Charisma & Fundraising

After helping my sister raise money for one of her projects (here's her blog) I've been thinking about why people donate to various causes (why X and not Y, and why X in the first place). It's an interesting problem as we all receive requests for donations and (if you're like me) donate only to particular set of them.

It seems like there are largely two drivers:

1. They believe very strongly in the cause
1. This means that credibility flows from the cause to the person.
2. In this scenario raising money is all about emphasizing how your work is the best solution to the problem.
2. They believe very strongly in the person
1. This means that credibility flows from the person - they essentially would support more or less any cause that this person is leading.
2. In this scenario personal relationships (or perceived personal relationships) matter the most.
   

I think what is most interesting is that people often emphasize and organize their campaigns on the former and forget about the latter. However, I think (with only personal empirical evidence) that #2 is the reason most people start giving in a cause.

It's because they know (or feel as if they know) the charismatic leader that they open their wallet. If a friend approaches me - as long as I don't disagree with the cause - what dictates the amount of money I'm willing to give is not how strongly I believe in it, but how close a friend they are. I simply don't have time to understand the complexities of that particular issue and compare various solutions. Instead, the best I can do is rely on the person presenting the case. The more I trust them (and their own research) the more confident I am in their solution.

Granted that this doesn't mean that in fund-raising you shouldn't explain any actual evidence and just beg your friends for $$, but focusing on relationships does change the entire way you frame, brand and market your cause. It's for this reason that social media (has) and I think, will continue to have a major impact on charity fund-raising.

Social Investing

I attended another MIT entrepreneurship event last night - this one was on Social Investing. The four start-ups presenting were all pretty different each focusing on a different aspect of the space:

1) Financial Times / Alphaville - the FT's blog & forums to discuss macro economics ideas
2) Sum Zero - wikipedia for investors (similar to wikinvest) except with a closed community of financial analysts
3) Stocktwits - filter for stock tweets on twitter
4) Covestor - democratizing fund managment - [hopes to] allow anyone to be a fund manager by providing a transparent way for individuals to publish their trades and positions

While all were interesting, Covestor seemed to be particularly innovative - challenging the way an entire industry is run. As Rikki explained, thanks to cheaper tools and access to information, anyone can open up an e-trade account and trade. But until this point it has been difficult for you to trade on behalf of other people (manage other's money). By simply publishing what trades each person makes, you could essentially invest alongside the best investors. With a subscription model [coming] and a revenue share deal, the investors publishing their trades can now generate revenue for their research, retail investors effectively have access to actively managed funds for a fraction of the price and Covestor has a business.

As you're probably thinking, there are a whole host of questions and problems as usually happens when you re-invent an industry. Rikki and his largely London based team are working hard to solve them and he was quite adept at fielding tough questions. I would be interested in hearing what Nassim Taleb would say (I'm currently reading Fooled by Randomness). My guess is that in his eyes this would just perpetuate, if not exacerbate the problems caused by mis-judging randomness. Competition among traders even in the Covestor fashion will not do anything to weed out those traders who are are at risk for a major blow-up but doing well (likely the best) in the short term. Perhaps Covestor should reccommend the book and educate the retail investor before they join.

In any case, I like the idea and look forward to seeing how this develops. At this point, transparency is a good thing and more of it is certainly welcome.

Social Entrepreneurship & family

My sister made it to the front page of Cornell.edu for her project Bikes to Ghana (the article is here, for those who are checking the site post re-fresh). It's great to see the local media and the Cornell community rallying to support this cause and a budding social entrepreneur. She's been quite busy in her last years at school. Between volunteering in Guatemala, the Ghana bikes project and preparing for her trip this summer biking across the country to raise money for affordable housing - I'm not quite sure how she fits it all in there.

If you'd like to support her cause you can help donate (select rider: Cossart, Anne-Lise) for the bike across the USA project, she has already raised 75% of her target $ and just needs a little more. You can also check out her blog here.

Congratulations little sister!

TED Lecture: Building a Sixth Sense

I just discovered (via my brother, Antoine) new favorite TED video. This lecture by an MIT researcher Pattie Maes and her student Pranav Mistry demonstrate their work in creating a device that could serve in their words "as a sixth sense". It's a wearable device - or rather an amalgamation of off-the-shelf devices - camera, projector and phone. Using the camera to perceive objects, the phone to transmit data and a projector to project the data - you can do such things as pick up an object and receive information about it via a projected image.



What's most startling about this kind of gadget, is the contrast between its simplicity and the size of its consequences. Although there is a lot of work behind the scenes in designing the computer programs, the actual hardware not only exists today but costs less about $350. However, this combination of gadgets by building on the existing infrastructure brings us one step closer to a collective mind - it makes interacting and receiving the world's collective information nearly instantaneous. There's certainly something (I'm guessing many, many) opportunities here.