Learning from the Acumen Fund: A strategic plan for international aid

I recently read an article on the Acumen Fund in the Stanford Business magazine, which I'm fond of. It was an appropriate piece to include in the publication, considering that the founder of Acumen, CEO Jacqueline Novogratz, is a graduate of the business school.

What struck me about her strategy is how simple it is. Basically, Acumen collects money from philanthropists and corporate investors, identifies businesses in developing countries that need assistance, gives loans to those business owners, and provides managerial assistance to ensure that improvements are made and that profits are eventually turned.

Loans, coupled with the business acumen provided by lenders, force small business owners to ferret out destructive elements like underperforming and pilfering. When a third party is scrutinizing all aspects of production (remember, they are now major stakeholders in the proposition), business owners become more efficient and more accountable. These are two crucial qualities sorely lacking in small businesses in developing countries.

How can this strategy be appropriated for use in the public health sector? For developing countries struggling to set up infrastructure, loans must come not only with instructions for use, but with built-in guidance and accountability. One of the keys to Jacqueline's success with business owners is that she constantly asks her customers what they think of Acumen's services. If they are unhappy, the company isn't doing its job. Likewise, if international lenders don't work with developing countries to find sustainable plans to use much-needed funds, little will be gained. Remember, we live in a world where 25,000 people die of hunger every day for reasons that have less to do with lack of resources than poor governance.

Acumen is an interesting example of market-driven solutions for human development. As it says on its website, the Fund aims to "provid[e] a product or a service that can be sold directly to out target market or to a small-scale entrepreneur, not only to government or donors who may be out of touch with the demands of low income consumers or their willingness to pay for what they value."

So there you have it. An example of the private sector not only being at the epicenter of global public health, but showing mistrust for other major stakeholders--governments and NGOs. To quote my sister, a current Stanford GSB student, "The quickest way to solve a problem is through business." Those of us in the field of public health and medicine will do well to heed those words.