Question

Based on the reading, "Case Northwest Community Ventures Fund,"

1. Does the for-profit avenue chosen by Eileen O'Brien make sense for Grassroots Business Initiatives, Inc.?

2. When is it OK to forgo economic profit in order to increase social returns? How can social returns be measured? Can social and environmental benefits be given a monetary value?

3. What is the upside for Michelle Foster if NCV succeeds? What are the professional risks she faces?

4. How should Foster position herself and her team prior to raising a follow-on fund?

Please answer all these 4 questions.

Answer 1

1. Does the for-profit avenue chosen by Eileen O’Brien make sense for Grassroots Business Initiatives, Inc.?

Eileen brings to the table a lot of experience she had another Companies. She brought assets under management and her to ability to track change. She can easily available for public support. Also help with funding alternatives by government are les restrictive.

2. When is it OK to forgo economic profit in order to increase social returns? How can social returns be measured? Can social and environmental benefits be given a monetary value?

If there is a conflict with values and economic profit. For example, John Coolidge chose his family over the profit. He chooses his family over working with Citibank. He didn’t want to lose a lot of time with his family. By working with Foster, it gave him or social return by choosing more family time, which hard to get back once it lost. Social return is more intangible, and it can have evaluated by the level of satisfaction you derive by combining your social/moral value with your everyday work ethic. Monetary value can’t be placed on social environmental benefits. Money just can’t measure up to social/environmental returns.

3. What is the upside for Michelle Foster if NCV succeeds? What are the professional risks she faces?

The upside for Michelle Foster success if the NCV succeeds is an opportunity to prove that venture capital investment when place within well undeserved markets could have real difference and realize a good return. It could a lot of doors to whole new class of rural investments vehicles targeting communities that would not otherwise have an opportunity.

4. How should Foster position herself and her team prior to raising a follow-on fund?

Foster should phase off from GBI, which she felt would generate positive results. With her flexibility to craft and replace the model, she would better position herself to handle the economic development and vision. This can only be accomplished by finding a model that will help the rural businesses to be more profitable. If that was accomplished, it will be more lucrative for investors to come in invest in the rural businesses.