Social Investment & Finance

Risk is an everyday term in conventional finance. In social investment it underlies all decisions, yet responses to social investment risk and ways to manage it are ill-defined and can be overwhelming to the parties involved. We’re working on developing a framework through which emerging approaches can be understood and learnt from.

Online fundraising grows at Razoo

Emma Tomkinson Social Investment & Finance ,

A gaming industry article featured Lesley Manford, the CEO of Razoo this week. Razoo is an online fundraiser that’s had success out of giving contests.

The biggest misconception that most small charitable organizations have, says Mansford, is that online fundraising is difficult and costly. Razoo does take a fee, but at 2.9% of each transaction, it’s lower than competitors such as Crowdrise which charges 5% or FirstGiving which takes a 7.5% cut.

Some people will argue that the philanthropy pool in Australia is a finite size and that increased donations in one area or for a new programs or models like Social Impact Bonds will reduce the flow of donations to other areas. I’m don’t know if this assumption has ever been tested, but perhaps online fundraising or crowdfunding reaches out to a different donor in a different way, creating a new ‘market’?

Is there anything we can learn from co-ops and mutuals about rewarding crowdfunders with some form of equity?

 

Who Gives A Crap on indiegogo

Emma Tomkinson crowdfunding, Great ideas for socially responsible living!, Social Investment & Finance ,

Who Gives A Crap is a brilliant social enterprise. Three young guys have used crowdsourcing platform Indiegogo to successfully launch their toilet paper business and raise money to build toilets in developing nations.

A good example of a new business reducing risk to their initial investors through crowdfunding. They’d have a lot to prove if they were asking for millions of dollars, but for fifty bucks, a funny, believable video and a box of toilet paper will do.

It goes like this. If they raise more than $50,000 (which they’ve done in just over 50 hours) they’ll do a production run of their toilet paper and send packs to those who bought them on the site. They’ll donate half their profits to WaterAid to build toilets where there are none. If they raise over $100,000 they’ll go into business and stock the line in stores.

Why has it worked?

The guys have developed their own eco-friendly and attractively packaged toilet paper and a whole heap of hilarious toilet jokes. They’ve set up their indiegogo site with a really funny, effective, high-quality video about their project and have set a good range of options for giving/buying.

They’re selling a product we all value, and we’re all enjoying the way they’re selling it to us and that we’re making a social contribution at the same time!

What’s indiegogo?

Indiegogo began in 2008 as a crowdfunding platform for independent film makers. Each project sets a target amount to raise and contributes 4% to Indiegogo if they meet their target. Tax incentives are only available to US customers through Paypal. Projects on the site also include registered charities, people looking to fund their mother’s holiday, their child’s college tuition, medical expenses or small business.

Invest with love!

Link Emma Tomkinson Social Investment & Finance , , , ,

Invest with love!

I heard DH Park from IWL partners, Korea, speak at the IIX/Shujog Impact Forum 2012 in Singapore about how he wanted to change the attitude of banks. With a Government that hadn’t issued a licence for a new bank in over 20 years, IWL bought 100% of the shares in W Savings Bank and began to deliver their philosophy “bank with love”. One of his initiatives was the Pinocchio loan – a loan to employed people with low credit rating. The interest rate for the loan is high, around 45%. The rate reduces if repayments are early and increases if they are late. This was partly in response to the rate of suicide in South Korea which has doubled in the last 10 years, with a third of suicides related to financial difficulty.