Club twin review catalytic philanthropy bill gates essay
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March 7, 2017
Alexandria VA—Mosaic M Fairfax Urban Hub Twin C2C
A Club Twin Review:
“Catalytic Philanthropy: Innovating Where Markets Won’t
and Governments Can’t” – An Essay by Bill Gates March 27, 2014
Publication Reference: Catalytic Philanthropy: Innovating Where Markets Won’t
and Governments Can’t By Bill Gates March 27, 2014
https://www.gatesnotes.com/About-Bill-Gates/Catalytic-Philanthropy-Innovating-
Where-Markets-Wont
Gates Comment 01: “While the private sector does a phenomenal job
meeting human needs among those who can pay, there are billions of people who
have no way to express their needs in ways that matter to markets. And so they go
without. “
Club Twin Conversation: How can “catalytic philanthropy” play
the “middle path” between private sector and government? What is the role of
government in meeting human needs not met by for-profit private enterprises?
Gates Comment 02: “… And while private markets foster many stunning
innovations in medicine, science, and technology, the private sector still under-
invests in innovation – dramatically ……. ”
Club Twin Conversation: Private Sector is under invested in
Innovation—Medical & Social Innovations?
Gates Comment 03: “There are huge opportunities for innovation that
the market ignores because those taking the risk capture only a small subset of the
returns….. Innovations for the poor suffer from both of those market limitations.”
Club Twin Conversation: Yep, I am familiar with Venture Capital
(VC) Model for ROI. They typically want 30% ROI, 5 to 7 years time frame. So, if 4
in 5 investments fail, but 1 in 5 succeed, the VC still succeeds.
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Gates Comment 03: “The market is not going to place huge bets on
research when there are no buyers for a breakthrough. This explains why we have
no vaccine for malaria today, even though a million people die from it every
year. “
Club Twin Conversation: How do you see government, meeting
this “private sector gap for the poor”??
Gates Comment 04: “In this gap, government plays an important role. It
can offer services where the market does not, and thus provides a safety net. To
some extent, it also fills in where the market leaves off in funding
Innovation. Medical research at the National Institutes of Health is a great
example. “
“But government faces its own obstacles to funding innovation. It generally
does not take the long view, because election cycles are short. Government is
averse to risk, given the eagerness of political opponents to exploit failures. Unlike
the private market, government is not good at seeding numerous innovators but
backing only the ones that make progress.”
Club Twin Conversation: Ok, but “private sector” is not
monolithic. There are small tech biz such as the U.S. government’s SBIR Phase I
was invented 20 years ago at NSF.GOV, and fills a “bridge”. But on a community
level government, say typically at Urban Hub, public knowledge of the value of
SBIR Phase I as a “bridge” to private sector is not known or appreciated. Business
Associations, such as Chambers typically focuses on retail and professional
business at a geography, and do not appreciate the value of those who are
technically trained and registered to enable them to qualified to submit RFP
response to SBIR Phase I. Question: Can “Catalytic Philanthropy” address this
need for medical & other knowledge economy innovations via providing public
education & SBIR Phase I tech innovators on a community level?