There's a distinct difference between being financially secure and being a greedy money grubber. One works hard to get the money they know they and their family need, the other is obsessed with acquiring more and more money, no matter the consequences.
Success Shaming at Its Worst
Why do some people criticize individuals who focus on building some wealth for themselves and their families? Even worse, apparently it's unthinkable for those people to try and build some wealth for themselves by investing in developing areas or countries. It's wrong to profit off of disadvantaged areas these critics say. Greedy, unethical, or even, evil.
But let's think about how limiting of an idea that is. If a typical working woman in the Netherlands wants to make an impact in a country like Cambodia, what are her options?
1. She could take time off from work and fly to Cambodia to volunteer her time.
2. She could donate to a worthy charity that seeks to help people locally in Cambodia.
So let's examine those two options. Both of those options cost her time and/or money. If she takes time off to volunteer, that's less money that she'll make this year for her family. If she takes money out of her budget and donates it, that's less money that she has to spend on her own family, and her own community.
Ultimately, she decides to do neither of these options, or she decides to donate a small amount to a charity if she has time to research and find one.
Making a Difference in a Sustainable Way
This working woman wants to make a difference in the world. She wants to do what she can to try and contribute to a more equal society. But she also wants to provide her family with a bright future.
In the Netherlands, she has many options for the bright future for her family part. She can invest in the stock market, in an index fund, or some other specialized financial instrument that will allow her to build her wealth for the future. Not Scrooge McDuck wealth, but a solid financial base so that she can afford to take care of her parents when they get older, help her kids pay for living expenses when they go to college, and maybe even help them buy their first home when they move out and get married.
Is that wrong of her to prioritize those goals over those of making an impact in countries throughout the world she's never been to? She may not be Mother Teresa, but she's not evil.
If we keep the world the same way that it is now, offering only volunteer work and charity as a way to make a difference, we leave making an impact mostly to rich people and individuals without life constraints who can travel the world volunteering and donating money they will never miss. Most working moms and dads, and almost everyone in debt is eliminated from making any kind of major impact.
Why Impact Investing Exists
This is the exact reason companies like Lendahand exist. Why not offer people the choice to put their money to work, to build some wealth for their future, and to do it in an ethical way that helps solve the global problem of inequality?
Many people incorrectly view this as a zero-sum game. They think that if you are investing money into someone in a developing country, you are doing that as an alternative to giving that person the money. Donation they see as generous, investing they see as greedy. But the reality is that the investor doesn't face the choice to either invest in someone or give to them, they face the decision to either invest in that person or invest in someone or something else.
Therefore, when someone criticizes an investor for wanting to benefit themselves while benefiting a small business in a developing country, they forget that that if the investor didn't make this type of impact investment, they would only be left with putting their money in more traditional investment options, such as stocks or an index fund. But who would that benefit? Then no money would be going to a small business in a country like Cambodia.
Changing the Way We Look at Investment Opportunities
What do you think the business owner in Cambodia would prefer? Would he rather be treated like a normal business person and be given the opportunity to receive a business loan and pay it back with interest? Or would he rather be ignored and the investment go to Wall Street?
I think the answer to that is clear.
If the only way we can get money from the developed world into the developing one is to guilt people into giving it away, we're in for a long wait until we bridge the huge wealth gap between those two groups.
However, if we can build meaningful, sustainable systems to allow the mutually beneficial exchange of money, through investments or other mechanisms, to bring economic prosperity to hard-working people in developing countries, while not forcing investors in mature economies to sacrifice their own self-interest, then we can help speed the rate of progress for ridding the world of wealth inequality and ridding it of poverty once and for all.