Friday, October 29, 2010

Talking About Money

This week in “magic” (Wharton shorthand for MGEC: 621 Managerial Economics) we discussed the concept of expected utility - the idea that our valuation of opportunity is not simply a function of monetary worth but also a reflection of our current assets and preferences. For example, a person with $500,000 in existing wealth will value the same job offer differently than someone with $50,000.
The lecture reminded me of a Laurine*, a Congolese woman I worked with several years ago who once said to me, “In America you work so hard for cars and bigger houses. At home, people work hard for food and water. It’s strange to think about. Feeding your children is more satisfying.”
Coming to Wharton from a non-profit background, I knew the M.B.A. experience would be challenge. I would be introduced to new ideas, industries and worldviews which would require me to operate out of my comfort zone (in fact, this is one of the reasons I chose to get an M.B.A.). However, the most surprising change I’ve had to make hasn’t been adjusting to the culture or lingo (elephant hunting?!), it has been shifting the way I think and talk about wealth. As a senior manager for Women Thrive Worldwide, a non-profit that helps women in developing countries lift themselves and their families out of poverty, I worked with many women who struggled to survive on $1 a day or less (the rough definition of extreme poverty). In fact, my colleagues and I thought about the value of $1 countless times a day: “How many ears of corn can a mother in Nicaragua buy with $1?” “What percentage of $1 in foreign aid reaches women’s cooperatives in Ghana and how can we maximize it?” At Wharton, I’m in classes with people who have been thinking about wealth from the opposite end of the spectrum. Many of my peers have led multi-million dollar marketing campaigns or managed investments for prominent hedge funds. One of my goals here is to learn how the expertise from both these perspectives can be merged.
I’ve begun this quest by joining the Wharton Social Venture Fund, a student run organization which partners with venture capital funds focusing on a triple bottom line (people, planet, and profits) investing**. I’ve met a community of students who are equally interested in figuring out how traditional finance and investing can be combined with large scale poverty reduction, access to education, and environmental preservation. At our first training we mixed a heated debate on measuring social impact with a detailed presentation on the venture capital process. While I didn’t leave with the “answer,” I did come away with a feeling of purpose and potential. I will keep you posted on our progress!
Mckenzie Lock, Forte Fellow
Class of 2012, The Wharton School at University of Pennsylvania

*Name changed.
**For those of you interested in learning more about social finance check out the Global Impact Investing Network’s website.

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