How We Can Put Billions of Dollars
To Work
Solving Our Eco-Challenges
Without Waiting for Big Governments to Act
- Why Can't Governments Protect the Environment?
- How Can the Green Economy Solve Large-Scale Eco-Challenges?
- What is Limiting Growth of the Green Economy?
- What Can I Do?
28
May 09
On Beyond Kiva – Merging the Gift Economy with Green Entrepreneurship
A lot of you have probably visited Kiva.org. It’s a great site that helps 1st world donors move money into the hands of 3rd world entrepreneurs. Since their founding, they’ve moved over $33 million into the hands of people who really need it to start a business.
Kiva’s success points to new opportunities to expand social equity and capital parity. On the shoulder’s of Kiva’s success, we can reach some profound new heights for people and the planet.
As you know, I’m pretty focused on growing the green economy. So, I study every funding strategy. Unfortunately, Kiva was not designed to grow the green economy, in the U.S. or elsewhere. In fact, when I last looked, they don’t even have a category for green business, even though this is a rapidly expanding field in many developing nations.
Expanding on Kiva’s Model to Grow the Green Economy
The core feature of Kiva is that donors put money into the system to benefit entrepreneurs. This is a huge breakthrough in conciousness. Before Kiva, most people felt that you should donate money to charities, but you should only “invest” in businesses. This old, default cultural philosophy has really limited the amount of good we can accomplish in the world as a society.
Soon, I’m told, Kiva will add a new program allowing donors to support loans to U.S. entrepreneurs. Here’s where I’m really wanting to see some expansion in our thinking as donors. The news is that Kiva will lend up to $10,000 per U.S. entrepreneur. Truth be told, there are very few green businesses that can really scale up inside the U.S. economy and impact the health of the biosphere with just $10,000 in seed capital. That won’t really even get a startup to first base in a first-world country.
Here’s where EcoSector comes in. We’ve created a gift system that allows the general public to donate a $1 or whatever amount they like into EcoSector’s “launch system”. This money is then used to pay the costs required to get a green business through their first “real” capital round. The fact is, what with securities attorneys and other essential services, it can cost an entrepreneur anywhere from $20,000 to $100,000 to raise their first meaningful round of capital. In today’s default capital system, this seed capital bottleneck is keeping 499 eco-solution companies from succeeding for every one that threads the needle. That means real solutions to our most urgent eco-challenges aren’t getting done.
Don’t take my word for it. This gap is real. Here’s a slideshow put together by a big venture capital firm that tells the same story from their point of view.
While you’re at it, I hope you’ll check out the video above that lays out EcoSector’s launch system in a fun and enjoyable way, or you can see click straight to it on YouTube to learn How to Launch 1000 Eco-Solution Companies by 2016.