{jcomments on}Last Monday night I pushed my way through a large and boisterous group, made up primarily of Generation Yers (or is it Z already?) and, despite my aversion to crowds and a case of jet lag having just returned from Costa Rica the night before, I was glad I did. What brought so many faces out to Czehoski on a Monday night, you ask? It was the ceremonious launch of Acumen Fund’™s Toronto Chapter.

Acumen Fund puts faith in entrepreneurs


The brainchild of former Wall Street maven Jacqueline Novogratz, Acumen Fund is a nonprofit social venture that puts its unfettered faith and hope in the power of entrepreneurs to fight the longstanding scourge of global poverty. Believing that neither charity nor markets alone can meet that radical challenge, Acumen promotes a hybrid paradigm that combines both. This blended values approach, investing in solutions that have potential for social impact and profit, has been paving the Fund’s path to change since it launched in April 2001.


Also referred to as patient capital — debt or equity investments of $300,000 to $2,500,000 in an early-stage enterprise with payback or exit in roughly five to seven years (but unlike a typical venture capital firm, if that goal is not met, Acumen won’t walk away) — financial and social returns are the result. Don’t look for grants here, though; you won’t find them. What’s more, all financial returns are recycled into new investments, with every dollar invested leveraged four times.

Patient capital at work


Today, Acumen Fund boasts 27 investments and a portfolio worth just under $40 million, not including a recent capital markets fund of $15 million. The focus is on supporting enterprises that provide low-income consumers with access to five specific areas: health, water, housing, energy and agriculture. And by the look of it, they’re getting somewhere. Case in point: D.Light, which uses LED technology to provide a much-appreciated alternative to kerosene lanterns, known to be more expensive, lower in quality and veritable fire hazards. As a side note, it is estimated that more than 1.5 billion people in the world live without access to electricity.


D. Light was created by social innovators and funded by Acumen ($800,000 in 2008, $400,000 in 2009) and a number of other investors. And how is the hybrid model working for them? Well, let’s see. Since 2007, D. Light sold 115,000 lights, impacting an average of 500,000 lives while their main competitor, Tata –dependent solely on grants — sold 5,460. Not exactly a full-blown analysis or conclusion, not by a long shot, but the numbers make it well worth taking a long, hard look at the patient capital model and its potential for real change.

Fighting poverty

Interestingly, as I made my way across the crowded room, chatting to whomever I could (tripping the waiter and stepping on about five toes in the process), it occurred to me that while many attendees knew a lot about consulting and business, they knew little about venture philanthropy. When asked what brought them here, the answers were diverse but shared one common theme: the desire to support a different way of doing business toward the eradication of poverty. Considering the response to the event, it seems the new Toronto chapter, with its goals of fueling knowledge, conversation, fundraising, awareness and more, is heading on the right track.



To learn more about Acumen Fund, check out our review of Jacqueline Novogratz’s book, The Blue Sweater.

Elisa Birnbaum is the co-founder of SEE Change Magazine, and works as a freelance journalist, producer and communications consultant. She is also the president of Elle Communications.

Pin It on Pinterest

Share This