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Think bigger, think differently

  • Published at 12:05 am November 11th, 2016
Think bigger, think differently
She is the founder of IIX, which has to date closed over 26 deals for high-impact enterprises, is facilitating +$25 million in impact investment capital and has impacted over 11 million lives; and Shujog, which has conducted over 100 impact assessments, produced +20 research papers and won two global awards for its programmes. This week, we catch up with this power woman and discuss her phenomenal career. What made you move from Wall Street to impact investment? I was fortunate to be born in a family that not only treasured education but also taught me the importance of public service. During my undergrad in the US, I was attracted to the power of businesses and market-based solutions. Thus, I joined Morgan Stanley in New York. I personally experienced the power of finance in shaping our world, but realised it was part of a system that only looks at maximising profit. After working for a few years, I decided it was time for me to return to Bangladesh. My goal was to use my finance knowledge for sustainable development. Back then, I came across a bank that was giving small loans to rural women. This was 1991 - and Grameen Bank was not very well known in Bangladesh or globally. Inspired by the women and communities who were empowered by microfinance to create opportunities for themselves, I created my first social enterprise, OneNest, an e-commerce that empowered thousands of handicraft artisans with improved livelihood by linking their products with the global market. I thought being a Bangladeshi woman in Wall Street was hard. Being what is termed today a woman ‘Social Entrepreneur’ in 1999 was even tougher. I managed to grow oneNest and ultimately sold it in 2004. oneNest’s work impacted the lives of over 500,000 women across Asia, Africa and Latin America. However, the sale left me a little empty. I realised that the only way for global development to be sustainable is for one of the most powerful forces in the world - finance and capital markets - to be part of the solution. That is when I founded IIX and then a year later Shujog – two organisations with the mission to bridge the gap between development and finance through a triple mandate - mobilizing capital for development through various investment platforms, knowledge management, and empowering stakeholders. IIX and Shujog have created an entire ecosystem of social finance/impact investing across Asia, enabling private sector capital to come into the development arena. What is the climate for impact investment in Bangladesh? Bangladesh has a vibrant social-impact landscape and the current narrative has been relentlessly driven forward by a diverse set of ecosystem players. Donor interest and conducive public policy, combined with the efforts of national-level organizations like BRAC and Grameen, have contributed greatly towards shaping the development paradigm in Bangladesh. But there is more to be achieved. Beyond its 26,000 NGOs and 600 MFIs, there is a new wave of impact entrepreneurs looking to use market-based solutions to achieve development goals in the country. Impact investing, investments with the intention to create demonstrable social and environmental outcomes alongside financial returns, is a new movement in the country that can bring in a new set of stakeholders into the development equation – the private sector, including banks, financial institutions, family offices, high net worth individuals, among others – all looking to create catalytic positive change with their investments. What are the biggest obstacles you faced while setting up and working at IIX and Shujog? Today, impact investing is commonly understood. I set up IIX and Shujog at the peak of the financial crisis where the world was starting to realize the dominant narrative of capitalism and business as usual needed to be redefined. Back then, impact investing was a term that was nearly unheard of - in both finance and development sectors - and was not easily accepted on either side. As pioneers in the field, one of the key challenges we faced was in aligning diverse stakeholders from private sector, public sector and civil society to imagine the possibilities that impact investing can bring to the world. It remains an important endeavour to create a narrative that binds seemingly disparate players together, and help them see that they really are part of one ecosystem. I had to educate the ecosystem, engage the ecosystem and change the traditional mind sets that were used to doing things in a different way. I did not have any donor funding, and had to create effective revenue streams and grow the companies while doing infrastructure and market building. This is what it means to be a social entrepreneur – you make your social cause sustainable by effectively using the market forces and I did just that. What is the philosophy that drives your focus on social capital? The goal of achieving sustainable development drives our focus on creating capital markets for social good. We want to move away from assistance that runs on hand-outs, which are unsustainable and often disempowering. Instead, we want to be the crafters of an age of empowerment, by providing access to opportunities through impact investing. As I like to say, I would like women not only have micro credit to sell milk or eggs; I would like these same women to have the potential to receive commercial loans and create small, even medium enterprises. I want them to be a part of the capital markets system and financial structures where they are truly a part of a democratic financial system. What was it like to be a woman from Bangladesh breaking into a traditionally male-dominated sector? For me, it was sort of a coming-of-age moment. I realised how much I could achieve by building on and investing in my intellectual abilities. I remember, when I first started working in New York (almost 30 years ago now), I had to learn not only the language of finance, I had to learn to dress right, I had to learn US sports lingo and be able to use it effectively, I had to learn to be comfortable working in a very male environment and I had to learn the ability to laugh at myself – all of this and have incredible stamina to work 100 hour weeks. All this would not have been possible if I did not have an ultimate goal in mind. There were days I was miserable but I kept on pushing because I would say to myself, ‘I am getting this incredible opportunity that very few from my country ever get, I need to learn everything I can and take it back….’. I had an incredible sense of responsibility towards Bangladesh and the rest of the developing countries. What is your dream for the future of Bangladesh? In moving forward, I want to see women graduating from microfinance and factory work to play a bigger role in the economic development of our country. Also, I would like to see the nation leverage the power of technology and finance to scale impact and create systemic change at the grassroots level. However, for this to happen we need to have proper public policy in initiating impact investing, the donor agencies changing traditional views of development and both the private and NGO sectors thinking of sustainable development. It is good news that Bangladesh is rapidly becoming a middle income country; however, it is bad news that with that, donor funding is depleting. In order to be able to handle our own development agenda and brace ourselves for the effect of climate change, we need to approach the development agenda very differently. We need to embrace impact investing/social finance so that we can effectively use finance and financial innovation for social good. I hope IIX and Shujog with all the work we have done across Asia over the last 7+ years can play a role in the sustainable development goals of Bangladesh. What would you say to the young entrepreneurs and bankers trying to break into impact investment? Think bigger. To remain innovative and responsive to the world's biggest challenges, we need to constantly push boundaries. Dare to think differently about the role of finance in expediting sustainable development – it is not about leaving their job to join a start-up social enterprise, there is so much they can do with their existing skill set and from within their own institutions to create change from within. For instance, being intraprenuerial can have a powerful catalytic effect on the impact investing ecosystem through strategic corporate social responsibility that includes employee engagement components or skills-based volunteering beyond financial support. IIX has worked with several corporate partners in this capacity including Bank of America Merrill Lynch and KKR. Beyond young entrepreneurs and bankers, I would challenge young people working in the donor sphere to play a bigger role. For Bangladesh's impact investing ecosystem to have a strong, resilient foundation, it needs the support of the donor community to de-risk investments, invest in key infrastructure such as accelerators or promote knowledge management through research pieces that can lay the foundation for future initiatives. What book are you reading now? I read the Economist, New York Times and the New Yorker pretty much every day. I am currently reading Empress Dowager Cixi by Jung Chang, My Brilliant Friend by Elena Ferrante, Democracy Against Domination by Kazi Sabeel Rahman (my brilliant cousin) and Listener by Lemn Sissay. When I am home sick, I always pick up Tagore’s Golpo Guchcho (along with some mango pickle). Who inspires you? The women of the world, many of whom are striving to create opportunities for themselves. What other profession would you choose, if you could? I grew up listening to the BBC radio. It's very likely that I would have been a war correspondent, if I hadn't become an entrepreneur! What is your favourite app? Uber - it's amazing how much easier it makes my life! One historical figure you wish you could meet? It will be the Rani of Jhansi, a woman who valiantly led troops of men to the Indian Rebellion of 1857 and became a symbol of national pride. One thing you wish you knew at the beginning of your professional career? It's still a man's world. Every step of the way. The best part of your job? The people I work with! One thing you still have from your childhood? My sense of defiant optimism. I don't think it'll ever leave me.