There is an interesting interview with Jacqueline Novogratz, CEO of the Acuemen Fund in the McKinsey Quarterly Report entitled - The State of Philanthropy.
Unfortunately she sets off on a very high horse about how private sector initiatives are very new, exciting and different to anything that the charity sector can offer. The interview is a very revealing example of the continuing paternal (or perhaps maternal) attitudes that aid agencies have been criticised about for decades. It is sad to see that atttitude promoted by what otherwise appears to be an excellent agency. The suggestion that a "private sector" approach to charging interest for services is the way forward, and that charities are not good at trading is just patently wrong. Micro finance has been embraced and extended by charities, to many areas never previously envisaged and in ways that could not be contemplated within the constraints of a straightforward repayment system.Privately funded initiatives, whilst very welcome in offering alternatives and additional funding need to work in partnership with agencies who know and understand the problems they are trying to solve and can do it without patronising and disempowering the beneficiaries.
What's more it seems to link directly to the trap that other financing agencies, offering loan finance to charities, rather than grants, can fall into. That is, the one where they, the funder know best. The voluntary agency can be forced to jump through inappropriate hoops and create costly processes just to comply with the perceived needs of the funder. Some organisations having developed a model, follow it slavishly, unable to respond to change, flexibility and other experiences, not least the expertise built up over many years of successful interventions.
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