Philanthropy doesn’t scale

Philanthropy does an amazing amount of good in the world. However, when philanthropy finds a solution to a problem, the solution only scales through yet-more philanthropy. In contrast, when a for-profit company finds a solution, the profits from the solution pay for more.

In a world where 7 billion people have access to a Coke within a half day’s walk, the same should be true for clean water, affordable energy, healthy food, health care and other essential products and services.

What is true is that we have a legal and fiscal structure for such solutions, namely the for-profit company. All we’re missing is a useful mission embedded within such companies, solving the important problems of the world.

This week’s webinar (above) talks about the invention of foundations, and compares the scale of foundations vs. for-profit companies.

It’s the third in the series. For the others, see fledge.co/webinars.

There are a lot of great posts buried in this blog’s archives that are still quite apt. Today is another reprise, this time revisiting the (often invisible) tradeoff between efficiency and resilience. Last time I explained that tradeoff with the case study of electricity blackouts in Texas and how that related to Google’s monopoly on search and Amazon’s dominance of eCommerce...

Who invented double entry accounting? The ubiquitous system of general ledgers, income statements, balance sheets, and cashflow statements found throughout businesses and quite a lot of households? This is yet-another of those concept so taken for granted that they seem to have been around “forever”, but thanks to Double Entry: How the Merchants of Venice Created Modern Finance by...

Many of the everyday details in The Work of the Stock Market told in between the history facts are often just as interesting as the history itself. Case in point, if you read the history of time zones, it seemed like the standardization was complete in the U.S. and Europe by the end of the 1800s. Yet in 1922… The difference in time between London and New York is four minutes and one second...

The standard structure for private equity funds (and venture capital funds) is “2&20”, as in a 2% management fee (±1%) and 20% (±10%) of the profits, a.k.a. “carried interest“. Why 20% of the profits? Henry Kravis of KKR explains below, starting at 6:00. TL;DR: Necessity, as he and his partners had no capital to put at risk. Share this:Click to share on Twitter (Opens...

Why did New York need another stock exchange in 1968? Why was the New York Stock Exchange, American Stock Exchange, and Pacific Stock Exchange insufficient? An unprecedented bull market coupled with paper-based systems. I’m in my 50’s and don’t remember “Wall Street” not having both the NYSE and NASDAQ as the two main exchanges. I am old enough to remember the AMEX...