Published Jan 1, 2007 8:00 AM
10. Higher Return
What: Compassionate capitalism
Who: Philanthropists Pierre Omidyar and Jeff Skoll, investors John Colligan and Penelope Douglas
Impact: In the 1970s, Bangladeshi banker Muhammad Yunus pioneered the idea of giving tiny loans to impoverished but ambitious villagers — a mission taken up by the Grameen Bank. (For their work, Yunus and the Grameen Bank were awarded the 2006 Nobel Peace Prize.) But Californians in the past 25 years expanded the concept into a growing mini-industry. Today, a growing list of top executives and corporate powers aim to do good by teaching the disenfranchised how to make a better living, including non-Californians Bill and Melinda Gates, whose foundation, the world's largest, expects the groups it benefits to meet milestones, achieve measurable change and, in many cases, eventually finance themselves. Among the most active, eBay founder Pierre Omidyar invests in operations with a "double" bottom line — a social agenda and enough profits to become self-supporting. Other billionaires, most at least a decade or two shy of retirement, have done likewise, such as Jeff Skoll, eBay's first employee, who set up a foundation in 1999 to foster "innovations that will benefit humanity."
Eureka moment: By 1999, John (Bud) Colligan, a partner at the Silicon Valley venture capital firm Accel Partners, had racked up much success investing in technology companies that promised to change the world. Now, Colligan figured, it was time to invest in businesses that could change the world of people in neighborhoods that success had overlooked. Working with long-time business executive Penelope Douglas, Colligan created a venture fund — now called Pacific Community Ventures — to bring capital and management expertise to modest-sized companies that pay decent wages and benefits to people in depressed neighborhoods. Colligan was among the first wave of people who changed the definition of philanthropy.
— Elizabeth Corcoran
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