This video was originally published here.
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In Scripture, when God’s people approach Him with their dreams and desires, He sometimes answers with an unexpected question: “What do you have in your hands?” In this short video, HOPE International explores how God invites His people, both in Scripture and today around the world, to play an active role in restoring brokenness.
Image by Cytonn Photography
This article was originally published here.
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— by Bill High
A recent UBS Investor Watch study notes that a whopping 41% of business owners expect to exit their business within the next 5 years. That business exit looks like the following:
51% expect to sell
Only 20% expected to leave the business to family
18% expected to shut it down
and 10% were unsure of their exit plans
While 65% of these owners were either ready to retire or believed conditions were favorable for sale, just 48% of these same owners had an exit plan in place. Nearly 60% of these owners had never had an appraisal of their business.
The adage certainly holds true that while many are willing, not many are prepared.
(I lay out the process for a successful business exit in Sell Well, a book I co-authored with Peter Kubasek and Rene Robichaud to help private business owners and CEOs navigate the many issues related to the sale of their company.)
Once again, the continuing climate for business sales looks strong but the underlying truth is that many are not prepared. These owners need to seek counsel for those who can guide them through the process.
The UBS Investor Watch study also presents statistics regarding family businesses and succession or exit plans. While some business owners desire their kids to take over the family business, many kids don’t share that desire.
82% of kids would rather have money from the sale of the business. Only 18% would actually want the business.
On the other hand, business owners understand some realities about their children.
89% acknowledge their kids aren’t interested in the business
21% realize their kids aren’t qualified
9% desire a different career path for their children
But whether the kids take over the business or sell it, owners list lots of worries related to a business exit and their kids:
57% fear they’ll take the business in a different direction
57% fear the sale to an outsider
55% believe they’ll squander the profits
52% believe they’ll fight over the money
The lessons from this study are what we’ve seen time and time again. Family business is a great idea. But few family businesses survive generationally—just 30% will survive into the second generation and only 15% or less into the third generation.
Successful generational family business takes careful transition, communication and planning—far more than just a casual handoff.
If you (or someone you know) owns a family business, here’s the takeaway from these numbers: don’t put off the planning, structures and practices that are essential to a successful transition from one generation of leaders to the next.
This article was originally published here.
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— by Craig and April Chapman
As we launched Impact Foundation, Jeff and I have searched for board members who share an excitement for kingdom impact investing and who have skills and experience to share. We found that and more in Craig and April Chapman. We asked the Chapmans to describe their experiences investing for impact. Here, in their own words, is there response.
Over the last few years, our paradigm about how best to provide financial support to organizations serving those in greatest need has been shaken up, if not blasted apart, by the notion of “impact investing.”
Historically, we have set aside some amount of our personal financial resources to go to non-profits – i.e. organizations that improve the lives of others – with the goal of impacting not only their physical, emotional or educational needs, but also pointing them to God. Frankly, we love being generous with our financial resources, mostly because it’s a tangible way of loving our neighbor, but also because it’s really all God’s money anyway.
The problem is that once we give the money away, it’s gone – and we have to continue making money in order to give more away. Clearly, that is not a sustainable strategy unless we have an unlimited capacity to make money. That’s where impact investing comes in.
One online dictionary tells us that “impact investing refers to investments made into companies, organizations, and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return”. In a practical sense, this means that we can invest in for-profit companies who are characterized by a double bottom line; i.e. financial and social return.
As Christians, however, we’d really like to see a triple bottom line: not only financial and social return, but also a spiritual return. These are companies that serve the world for Christ, meeting physical, financial, emotional, social and spiritual needs while making money for investors.
Do companies like that exist? Absolutely, and more are being created every day. These are companies founded and run by very smart and spiritually grounded Christians – companies like
Cloud Factory, an Indonesian company that employs small groups to do piecemeal data entry while providing spiritual support and encouragement to the workforce.
Sseko Designs employs young women in Uganda to make sandals, donating part of the financial profits to allow them to attend the local university, all in the name of Jesus.
Praxis Labs, a business accelerator, helping Christian entrepreneurs to “create cultural and social impact through entrepreneurship”.
So let’s assume we find a “triple bottom line company” that resonates with our passions, and we invest in them. Let’s further assume that they do well, and provide a nice financial return. Well, what do we do with that money – put it back into our bank account and spend it on ourselves? On the contrary, it’s our desire that the financial return be reinvested into more impact investments, thus creating a self-sustainable cycle of social and spiritual impact. Pretty cool, right?
We have now made two investments through Impact Foundation, and are about ready to follow those up with a third. These are essentially private equity investments with some inherent complexity, and the IF investment committee has provided some valuable insight as we evaluated the term sheets. In fact, they even suggested some simple changes in the final contract language that might protect our investment later. In order to make these investments, we moved money from our NCF donor advised fund into the IF donor advised fund, and IF managed the entire process. Overall, we could not be happier having the IF team as our partner in our personal impact investing portfolio.
Forbes Magazine has named impact investing the #1 trend in philanthropy for 2015 and 2016. But we wondered – is it really philanthropy if the money is invested rather than given away? It’s our belief that there will always be a need for pure philanthropy, but impact investing provides a responsible and sustainable alternative to love our neighbors for the long term with the potential of also growing our giving fund. We’re thrilled that Impact Foundation was formed to make what might sound like a complicated approach to serving the least of these into an accessible tool for all of us.
This article was originally published here
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Our friends at Impact Foundation recently took a trip to Ethiopia, and this is Part 1 in the series of things they learned and found there. For more in this series, visit their website.
— by Impact Foundation
“Jobs, not aid, are the most urgent need of these starving people,” I thought. We crouched on the dirt floor of a twelve-foot diameter grass hut in the Omo River Valley of Southern Ethiopia. Twenty-one hours away from the capital city live the Kara, Hammar, and Benna tribes—people who use cell phones to communicate but whose ways are otherwise unchanged from those of their ancestors who settled the region thousands of years ago. Picture the most remote tribal images you have seen in a National Geographicmagazine, and you are likely thinking of these people groups.
We sat in that hut listening to Ari, a member of the Kara tribe, describe the effects of a government program to dam the Omo River for flood control and to provide hydroelectric power to parts of the region. The dam ended the practice of planting crops in receding flood waters. Plus, the dam changed the chemistry of the river making the water muddy, undrinkable, and unfishable.
In the first few years after the dam was completed, these problems were manageable because a Turkish company opened a 25,000-acre farm that employed many people from the local tribes. It also operated an irrigation pump to bring fresh water to the villages. Unfortunately, all than ended 18 months ago when the company hit hard times in their corporate office and left the region abruptly.
Ari described how since then people have been starving, and entirely dependent upon bags of sorghum that an aid group intermittently delivers. While he talked, Ari’s wife sat with us, occasionally dipping into a plastic bucket of mud-colored liquid. As she drank, she became more and more disengaged.
“Do people use the sorghum to make hooch?” asked one member of our group. The answer was vague but we later got more of the story from our host, Lale a man born in the Kara village and who later attended boarding school, ultimately obtaining a college degree in the US. As the only member of his tribe to ever have traveled abroad for schooling, he is one of only a handful who are college educated. Lale explained that his friends spend most days drunk. Without fishing, farming, or a job to fill their days, there is little reason to do anything else.
Lale, who lives in a nearby city, and another member of the Kara tribe during our visit to the village.
As hard as it was to watch the scene inside the tent, it was heart-wrenching to watch the children outside the tent. Little ones with distended, undernourished bellies, clamored for attention but many adults were too affected by alcohol to give it. Instead of learning farming, fishing, and household management practices that have been passed through generations, the kids are learning from these elders how to survive on handouts.
We will never “charity” our way back to sustainability for the Kara, Hammar, and Benna people. Worse, as people become dependent on the charity’s aid it threatens their way of life as they lose ancient skills in a single generation. Our time in the hut demonstrates in miniature what is happening all over Africa due to war, genocide, AIDs, drought, corrupt governments, and too much aid.
Charity or government aid is critically important component of emergency response to crisis, such as genocide, famine, war, and mass displacement. The question becomes at what point should the focus appropriately shift from aid and emergency relief to investment and economic development.
Carried too far, aid can create dependency and cause more problems. Many good books have been written to elucidate this cycle, like When Helping Hurtsand Toxic Charity,but our new favorite is Social Impact Investing: A New Agenda in Fighting Povertyby Kim Tan and Brian Griffiths. Through data from the United Nations and the World Bank, the authors point out the inverse relationship between the volume of aid dollars and economic growth in sub-Saharan Africa. In other words, the more aid that is sent, the worse various economies fare. We cannot sustainably overcome poverty with aid.
There are bright spots in Ethiopia, though, where large-scale business is making a difference in driving back extreme poverty and ills of too much aid. The next blog posts in our Ethiopia Series will highlight the transformational work of Verdant Frontiers: “What Does it Take to Find Success” and “Understanding the Verdant Model”
This article was originally published here
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Last week, God brought together 150 leaders shaping the Faith Driven Investor community to discuss what God is doing and how we might work together. One of our friends, Mats Tunehag led us in a prayer that was an adaptation of a well known prayer by St. Patrick. We thought it might be an encouragement and a great way to recalibrate as we start off our week.
— by Mats Tunehag
On March 17 many people around the globe celebrate St. Patrick. He was a human trafficking victim in the 5th century, who became a missionary to the people and land (Ireland) where he was a slave.
Let me share a well-known prayer by St. Patrick, and customize it to a prayer for faith driven investors: (the original is in bold and italics)
Christ with me, as I invest for the common good and God’s glory
Christ before me, as I steward the wealth entrusted to me
Christ behind me, as I evaluate opportunities near and afar
Christ in me, as I invest time, treasure and talents in others
Christ beneath me; He is the foundation
Christ above me, He is the owner of it all
Christ on my right, Christ on my left, He is the Lord of the marketplace
Christ when I lie down, and rest from my work
Christ when I sit down, in my office chair
Christ when I arise, enthusiastic or weary
Christ in the heart of every person who thinks of us, and our vision
Christ in the mouth of everyone who speaks of us, and our work
Christ in every eye that sees us, young and old, rich and poor, countrymen and foreigners
Christ in every ear that hears me speak about our products and services
Glory be to God the Father, the Son and the Holy Spirit, forever and ever.
Amen!