Venture Socialist? – Value Over Risk & Return

One June 16th, 2010 I wrote the following on my old blog @ dananimal.blogspot.com:

If I could give one thing to the world… one thing that would change it and sustain it… it would be the oxymoron of a non-profit organization that’s goal and purpose in life is to create, invest in, support, and build sustainable businesses… an organization that reinvests what is earned into the community and the world around it… building businesses not merely with the intention to get rich and the desire become the largest of the Fortune 500’s, but the goal of becoming the best business they can possibly be… choosing instead of big, instead of gargantuan, to be great.

This speaks to the heart of what I believe in and have experienced. There are handfuls of people out there with great ideas and existing small / struggling businesses. Venture Capital does not accept the returns of local startup ventures; they are looking for promising ideas that are geared toward huge growth. Banks don’t care anymore; they have shut the doors to businesses and become completely risk adverse. Personal investments today are based upon large multi-national conglomerates and large company funds instead of local, valuable, longer-lasting (more sustainable) quality businesses. To me this smells strongly of opportunity.

I have heard talk of a third metric entering the business investment space, and that is social impact. Risk, Return, and Social Impact. I might call that third term societal value, or simply value. In all the hype of the DOt cOM 90’s and the booming Real Estate Triangle-scheme like 2000’s we lost sight of the fact that return is related to value. That the market price of a stock and the appraisal of a property need to be rooted in its actual value. For years we have based return on comparable return; valuation based upon growth instead of tangible and sustainable value, real estate based upon comparable sales. Perhaps what is really missing is taking that step back to say, “how will this business change and improve our world?”

Do I have the complete answer; nope, not yet. But I believe a great start is to investigate the root of local success, share those behind-the-scenes stories, and allow the people to bring some of that money invested back home, to the businesses they trust and interact with daily. I want to start by showing why Reno / Tahoe is a great place to live and do business. I want to encourage people to come here, start businesses here, and invest here. Not a new silicon anything, but a local us thing.

What do you think? I welcome your comments…

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