Why is Raising Money for Startups Easier than Raising Money to Save Girls from Slavery?
For my 50th birthday, I kicked off a fundraiser of $50,000 to save 500 girls from slavery in Nepal by paying for their education through the Stop Girl Trafficking initiative at the American Himalayan Foundation. The bounty of donations and kindness has been overwhelming. In just six months my campaign has raised more than $32,000.
In that same six months, at Jack Industries I helped two startups fundraise and close angel investments each in magnitudes much larger than $50,000.
Why has it been easier to raise money for startups than to raise money for girls to attend school and avoid being sold into slavery?
If investing in success is a metric, the investment in the girls is a better bet. Once educated, the girls stay out of sexual and domestic slavery by contributing economically to their families. The current startup failure rate is documented anywhere from 50% to 90%. According to Stop Girl Trafficking, they have kept more than 10,000 girls out of slavery through education and after becoming educated, zero have become slaves. In other words: a 0% failure rate.
If investing in passion is a metric, the investment in the girls is again a better bet. They are legitimately hungry to learn. There is no risk that they are using the investment for some other purpose or just making up stories about their technology, connections or promises. The girls are not hustling the investment to aggrandize their resumes or egos.
If investing in hard work is a metric, the investment in the girls is the safer bet even though startups are notoriously hard work. I don’t know any founders doing three hours of farming and other hard labor chores before going to work for the day. I have worked long hours launching businesses but I had security and first world luxuries bookending my days.
If the knock-on effect of the investment needs to be job creation and economic growth, saving a girl from slavery through education puts her squarely into the economy as a provider and purchaser of labor and goods. She transforms from an underutilized asset to a contributing economic agent.
The why must be the perceived lack of return on investment.
With a startup investment, the investor has a slim chance of recouping the investment or better yet, making money on the investment. The investor watches the investment, engages in the business and participates in the opportunity. With a donation, the investor will never recoup or make money on that donation except through lowering their federal tax burden through the donation deduction scheme.
The investment is front of mind and present. The donation is out of sight and distant.
Maybe all I need to do is get devices to these girls and teach them to make and pitch their own investor decks, respond immediately to any investor questions and provide quarterly and annual reports documenting spend rate, value created and capital utilization? In ten pages, thirty size font and twenty minutes, a girl could explain the problem (slavery), the solution (education in order to get a job), the opportunity (meaningful life with dignity and purpose), the investment ($100 pays for one year of education), the competition (30M slaves globally) and the team (the girl herself plus the Stop Girl Trafficking initiative).
If I can keep the girls on the front of the investor mind, then maybe the ROI of moving girls from slavery into the economy through education will suffice and I could raise money for the girls as I have for startups.
Until then, you can angel invest with a guaranteed return of saving a girl from slavery in Nepal by donating on Crowdrise.