UPDATE (Sept. 24, 2018): War Child Canada is pleased to congratulate Brock Warner on this accomplishment! On September 21st, in front of a panel of judges, Brock pitched his idea of the 1-in-9 Fund: a publicly traded investment fund that directs a share of the fund’s management fees to support children and youth affected by conflict and crisis. A great idea, a great presentation, and now one of the three prize winners of the Resource Mobilization Challenge. Thank you Education Cannot Wait and The Global People’s Summit for helping us take the first steps toward making the 1-in-9 Fund a reality.
War Child was recently named a finalist for the Education Cannot Wait ‘Resource Mobilization Challenge’. This morning I presented our pitch in New York. Here is an abbreviated version. Many thanks to all at Education Cannot Wait for giving us this opportunity.
Being a fundraiser, I’ve got a problem. The problem is that despite individuals, corporations and family foundations being as philanthropic as at any point in our history – there are in increasing number of charities vying for every charitable dollar up for grabs.
A significant limiter here, is that a Foundation has a payout requirement of 5% of their assets. In Canada we call it a disbursement quota and it’s even lower – just 3.5%. I bring this up because traditionally, charities are only involved in conversations about how to spend this 5% slice of the pie.
We believe the 1-in-9 Fund unlocks a door for charities, and invites us to mobilize the other 95% of a donor’s assets.
So how would we do this?
Well, we have a big idea that we believe that Education Cannot Wait and War Child, with the right private sector partnerships just may be within reach.
Our idea is to develop an Exchange Traded Fund (ETF), or, an index fund which directs a very small portion of the fund’s assets under management – as little as 0.1% – annually to support education for education in emergencies and protracted crises.
We’ve named it the “1 in 9 Fund” for the 1 in 9 children currently living in a war-affected country.
Why an ETF? Because this market is surging. They are accessible to the average retail investor because they have a much lower threshold for investment than traditional funds, and lower fees. For Pension Funds and Labour Unions that are being increasingly pushed for divestment by their members, the 1-in-9 Fund could be just the ethical investment product that a fund manager is looking for.
The global ETF market is growing by more than a trillion US dollars annually, meaning that with the right partnerships and strategy in place, we can profit from this growth without crowding out any existing, traditional sources of funding.
If the market does in fact grow to the projected 7.6 Trillion by end of 2020, this means that the 1-in-9 fund would need to attract approximately .65% of the market to meet our target of $50 million in annual revenue for Education Cannot Wait. 1% of the market would mean $76 million annually.
As ethical investing and ETF’s grow in popularity, there’s a risk that charities will continue to be excluded from the conversation. We have a window of opportunity to be bold, and create the space that would allow us to flourish and claim our space alongside the CEOs, entrepreneurs and investors.
Our message to potential partners and investors is pretty simple. Let’s make money, not war. It is possible to invest responsibly, fund development projects, and make money – all at once. The 1-in-9 Fund is a big idea for a big challenge. We hope that you’re up for the challenge, because we certainly are.