Good Capital is pioneering a new approach to feel-good investing: private equity
The article is behind a pay wall, but the gist of it is that avarice and altruism have long been conjoined in the lives of great philanthropists (get rich through avarice and give it away with altruism), but now you can express both motives at once in a new breed of double-bottom line investments, of which Good Capital is an example. I would not say that the article is particularly thoughtful or deep, but it should draw attention to the nascent double-bottom line investment field.
The article makes much of taxation of double bottom line investments, particularly when they are provided to a Foundation. My concern there is that any good idea can be turned into a scam. Double-bottom line investing, when done through program related investments, could become a boondoggle. I hope the good people do it right, and that we as an emerging field find a way to flag the bad actors before a good idea is abused. A wise move would be to use language carefully and literally: gift, investment, program related investment, etc, rather than using words like "investment" to cover all three. To say or imply that an investor can "do well" and satisfy greed through a tax deductible investment via a Foundation is the kind of thing that will bring the field into disrepute. Neither Good Capital nor the article assert that you can get rich, get a deduction, and do good all at once in the same vehicle, but the article has a knowing/sceptical tone that implies that there are angles here to be worked. Such articles may attract the best and the worst into the field, followed of course by regulators and litigators. Let's hope that early entrants set high standards in daily practice before that happens. As these private equity double bottom line funds begin to proliferate, I hope those with deep knowledge and good instincts do some thoughtful public spirited analysis, out in the open. Open debate is one way to to keep a good idea from going bad.
