit company could see this investment and issue very-low-interest short-term loans with the micro-credit-balance as the collateral safety. I mean money is more valuable commodity than to remortgage your house (even if your money is far away and doing good in another part of the globe)

Photo of Vincent Cheng

Hmm...using microloans as collateral...interesting idea. I must admit though, I am a little bit wary of too much financial engineering. I.e. I'd personally run away as fast as possible from microfinance CDOs ( http://en.wikipedia.org/wiki/Collateralized_debt_obligation ) =P We've already seen the potential for this to spread & magnify risk in a way that's opaque and thus not fully understood by some of the parties involved.

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