SPEAKER_00 0:12

You're listening to the Philanthropisms Podcast with Roger Davis. Hello, you're listening to the Philanthropisms Podcast. This is the podcast where we try to put philanthropy in context. I'm your host, as ever, Rodri Davis, and this week I am in conversation with Dr. Faranaz Karim. Now, Faranaz is the founder and CEO of Insan Group, which is an impact investing organization. She's also, more broadly, got a long track record as a social entrepreneur and also as an academic and political scientist. So on the social entrepreneurship side, she's previously worked with the United Nations, the World Bank, and various non-profits around the world, including in Afghanistan, Palestine, Bosnia and Herzegovina, so lots of interesting places. And on the academic side, she's recently completed a doctorate at Exeter University in the UK. Before that, she was a teaching fellow at Harvard for a bit, and she's also been a faculty member at Zyed University in Dubai. She got a master's in public administration from Harvard and an undergraduate degree from McGill, so she certainly knows what she is talking about. And so I sat down relatively recently with uh Far and I was to have a really interesting conversation about the work that she does at Insan Group and more broadly about uh the kind of wider context for impact investing and what the relationship is between that and philanthropy. And so we talked about the work of InSan Group, we talked about what impact investing is, what the market looks like at the moment, and as I say, kind of what the intersection is between impact investing and philanthropy and how the two can potentially work well together, or whether sometimes they slightly kind of cut across each other so that they're not being additive, and whether that's a challenge. We talked about on the recipient uh side what a focus on entrepreneurship brings uh in terms of benefits and whether uh actually it's merely that it allows you to fund things in a different way or to fund different things, or whether there are actually kind of deeper points about um investment relationships or loan relationships being somehow uh more equitable or uh having slightly less problematic power dynamics than we sometimes get in gift relationships. Um we also talked about measurement, which is obviously very important uh in the field of impact investing, and about uh some of the challenges of getting away from a solely quantitative view of measurement and trying to get minor more kind of qualitative elements in there so that we can capture some of the important elements of social value. Um we also talked about risk and failure and how we understand that in philanthropy and and in impact investing. Um we talked quite a bit about the United Nations sustainable development goals and the uh the sort of merits of those and perhaps uh the drawbacks of those as a framework, um, and how Far and IS has used those in her own work at InSun group and to try and put them uh into to practice and particularly make them relevant to smaller organizations on the ground. Um and then we also talked about some of the challenges of trying to balance getting on and working within the field of philanthropy or impact investing with systems uh as they are now versus trying to drive more fundamental systemic change and how to kind of balance that uh that tension sometimes between uh pragmatism uh and idealism. So without further ado, uh let's go into the conversation. I should just say uh very briefly that as I was editing it, I noticed that um certainly in the first half um when Flor and I was speaking, there's a couple of points at which there's a slight click um in the audio, which I think must be a loose microphone connection, which I didn't notice at the time. I've done my best to clean that up, so hopefully it's not uh too invasive, but um just to forewarn you about that, but it does go away, I think, uh certainly towards the second half. Um so without further ado, let's go into the conversation and I'll be back at the end for the usual bit of housekeeping. Okay, great. Well, I'm here with Dr. Faranaz Karim. Hi, Faranaz.

SPEAKER_02 4:47

Hello.

SPEAKER_00 4:48

Um, and Faranaz is the founder and CEO of Insan Group, as you'll have heard in the in the introduction. Uh, it's great to have you on the podcast. Hopefully, we're gonna have a really interesting conversation talking all about this kind of intersection of impact investing and philanthropy and how you get money down to the grassroots effectively. Um, but maybe the best place to start is just for you to say a bit about your background and particularly kind of what INSAN Group is for anyone who's not heard of it and how the organization came about.

SPEAKER_02 5:15

Sure. Thank you very much, Rodri, for having me. I'm really excited about this conversation. Um, so Insan Group came about from uh my field experience. Uh so when I was much younger, I had this dream of becoming UN Secretary General one day. Um I still have that dream, by the way. Um, and uh essentially, you know, at a very early age, I knew I wanted to study things related to international relations and development and the big issues of this world. Um, ended up as a United Nations volunteer, you know, in my mid-20s, supervise elections in Bosnia after the war, and then spend a couple of years between Pakistan and Afghanistan as a United Nations volunteer for UNDP. Um, so basically a UN agency and doing sort of uh literacy uh work and also empowerment work for women uh in Afghanistan, and this was during you know Taliban Afghanistan. And I would say this is kind of my formative experience, and from there on I um, you know, I worked in Central Asia, um, ended up by managing a large uh nonprofit in Afghanistan again at a particular time where the situation was more hopeful. And from all this experience across the humanitarian and development uh sort of a spectrum in the field, uh in conflict, uh post-conflict countries, I woke up one day with the idea of Insan. Uh so Insan means human in a number of languages, and uh it really is for me and for my team as well, uh, because I'm lucky enough to work with uh people that have had similar experiences than I have, uh, that are on my board or on my actual team after you know 15, 20 years. Um, and I think for all of us, uh the name really uh resonates because it is about the essence of humanity and the commonality that we all have, despite the various opportunities that you know unfairly separate us. Um so that's the meaning of Insan. In a nutshell, INSAN was trying to solve two problems that were clear to me uh through these experiences in the field of aid and developments. The first is uh a very top-down supply-driven system that channels capital uh in very short-term ways and often uh decontextualized from the realities of the end users or the beneficiaries. That was really one problem in terms of how capital is allocated. And the second problem was the question of metrics, the idea that we're thinking that we're doing good, but in fact we're blatantly measuring all the wrong things back then. Um so with these two very simple ideas of capital allocation to local entrepreneurial solutions and pushing our thinking around measurements uh further, Insan came to be uh with the initial and in part support of the Umijira family, uh founder of eBay, and after that from you know high network individuals and various foundations we've worked with over the years.

SPEAKER_00 8:26

Yeah, it's great, really interesting to hear, and loads to follow up on there. I guess I mean the first thing I wanted to ask is obviously given that the focus of the work you're doing is, as you say, on supporting entrepreneurs and doing that through kind of investment type approaches, one of one of the challenges you said you're trying to address is obviously shifting away from a kind of top-down model uh to one that is more responsive from the ground up to the needs of you know communities and and individuals. What was it about that that led you to sort of focus on entrepreneurship and an investment approach in terms of the demand you were seeing? Was that demand very clearly for that kind of funding and those kinds of approaches rather than maybe traditional philanthropic or grant-making ones?

SPEAKER_02 9:10

Yeah, so I mean that's that's you know, that's a fantastic question. So perhaps conceptually, conceptually, I think I'll start by probably laying, you know, what I think, you know, traditional, uh, as you call it, philanthropy would handle this part as part of a as part of an overall approach. So, you know, I observe that much of philanthropic funding tends to be identity driven, um, social proof driven, emotionally driven. Some of it may engage in long-term bets, right? So cancer research type of things or endowments. But what I wanted to do is not necessarily replace all these approaches, which I think are valid in their own right, although some of them can be improved uh in their delivery mechanisms, but I wanted uh, as part of that way of thinking about philanthropy to insert a little slice of the pie for what we call catalytic capital. And the reason why, the reason why I thought that was important is because um rather than deciding as a DFI, as a UN agency, as an international NGO, as a you know, sort of a foreign-driven uh entity, what priorities are for these communities, I thought that it was more important to find entrepreneurs that actually emanated from these contexts and understood the challenges and said, hey, I'm going to devote my life trying to solve this problem of access, for example, delivery of good healthcare or delivery of education or safe, you know, places for childcare, or safe places for playgrounds for children. And I felt that those kinds of solutions uh that were driven by an entrepreneurial spirit uh were underfunded, undercapitalized, under-supported. And uh I saw sort of hands-on the cost of not doing that, uh, which is one of the privileges that we have in Western countries, that you know, ideas can get backed up uh to innovate and to actually reach uh those that are underserved by markets and underserved by a system that is imperfect.

SPEAKER_00 11:37

Yeah, absolutely. Um, and just one sort of follow-up on that, because I'm really interested in this, is when we're we're talking about that intersection of uh kind of grassroots empowerment and entrepreneurship and investment. Do you have any sense as well that from the point of view of those individuals or communities on the grounds, there's actually something uh preferable about uh a kind of investment type relationship where it where it's feasible, as opposed to a more traditional gift relationship? Because you know, one of the criticisms of philanthropy is often that it even when it's very well intentioned, it's quite paternalistic and disempowering or can be. And and perhaps actually doing things on a the basis of investment and entrepreneurship is maybe in a way more honest. I don't know whether that's a slightly loaded term, but do you have a sense in which actually you the people on the ground really feel as though they prefer that to accepting a gift?

SPEAKER_02 12:33

So, you know, I think that's a fascinating question. And of course, you know, we know all the research on microfinance and you know cash transfers and all of this. So, you know, we can take uh various levels of discourse to answer uh this question fully, but um focusing on the work and the experiential knowledge base that we bring to the table and trying to keep a balanced approach because I I welcome the critical lens on what we're doing. I will say that the added value theoretically of a markets-based approach that's solving for a problem of, let's say, as an example, um, you know, access to good, uh patient-centered, outcome-centered health care in slums, yeah, uh, which is actually one of the organizations we've worked with. You know, that problem is through a market-based approach, is in a way much more, much more equally served by market mechanisms if done properly, right? With proper data on health outcomes, number one, proper data on who are we serving, um, you know, in terms of gender, in terms of children, in terms of tribe, in terms of whatever indicators you want to look at to measure inclusion and diversity, but also the market mechanism that uh that basically gets a patient to rate the service, right? And this rating of the service dimension, I think, is is underappreciated because that really does level the playing field, because you're moving away from a pure market-based mechanism that we have in some of our economies to one where we are introducing that system of are you satisfied as a customer? You know, is this price point good for you? How many days does it take you to get better? You know, all of the tools that technology and sort of you know marketing and market-based mechanisms bring in terms of clarity and equality are being introduced, but not only in this sense, but also within the greater context of you know, how is this contributing to leveling the playing field in a city, in a county, in a country, right? And so I think that the combination of these things are helpful in some ways. Now, I don't want to be a sort of capitalistic evangelist here because I do think that we are working in a very imperfect system that we are painfully trying to tweak for the greater good here. So that's my general conceptual, you know, micro lens that I'm operating with. Um and sometimes the market mechanism will not deliver, will underdeliver on its promise, and will simply not reach particular segments of society that can't pay for certain goods, you know, and and and we see over and over again social entrepreneurs that are disillusioned by having created a for-profit which never gets funded properly, and then turn to blended capital, turn to you know, nonprofit structures because they find it easier to raise capital over a long term. So I don't think in terms of an ecosystem that we've really solved this issue of the right legal structure, the right incentives, the very deep and holistic understanding of who the stakeholder is and where is the power dynamic and its challenges leading us. And I think we're still in a conversation about this.

SPEAKER_00 16:12

Yeah, absolutely. And I would love to come back in in a moment to that question of the relationship between where we see the role of philanthropy and where the potential role of more sort of market-based mechanisms is. Because again, as you say, it's it's definitely not a sort of either-or choice, and actually both are appropriate, often in different contexts. And maybe we don't really understand that as well as we should. Um, I just wanted to ask first on the sort of specific work that you do at Insan Group, what what kind of form are the in the investments that you're making actually taking? Because again, we sort of talk about impact investing and socially motivated investing, but that covers a huge range of activities. So is it sort of primarily equity-based investment? Is it you know loan finance? Are they relatively sort of simple loan mechanisms? What or is there a mix of those things?

SPEAKER_02 17:01

So there is the theory and there is the reality. So as you know. So the theory is most of our investments um are equity-based, uh, the the overwhelming majority of them. And this was done simply because we wanted to bring the rigor of due diligence in our own way of looking at entrepreneurial opportunities. Um, and we wanted to, I'll come back to that in a second, but we also wanted to be a little part of a greater story that would unfold, right? The vision was always that we come early stage, but we know that we will be followed by, or hopefully we think we will be followed by many others. And so we wanted to pave the way for other investors to come. Uh and so that that that was the logic. In practice, in practice, and you know, that took me even a long time to understand that in practice, not only us as a little entity, because we are small and very humble, but that but that a lot of it is accompanied by a high dose of blended capital, of grant money that comes to the entrepreneurs in the form of awards or prizes or philanthropic um giving, um uh grant giving by a range of foundations or high networks over the years. And that capital has been instrumental for these uh startups to be able to plow through these very difficult periods uh that we've known globally, right? Um of COVID, of supply chain breakdowns, of increasing cost of goods, etc. etc. etc. Millions of challenges, and not to mention security challenges on the ground and electoral upheavals in some of those countries we work with, and the list goes on. Um so so in practice, it's a fallacy. It's an absolute fallacy in the sector that impact investing is all about private capital. And I'm quite happy to spend time with smart people to you know bring data to show this, but it really is a fallacy. If you think of DFIs that are funding a lot of these commercial companies, DFI is public money, right? Um, so you know, this is linked to the other grand fallacy around financial sustainability, you know, which is kind of the equivalent of the overhead fallacy in the nonprofit sector. The financial sustainability in every startup, uh innovative venture across the world, even in the West, even in you know, uber capitalistic places, are you know are is is that the is that it's risk capital. And that risk capital is often cushioned by a lot of a lot of grant money and free money uh in the form of accelerators, in the form of purbono services, in the form of you know absolute devotion from angel investors, board members that give up their time, treasure, and talent. So that's the reality, uh, and that needs to be you know recognized.

SPEAKER_00 20:03

And that's really interesting. I I think it's a fascinating question. I mean, and I guess there's that broader sense in which impact investment certainly, you know, in its current form, is made possible by those other forms of socially motivated funding that are you know even more risk tolerant. Um do you what's your sense of where where you know whether there are lines that need to be drawn? Because I know there are some instances in which it's more explicit and and sort of structures are created which put position uh philanthropic capital as almost kind of first loss capital in order to bring in um impact investing. And I personally I've I find that idea somewhat uncomfortable in that um I worry that it's sort of whether it is using the motivations of of um uh sort of philanthropic funders in order to make something that that otherwise wouldn't be feasible as an impact investment feasible, and I and whether it is sustainable. You know, if it's kind of catalytic and leads to a situation in the future where that becomes a sort of viable investment, that's fine. But if it's only ever viable if you have a layer of philanthropic money, is that genuinely moving anything forward? I mean, what what's your sense there of some of the sort of potential challenges?

SPEAKER_02 21:22

I think that's that's a fantastic question. So if you if I build on my previous point, right, that we are living in this fallacy that um those boundaries, right, between private, public, and let's call it philanthropic or nonprofit, right? Philanthropic capital are hermetically sealed. They are not, you know, they are not. So if we break that uh initial construct, um, and in fact, that's the first barrier, is not recognizing that in fact the ecosystem would work way better if we understood that in fact. That capital is flowing across these pillars very seamlessly, in fact, right? Taxpayer money that's behind DFIs investing, commercial entities, a lot of them, you know, benefit from philanthropic money in various forms, which I've alluded to. So if you start from the premise that in fact it's not so clear-cut in the first place. And because we are talking about not just financial capital in the form of money, but we are also talking about human capital in terms of expertise and networks, and we are also talking about then technological capital to embed efficiency in some of the models that are, you know, that are sort of emerging. So if you're looking at it in this way, it's naturally blended. But if we go back to the way the sector talks about it generally, then I would say that I would say that overall there is an advantage of not looking at philanthropy in general that should be moving towards impact investing or catalytic capital in particular. Well, what do we mean first of all by catalytic capital for our audience? You know, it's risk capital essentially, right? Think of it as VC money, right? But VC money for a more equal world or you know, a more a more sort of a less unequal world, let's say it's if we're looking at you know, sort of a global source of capital from you know to um to the central power in Africa and India. Um so with capital for innovation tends to be concessionary and long-term oriented. So if we're looking at this definition of catalytic capital, then and and you're not you're not necessarily saying this is a panacea, right? You're saying this is one particular pillar or slice of the bigger pizza, let's say, right, um, that is philanthropic capital, which can continue to be what it is, right? Identity, emotional, you know, uh sort of uh uh uh social proof, long beds driven. Uh but within that pie of uh uh let's say a philanthropic portfolio allocation within that pie, if a percentage of it uh could be growing, that would be fantastic to um actually provide entrepreneurs with a little bit more room to maneuver. Because the situation at the moment, and this is the risk of not having that catalytic capital, and I'll come back to I'll come back to that catalytic capital in a minute, but the risk of not having that catalytic capital is that impact investors who are motivated by, if you look at the definition of impact investors, they're motivated by you know an intentional investment that seeks financial returns alongside environmental and social returns. But but because it's alongside, they're looking, I wouldn't say primarily, but very often, primarily, financial returns. So if you're looking at primarily, well, alongside in theory, primarily, you know, in reality, they're basically either paying lip service to environmental and social returns. This is a provocative statement, um, uh, or they are clearly looking for a winning horse, right? Um, and with all the language that goes with it, this would be fascinating to do a little bit of discourse analysis on, it's really fascinating language, um unicorn, etc., um, zebras and others. But so so so the problem is if you're taking that impact invent investing lens, what does that mean? Uh it means that naturally you're going to be attracted to those that pass due diligence that pretty much guarantees a fairly good, fairly not too long time frame before return. And that means you're naturally going to be attracted to lucrative markets, yet again, uh, even in those in those regions of the world, you're go if you're in India, you're going to be attracted to states or particular sectors that are sexier than others. Same thing in sub-Saharan Africa, that's why 80% of the capital has been going to four countries. Um, so again, you know, larger markets, more mature markets within that, you know, upper uh societal segments of society, within that tech products that have uh or delivery um you know applications that have the power to be transformative in a you know sort of uh faster time frame. And again, you're you you're you're going towards the default lens of capitalistic incentives, which is uh which is pretty much guaranteed uh to lead to further inequality in the medium to long term. So this is why the rationale for catalytic capital, uh concessionary capital, uh where philanthropy is best placed, again, not holistically, because I agree with you, it's not panacea, but a percentage of our portfolio should be directed there to prevent that and for us to diversify to uh you know education, health, supply chains, you know, service delivery offerings that actually are going to be serving those who are marginalized from the system in the first place, those where the impact invested capital will not go to.

SPEAKER_00 28:18

Yeah, that's really interesting. And so is Adam, so the level of the overall impact investment market is part of the problem then that you know, I guess if you can think of things along a spectrum from social return to financial return, where you know you've got kind of fully commercial at one end and then philanthropic giving at the at the other, that at the moment too much of what we see in impact investing comes from the finance end and just sort of allows a little bit of social or environmental concern to come in, but but finance and financial return is still dominating. And what we don't have nearly enough of is money that has started from the philanthropic end but has applied investment approaches and investment principles. Um, and and that would be the space within which we would find the sort of catalytic philanthropy or or you know impact investment that might address, as you're saying, some of these um things that are in kind of less immediately profitable markets and slightly thornier problems.

SPEAKER_02 29:18

Exactly. That's that's that's exactly right. And this is why, you know, in Insight we spent you know much of our time to well, to do three things, right? To number one, uh do the work. Because unless you've actually built a portfolio, you don't know number one, the challenges that entrepreneurs go through. So it's easy to pontificate, but it's not that easy to actually do the work of going to the field, doing the due diligence, understanding the reality that the entrepreneurs deal with day in, day out, and understand who are the clients, right? Who are the end users and how is you know how is their life improving? How do we measure that? Are metrics valid, right? Do they tell the full story? You know, what does it mean for these entrepreneurs to try to scale these businesses when they have to spend more than half of their time, these you know, amazing, amazing change makers, you know, in the nonprofit, for-profit structures that are out there in the world devoting decades of their life? And you know, is it fair that they spend half of their time trying to raise money and understand the complexity of the simplified narratives that are floating around while being disillusioned with how much time it actually takes to raise capital, any type of capital, because that's another fallacy, is it's not going to be one type of capital, as I mentioned before, because it is in reality blended capital. But it's also not a one-time fundraise. It will be many rounds of fundraising if you know an entrepreneur is successful. And that means you can understand the amount of time that goes into um and stress, you know. I really mean stress, stress for the business, stress for the employees, um, and and you know, and and mental stress for these entrepreneurs, and and which we don't talk about uh enough, but over a number of years to actually try to solve a problem that's very real, which could be proper access to healthcare in slums, which could be compostable sanitary pads in India, 100% compostable pads, and and and and and try to work not only to raise the money to grow their ventures, but also to compete in a world where you know the odds are not in their favor, you know, because these are not lucrative markets to begin with. And also you're facing essentially, you know, funders that will tell you, well, put your costs down and make money very quickly, but then you know what marketing costs are like in today's digital world. So that's to give you the reality of some of our investments.

SPEAKER_00 32:00

Yeah, it's really I mean, it's really interesting. Um one other thing I want to try, you mentioned sort of a couple of times, and it's um clearly very important to your work, is around the getting the the right focus on kind of um metrics and and measurement to understand the impact that you're having. Um I was very struck by one thing that I read that you'd written about the fact that that is important, but in doing so, we need to make sure we're not just relying on quantitative data because that doesn't really tell the full story that you want to capture often about um these organizations and entrepreneurs, and that we also need to take into account qualitative data. Could you say a bit more about kind of what what kinds of things you're thinking of in terms of that qualitative data and what that might look like in practice?

SPEAKER_02 32:46

Um yes, and you know, it makes me think of you know a great story. But when I was uh in my last posting in Afghanistan, did some work on this amazing development program that was handled by the government with the World Bank and the government's Ministry of Rural Rehabilitation and Development. It was called National Solidarity Program, and it was all about community-based sort of priorities that would be set at the village level, right? And um, and so we were, you know, some of the NGOs working on it, and then eventually I was working to supervise some of this and monitor some of this program, but we're going to the field and getting these village elders to define their own priorities and from there derive, you know, the metrics of change. And it was really interesting because at that time, you know, I worked really closely with uh a colleague of mine who's you know now on our board, uh, and we spent a lot of time thinking about this issue of qualitative metrics. And uh in in one of these water and sanitation, I think it was like uh a sort of a well project, the the metric, and we used to say the metric of change, the qualitative metric of change needs to come from the end user in their own words and in their own language, not concocted in a boardroom. So it shouldn't be, you know, how much water is that hand pump going to deliver, but it needs to be well, how does this change the life of generally it tends to be a woman or a young girl who fetches the water? And so we went out, you know, to the field, and um, and and I remember the stories of empowerment were really the story we we used to laugh because it was like, well, that's the right metric. It was someone saying, This is great because I get to leave the house to go fetch water, and that gives me a break from my mother-in-law for a couple of hours, you know. And it was like, that was the metric of change. And and it's you so you'd be surprised that um that in fact, that in fact, when you start listening to the voices of the end users, you have a very different sense of the reality of their day-to-day life and what a particular project or intervention means to them. So in Insan, what we've tried to do is go to the field uh to uh capture the voices of the end users. So sit for a whole day in one of the clinics that we funded and really look at the patients and who are they, first of all, and then ask them and then and then capture sort of video footage on this. Uh, but in the last couple of years, we've basically tried to think about the best way to scale what we're doing rather than raise money and make an investment and do it again and again and again, and looking at the fact that we're very small and in the greater scheme of needs, everything is very small. And so we built the first version of a platform called ImpactFootprint, impactfootprint.org, to feature innovations to meet the SDGs, the UN sustainable development goals. And we really focused uh initially on you know basic data, but tried to put a context note around each of the metrics that we've had based on our research, where no one wants to be judged by a number because a number may or may not mean anything, as we know from a lot of these you know, sort of platforms that judge entities by overhead expenses, which is you know completely ridiculous. And so we wanted to, first of all, put these context notes and let the entrepreneurs tell the story in a way that makes sense to them. It's their story that should be showcased. But what we'd like to do in the next iteration of it is embed qualitative data in the form of these videos, you know, testimonials from the end users, but maybe geospatial data, but also reviews. And that really came to, it really came to um sort of my mind one time where we had gone to India to interview students who had just graduated from this amazing organization called Yanchala. And uh and we followed them over four years uh as a project with uh a great pro bono uh sort of partners of of ours, uh videography partners analog production. And we we used to go every year to a field and try to find the same students year after year after year. And then eventually we we did this video of this lovely girl called Amisha, who said, Well, you know, I'm not, I'm now a therapist, and you know, I studied, you know, you know, health and now I have my own practice, and you know, I came from nowhere in the slum, and this is where I am. And she told her story. And we posted the video on Instagram, and a few months later she replied on Instagram herself and said, By the way, everyone, thank you for liking this post. It's me, I'm real, and and I really did go to this to this program and loved it. And I just thought to myself, well, look at this. We have you know Delivery that asks us if we like our food. Wait, why don't we start using the end users if they like their experience? You know, why don't we just why don't we now begin finally with all these tools to go straight uh to capture the reviews from them, testimonials from them, you know, in audio, video, geospatial data, but also basic, you know, sort of reviews like this, where we have an endorsement, right, a verification that this is real.

SPEAKER_00 38:10

Yeah, I mean it's a fascinating idea. And I think huge potential there, as you say, in that increasingly the the technology is there, um, both to kind of capture that qualitative data in the first place and then to analyze it and and sort of turn it into other forms that serve different different purposes. Um I wanted to ask actually, because you you mentioned there um in the context of that, the the work you've done on impact footprint, and and in passing, you mentioned the the UN sustainable uh development goals, the SDGs. And it sort of strikes me that that's really interesting because you know, uh at one end of the spectrum you're talking about trying to understand impact from the point of view of the ground up from the individual and and how it affects their life, and starting from that point, and then almost right at the other end of the scale, you've got this this huge framework of kind of you know um uh agreed goals and priorities and ways of measuring them um that sort of set at the uh uh you know um uh the UN level. Do you in in that work you do? I mean, do you think one of the challenges that we have, I mean, with the SDGs, I guess, is that because they do exist at that scale, often there nothing is filling that gap in between what it means to the individual or the organization on the ground and how they understand their own work, and this framework that has been designed to be of relevance to kind of huge INGOs and governmental funders, and that actually the sort of work you're trying to do in essentially almost kind of translating between those two things, you know, is is really important because that that's the only way that you kind of get people to do the work that's going to deliver towards the SDGs or to understand how work they're already doing might be contributing to them.

SPEAKER_02 39:51

I I think that's that's such a great point. And you know, in using the UN SDGs, you know, there's a you know, of course, as you know, um a lot of people call you know call some of it SDG washing and all of this because uh the the translation of these goals uh can be uh as as you say, um a little bit opaque. So I think it's it's a great question. Uh let me try to first address it uh conceptually. So I uh well, you know, I I told you a little bit uh you know my my own background. I don't I think that the United Nations Sustainable Development Goals, you know, which replaced the MDGs and which will probably be replaced in 2030 by a successor acronym of some sort, hopefully when we'll have made some progress on these ones. Um I think they are phenomenal. And I think they are phenomenal because it's not that easy to capture, to capture the globality of challenges that we face as a human species and beyond. And uh and I think in that sense, they are very global in nature, intrinsically equalizing in their intent and stakeholder diversifying, for lack of a better word. And what I mean by that is of course the starting point is government, right? So the you know, 193 or or I don't know how many we have these days, governments. So it's meant to be that global dashboard so that governments are aligned towards something that makes sense. Obviously, we're failing on some of them. I just start with UN SDG 16 uh as a point of failure, uh atrocious failure. And that's my personal perspective, obviously, because I have a background in political science as well. Um, and I find this absolutely heartbreaking uh on a daily basis. So uh, but but SDG 16, I would say is if I had to rank the goals uh with SDG1 on poverty, probably should be at the forefront of our priorities on a daily basis, and uh and and the others are all linked to them. So they are interlinked and in that sense, and they are ambitious, and in that sense, they seem to be hard to pin down, but actually they are meant to be used by a variety of stakeholders, uh, from governments to then corporations, of course, asset managers and all the way down to NGOs and uh civil society organizations, etc. So I think they are they if used properly and not overly diluted, uh they I think they can be extremely useful to first of all say this is the primary SDG that we focus on, right? Because in a way they're all interlinked. So all of them could be gender and which should be mainstream by now, and all of them should be climate, which should be mainstream by now. But of course, certain particular ventures, if we come down to the work that we're doing, focus on one aspect in general uh that is prevalent, which could be health or education or you know, biodiversity, etc., renewable energy, etc. So they're useful in that sense. You're right. If we overboard on targets and metrics, we can get lost again into a bureaucratic exercise, and we want to stay away from anything that will take us back to, you know, something that's something that becomes meaningless very quickly, um, you know, a bureaucratic checklist. Or worse, a checklist that actually doesn't link back to the real metrics of change that we've just talked about. But I think that if we're able, um, and we've started and we've debated this in our team a lot, and also researched it through uh, you know, gazillion interviews with stakeholders over the years. But in the first version of Impact Footprint, we decided to just focus on one and then really link a mission statement to a theory of change, and then from there derive a couple of KPIs or metrics that can be then standardized with you know with the great standards that have been put. Into place in the last few years. And again, the standardization is not necessarily something that needs to be very harshly driven, but it would just help us propel the sector forward to say, you know, what are we talking about when we're talking about increase in income for artisans, for instance, as a metric, or patient satisfaction in a healthcare venture, or learning outcomes in an educational venture. It's just to give us a little bit of standardization in terms of saying, well, are we really moving the needle for those markets or that were underserved or these areas that were, you know, sort of never touched by capital to enable scale. So in that, in that sense, if you are, I think, approaching approaching them with cautious not to deter smaller innovators or those that may not have the means to develop very sophisticated impact systems. And if you contextualize them not to be punishing and to reflect the reality and operational reality of the field. And if you accompany them with qualitative metrics that are meaningful that we just discussed, you know, video, audio, geospatial, testimonial type of metrics, and you know, there may be you know many more, um, then I think you can really use them to show a story of changed at Israel.

SPEAKER_00 45:27

Yeah, absolutely. I mean, and I think, you know, even if the SDGs are an imperfect tool, I mean, as you say, the fact that we have that framework and it has been agreed between so many parties with kind of competing interests and worldviews is itself a remarkable achievement. And so they do, I think, you know, have huge value. Um, I could keep talking about the SDGs for ages, um, but I'm aware that we're coming up on the hour. And I just wanted to ask one um final question. Um, it's a it's a relatively big one, I should I should warn you, in that um, in some of quite a few of the things that I've read that you've written, you talk quite a lot about um the importance of thinking of sort of genuinely new um uh economic models or societal models and and around ideas of things like donut economics uh and some of the other kind of ideas similarly that have been put forward. In terms of the work that you do, um how much of it do you do you see as kind of working within the existing system to sort of fundamentally change the system? And do you find that a challenge at all? Um, I mean, I sort of ask, because it's a conversation within the philanthropy world, certainly, about whether, you know, the extent to which philanthropy is a kind of reflection of the system that's created it and whether its ability to sort of fundamentally challenge that system is therefore limited. And I wondered if in the work that you do that sits more at the intersection of um uh of philanthropy and and sort of investment in it and and kind of um entrepreneurial models, whether you felt as though you had more capacity to use that work to sort of drive genuine transformative change.

SPEAKER_02 47:05

I mean, that's a phenomenal question. You know, and in a way it's it's a question about are you more effective within a system or outside a system? You know, I started within uh sorry, you know, my work within the greater system of these large institutions to understand how they work and uh pick the entrepreneurial route to have that flexibility, right? To work with. So, I mean, the advantages of the entrepreneurial route is that you have the benefits of thinking freely and doing thought leadership pieces that some people read, and I'm so happy you read them. And so you're a free thinker in a way, um, and you charge your own path with people you like. Uh, and that that's really a luxury. Um, and it's people you like in your team, in your board, the people who fund you, and and your the partners that you choose, the corporate partners, etc. So, in a way, you concoct your perfect recipe that you think is perfect, right? Uh, so to speak. But the problem is this is kind of an escape route in a way, because it works well when it's small, as as we have been, but when you want to scale, then you have to go back into the real world. And uh so with Impact Footprint, for instance, we need to we need to make this scale. And we need to interact with larger funders, and we need to be part of these power dynamics. And uh, you know, I can't tell you the myriads of ways in which these dynamics work. You know, the capital going to the same countries over and over again. It's kind of a herd mentality, capital going to, you know, those that may have been founded by, you know, people by a particular skin color and not others, the capital by default going to networks, you know, access to networks is a massive one, right? Massive one to people who know you or you know, having access. So there is so many ways in which the system, not just the philanthropic system, by the way, the VC system, right? Uh political systems, I mean, every system in a way is is systemically uneven. And uh and so, in a way, you can't really escape from that if you want to affect change. And I don't know the answer. To what extent do you have to compromise your values to become extremely quote unquote successful? And of course, it depends on how you define success. So I don't know the answer to that because we, you know, by the metrics of success of the greater world, uh, you know, we haven't we haven't reached that. But uh but by the metrics of success of human change, I think we're doing what we want to do.

SPEAKER_00 49:56

Well, that's yeah, great to hear. And I mean, I you know, I it's an unfair question in a way, in that if you could come up with a an answer to the the the question of sort of how you balance pragmatism and and working with the world as it is versus sort of idealism and seeing the world in a totally different way. You know, it's it's not as if we're the first people to struggle with that with that question. Um but anyway, I mean it just remains to say, Faranais, thanks ever so much for coming on the podcast. I've really, really enjoyed having the chance to to talk. It's been a fascinating conversation. Um, is there anything that you would would like um, you know, before you go, just to flag up to people? I'll obviously put links in the show notes to where they can find more details on your work and some of the things that you've written that that we've discussed. But is there anything particularly you've got uh coming up that you'd like to uh alert people to?

SPEAKER_02 50:41

Um well, not not so much about us. I'm sure you're going to do a good job to represent, um, to represent us, but perhaps I I'd like to end on a couple of thoughts I've had lately.

SPEAKER_01 50:52

Yeah, of course.

SPEAKER_02 50:53

You know, because we have to interact with um, particularly in building impact footprints, many donors, um, these investors, but also entrepreneurs that are doing really unbelievable things in the world. Um I think it's really important for all of us uh to remember to be humble because as we've just said, the system is very top-down. Uh, but it's important to remember that the challenges are massive in the world and that all of us are working on little little pieces of a much bigger puzzle. Um, and so humility and and respect is is really critical. And I think if we had more of that in the ecosystem, it would work more fluidly uh and it would be less top-down. Um so that's that's one. And then the second, I think, is you know, uh at the entrance of the United Nations in New York, there is a poem by an Iranian poet called Saadi, called Bani Adam. And this this poem is really about the essence of humanity. And and I think that in the particularly the current world we live in, in the last, you know, unfortunate uh few years, I think we should remind ourselves to no matter what we do, no matter what tool we use to effect change in the world, or what path we choose, remember to stay compassionate and and to keep your heart in the right place. And I think that that would take us a long way.

SPEAKER_00 52:23

Yeah, I think, I mean, absolutely agree, and I think hugely important things to to remember. Um, yeah, thanks ever so much for for coming on the podcast and wish you all the best with your work. And you know, perhaps we can catch up at some point uh in the future and and see how things have developed and pick up some of these conversations.

SPEAKER_02 52:40

Thank you so much, Roger, for your time.

SPEAKER_00 52:51

Okay, great. Well, my thanks again to Farinaz for finding the time to come on the podcast. Really interesting to talk to her about her work um and great to have a conversation um exploring uh impact investing because it's not something we've talked about that much on the podcast, um, and it's something I've done work on in the past, although not for a while. And I think the intersection between that and uh and philanthropy is a really interesting area, so it's great to have a conversation about it. I will put links in the show notes to places where you can find uh articles and comment pieces that Faranais has written that relate to quite a lot of the things that we were talking about in the podcast. I'll also put links to a couple of things that I might have written uh or other episodes of the podcast that might be of interest. Um if you're interested more broadly in philanthropy and civil society issues, do check out the website at whyphilanthropymatters.com. You can also find contact details for me there where you can get in touch if you've got ideas for people I could talk to on the podcast or uh other issues that we could explore, or just in general, if you have thoughts on any of the work of Y Philanthropy Matters, I'd love to hear feedback on that. Um other than that, it would be great if you could like, uh subscribe, um, do leave a nice review on iTunes or wherever else you get your podcasts. Uh, if you've got friends or colleagues that you think would be interested in the podcast, then please do share it with them. You know, the more the merrier. And other than that, I will see you next time.

SPEAKER_01 54:15

Bye.