Previous articles in the series available here: Part 1/5, Part 2/5
We hold eBay and its founder, Pierre Omidyar, in great esteem and to the highest of standards. The Omidyar Network is a ‘mission based’ organization founded by Pierre Omidyar and his wife Pam in 2004. It makes both for-profit and non-profit investments.
When it comes to “massifying” microfinance investments in dollars, however, Mr. Omidyar knows better. We at MicroCapital have publicly tracked Mr. Omidyar’s evolution in microfinance for you over the years, so you may be familiar with his story.
In July 2005, we strongly applauded Mr. Omidyar’s philosophical stand on microfinance investing as a solely commercial approach, but questioned him for simply not walking his talk (see story, parts one and two). In that story, we gave him the benefit of the doubt. In his defense, he was still transitioning away from disbanding the grant-making Omidyar Foundation towards the “social enterprise” model of the Omidyar Network, thereby blending pure investment capital and philanthropic capital (that which already yielded a tax write-off to the donor.) This was an innovative move at the time (since then, Google.org has outdone him in this regard), hence Mr. Omidyar deserved the benefit of the doubt. Thereafter, we vigorously applauded and then defended him when his innovative $100 million Tufts-Omidyar Microfinance Fund was lambasted in the Boston Globe, the hometown newspaper of Tufts University. Also, he has been wise about donating in microfinance (story). We worked hard to defend Mr. Omidyar when the New Yorker magazine painted him an antihero juxtaposed to Dr. Yunus of the Grameen Bank.
Mr. Omidyar, you are worthy of extraordinarily high expectations. Please note that we also hold Dr. Yunus to these standards. This month, we report on his apparent conflict of interest in his dealings with the Norwegian government.
We hope this “massification” of microfinance investment works. Maybe MicroPlace is part of a broader innovative strategy to build an efficient market mechanism to deliver capital correctly into the poorest parts of the world. Maybe GE Capital is involved as they begin to back PayPal, a subsidiary of eBay. Maybe these dollar investments will be properly insured and priced so currency exchange and fluctuations do not increase poverty. We hope this is a farsighted effort. We hope that Mr. Omidyar is indeed backing his very public stand on microfinance with his own sweat, rolling up his sleeves to get this right.
eBay Enters Microfinance
Five Part Series by MicroCapital
April, 2007
