Thursday, May 08, 2008

Pattern recognition at Investors Circle

There is a community supported agriculture program in Denmark in which 150 co-worker farmers serve 50,000 homes with organic produce brought direct from field to house. It is believed to be the largest such effort anywhere in the world. In community supported agriculture the customers are also investors - they buy shares in the farms. Thomas Harttung, the farmer, investor, entrepreneur behind the effort, called Aarstiderne, is a regular participant at Investors Circle, my third conference in four days.

This single example presents some of the key themes and opportunities for the Investors Circle community, and I would argue, most everyone else.
  • Where does our food come from?
  • What is capital for?
  • What and who is in my community?
  • Will the planet survive?
One session at the conference focused on Slow Money, in which the challenges of trying to invest in sustainable food systems is discussed as running counter to investing in clean tech. For example, slow food requires small scale, locality, eco-principles and long investing horizons. Clean tech, like most tech, turns on questions of rapid scalability, global reach, technology as solution, and quicker returns. So the question becomes, if you care about the planet and want to invent or invest in line with your values, what do you and how do you do it? Clearly alternative energy sources are needed and they need (and are getting) investment capital.

This moment in time, unlike any other I'm aware, is being defined by simultaneous global rises in prices of food and gasoline. But the solutions to the two problems may or may not be similar, they may or may not be linked, and the ways we invest capital (environmental, financial, human, and intellectual) and the returns we seek may or may not be the same.

It is hard, intellectually and emotionally, to simultaneously consider the relationships between the headlines. How do we think about all of these issues - global warming, food shortages, water crises, calamitous weather damage, political isolationism - and the ways they relate to each other? How can we separate out realistic strategies that take into account the complex systems in which both the problems emerge and the solutions must be implemented?

These are the kinds of questions I can depend on Investors Circle to raise. There is enough commonality and diversity of participants and topics so that patterns emerge and new ideas are generated. I always learn something I simply did not know before I came. The 300 or so people gathered here question the assumptions of plenary speakers, challenge the powerpoint presentations at breakout sessions, and debate the key points during and after each formal talk. The conference attracts foundations, bankers, lawyers, entrepreneurs, and investors - most with at least two bottom lines in mind.

Since I've been to three conferences in four days let me make a few comments about conferences:
  • I am more likely to actually learn something when there are multiple perspectives and different opinions being actively discussed. This requires people coming from different positions in a system (entrepreneurs and investors/funders and grantees, at the very least).
  • Smaller is better for finding people you might actually work with over time.
  • Larger is good for meeting people in the halls and seeing such a variety of vendors and exhibitors that you might actually question the choices you've made about how to do your work. Do I need a donor advised fund or a private foundation? Do I want to bank in line with my values as well as invest? Why are there attorneys here, what questions did I forget to ask?
  • Content that draws in and involves people from different countries and cultures is more interesting than panels on "the international fill-in-the-blank."
  • Small groups that give people a place to participate as both audience and panelist are great as long as they also find ways to bring in new voices.
  • I hope that I never have to organize a conference and I appreciate the efforts of those who do.
I'm off the conference treadmill for about two weeks. Then I head to Vietnam for the Asian Pacific Philanthropy Consortium conference on diaspora giving. It is a smaller gathering on a focused topic of great interest and immediate relevance for me, in a place I have always wanted to visit, with scholars and presenters I respect. I'm looking forward to it.


Anonymous said...

what a great post and a great summary! thank lucy.

Lucy Bernholz said...

thanks! and thanks for your buzzwords contributions also...

Anonymous said...

Hi Lucy,
Just a comment on the part about CSA's (Community Supported Agriculture) - Several of these organizations are cropping up around North America. In fact, where I live (Calgary, Alberta) the education system is starting to integrate food sourcing as part of the elementary curriculum (I am not sure about higher levels). I believe Hazon (a NYC organization combating hunger) also has a partnership with a CSA in upstate in NY.

There's a book written by a couple who live in Vancouver, BC called the Hundred Mile Diet - that discusses not only sourcing food, but the that impact of our current lifestyle is having on our planet. It's an interesting read.

As we integrate CSA's into the Investor Circle model I wonder what role the big box stores (like Walmart) will do in response? I pose this question because of the current economics (we haven't paid the real cost of food in decades and these stores undercut things further). I wonder if there is a way to integrate a broader business model that will attact consumers to shop locally and invest in CSA's (or other forms of investor circles that have social benefits)?

Lucy Bernholz said...

Great questions. I'm familiar with CSAs here in San Francisco where they are quite popular. I don't know how broad the movement is across north america, though I think there are quite a few, none of the size of the single Danish example.

Size is an interesting question for CSAs, seems to me.

The big box issue and real price of food are exactly what we need to be thinking about. Bill McKibben's Deep Economy is the best book I've read on this, with some mindblowing stats about food - such as the note that Philip Morris/Nabisco, which merged in 2000, collects 10 cents of every dollar American consumers spend on food (p 53).

I think the idea of local investors circles, perhaps built around CSAs, as I think you are suggesting is interesting. This might be what some of the local currency movements are about, or even the Interra card - which is creating a local merchants reward program. There are lots of ideas - not sure where the best place is to track them all - does anyone know?

nelson said...

As my point of view, history may not repeat exactly when it comes to the financial markets because at the extreme technological advancement can make the current population to think that they have beat Mother Nature; in spite of this, human beings remain as frail emotionally today as the generations before them, setting the stage for historical repetition.

Anonymous said...

In today’s increasingly mature market environment. This is because when a large enough body of investors / speculators get to know something, and then act on it. It's fair to say this is exactly what condition our condition is in , fuelled by runaway money supply growth also characteristic of high degree market tops that can take many years to fully mature.

Wide Circles

Anonymous said...

I imagine there is rather an elite group, none of the sizing of the individual Danish pastry representative.
Wide Circles

Unknown said...

Glad to read article like this. I know something about CSAa where they are very popular.

Investors circle said...

I've also joined few seminars like this, I would say it has similarities with this post but the biggest part I'd like to know is it's process and how it can be really helpful.