Month: August 2008

What do you practice?

~ Sasha ~ 1 Comment

Finally over my cold, I did sleep past 4 in the morning last night, helped by a late night out the night before. But I’m in the habit of waking up at 6:20am, usually 7 days a week, thanks to my kids, early risers that they are. (I do miss the occasional chance to sleep until noon).

Habits are interesting things. The New York Times recently ran an article about Dr. Val Curtis, an anthropologist living in Burkina Faso who is currently the director of the Hygiene Center at the London School of Hygiene & Tropical Medicine. Dr. Curtis has enlisted the help of the some of the world’s leading consumer product companies in an effort to double the rate of hand-washing in Ghana. If this can be achieved, it could significantly decrease transmission rates of diarrhea and other fatal disease caused by poor hygiene. Wouldn’t it be amazing if the same companies that have taught us to need blister packs of gum, branded detergent, and Swiffers could apply these same techniques to teach people habits that save lives? And where do we draw the line if, along the way, this results in pushing a particular brand of hand soap, maybe one that costs a little more than another option?

A lot of how we go through our days is about habits. By repeating certain actions — drinking a morning coffee, brushing our teeth, smoking cigarettes, or checking a Blackberry — we condition ourselves to do and expect certain things. I think this is why making real personal change can be so difficult.

On the other hand, think about the power of simply practicing a new behavior. What if you wanted to get better at being kinder or listening more? Why not start by practicing, by the simple act of repetition? Start small. Say ‘good morning’ to the person you see in the lobby every morning where you work. Spend two weeks turning off the TV at 9pm. Make a point of looking people in the eye when they talk to you.

We are the way we go through the world. What behaviors are you practicing?

Acumen Fund Breakfast Discussion on Energy

~ Sasha ~ 1 Comment

[Editor’s note: this entry was originally posted on the Acumen Fund blog.]

Yesterday morning, Acumen Fund hosted a monthly breakfast for members of our Partner community featuring Acumen Fund Director of Capital Markets and Energy Portfolio, Raj Kundra. With 30 guests in attendance, this promised to be an engaging discussion.

Brian Trelstad, Acumen Fund Chief Investment Officer, opened up the discussion with reference to Acumen Fund Advisory Council member Peter Goldmark, who observed in 2006 that marginal changes in the climate will affect those on the margins first and most profoundly. Later that year – in no small part due to Peter’s influence – Acumen Fund made a Clinton Global Initiative commitment to launch an energy portfolio, and we began our work in energy 12 months ago.

Raj began the talk with a description of the Acumen Fund model, and how we raise philanthropic capital to invest in breakthrough enterprises that provide critical goods and services to the poor – with a focus on health, water, housing, and most recently energy. So while Acumen Fund acts like a venture capital firm, we differentiate ourselves with our focus on large-scale social impact, coupled with economic sustainability, as our primary objectives. We invest in management assistance to support our investees – both before and after we make an investment. And we believe in the power of sharing what we are learning, based on the recognition that in a world with trillions of dollars of capital, we will always, by definition, be a relatively small player.

Raj continued with a discussion of the poverty trap that poor people face with respect to energy. As of 2005, poor people spent more than 14% of their incomes on energy, and Raj estimates that these numbers have increased to over 20% with the recent surge in energy prices. In addition, the poor often use fuel sources that are expensive, inefficient, and dangerous (for example, kerosene lamps or burning wood for cooking in open spaces). Finally, with limited access to energy, productivity (whether on the farm or the result of the shortened day for studying or work) is simply lower, all of which contribute to a ‘poverty trap.’

Even though this problem exists, there’s a significant market opportunity in energy, with the poor spending roughly $433 billion a year on energy – or about $100 per person per year – most of which is in Asia. So a lot of spending is already happening today, and the question for Acumen Fund is how to find entrepreneurs who are looking to provide products that are better, safer, more energy efficient, and therefore lower cost for poor consumers.

Raj scoped out Acumen Fund’s focus areas as broadly divided between “Renewable Energy Generation & Supply” (micro hydro, wind, biomass, solar, biogas, and biofuels) and “Energy Consumption & Appliances” (high efficiency lights, cookstoves, and other household level applications). Broadly speaking, Acumen Fund sees opportunity in these two areas, though some areas (like large scale generation and supply, where the state plays a heavy role; or direct-to-consumer retailers) look to be out of scope for now. Raj went on to describe Acumen Fund’s portfolio of closed and approved investments, totaling $2.5 million, which focus on LED lighting and a micro-hydro provider in India; as well as our late-stage pipeline of about US$4 million of investments on which we are doing serious due diligence. We are seeing significant progress in the portfolio and expect it to grow considerably over the coming 12 months.

Raj closed the presentation with a diagram of what it takes to navigate the carbon markets, pointing out that there are across the board opportunities for Acumen Fund to provide expertise and support to entrepreneurs; and also noting that there’s a particular role for patient capital to play in these markets, where a two year certified emission reduction process can significantly alter the economics of a given investment.

This discussion quickly shifted gears, touching on LED light prices (currently US$10 to $30, with the expectation that costs will continue to drop as companies scale); the role of mini-grids (by definition less efficient, but potentially effective in areas where the grid will not be built out for the foreseeable future); how to ensure that customers get access to energy; whether and how Acumen Fund should invest in biofuels companies (where we have been extremely cautious); how we think about environmental impact in this portfolio in particular; and how to compare various options at the level of the low-income household, to decide which interventions might have the greatest impact.

In the end, I was left with a sense that Raj and Acumen Fund have both a broad and deep understanding of the energy market, but that there are a number of truly complex issues where we and others still have a lot to learn. We hope to continue to learn by doing, supporting entrepreneurs with the passion, vision, and commitment to execution to help millions of people to escape the poverty trap.

4 in the morning

~ Sasha ~ Leave a comment

My summer cold, which I was sure would pass in 24 hours, is entering its second week. So, Nyquil notwithstanding, most mornings this week I’ve been awake at 4 in the morning. This feels like the worst of all times of day to be awake, doesn’t it?

Why is that? Where did I even get this idea about 4 in the morning? How did 4 in the morning get such a bad rap?

The slam poet Rives might have the answer. Check out his “4 in the morning” lyrical origami at the 2007 TED Conference. I don’t want to summarize any of it, for fear of ruining the effect. See it for yourself and you’ll see how Rives has the uncanny ability to take any topic and make it captivating, humerous and profound. His “mockingbirds” riff still gives me the chills. (check it out; it’s 4 minutes long)

Rives is just one of the speakers at the TED (Technology, Entertainment and Design) Conference who defies easy classification. TED is a conference about the spread of ideas. It brings together some of the smartest people on the planet, and asks them to give 18 minute TED talks on their area of expertise. So the next time you’re thinking about watching a Seinfeld rerun on your DVR (“it’s just 22 minutes long,” you think), check out a TED talk instead.

I’m continually amazed by how transcendent the speakers are. Who could imagine being captivated by a biologist talking about the fastest movement in the animal world; a doctor and researcher explaining graphically why some countries are rich and others are poor; a brain scientist talking about her personal experience having a stroke; or computer scientist who modified a Wii remote control to make a $50 whiteboard (the market price is $2,500).

To me, TED is about the raw power of ideas, and of community, to change the world. It is also about how influence comes from the ability to communicate with people outside your field of expertise (see: the Obama campaign).

And listening to these speakers, one cannot help but think, “Wow, maybe I can do something totally fabulous that makes the world a different and better place.”

Tell a Friend (really)

~ Sasha ~ Leave a comment

It’s this blog’s one week anniversary. Already I’ve learned some things:

  1. Blogging takes about 3x more time than I expected
  2. I also like doing it more than I expected
  3. I think that finding out the series of random facts I need to make a post come together (e.g. what is U.S. aid to Pakistan? What’s going on with fuel economy legislation? What should I know about Maimonides?) will, over time, make me a smarter person
  4. I’m very interested in figuring out how to build an audience of interested readers

This last point is where you all come in. While I’m a big fan of shameless self(blog)-promotion (and have been doing a good deal of it), I’m looking forward to the day when I don’t have to update my Facebook profile letting people know that I have a new blog post.

Since there are many more of you than there are of me, you can play a part in this social experiment. Please pick one of the following (really, I need your help):

  1. If you’re a blogger/Facebook/MySpace/social media user, post a link to my blog somewhere in Web 2.0-land
  2. Think of one person you know and send them this email:

Dear So and So,

I’ve just started reading a blog about philanthropy and social change. Sasha’s a credible guy who works at Acumen Fund and I’m enjoying hearing what he has to say and thought you might too. The site is http://sashadichter.wordpress.com. No obligations, but thought you might want to check it out

Enjoy,

YOU

(P.S. If you’re my mother, you’ll probably have to edit that note slightly)

Think about how much email you send out every day — don’t you think you could add this to the list without bending a friend out of shape? (If you post to a site, let me know where; he/she who generates the most traffic (per “site referrals” on WordPress) wins a prize.)

This could be fun. I promise to post about progress. Thank you!!

EnergyStar for Cars

~ Sasha ~ 4 Comments

U.S. auto sales hit a 16 year low in July, with the double whammy of high gas prices and tight credit hitting U.S. auto makers especially hard. General Motors sales dropped a whopping 27 percent, and GM reported a $15.5 billion loss in the third quarter on revenues of $38 billion. (These are such large numbers that the bear repeating: GM posted a $15.5 billion loss in just three months). So I doubt U.S. automakers are hankering for ways to make it even more transparent to consumers that the majority of their cars are fuel inefficient. Hearings were held today by the NHSTA on new standards that would require 35 mpg for the U.S. auto fleet by 2020 (vs. today’s 25 mpg average). And if you ever wanted proof that a picture isn’t always worth a thousand words, check out this photo of the hearings. Huh??

I’m assuming that the standards will be postponed or watered down in some significant way. So here’s an interim step that might be harder for the Big Truck Makers to fight: why not require every new car to have, on the sales slip that’s posted in the window, an estimation of the cumulative fuel cost of the car over 1, 3 and 5 years?

To keep things simple, and to lay off American car makers for a second, imagine you want a family car and walk into the Toyota dealership to compare the hybrid Prius to the minivan Sienna. They both can be had for about $27,000 with some options. Don’t you think more consumers would make the environmentally friendly choices if they saw on the sticker that, over 5 years driving 12,000 miles a year, the Prius would save them almost $9,000 on gas (for those who don’t trust my math: $5,870 worth of gas versus $14,211 at $4.50/gallon using the ‘official’ mileage numbers, which are way too high).

This has been tried before with the Energy Star labeling program, which apparently has saved $14 billion in energy costs. What if Toyota, which is already way out in the lead with the Prius, leveraged their advantage and took the step of voluntary labeling their showroom cars in this way? Don’t you think consumers would come to expect it and the Big Three would be forced to respond?

Mohsin Hamid’s stories of Pakistan

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In the past 24 hours I finished reading two books by Mohsin Hamid: Moth Smoke and The Reluctant Fundamentalist. I’m not unearthing anything new here – Moth Smoke was a New York Times Notable Book and The Reluctant Fundamentalist is a bestseller and a Booker Prize Finalist. Nevertheless, let me encourage anyone who appreciates good writing to read these two books. Hamid hits you in the face with the difference between being able to write and being a writer; he is a master of prose, pacing, setting and character.

The books also resonated because I was in Pakistan just two months ago, so the first-hand account of life in Karachi and Lahore was of particular interest. As Americans we have almost no personal exposure to Pakistan, and while I’m sure there are countless political histories available, one could do worse than begin with Hamid, if for no other reason than to remind oneself of the obvious: that Pakistan is a country of 180 million people each of whom has his own story.

I am a novice in my own understanding of Pakistan, having visited there once and having only a cursory knowledge of its history, culture and politics. But the contrast between my experience in Pakistan (confirming that most places, and most people, in the world are more the same than different) and the questions I got both before and after my trip (“how WAS Pakistan??!!”) reinforced my sense that we Americans we have, on the most part, an unbelievably limited exposure to and understanding of this country of 180 million people (and the exposure we get is often in CNN News briefings and statements by Presidential candidates about “the war on terror.”)

The cover of the Economist’s January issue blithely called Pakistan “The World’s Most Dangerous Place” (a Pakistani colleague of mine at Acumen Fund has that cover, hand grenade and all, ironically displayed at his desk). I find that hard to believe, but even if it were true, shouldn’t part of the answer be investing in local solutions that create economic opportunity and help fight poverty (and not just more bombs)? One-fourth of Pakistan’s 180 million people are poor. Food and energy prices are rising (Pakistan recently shifted clocks forward an hour in an effort to save energy, and Acumen Fund Fellow Jawad Aslam’s take on this is not to be missed) and, with rising prices, tension is also rising, especially in the cities. Meanwhile, under the Bush administration alone, the U.S. government has provided more than $2 billion worth of funding to Pakistan, with up to a third of it unaccounted for.

There’s a lot to bite off here, which is intimidating. So why not start with Hamid’s accounts, to pique your interest, and go from there?

Slydial: Please leave a message after the beep

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A new service has been launched called Slydial, which lets you place a phone call that goes directly to a persons’ voicemail, without the phone ever ringing. The service addresses the silent wish of every teenager who, for the past three decades, has whispered to herself, “I hope no one is there and I can just leave a message.”

The Slydial website describes when you might use their service:

Create the illusion of communication
You maxed out your emergency credit card the first week of school. Your parents are looking for some answers. A text message isn’t going to cut it but a voicemail would mean that you tried calling them.

Wow. Pretty bold to come out and state that your value proposition is to create the illusion of communication.

The number of tools we have to communicate is multiplying. If I want to let someone know what’s on my mind, I now have to decide between a phone call, an email, an SMS message, posting on my blog, updating my Facebook or MySpace or LinkedIn or Plaxo Pulse profile. And if I were 20 years younger I could add to that list things like Twitter, video messages, vMix, Bebo, and of course Slydial.

All of this is very exciting, but it also requires a new kind of filtering and understanding of which messages are appropriate for which media. There is also the risk that, as the media multiply, less time and effort goes into composing messages that create a real connection and understanding between people. We end up with lots more information, but a lot less meaning, and we lower the bar on what’s good enough in communications with the excuse that email (or SMS or whatever else) is supposed to be sanitized and devoid of emotion and real connection.

The medium is not itself the problem. But when I find myself emailing someone who sits 6 feet away from me in the office to ask a question, I do wonder if things have gone too far. At least I’m not Slydialing them…yet.

Your Money or Your Health?

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I’m sick today. Being sick in the middle of the summer is a double whammy. Eighty-five degrees and sunny with a sore throat should be an oxymoron.

Yesterday I completed an alumni survey sent out by my esteemed business school. It was more or less standard fare: what have you been doing professionally, what kind of responsibilities do you have at your job, how much money do you make, how happy are you? I wonder if the compilation of these results are more for collective voyeurism and one-upmanship (“I’m wealthier than my peers”) than because they give the administration the opportunity to reflect on the curriculum.

Two questions stood out for me. One asked me to rank what is most important to me, from most to least, choosing between things like my health, the well-being of my children, my income, my net worth, time to do stuff outside of work, my involvement in my community, etc. Are they serious? My health and my children’s well-being are in a category by themselves, aren’t they? Are there actually people out there who put those things at the bottom of the list? I’m curious to know.

The second surprising question asked what skills most help me in my professional life. The surprise was that the list included both the obvious skills for a business school to care about (analytical thinking, leadership ability) and some surprises (ability to listen, empathy). I suspect that my rank-ordering will be in the “long tail” relative to my peers (I put those “soft skills” high on the list). My question is: if all the alumni came back and said what they really needed most was empathy and listening skills, would that result in an about-face in the business school curriculum? If not, why is HBS asking?