Latest / Masters in Business / Interview With Saadia Madsbjerg: Masters in Business (Audio)

Transcript

Interview With Saadia Madsbjerg: Masters in Business (Audio) · Masters in Business

0:02
Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.
0:08
Speaker 1: This week on the podcast, we have an extra special guest,
0:12
Speaker 1: Sadia Modsburg, director of Innovation and managing partner at the
0:17
Speaker 1: Rockefeller Foundation, a small, four billion dollar outfit dedicating itself
0:23
Speaker 1: to the betterment of mankind. How's that for a broad subject? Anyway,
0:30
Speaker 1: If you're at all interested in philanthropy or how foundations operate,
0:36
Speaker 1: and what it's like to have to think about giving
0:39
Speaker 1: away hundreds of millions of dollars a year, I expect
0:43
Speaker 1: you will find this conversation to be quite fascinating. The
0:48
Speaker 1: Rockefeller Foundation takes a decidedly off center approach. As the
0:54
Speaker 1: expression goes, they are not looking to give a man
0:56
Speaker 1: of fish as much as they are looking to find
1:00
Speaker 1: the economic choke point that is leading to whatever distress
1:05
Speaker 1: any given region is suffering and find ways to fix
1:10
Speaker 1: that on a permanent basis. Two so called teach the
1:14
Speaker 1: person to fish. Uh. They've spent a lot of time
1:17
Speaker 1: thinking about things like resilience and how cities and regions
1:22
Speaker 1: can develop resiliency. Two ongoing threats, be they economic, terrorist,
1:29
Speaker 1: or even just threats um caused by the weather like
1:33
Speaker 1: Super so Sandy or Katrina all told, I found this
1:38
Speaker 1: to be quite a fascinating conversation, and if you are
1:41
Speaker 1: at all interested in all things philanthropy, I think you'll
1:45
Speaker 1: similarly find it interesting. With no further ado, here is
1:49
Speaker 1: my conversation with Saudia Madsburg. This is Masters in Business
1:56
Speaker 1: with very Ridholts on Bloomberg Radio Mice. Special guest today
2:01
Speaker 1: is Sadia Mottsburg. She is the managing director at the
2:05
Speaker 1: Rockefeller Foundation, which has about four billion dollars in assets.
2:10
Speaker 1: She joined the foundation in and leads the foundation work
2:14
Speaker 1: on innovation. Previously, she was senior vice president for strategic
2:19
Speaker 1: Planning at the New York City Economic Development Corp. She
2:22
Speaker 1: spent six years at Mackenzie and four years at Cisco.
2:26
Speaker 1: Has a Masters in Science in Applied Economics from Copenhagen
2:31
Speaker 1: Business School, as well as an undergraduate degree in international business.
2:35
Speaker 1: Saudia Madsburg, Welcome to Bloomberg. Thank you, briam delighted to
2:38
Speaker 1: be here. Uh and it's a pleasure to have you.
2:40
Speaker 1: So let's spend a little bit of time on your
2:43
Speaker 1: background before we delve into the details of what the
2:47
Speaker 1: foundation does. How do you go from being a consultant
2:50
Speaker 1: at mackenzie and working on telecom technology at Cisco, to
2:56
Speaker 1: too of working in a foundation. How does that trend
3:00
Speaker 1: position take place? So if you had asked me, you know,
3:03
Speaker 1: twenty odd years ago, whether I think I would be
3:05
Speaker 1: sitting in the position I'm in now, the answer would
3:08
Speaker 1: probably be no, because it hasn't been an intentional career
3:13
Speaker 1: choice that I made from the very beginning. UM, I've
3:16
Speaker 1: always followed my intuition and my feeling in terms of
3:20
Speaker 1: what I need to be doing and where I need
3:22
Speaker 1: to be doing that. So that is what took me
3:25
Speaker 1: from consulting to the world of tech, to public um
3:29
Speaker 1: sector in terms of New York City and now here
3:32
Speaker 1: at philanthropy. But as I do reflect back at all
3:35
Speaker 1: of this, I do think that the experiences I've gathered
3:38
Speaker 1: along the way put me in a better position to
3:41
Speaker 1: be doing the job I'm doing today. So so obviously
3:44
Speaker 1: with an entity like McKenzie, which is known as a
3:46
Speaker 1: consultant to all different manners of organizations and businesses, UM,
3:51
Speaker 1: there's clearly and overlap. But technology telecom, how does that
3:55
Speaker 1: translate into heading up the innovation project Rockefeller? So technology,
4:02
Speaker 1: I would say I mean always but a lot recently
4:05
Speaker 1: as well, is playing a critical role in terms of
4:08
Speaker 1: how society is developing, how the basic fundamentals of you know,
4:13
Speaker 1: the job market are being shaped, what has happened, where
4:17
Speaker 1: growth is coming from, how we interact with each other,
4:20
Speaker 1: how we work with each other. Uh, the work that
4:22
Speaker 1: I did at Cisco was very much about that. It
4:25
Speaker 1: was about understanding what is the fundamental role that technology
4:28
Speaker 1: plays in our lives at work and outside of work,
4:32
Speaker 1: and how can we use technology to address some of
4:34
Speaker 1: the fundamental challenges and opportunities. Because it's not all about
4:37
Speaker 1: challenges as we go along, So let's talk about some
4:40
Speaker 1: of those challenges and some of those opportunities. I want
4:44
Speaker 1: to reference something you had blocked about for the Foundation,
4:49
Speaker 1: the Innovative Finance Revolution. What is that and what does
4:53
Speaker 1: the Foundation do with that? So before I get to
4:57
Speaker 1: describing the revolution, maybe I can dis where have the
5:00
Speaker 1: challenge that that revolution attempts to address. So twenty fifteen
5:05
Speaker 1: I think was a landmark year and in many different ways,
5:08
Speaker 1: but there are two particular things that we saw happened
5:11
Speaker 1: that year. One was that the world came together to
5:15
Speaker 1: um agree on what we call the Sustainable Development goals,
5:18
Speaker 1: which are seventeen very lofty goals about how we want
5:22
Speaker 1: the world, what we want the world to look like.
5:25
Speaker 1: At the same time, we also had the Paris Climate
5:27
Speaker 1: Agreement that you know, most countries around the world came
5:30
Speaker 1: together and agreed on and has been ratified by you know,
5:33
Speaker 1: a significant number of them. I think there's one large
5:36
Speaker 1: country that hasn't gotten around to signing offer right, and
5:38
Speaker 1: we can we can get to what that actually means
5:41
Speaker 1: in practical attempts. But both of those agreements kind of
5:45
Speaker 1: brought to the forefront the big question of how are
5:49
Speaker 1: we going to pay for all of this? How are
5:50
Speaker 1: we going to pay for these sustainable development goals? And
5:53
Speaker 1: this isn't just about developing countries, it's about us, Europe,
5:56
Speaker 1: you know, the entire world. And how are we going
5:59
Speaker 1: to pay for are all the climate related efforts that
6:01
Speaker 1: we want to do, And that is where innovative finance
6:05
Speaker 1: comes in. And just to put a few numbers on
6:07
Speaker 1: the table as well, it's estimated that for the sustainable
6:11
Speaker 1: development goals, they're going to cost around fifty to seventy
6:14
Speaker 1: trillion over the next decade. Trillion trillion with a capital
6:19
Speaker 1: T that's a lot of zeros, and there are also
6:22
Speaker 1: some you know, and and these are high level estimates,
6:25
Speaker 1: so when you dig down, I'm sure you can refine
6:27
Speaker 1: it along the way, but they're also estimate stent that
6:29
Speaker 1: there's a massive funding gap in terms of how we're
6:32
Speaker 1: going to get there, and that takes into account the
6:34
Speaker 1: money philanthropy has, the money the private sector has. So
6:38
Speaker 1: if we're talking about and there's just another number for
6:42
Speaker 1: to put it in context, a gap of roughly two
6:44
Speaker 1: point five trillion per year in developing countries alone. So
6:49
Speaker 1: that doesn't even include where we are sitting right now.
6:53
Speaker 1: So we have to think innovatively. We have to think
6:57
Speaker 1: about alternative solutions, and we at the Rockefeller Foundation think
7:01
Speaker 1: that innovative finance is a big part of the answer.
7:06
Speaker 1: So how does that manifest itself? What does innovative finance
7:10
Speaker 1: do to help funds projects like smart power for rural development.
7:16
Speaker 1: So innovative finance represents a pretty expansive set of financing
7:21
Speaker 1: mechanisms that, in one way another are designed to either
7:26
Speaker 1: attract more money to development goals and and different programs
7:30
Speaker 1: and initiatives, or to take the money that's already in
7:34
Speaker 1: place and the new money that's coming in and make
7:36
Speaker 1: sure that it's more effectively deployed. Because I talked about
7:40
Speaker 1: the massive funding gap. That gap is there and we
7:43
Speaker 1: need to focus on it. At the same time, we
7:45
Speaker 1: also need to make sure that the way money is
7:47
Speaker 1: delivered is done in a more predictable way, in a
7:50
Speaker 1: more sustainable way, because if people you know, are working
7:54
Speaker 1: in this space, you have to know what's going to
7:56
Speaker 1: happen next year in terms of whether you're going to
7:57
Speaker 1: have the money or not. So you're really referring to
8:00
Speaker 1: of philanthropic efficiency, making sure that the money that is
8:05
Speaker 1: allocated is used appropriately and effectively for whatever the I
8:09
Speaker 1: will say, not just philanthropic funding, also what comes from
8:13
Speaker 1: the private sector, also what comes from the public sector.
8:16
Speaker 1: So pretty pretty broad and and you know, just to
8:19
Speaker 1: put context to what kind of financing mechanisms we're talking about,
8:23
Speaker 1: it's everything from insurance links, securities, to pay for performance
8:27
Speaker 1: debt structures to even micro texas. I'm Barry Ridholts. You're
8:33
Speaker 1: listening to Masters in Business on Bloomberg Radio. My special
8:37
Speaker 1: guest today is Sadia Modsburg. She is the director of
8:41
Speaker 1: Innovation at the Rockefeller Foundation, and and let's talk a
8:45
Speaker 1: little bit about the foundation's mission. I'm gonna quote right
8:50
Speaker 1: off of the website to improve the well being of
8:53
Speaker 1: humanity around the world. That's a little broad. What what
8:57
Speaker 1: does it really mean in actuality, improve in the well
9:00
Speaker 1: being of humanity? It is indeed quite broad, and every
9:04
Speaker 1: time I say it, I almost kind of need to stop,
9:07
Speaker 1: take a breath, let it sink in, and then, you know,
9:10
Speaker 1: talk about what that actually means. So, the Rockefellow Foundation
9:14
Speaker 1: has been around for roughly a hundred and four years.
9:17
Speaker 1: The year I joined, we were celebrating our centennials, So
9:20
Speaker 1: the fact that we had been around for a hundred
9:22
Speaker 1: years and were reflected back on what we had achieved
9:25
Speaker 1: in those hundred years and what it had meant. We
9:28
Speaker 1: have always stayed true to the mission, which is to
9:31
Speaker 1: promote the well being of humanity. But what that means
9:35
Speaker 1: at any given point in time, of course, has shifted
9:38
Speaker 1: over the years, and it's shifted based on what we
9:41
Speaker 1: think the big challenges of our times have been and
9:45
Speaker 1: where we think that philanthropy has an important role to
9:48
Speaker 1: play in terms of stepping in, trying out new solutions,
9:52
Speaker 1: proving how they work, and then letting others step in
9:56
Speaker 1: and drive those forward. I would say, though, the three
9:59
Speaker 1: things that have remain the same over the hundred and
10:01
Speaker 1: four years. One is our focus on innovation, so really
10:05
Speaker 1: driving towards new thinking and new solutions. The second is
10:09
Speaker 1: more you know and and it's something if you read
10:12
Speaker 1: some of the letters written by John D. Rockefell in
10:14
Speaker 1: the early days that it comes out is this idea
10:17
Speaker 1: of scientific philanthropy, meaning what what's about trying to really
10:22
Speaker 1: understand what the core underlying drivers behind the challenge are.
10:26
Speaker 1: So instead of just throwing money at something and so
10:28
Speaker 1: here's money, you know, let's go alleviate the pain and
10:31
Speaker 1: suffering here, it's about really understanding what the fundamental issue is.
10:35
Speaker 1: So when they say when you say scientific philanthropy, you
10:38
Speaker 1: mean sort of a scientific methodology using an evidence based approach. Yes,
10:44
Speaker 1: to say, hey, these dollars are actually having resonance and
10:47
Speaker 1: having an effect, these not so much less focus on
10:49
Speaker 1: what's working. Both that, but also to use the data
10:53
Speaker 1: and to use the research to understand what the problem
10:56
Speaker 1: really is, where the problem really comes from. So when
11:00
Speaker 1: you're trying to figure out what the answer to that
11:02
Speaker 1: problem is, you're actually addressing the root causes of it.
11:05
Speaker 1: As opposed to just you know what comes to this effect.
11:08
Speaker 1: So it sounds like it's somewhat process oriented. Don't just
11:12
Speaker 1: identify a problem, find that fulk rum point that's the
11:16
Speaker 1: key to the problem. Right. That sounds quite fascinating. I
11:19
Speaker 1: assume you're a five percent foundation, meaning each year you
11:23
Speaker 1: give away five of of the four billion or so
11:28
Speaker 1: UM and your your portfolio offsets those that that donation.
11:33
Speaker 1: How do you prioritize where to focus your efforts again,
11:37
Speaker 1: improving humanity, improving the well being humanity a giant charge
11:43
Speaker 1: trying mission. How do you drill down and say, we
11:46
Speaker 1: want to focus on these areas and within these areas,
11:49
Speaker 1: this is the specific um issue we want to attack. So,
11:53
Speaker 1: as I mentioned, we try to you know, really understand
11:56
Speaker 1: what we think the big challenges of our times aren't
11:59
Speaker 1: based in at set our strategy at any given point
12:01
Speaker 1: in time. That's the responsibility that the senior leadership team carries,
12:05
Speaker 1: as the responsibilities that our trustees carry as well. If
12:09
Speaker 1: we look at where we are at this point in
12:11
Speaker 1: time and where we have focused, we have two overarching
12:14
Speaker 1: goals as we call them. One is around resilience building,
12:18
Speaker 1: the other one is advancing inclusive economies and within that therefore,
12:24
Speaker 1: what we call issue areas um that we focus on.
12:28
Speaker 1: There's advanced health, revalue ecosystems, transform cities, and secure livelihoods. Now, now,
12:34
Speaker 1: having just said what these issue areas still brought issues,
12:39
Speaker 1: So that brings us back to how do you operationalize
12:42
Speaker 1: it on a day to day basis? How do you
12:44
Speaker 1: actually try to understand what's happening in those spaces. We
12:47
Speaker 1: have a strategic insights team that continuously monitors what's happening
12:52
Speaker 1: in those spaces and shapes different suggestions for areas where
12:57
Speaker 1: we could engage, and then we take those are years
13:00
Speaker 1: and have a conversation around you know, how pressing is
13:04
Speaker 1: the problem. And I'll be honest, in most cases when
13:07
Speaker 1: you look at it, nobody can come and argue the
13:09
Speaker 1: problem isn't pressing. They're they're terrible things happening around the world,
13:13
Speaker 1: you know, in our backyard and across the ocean as well.
13:16
Speaker 1: So it's about that, But then it's also about what
13:19
Speaker 1: we like to call looking at dynamism and potential for innovation.
13:24
Speaker 1: So with dynamism, what I mean is is there something
13:27
Speaker 1: happening at this point in time that makes it the
13:31
Speaker 1: right time for us as a foundation to go in
13:33
Speaker 1: and engage. Is it on the policy side, is their
13:36
Speaker 1: developments in the private sector that what we should be
13:39
Speaker 1: looking at and focused on. Is it something in civic society,
13:43
Speaker 1: some thing that gives an indication there's a momentum that
13:46
Speaker 1: we can build on and accelerate. And then of course
13:49
Speaker 1: there's the impact at scale. We're here, I mean, philanthropy
13:53
Speaker 1: is here to serve poor and vulnerable people around the world.
13:57
Speaker 1: That is our role, that is what we're focused on.
14:00
Speaker 1: So at the end of it, it comes down to
14:02
Speaker 1: our ability to have impact. So we're gonna talk more
14:05
Speaker 1: about resilience in a few minutes. Let's talk a little
14:09
Speaker 1: bit about um, the day to day and the prioritization.
14:14
Speaker 1: Do you look for low hanging fruit as the expression
14:18
Speaker 1: uh suggest, where where there's an immediate impact or are
14:22
Speaker 1: there occasional moonshots that hey, we don't know if this
14:26
Speaker 1: is going to be successful, but if it works, the
14:28
Speaker 1: impact is tremendous. So it's a both, it's it's that's
14:33
Speaker 1: what I was going to say. It's a fine balance,
14:35
Speaker 1: and it's both. And again, when our mission is so broad,
14:40
Speaker 1: our areas are so broad, if we're really doing our
14:43
Speaker 1: job well, we can't be going to the obvious solutions
14:47
Speaker 1: and funding the obvious things. But sometimes you need to
14:50
Speaker 1: do that too. Um. I mean, we think of our
14:53
Speaker 1: money as America's risk capital, where we can deploy it
14:57
Speaker 1: in ways where the private sector wouldn't be will too,
15:00
Speaker 1: because they maybe don't want to take on the risk.
15:03
Speaker 1: The public sector again may not be able to because
15:06
Speaker 1: either they don't have the resources available or they don't
15:09
Speaker 1: have the ability to take that risk. So we have
15:12
Speaker 1: a big responsibility in terms of what we do with
15:14
Speaker 1: that really precious privileged capital in terms of driving towards
15:18
Speaker 1: new solutions. I mean, and you talk about moonshots that
15:22
Speaker 1: you can look at it in many different ways. We
15:24
Speaker 1: talked about in a bit of finance earlier and one
15:27
Speaker 1: of the portfolios that that I oversee the Foundation is
15:31
Speaker 1: called zero Gap, and it is focused on the financing
15:34
Speaker 1: mechanisms and closing the funding gap within that. Right now,
15:38
Speaker 1: we're funding something called outbreaking epidemic insurance. Now, ten years ago,
15:43
Speaker 1: if you weren't to anybody in the insurance industry and said,
15:45
Speaker 1: you know, public health, you know there's a massive lack
15:49
Speaker 1: of funding. They are all these public health emergencies that
15:52
Speaker 1: come up time and time again, we don't have a
15:54
Speaker 1: good system in place to fund out how about insurance.
15:58
Speaker 1: Many of them would probably you know, have roll their
16:00
Speaker 1: eyes and say, yes, that's great. We run this business,
16:05
Speaker 1: you know, based on these things, and you know, good
16:07
Speaker 1: luck fiddling with that. Over in the philanthropic sector. I'm
16:11
Speaker 1: Barry Ridholts. You're listening to Masters in Business on Bloomberg Radio.
16:15
Speaker 1: My special guest today is Sadia Madsburg. She is the
16:18
Speaker 1: managing director of the Rockefeller Foundation, focusing on the Foundation's
16:23
Speaker 1: work on innovation. So let's talk a little bit about
16:26
Speaker 1: resilience as a public policy here in here in New
16:30
Speaker 1: York City and the surrounding region. Uh, the Superstorm Sandy
16:36
Speaker 1: was a giant mess that caused all sorts of problems
16:40
Speaker 1: in some ways outside of Katrina. It was the most
16:43
Speaker 1: expensive um storm, certainly on the East Coast. What can
16:48
Speaker 1: we as a city and a region do to become
16:52
Speaker 1: more resilient. So I was working for New York City
16:56
Speaker 1: at the time super Storm Sandy hit, and you're right,
17:00
Speaker 1: it was a massive disaster. It was a mess. It
17:04
Speaker 1: costs the local economies of the states that were hit
17:08
Speaker 1: by it a lot. The small and medium sized businesses
17:11
Speaker 1: were shut down for a while. The public infrastructure broke down,
17:15
Speaker 1: whether you're talking about subways or telecommunications infrastructure, um, electrical electrical.
17:22
Speaker 1: I live in the suburbs. We had no electricity for
17:24
Speaker 1: twelve days. If you would have asked me beforehand, yeah, hey,
17:27
Speaker 1: what are the odds that a storm is going to
17:29
Speaker 1: knock out electricity for two weeks? I would say, this
17:31
Speaker 1: is America. That shouldn't happen. Yeah, exactly. I mean I
17:34
Speaker 1: was living downtown Manhattan and you know I had to
17:37
Speaker 1: relocate to Midtown. That was the extent of you know,
17:39
Speaker 1: the suffering I I went through. But but no, it
17:43
Speaker 1: was a big shock to the system. And that really
17:47
Speaker 1: does bring forward this whole concept of resilience and what
17:51
Speaker 1: should we do, not just at a city level and
17:53
Speaker 1: a state level, but for countries and regions as well.
17:56
Speaker 1: At the Rockefeller Foundation, we talked about resil alliance as
18:00
Speaker 1: the capacity of individuals, communities, societies to withstand shocks when
18:07
Speaker 1: they happen and then bounce back from them faster as well.
18:10
Speaker 1: So it's not about trying to stop the disasters from
18:13
Speaker 1: happening and saying how do you put in place the systems,
18:16
Speaker 1: the solutions, the policies that will allow you to bounce
18:20
Speaker 1: back faster? Now have we done that? Because I know
18:23
Speaker 1: in the world of finance, we are notorious for experiencing
18:27
Speaker 1: something terrible and then forgetting about it as soon as possible.
18:30
Speaker 1: Have we forgotten about Superstorm Sandy or Katrina? Or have
18:35
Speaker 1: we taken steps to become more resilient as a as
18:38
Speaker 1: a geography. So I think in in the public realm um,
18:43
Speaker 1: there's this very broad understanding that you cannot just forget
18:46
Speaker 1: and pretend that it didn't happen. It's happening time and
18:49
Speaker 1: time again in different parts of this country and different
18:52
Speaker 1: parts of the world. So there is a very strong
18:55
Speaker 1: momentum and focus on saying, you know, let's let's get
18:59
Speaker 1: to this oceans. Part of it is also breaking away
19:03
Speaker 1: from the silos that we operate in. Don't think about
19:06
Speaker 1: you know this is this has to do about education,
19:09
Speaker 1: This has to do with infrastructure, this has to do
19:11
Speaker 1: with you know something else. You have to sometimes cut
19:14
Speaker 1: across the silos and say what are the right solutions
19:17
Speaker 1: you put in place? And I mean, I'd like to
19:19
Speaker 1: give an example again from our innovative finance portfolio of
19:22
Speaker 1: something we're funding currently which people would not normally associate
19:28
Speaker 1: with resilience effort, and it has to do with natural infrastructure.
19:33
Speaker 1: So by natural infrastructure, I mean oyster reefs, I mean
19:37
Speaker 1: coral reefs and you know marsh lands and coastal wetlands.
19:41
Speaker 1: They protect a natural barrier when it comes to storms.
19:46
Speaker 1: You know, they have done it time and time again.
19:48
Speaker 1: Their science out there that shows that, you know, a
19:50
Speaker 1: healthy coral leaf can absorb around of the energy of
19:55
Speaker 1: a wave that is massive. So you don't even have
19:59
Speaker 1: to go think, you know, let's build a massive sea
20:01
Speaker 1: wall or any you know, thing equivalent to that. How
20:05
Speaker 1: do you put in place mechanisms that can allow you
20:08
Speaker 1: to protect the natural environment we have today that is
20:12
Speaker 1: protecting us. So so what we're funding and we're working
20:15
Speaker 1: currently with the Nature Conservancy and they're partnering with Swiss
20:18
Speaker 1: re on it is to say, um, there's the meso
20:20
Speaker 1: American reef. It's the second largest reef in the world.
20:24
Speaker 1: It protects a lot of the local economy. When it
20:27
Speaker 1: comes to the Mexican Mexican tourism system, can you gather
20:32
Speaker 1: the hotel association and the local businesses that benefit from
20:36
Speaker 1: having a healthy reef get them to pay into a
20:40
Speaker 1: fund that invests in the maintenance of the reef but
20:44
Speaker 1: also bios catastrophe insurance on it, so when something terrible happens,
20:49
Speaker 1: one insurance pays out immediately, so you have the money
20:52
Speaker 1: in hand, build right away because you have to. And
20:55
Speaker 1: I didn't understand you know, the complexity of it, but
20:57
Speaker 1: a lot of it is picking it up at the
20:59
Speaker 1: right time, reattaching it so it can continue to go.
21:02
Speaker 1: It's you know, you can't come back in a month,
21:05
Speaker 1: two month, three months into it because then you're vulnerable
21:07
Speaker 1: to the you know, there are some little things I
21:11
Speaker 1: was I think a lot of people were shocked about
21:12
Speaker 1: with Sandy, and we haven't even gotten to Katrina shocked
21:16
Speaker 1: to learn that emergency generators are located in the basements
21:19
Speaker 1: of buildings, which assumes there's no flooding right stop and
21:23
Speaker 1: thinking about this was done twenty thirty years ago. People
21:26
Speaker 1: weren't really conceptualizing a wave coming over Manhattan, going down
21:31
Speaker 1: into the subway, going down into the basements of buildings,
21:34
Speaker 1: and basically rendering those emergency generators um unusable. But what
21:39
Speaker 1: you're talking about with reef building and oyster bed promotion.
21:43
Speaker 1: These are giant macro projects that are far beyond anyone business,
21:49
Speaker 1: probably anyone UM city or or municipality. It has to
21:54
Speaker 1: be part of a broader effort. I'm Barry Ridhults. You're
21:58
Speaker 1: listening to Masters and Business on Bloomberg Radio. My special
22:02
Speaker 1: guest today is Sadia Madsburg. She is the Director of
22:05
Speaker 1: Innovation at the Rockefeller Foundation, whose mission is to improve
22:10
Speaker 1: the well being of humanity around the world. So let's
22:14
Speaker 1: get into the nitty gritty of that. Uh, I'm ballparked.
22:18
Speaker 1: The foundations about four billion dollars? Is that slightly more
22:23
Speaker 1: than that? Slightly more than that? Um? How does the
22:26
Speaker 1: Foundation manage its money? Do they use in house managers?
22:30
Speaker 1: They use out outside managers? They use both. So we
22:34
Speaker 1: have our investment office that is led by our Chief
22:37
Speaker 1: Investment Officer, Donna Dean. She's a brilliant, very very smart
22:41
Speaker 1: woman who's been taking care of the money for us
22:44
Speaker 1: so that the rest of us on the program side
22:47
Speaker 1: have money to spend on unfulfilling our mission. Uh. It
22:51
Speaker 1: is managed externally. We have our team internally that sets
22:55
Speaker 1: you know, goals and along with the with our board
22:59
Speaker 1: and and us on which direction we want to be
23:01
Speaker 1: going in, and then they look for the right opportunities externally.
23:05
Speaker 1: So you target five percent a year to give out.
23:08
Speaker 1: That's everybody that's a tax exempt foundation uses uses that money.
23:15
Speaker 1: How our priorities set? Is it long term thinking and
23:19
Speaker 1: it's mapped out over years, or do you have the
23:22
Speaker 1: ability we reference the bowler earlier, do you have the
23:25
Speaker 1: ability to pivot when an emergency such as that pops up.
23:30
Speaker 1: So we try to do boats because we have to
23:34
Speaker 1: be invested in areas for the long term. You can't
23:39
Speaker 1: come up with solutions, you know, in the short term
23:42
Speaker 1: and say, you know, we saw for it, let's go
23:43
Speaker 1: on the next, onto the next one. So we have
23:47
Speaker 1: some of it dedicated towards our longer term initiatives and programs.
23:51
Speaker 1: One example of that is what we call yield wise.
23:53
Speaker 1: It's focused on reducing post harfice lass in agricultural food
23:57
Speaker 1: chain in Africa. It's something we yield loss yield wise.
24:01
Speaker 1: So yeah, so it's focused on reducing post harvest loss.
24:05
Speaker 1: So from the time a small hold of farmer harvests
24:08
Speaker 1: it till the time it gets to a market where
24:11
Speaker 1: you can still sell it. There's a big loss that
24:13
Speaker 1: happens in there, meaning just natural attrition rot or what
24:19
Speaker 1: what is it that it's a combination of that. So um.
24:23
Speaker 1: One of the crops that we're looking at is called cassava.
24:28
Speaker 1: It's something that you have to get to the market
24:31
Speaker 1: quickly and process very quick to melon and it's um
24:35
Speaker 1: a decent size and so I you know, for me,
24:39
Speaker 1: it's more about how do you want link it to
24:43
Speaker 1: the local markets in a more efficient way quickly And
24:47
Speaker 1: sometimes technology plays a role, or processing close to where
24:52
Speaker 1: you're harvesting plays a role. Uh. Sometimes it's about having
24:56
Speaker 1: in place agreements when it comes to bulk purchase with
25:00
Speaker 1: big you know, food chains, where you know there's somebody
25:03
Speaker 1: there to take it off your hands and know what
25:06
Speaker 1: to do with it. Um. So it's a number of
25:09
Speaker 1: different things that come into play in terms of how
25:12
Speaker 1: you can work towards reducing food loss. So when I
25:16
Speaker 1: when I'm I'm listening to the maintaining the yield and
25:20
Speaker 1: dealing with the loss, that sounds like you're trying to
25:23
Speaker 1: attack two things. One is poverty in the Third World
25:27
Speaker 1: by by allowing farmers to generate a better economic return.
25:32
Speaker 1: But that also applies towards food scarcity and starvation. If
25:37
Speaker 1: you're getting a better yield, then you have less loss.
25:40
Speaker 1: That just means is that much more food around, right?
25:43
Speaker 1: I mean it has to do with food security definitely.
25:46
Speaker 1: UM And actually, I mean what I didn't mention was
25:49
Speaker 1: the efforts that we're doing here in the US UM
25:52
Speaker 1: within that initiative aren't focused on reducing harvest loss, but
25:56
Speaker 1: it's about consumer waste. There's a lot of food that
26:00
Speaker 1: you know comes into grocery stores, comes into your fridge,
26:03
Speaker 1: my fridge that never gets consumed that we end up
26:06
Speaker 1: throwing out. So again, more to say, we look at
26:09
Speaker 1: what the challenges were and then figure out what we
26:12
Speaker 1: think the appropriate response would be. So let's let's talk
26:15
Speaker 1: about that, because I know I'm the person who takes
26:19
Speaker 1: the garbage out in the house and my wife is
26:21
Speaker 1: always wait a second and going through the fridge and
26:24
Speaker 1: tossing out whatever is turns or the tomatoes. So what
26:28
Speaker 1: can you do in the United States to reduce And
26:32
Speaker 1: it's the if memory serves it's massive. It's like fift
26:35
Speaker 1: of the farmed food is wasted. Is that is that
26:38
Speaker 1: a fair number? So I don't know the exact percentage,
26:41
Speaker 1: but it is a really, really significant amount. Yes, uh
26:45
Speaker 1: so we're in the process of deciding where to go
26:47
Speaker 1: with it. Part of it has to do with creating
26:50
Speaker 1: alternative markets. Right, what is waste to you may not
26:54
Speaker 1: be waste to somebody else. Um. I don't know how
26:57
Speaker 1: things were when you were growing up in your house
26:59
Speaker 1: and what kind of food culture there was around it.
27:02
Speaker 1: But in the old days, you used to take a
27:04
Speaker 1: lot of the things that you would consider close to
27:07
Speaker 1: expiration and you would make stock out of it, right,
27:10
Speaker 1: And you would make stock and cook it right, and
27:12
Speaker 1: you could put it in the freezer. It tastes delicious.
27:15
Speaker 1: You can use it, you know, for time and time again.
27:18
Speaker 1: But and then you can, you know, do other things.
27:21
Speaker 1: You can donate it to local organizations that try to
27:26
Speaker 1: bring food to people that don't currently have food. So
27:30
Speaker 1: part of it is behavioral. Part of it has to
27:32
Speaker 1: do with the market dynamics, and I think you have
27:35
Speaker 1: to work on both hand. And I recall reading not
27:37
Speaker 1: too long ago about the market for quote unquote ugly fruit, yes,
27:41
Speaker 1: which I find fascinating that, Hey, this tomato was ugly,
27:45
Speaker 1: this apple isn't pretty, but it's perfectly edible. And there
27:49
Speaker 1: are people who are more than happy to buy it
27:51
Speaker 1: at a substantial discount. And that's an economic solution to one.
27:56
Speaker 1: I mean not just that very if you go to
27:58
Speaker 1: any of the farmers markets around here. I live close
28:00
Speaker 1: to Union Square and I go so I go there often.
28:04
Speaker 1: And the food isn't set up to look beautiful and
28:08
Speaker 1: well shaped and the same proportions and the same sizes
28:11
Speaker 1: and all that. That is just nature. That's you know,
28:15
Speaker 1: that's part of the charm of the farmers market. This
28:18
Speaker 1: isn't factory farmed. Every tomato is perfectly read, perfectly round.
28:22
Speaker 1: Everything looks like it was recently grown without a lot
28:26
Speaker 1: of chemicals that I think always thought that was half
28:29
Speaker 1: the appeal. So we're talking about some of the things
28:33
Speaker 1: that money can do. What are some of the things
28:37
Speaker 1: that money can't do, or at least can't do by itself. Meaning,
28:42
Speaker 1: how do you decide we can only go so far
28:46
Speaker 1: with this project? And there needs to be a lot
28:49
Speaker 1: more education and a lot more persuasion of people before
28:53
Speaker 1: they recognize and funds a project. If that makes any sense.
28:59
Speaker 1: It does, um, I think the most stark example of
29:04
Speaker 1: what money can't fix or philanthropy can't fix today is
29:08
Speaker 1: the Syrian crisis. Um If you look at it, it's
29:12
Speaker 1: a crisis that started, as you know, small protests escalated
29:17
Speaker 1: into a full blown um civil war. Now you're a conflict,
29:22
Speaker 1: and now you're at a point where you know there
29:24
Speaker 1: there is a cease fire. But I've read one of
29:27
Speaker 1: the headlines in New York Times saying, you know, the
29:30
Speaker 1: parties were quarreling about how to move forward. In the
29:33
Speaker 1: span of those five years, you have a quarter of
29:36
Speaker 1: a million people that have died. You have eleven million
29:40
Speaker 1: people that have been displaced from their homes, some of
29:43
Speaker 1: them within Syria, but a significant amount of them left
29:47
Speaker 1: Syria as well, state went to neighboring countries. Jordan's I
29:53
Speaker 1: was Jordan recently. And then it's amazing what capacity that
29:57
Speaker 1: country has had to take in refugees time and time again,
30:00
Speaker 1: and the treat them with decency and dignity. But Lebanon
30:04
Speaker 1: as an example, Jordan as an example. There even your
30:06
Speaker 1: refugee is going to Iraq. I mean, who would have thought,
30:08
Speaker 1: but you know, somebody would want to go to Iraq
30:10
Speaker 1: as a refugee to get away from what's bad. And
30:13
Speaker 1: then I got you know, Turkey, and then I started
30:15
Speaker 1: getting closer to my old home, which is Europe, and
30:19
Speaker 1: it's been front and center of the policy debate in Europe,
30:23
Speaker 1: in the US, in Australia, and you know, all other
30:26
Speaker 1: parts well impacted. Brexit might have an impact on the
30:30
Speaker 1: election here. I I think people underestimate how significant the
30:35
Speaker 1: issue in Syria was as a global um affectation. It's
30:40
Speaker 1: really driven all sorts of issues around the world. So
30:44
Speaker 1: if I take that as an example, there's no amount
30:46
Speaker 1: of money that I could have given us a grant
30:49
Speaker 1: that would have fixed the core of that problem. Now
30:52
Speaker 1: there are things that we can do, we should be doing,
30:56
Speaker 1: and we are trying to do around How do you
30:58
Speaker 1: then take the people that are, if affected by the conflict,
31:01
Speaker 1: refugees and try to create more inclusive societies that they
31:05
Speaker 1: can be a part of to actually, you know, allow
31:09
Speaker 1: them to come back into what could be a normal
31:13
Speaker 1: life away from what what they left behind. That's quite
31:17
Speaker 1: that's quite astonishing. So when you pick a specific issue
31:22
Speaker 1: to focus on, obviously one one question is can we
31:27
Speaker 1: have an impact? And if the issue is perhaps not,
31:32
Speaker 1: we there's not enough money in the world to resolve
31:34
Speaker 1: this that that becomes a diplomacy and governmental challenge. But
31:39
Speaker 1: when you find something that you believe your approach and
31:42
Speaker 1: your um cash can actually impact, how do you go
31:47
Speaker 1: about measuring that impact? How can you determine how effective
31:52
Speaker 1: a given program is, both both when you're evaluating against
31:57
Speaker 1: other programs you're running or deciding, hey, we're really seeing
32:01
Speaker 1: residents here, let's put a greater refer into this or not.
32:04
Speaker 1: Do you manage just like an actual portfolio. So we
32:08
Speaker 1: do have a very strong focus on what we call monitoring,
32:13
Speaker 1: which is doing it as the program is implemented, and
32:16
Speaker 1: then evaluation, which is the actual outcomes of the program
32:19
Speaker 1: once it has been implemented. One because we want to
32:23
Speaker 1: make sure that the impact we want to have on
32:25
Speaker 1: the life of pinvulnerable people is actually achieved, but to
32:29
Speaker 1: also so we can figure out whether the starting point
32:32
Speaker 1: that we had for when we started the program was
32:35
Speaker 1: the right one or whether we need to pivot along
32:37
Speaker 1: the way. We have been speaking with Sadia Modsburg of
32:40
Speaker 1: the Rockefeller Foundation. If you want more information on the foundation,
32:44
Speaker 1: you could go to their website just google Rockefeller Foundation,
32:48
Speaker 1: or go to Rockfeller is it Rockfellow Foundation dot org?
32:51
Speaker 1: Is that right? Um. If you enjoy this conversation, be
32:54
Speaker 1: sure and stick around for the podcast extras, where we
32:57
Speaker 1: keep the tape rolling and talk about all things philanthropic.
33:01
Speaker 1: Check out my daily column on Bloomberg View dot com
33:04
Speaker 1: or follow me on Twitter at rit Halts. I'm Barry
33:08
Speaker 1: rit Halts, Human listening to Masters in Business on Bloomberg Radio.
33:13
Speaker 1: Welcome to the podcast. I don't know why I do that.
33:15
Speaker 1: I do that every time, Sadia, thank you much so
33:18
Speaker 1: much for doing this. I find the topic of how
33:22
Speaker 1: great pools of wealth is subsequently used in endowments and
33:27
Speaker 1: foundations for whatever the founding principle um goal was, Even
33:36
Speaker 1: when it's something as broad as making humanity, improving the
33:41
Speaker 1: well being of humanity, something like that, it's fascinating because
33:44
Speaker 1: you usually don't get to see the nuts and bolts
33:47
Speaker 1: of how that's done. And what I find really interesting
33:50
Speaker 1: about the Rockefell Foundation, I think people's general sense of
33:56
Speaker 1: foundations are they're throwing money at problems, and and everything
34:00
Speaker 1: you've described is much more to get Biblical teach a
34:04
Speaker 1: person of fish rather than give them a fish. It's
34:06
Speaker 1: identifying where the problem is and looking for a solution
34:10
Speaker 1: where there's some subsequent ongoing economic incentive to keep the
34:16
Speaker 1: solution going. And that's that's really quite fascinating to me. Um,
34:20
Speaker 1: I imagine your day to day work must be really interesting.
34:23
Speaker 1: It really is that it keeps me on my tiptoes.
34:26
Speaker 1: So when I was at the point of deciding whether
34:31
Speaker 1: or not to join you know what I would broadly
34:33
Speaker 1: characterize as the social sector of the development sector, I
34:36
Speaker 1: actually went around and talked to a lot of people
34:39
Speaker 1: and I thought, I don't want to just jump the
34:41
Speaker 1: fans because I think it's going to be better on
34:43
Speaker 1: the other side. Let me get a realistic feel for
34:46
Speaker 1: what's happening. And it was an interesting time where, you know,
34:49
Speaker 1: a lot of people said, no, no, no, if you
34:51
Speaker 1: really want to make a difference, you know, find one
34:55
Speaker 1: of the smaller startups and go work there. Don't go
34:58
Speaker 1: in philanthropy. There's said in their ways and what have
35:02
Speaker 1: they done. And what I've come to realize and and
35:06
Speaker 1: really respect about the place that I work in, about
35:09
Speaker 1: the field of philanthropy at large, is, you know, it's
35:11
Speaker 1: not about hacking. You know, global poverty, you can't do that.
35:17
Speaker 1: The problems that there's no silver bullets, there is none
35:20
Speaker 1: of that and you know this idea, you can do
35:22
Speaker 1: an app and you know everything will be fine. No,
35:25
Speaker 1: you have to have respect for the complexity of the
35:29
Speaker 1: problem and then you have to just go at it.
35:32
Speaker 1: And my days are fascinating. I mean, you can start
35:35
Speaker 1: with talking about infrastructure finance, and then you know, talk
35:39
Speaker 1: about a humanitarian crisis and rhythm refugee crisis, and from
35:43
Speaker 1: there will go on to natural disasters in Africa and
35:47
Speaker 1: how to think about the solutions there. So there's never
35:51
Speaker 1: a dull moment I can imagine. Um, I was going
35:55
Speaker 1: to ask you. We didn't get to to this question earlier.
35:59
Speaker 1: I and I don't know if this is the focus
36:01
Speaker 1: of the Rockefeller Foundation, but what can a foundation do
36:07
Speaker 1: about global or domestic inequality? Is that an issue that
36:12
Speaker 1: comes up. So one of our two goals is about
36:15
Speaker 1: advancing inclusive economy. So we we talk about it and
36:18
Speaker 1: think of it as inclusion that everybody gets to participate
36:23
Speaker 1: in the economic bounty of a given so not just economically,
36:27
Speaker 1: but socially as well, because you can't distinguish one from
36:31
Speaker 1: the other. If you're a member of society, you want
36:34
Speaker 1: people to be integrated on the social side, cultural side.
36:37
Speaker 1: You know, economic side, give them the same opportunities and
36:40
Speaker 1: treat them as equals. And I think philanthropy has a
36:44
Speaker 1: role to play. One of the programs and you mentioned
36:47
Speaker 1: it earlier that we're funding is Smart Powerful Rural Development.
36:51
Speaker 1: It is an effort focused on trying out testing new
36:55
Speaker 1: sustainable business models that drive like trification and economic development
37:02
Speaker 1: of rural villages in India. That's about how do you
37:05
Speaker 1: take somebody who's currently completely excluded from what's happening and
37:09
Speaker 1: try to bring them into the economy, but do it
37:12
Speaker 1: in a way where it's actually sustainable. Really that that's
37:16
Speaker 1: quite ah, that's quite interesting. A buddy of mine is
37:19
Speaker 1: working on this project that it's called Helical something I'm
37:24
Speaker 1: drawing a blank on it. They essentially take what is
37:27
Speaker 1: a a rail car or you know, the standard shipping
37:32
Speaker 1: containers and they converted so you could basically air drop
37:37
Speaker 1: it anywhere. The doors open it up, solar panels come
37:40
Speaker 1: out to the top. You you purify water, you have
37:44
Speaker 1: a satellite uplink for communication. You are able to grow
37:48
Speaker 1: all sorts of food stock for for um, cattle and
37:53
Speaker 1: sheep and everything. And it's the idea is you can
37:55
Speaker 1: instantly in the response of let's say a Katrina or
38:00
Speaker 1: some other emergency. You could instantly instant civilization with this
38:04
Speaker 1: one thing. It's really quite that is fascinating. You know.
38:08
Speaker 1: It's recently um in Denmark and I was visiting my dad,
38:14
Speaker 1: who spends part of his time in Denmark now a
38:16
Speaker 1: lot of it in Pakistan, and he was telling me
38:18
Speaker 1: how he has a solar panel installed back home in
38:22
Speaker 1: the village in Pakistan because there's so much load shedding
38:25
Speaker 1: that happens. And I thought, wait, it's like you just
38:28
Speaker 1: had it installed yourself, and he said, yes, it's about
38:32
Speaker 1: It was like, it was like, do you have a
38:33
Speaker 1: battery for it? And he looked at me as if
38:35
Speaker 1: I was an idiot, and of course I have a
38:38
Speaker 1: What are you gonna do with it? You know? How
38:39
Speaker 1: do you get power at night? It's amazing how this
38:44
Speaker 1: sort of decentralization. Remember when you look at let's say
38:48
Speaker 1: telecommunications and a lot of parts of the world. You know,
38:51
Speaker 1: it's a big deal for the United States to wire
38:53
Speaker 1: phones to everybody, and a lot of parts of the
38:56
Speaker 1: world just skipped over that went right to cellular I
39:00
Speaker 1: wouldn't be surprised to see something very very similar happening
39:03
Speaker 1: with electrical distribution. They're gonna skip over that centralized authority
39:07
Speaker 1: and say, hey, it's especially today panels are so efficient, So,
39:12
Speaker 1: I mean, they still have a way to go, but
39:13
Speaker 1: they're a tenth of what they were. I think that
39:16
Speaker 1: that you need on gred and offward situations to go
39:19
Speaker 1: hand in hand. But but but I think they have
39:21
Speaker 1: a big role to play. I mean, you mentioned decentralization.
39:24
Speaker 1: Another interesting thing that we're funding right now is and
39:29
Speaker 1: it's very different from electrification, where it goes back to
39:32
Speaker 1: the topic of inclusion is the use of blockchain technology
39:37
Speaker 1: to create economic identities for displaced people. Now, that sounds
39:42
Speaker 1: so in other words, Syrian refugees, everybody gets a unique identifier,
39:47
Speaker 1: and that blockchain is a way that you can validate
39:49
Speaker 1: who they are. So not just that, and it's more
39:52
Speaker 1: about what it can do for the development organized less
39:55
Speaker 1: about what it can do for the development organizations, and
39:58
Speaker 1: more about the individual. Today, if you're displaced from home,
40:01
Speaker 1: you know, you may have left under god awful circumstances,
40:05
Speaker 1: you may have some form of identification or not. You
40:08
Speaker 1: end up in a camp, you get a number and
40:10
Speaker 1: that's quote unquote your identity. But and then you know,
40:14
Speaker 1: when you go from one place to another, you may
40:17
Speaker 1: keep it, you may not, you may get a new one.
40:19
Speaker 1: There's probably no record, collective record of what you've done
40:22
Speaker 1: along the way. So what blockchain can allow you to do?
40:26
Speaker 1: And we're still testing it, so so let's see what
40:28
Speaker 1: the results are. It can allow you to record along
40:32
Speaker 1: the way the different interactions. You have to say, you're
40:35
Speaker 1: living in Jordan's not in a camp. You know the
40:38
Speaker 1: refugees there live outside the camps. You get a cash
40:42
Speaker 1: transfer from U n h c R regularly, right, Um,
40:46
Speaker 1: You have a cousin that lives in Europe who sends
40:50
Speaker 1: you money, remittances regular on a regular basis. You have
40:54
Speaker 1: some small job that you've taken somewhere, you know, maybe
40:57
Speaker 1: part time, maybe something. You have money that comes from.
41:00
Speaker 1: Imagine if you had one place where all those interactions
41:03
Speaker 1: could be recorded. So at some point in time you
41:05
Speaker 1: want to start your own business and you go to
41:07
Speaker 1: the bank and say I would like to take out
41:09
Speaker 1: a loan, They wouldn't look at you and say, well,
41:12
Speaker 1: I'm sorry, you are just a person who has no
41:15
Speaker 1: record of showing what your credit worthiness is or isn't
41:19
Speaker 1: you actually have the ability yourself as an individual to
41:22
Speaker 1: choose how much you want to share with the institutional
41:24
Speaker 1: and then figure out alternative ways of getting integrated into
41:28
Speaker 1: the new home that you found. That that's fascinating, that
41:31
Speaker 1: that may be the best single usage of blockchain i've
41:34
Speaker 1: heard to date. That that's really quite interesting. So I know,
41:38
Speaker 1: I only have you here for another fifteen twenty minutes,
41:41
Speaker 1: and I have a bunch of questions I want to Uh,
41:44
Speaker 1: I wanna go over. Let me just go to one
41:48
Speaker 1: that I know I missed earlier. You mentioned about working
41:53
Speaker 1: with the private sector. How do you integrate what you
41:58
Speaker 1: do with both state and federal governments, local and federal governments, um,
42:04
Speaker 1: other philanthropy as well as the private sector. How does
42:08
Speaker 1: that look when a project is moving forward? Right? So,
42:13
Speaker 1: as I mentioned earlier, one of the core principles that
42:16
Speaker 1: we've always had is about building relationships and partnerships because
42:19
Speaker 1: we realized that we never alone can come up with
42:22
Speaker 1: the with the answer and then drive it forward. Now,
42:25
Speaker 1: that can take many different shapes and forms. Sometimes it
42:28
Speaker 1: is the public sector, either the federal level or state
42:32
Speaker 1: or national um sorry, state or local that we partner
42:37
Speaker 1: with and then bring in the private sector, and sometimes
42:39
Speaker 1: it may just be with the private sector. I mean,
42:42
Speaker 1: I'll give you one example of a place where we
42:44
Speaker 1: we've collaborated quite well across the board, and it goes
42:48
Speaker 1: back to the to the finance work as well. UM
42:51
Speaker 1: it's called New York City Housing Acquisition Fund, and this
42:54
Speaker 1: was around ten ten years ago, more than ten years now,
42:58
Speaker 1: where we came to get there with a number of
43:01
Speaker 1: different philanthropies, the City of New York, and a number
43:04
Speaker 1: of big banks to create this fund that was targeting, um,
43:09
Speaker 1: creating more affordable housing units here in the city. You
43:12
Speaker 1: know what the real estate market here looks like. You
43:15
Speaker 1: know how tough it can be to get loans to
43:18
Speaker 1: to do affordable housing. So what we did was, so
43:22
Speaker 1: there's Battery Park City along with a number of different foundations,
43:25
Speaker 1: we created a guarantee fund. At the back of that,
43:29
Speaker 1: we attracted around two hundred million from big banks. So
43:32
Speaker 1: you have the likes of JP Morgan City, Morgan Stanley,
43:39
Speaker 1: many of them or most of them that put money
43:41
Speaker 1: into it. Now, we couldn't have done that alone. The
43:44
Speaker 1: banks wouldn't have ventured into it because they saw it
43:47
Speaker 1: potentially as a risky proposition and the city couldn't have
43:50
Speaker 1: done it alone. And so what did that end up funding?
43:53
Speaker 1: So they have to date deployed over three hundred million
43:57
Speaker 1: UM and invested in either the preservation or the creation
44:00
Speaker 1: of more than ten ten house affordable housing units here
44:04
Speaker 1: in the city. And that's in down in Battery Park alone.
44:07
Speaker 1: It's it's it's all over the city. And they continue
44:10
Speaker 1: the work. The fund still exists. That that's quite that's
44:12
Speaker 1: quite fascinating. You know, I wanted to ask you a
44:15
Speaker 1: question personally. So you're you're born in Copenhagen or born
44:20
Speaker 1: in Denmark? Is that right? And so you you grew
44:22
Speaker 1: up there? You do a semester abroad UM at Boston
44:27
Speaker 1: College and at George Washington for undergraduate and graduate. How
44:32
Speaker 1: challenging was the decision to say, um, I'm gonna come
44:36
Speaker 1: work in America. By all the annual UM surveys, Denmark
44:43
Speaker 1: is considered one of the happiest countries in the world.
44:46
Speaker 1: How do you decide to I mean, do you just
44:49
Speaker 1: not like bicycles? What makes you? Every I've been to Dencark.
44:53
Speaker 1: I've been to Copenhagen twice and the one thing everybody
44:56
Speaker 1: tells you is look both ways. Pretty cross the street
44:58
Speaker 1: you're gonna get rund of a bike by schools. And
45:00
Speaker 1: it's so true. It's I've never seen anything. Forget Portland,
45:05
Speaker 1: Seattle of San Francisco, that is a bicycle city. It
45:08
Speaker 1: sure is. And you know it's a dangerous endeavor to
45:12
Speaker 1: drive in the city. You're here where it's dangerous to bike,
45:16
Speaker 1: and everyone's exactly there as a as a as a
45:20
Speaker 1: car driver. It's like you're surrounded by bikes. It's amazing.
45:23
Speaker 1: So I I mean you mentioned, you know, my being
45:26
Speaker 1: born in Denmark. I was. Both my parents were from Pakistan.
45:31
Speaker 1: They had moved there back in the sixties, and as
45:34
Speaker 1: a result of a lot of different family decisions, I
45:37
Speaker 1: ended up moving and living in Pakistan for a long
45:39
Speaker 1: time as well. So yes, I did my basic elementary
45:42
Speaker 1: schooling in Pakistan. I lived there for nine years, then
45:46
Speaker 1: moved back to Denmark. Um was that culture shock going
45:49
Speaker 1: back and forth like that. So I mean, if you
45:54
Speaker 1: take kind of you know, a spectrum, you could put
45:56
Speaker 1: Pakistan at one end and you'd put Denmark at the
45:59
Speaker 1: exact Visit it right, Boisan is loud, it's colorful, it's messy,
46:05
Speaker 1: it's completely it's completely unorganized, and then Denmark, on the
46:09
Speaker 1: other hand, is calm. It's you know, very black and
46:14
Speaker 1: white and gray, and it's it has a you know,
46:18
Speaker 1: very different field to it. I grew up in both worlds.
46:21
Speaker 1: I grew up in both worlds when I was living
46:22
Speaker 1: in Denmark. I grew up in both worlds when I
46:25
Speaker 1: was living in Pakistan and visiting Denmark. Um. So for me,
46:29
Speaker 1: I don't see the culture shock. I can start a
46:32
Speaker 1: thought in my head in Danish and finish it in
46:34
Speaker 1: Urdu and then say it in English. That is just
46:38
Speaker 1: how you know what my life was like. In terms
46:41
Speaker 1: of moving to the U S. I'd say yes, I
46:43
Speaker 1: lived in Boston for half a year, and then I
46:46
Speaker 1: lived in d C for a year while I was studying,
46:48
Speaker 1: and then when I was at McKenzie, I did um,
46:52
Speaker 1: I moved over to your New Jersey office. Lived in
46:54
Speaker 1: New York, but did that for a year. And the US,
46:59
Speaker 1: the U S. East Coast has always had a special
47:02
Speaker 1: place in my heart. So my husband and I we
47:04
Speaker 1: moved here eight years ago because we were getting restless
47:08
Speaker 1: in Denmark. I was getting restless in Denmark and New
47:11
Speaker 1: York has always felt like home right. A lot of energy,
47:14
Speaker 1: a lot of dynamism, a lot of things going on here,
47:16
Speaker 1: a lot of messiness, lots of noise. Yes, so it's
47:20
Speaker 1: a little bit of of all the world. Exactly, very interesting.
47:23
Speaker 1: So let's jump to some of my favorite questions. I
47:26
Speaker 1: asked these of all my guests. Um, we talked about
47:30
Speaker 1: what you did before you started working? Who were some
47:34
Speaker 1: started working at a Rockefell, or who are some of
47:37
Speaker 1: your early mentors. So I think it's only now that
47:43
Speaker 1: I've come to think of them as my mentors. If
47:45
Speaker 1: you'd ask me this question twenty years ago, I wouldn't have.
47:48
Speaker 1: That's a lot of the women in my family. I
47:51
Speaker 1: grew up in a very patriarchal society, whether that was
47:54
Speaker 1: you know, in our house in Denmark, or whether it
47:56
Speaker 1: was in Pakistan, and in Pakistan I assume as patriarch
48:00
Speaker 1: called Denmark also, No, well, a lot of that culture
48:03
Speaker 1: from Pakistan moved over with my family to Denmark. So
48:07
Speaker 1: so no, not wrought a Daniel society. It's the opposite.
48:11
Speaker 1: But if you look at it, I've I've drawn inspiration
48:13
Speaker 1: from many that you know found their own way forward,
48:17
Speaker 1: whether that was my aunt who raised her own kids
48:21
Speaker 1: the way she wanted to after her husband passed away,
48:23
Speaker 1: or my mother who was, you know, a very successful doctor,
48:27
Speaker 1: or some of my cousins who broke away from tradition
48:30
Speaker 1: and did what they wanted to do, um, which was
48:33
Speaker 1: against expectations. On the other side, I would also say,
48:36
Speaker 1: in the more traditional sense, some of the directors that
48:40
Speaker 1: I worked with when I started at McKenzie um ages
48:43
Speaker 1: Ago one in particular. I remember it was one of
48:46
Speaker 1: my first projects. I was the junior associate on the team.
48:49
Speaker 1: We went in seated there with the CEO and so on,
48:52
Speaker 1: and the CEO asked a question and the director turned
48:55
Speaker 1: around and pointed to me, and he said, well, she
48:57
Speaker 1: did the work, why don't we just ask her? And
49:01
Speaker 1: it was just I mean, it showed me that it's
49:05
Speaker 1: about your ideas and what you have to offer and
49:08
Speaker 1: not rank um that matters in the world. And he
49:13
Speaker 1: showed that by example, and he gave me the confidence. Now,
49:15
Speaker 1: if the answer to this question hadn't been good, I'm
49:18
Speaker 1: sure he wouldn't have given me the same opportunity again UM,
49:22
Speaker 1: But that did set the tone for how I've approached
49:24
Speaker 1: a lot of things in my career since. Care to
49:26
Speaker 1: share the name Michael, help you, Michael, help you, help you?
49:31
Speaker 1: So local Danish person. Yes, And so let's talk a
49:36
Speaker 1: little bit about what people influenced your approach to philanthropy,
49:42
Speaker 1: who has affected how you look at the world of
49:46
Speaker 1: affecting change for the betterment of mankind. So this may
49:52
Speaker 1: sound a little bit cliche, but this was ages ago.
49:55
Speaker 1: I was still in the private sector. I was getting
49:57
Speaker 1: on a plane to go to some clients somewhere and
50:00
Speaker 1: I had a magazine UM that had an interview with
50:04
Speaker 1: Bill Clinton. And I know it's not the popular thing
50:06
Speaker 1: to say these days and talk about the Clinton Foundation,
50:09
Speaker 1: but I talked about some of the work where it
50:10
Speaker 1: laid out some of the work that they were doing
50:13
Speaker 1: in Africa around medicine for HIV n A. So talked
50:16
Speaker 1: about how they had brought together different players from the
50:19
Speaker 1: private sector to you know, reset the price off those
50:23
Speaker 1: medicines in that part of the world, and how they've
50:25
Speaker 1: done it through something called advanced market commitments. And to me,
50:29
Speaker 1: that was completely fascinating that, you know, and I hadn't
50:32
Speaker 1: thought of philanthropy in those terms. I thought about it
50:34
Speaker 1: in the more traditional You just give money and then
50:36
Speaker 1: you wait for something good to happen Um the other person,
50:40
Speaker 1: and this is more around our zero gap And in
50:42
Speaker 1: a bit of finance work I met he used to
50:45
Speaker 1: be the former Treasurer of the World Bank. His name
50:48
Speaker 1: is Kenneth lay Um, and he was the one who
50:52
Speaker 1: designed the very first green bond. Now when we talk
50:55
Speaker 1: about green bonds and all the good and bad things
50:57
Speaker 1: that have come with it, you know, it doesn't get
50:59
Speaker 1: associated with the person. But you know, I've had many
51:03
Speaker 1: conversations with him since and he keeps going at the
51:06
Speaker 1: point and I completely agree with him, and it's it's
51:08
Speaker 1: influenced my approach as well, which is, you know, take
51:11
Speaker 1: philanthropic funding to create new solutions that are sustainable instead
51:16
Speaker 1: of putting philanthropic funding forward as concessionaire capital, cationary capital.
51:21
Speaker 1: That's quite interesting them that that's really quite quite fascinating,
51:27
Speaker 1: And it's so easy to get wrapped up, especially in
51:30
Speaker 1: the last election, with some of the political criticisms of
51:35
Speaker 1: various foundations. When you look at what the Clinton Foundation
51:39
Speaker 1: itself has actually accomplished. They've performed a lot of extract
51:43
Speaker 1: the politics, They've performed a lot of good and that
51:47
Speaker 1: gets lost in the political debate. So I don't I
51:50
Speaker 1: don't think what you're saying is especially controversial. You just
51:53
Speaker 1: have to sometimes ignore all of the craziness around around
51:59
Speaker 1: US elections. That has to so, as a someone who
52:02
Speaker 1: spent a lot of time overseas, how do you look
52:05
Speaker 1: at US? I mean, do you I think our elections
52:08
Speaker 1: are insane? I can't imagine someone who didn't grow up here.
52:12
Speaker 1: You know, you look at the UK their elections or
52:14
Speaker 1: they seem to last a month and a half and
52:16
Speaker 1: it's done. This is like a never ending at least
52:19
Speaker 1: for this one was two years. Just someone who's far
52:23
Speaker 1: and born but living in New York look at this
52:25
Speaker 1: and say, what are you people doing? This is a
52:28
Speaker 1: giant waste of energy, um verry. You forget that I
52:32
Speaker 1: also grew up in Pakistan. So if I take so
52:36
Speaker 1: an insane electoral process is in a constant state of elections.
52:41
Speaker 1: I mean, and you know, until recently, I think we've
52:44
Speaker 1: had a very long period where none of the elected
52:47
Speaker 1: governments had finished their attemp before there was a new election.
52:50
Speaker 1: How does it compare to the way self governance takes
52:53
Speaker 1: place in in Denmark? So Denmark is very buttoned up,
52:59
Speaker 1: it's very focus. From the time you announced an election
53:02
Speaker 1: to the time the election happens. You're talking about weeks.
53:05
Speaker 1: You know, there isn't any after this election, especially. Um,
53:11
Speaker 1: let's talk a little bit about books. People always ask,
53:13
Speaker 1: always say to me, I'm curious as to what favorite
53:16
Speaker 1: books your guests have so related to philanthropy, finance, fiction, nonfiction.
53:22
Speaker 1: What sort of books do you really enjoy? So, Um,
53:27
Speaker 1: I spent a lot of my time reading white papers
53:29
Speaker 1: and such reports and those aside. I know, I know. Actually,
53:33
Speaker 1: my my seven year old daughter is really into Harry
53:36
Speaker 1: Potter these and you know, once in a while when
53:39
Speaker 1: she sees me with an actual book, she will come
53:41
Speaker 1: over and she was like, how long is that book?
53:43
Speaker 1: And I'm like, three pages, doesn't matter. I just read
53:46
Speaker 1: seven hundred pages. You can do this. So she's looking
53:49
Speaker 1: down and oh, yeah, I get shamed by my daughter.
53:53
Speaker 1: But to mention a couple of interesting ones I've I've
53:56
Speaker 1: read recently, Um, there's a fascinating book called Today We
54:00
Speaker 1: Drop Bombs, Tomorrow We Build Bridges, and it traces kind
54:05
Speaker 1: of the history of what has happened in the humanitarian
54:08
Speaker 1: space since the beginning of the Afran War, post war reconstruction,
54:13
Speaker 1: and no, not so much about post war reconstruction. It's
54:16
Speaker 1: about how our humanitarian agenda has been brought closer and
54:19
Speaker 1: closer to our military priorities. Really, so, humanitarian organizations have
54:24
Speaker 1: always worked on the principle of neutrality. You know, you
54:27
Speaker 1: go where the need is great as you do what's
54:29
Speaker 1: needed to be done. It's not about politics. It's just
54:33
Speaker 1: about helping the change that has changed in many ways.
54:37
Speaker 1: You should read the book. It's it's a fascinating recounter
54:42
Speaker 1: Peter gil Um. It's about what happened in Afghanistan. What
54:45
Speaker 1: has you know, happened since in other parts of the
54:47
Speaker 1: world as well, where NGOs to a large extent are
54:51
Speaker 1: dependent on funding from the governments and if the governments
54:57
Speaker 1: want them, you know, to go to certain part off,
55:01
Speaker 1: say a country, to perform their work there. Sometimes you
55:04
Speaker 1: don't really have an influence over that. So if you
55:07
Speaker 1: look at where the bulk of the foreign aid went
55:11
Speaker 1: in Afghanistan, it went to the places where there was
55:15
Speaker 1: also the biggest military presence. Quite fascinating. Give me another
55:19
Speaker 1: book if you have. I just started reading it. Strangers
55:23
Speaker 1: at the Door. It is it looks at the moral
55:26
Speaker 1: crisis brought upon by you know, the massive refugee crisis.
55:31
Speaker 1: It kind of argues that, you know, it's it's a
55:35
Speaker 1: challenge that cuts across borders, and we are all dependent
55:39
Speaker 1: on each other define the right solutions. So taking a
55:42
Speaker 1: more protectionist approach, um isn't the way forward. I mean,
55:46
Speaker 1: it's that sounds fascinating any and then I can always
55:51
Speaker 1: recommend some research papers if if you're interested, I'll pass
55:55
Speaker 1: listen everybody. I would imagine half the listeners to this
56:00
Speaker 1: been a lot of time reading and finance and other
56:03
Speaker 1: such UM related papers, and the question always comes up,
56:08
Speaker 1: is I want to put this aside? Give me something
56:10
Speaker 1: either fiction or nonfiction, biography or something else. I can't
56:14
Speaker 1: tell you how often the question comes up. UM. So
56:17
Speaker 1: those are two good recommendations. Well, we'll look into that.
56:19
Speaker 1: So since you joined UM the Rockefeller Foundation, how have
56:23
Speaker 1: you seen the industry changed? Meaning how is philanthropy in
56:30
Speaker 1: the midst of adapting to the modern world. So in
56:35
Speaker 1: the last four years a lot has changed. I think
56:39
Speaker 1: more filmthropic money with big names has come in. Zukobug
56:43
Speaker 1: Chan initiative is just an example of that. I guess
56:46
Speaker 1: that's good for the broader field in terms of more
56:49
Speaker 1: people focusing on the things that that we focus on.
56:54
Speaker 1: UM I think there's been a clear recognition of the
56:57
Speaker 1: role of private sector in getting to solutions, and I
57:00
Speaker 1: think the work around climate change and the involvement of
57:02
Speaker 1: the business community in that largely speaks to it. I
57:06
Speaker 1: think there's also been more of a recognition of the
57:10
Speaker 1: interdependence and problems cutting across boundaries than before. I think
57:15
Speaker 1: climate change again is part of it. You can't as
57:18
Speaker 1: one country you just solve it. You're dependent on every
57:21
Speaker 1: other country around you. Global migration is another example of that,
57:27
Speaker 1: and then the big backlash against globalization that has come
57:32
Speaker 1: to the forefront is affecting a lot of them. What
57:34
Speaker 1: about big data? Is big data impacting philanthropy the way
57:38
Speaker 1: it is impacting the private sector. So it is, and
57:41
Speaker 1: we do try to build solutions around it, but it's
57:45
Speaker 1: it's again about having context for that data, understanding what
57:49
Speaker 1: it means and what you need to do, instead of
57:51
Speaker 1: blindly following it. So I'm down to my last two
57:55
Speaker 1: and very favorite questions. So if a millennial came to you,
57:59
Speaker 1: someone who just duated college and said I'm interested in
58:02
Speaker 1: a career in philanthropy, what sort of advice would you
58:05
Speaker 1: give them. I would say one thing, which is have
58:09
Speaker 1: respect for the problems. It's something that we were talking
58:12
Speaker 1: about earlier. These are complex, messy problems. You have to
58:16
Speaker 1: have respect for them. You have to really understand them
58:18
Speaker 1: before you start jumping to solutions. There are no quick
58:22
Speaker 1: fixes around here, you you know. Uh. The other thing
58:25
Speaker 1: I would say is you better buck up because you're
58:29
Speaker 1: going to get knocked down many, many, many times. And
58:32
Speaker 1: that is part of working in this space. You try
58:35
Speaker 1: many things before you get to the one that really works.
58:38
Speaker 1: So be willing able to just jump in there and
58:43
Speaker 1: and keep going at it. You have to be resilient.
58:46
Speaker 1: And yes, yes, very much, so thank you for that plug.
58:49
Speaker 1: And and our last question, what is it that you
58:53
Speaker 1: know about the world of philanthropy today that you wish
58:56
Speaker 1: you knew ten plus years ago when you started. I
58:59
Speaker 1: wish I knew how hard it would be to give
59:01
Speaker 1: away money. Really it is really really difficult. So with
59:05
Speaker 1: all the other jobs I had before coming here, including
59:08
Speaker 1: city government, it was about you know, I have this idea,
59:11
Speaker 1: and where do I get the money from and what
59:13
Speaker 1: do I do? And then with this job, I was like,
59:16
Speaker 1: this is realiant. Now I'm the one who has the
59:19
Speaker 1: money and I get to have the conversations about where
59:21
Speaker 1: to give the ideas. It is so difficult because at
59:25
Speaker 1: the core of it, our responsibility is to poor and
59:28
Speaker 1: vulnerable people. It's precious dollars. It cannot be squandered. And
59:33
Speaker 1: even though when we take risks, they're calculated risk. I
59:36
Speaker 1: end with one thing. So David Rockefeller Jr. Used to
59:39
Speaker 1: be on our board. He just retired last year after
59:41
Speaker 1: his term was up. And he's a lovely man, very passionate.
59:46
Speaker 1: Every time we had our board meetings, you know, got
59:48
Speaker 1: a chance to meet him, he would say, what are
59:50
Speaker 1: you working on right now? That excites you the most?
59:53
Speaker 1: I remember the first time he asked me the question.
59:55
Speaker 1: You know, I had a slight moment of panic and
59:57
Speaker 1: I was like, if I can't with conviction give him
1:00:00
Speaker 1: an answer, you know, about to that question that I
1:00:03
Speaker 1: don't deserve to be in this role because it was
1:00:07
Speaker 1: you know, his family that started at all. It's because
1:00:10
Speaker 1: of him that we're doing what we're doing, and I
1:00:12
Speaker 1: better do a good job. Well, that sounds quite fascinating.
1:00:15
Speaker 1: We have been speaking with Saudia Madsburg of the Rockefeller Foundation.
1:00:22
Speaker 1: If you enjoyed this conversation. Be sure and look up
1:00:25
Speaker 1: an inch or down an inch on Apple iTunes and
1:00:27
Speaker 1: you could see any of the hundred and fifteen or
1:00:30
Speaker 1: so such conversations we have had previously. Uh be sure
1:00:35
Speaker 1: and share your comments, feedbacks and suggestions with us right too.
1:00:41
Speaker 1: I'm gonna do that again because I just totally uh
1:00:44
Speaker 1: tripped on my own tongue. Be sure and send us
1:00:47
Speaker 1: your comments, feedback and suggestions. That's the proper use of
1:00:52
Speaker 1: the plural words right to us at m IB podcast
1:00:57
Speaker 1: at Bloomberg dot net. I would you remiss if I
1:01:01
Speaker 1: did not thank Medina, our recording engineer, Taylor Riggs, our booker,
1:01:06
Speaker 1: and Michael Batnick, our director of research. I'm Barry Riholts.
1:01:10
Speaker 1: You've been listening to Masters in Business on Bloomberg Radio.