Thursday, December 5, 2013
In a New York Times DealBook column, Andrew Ross Sorkin explores an interesting idea put forward by Lindsay Beck: is there a way to harness financial instruments to dramatically increasing funding resources for nonprofits. Ms. Beck, who has a Wharton M.B.A. and founded a successful charity that aided female cancer survivors with pregnancy, has pursued the idea with a number of investment banks. Based on the article, much work still has to be done to make it a reality and it is far from clear that the idea will prove to be a viable and successful one, but it and the other innovative financing ideas discussed in the column raise a host of intersting issues. For example, what bodies of laws govern such instructions - federal and state securities laws, state charitable soliciation laws, both? What remedies would aggrieved "investors" have? What monitoring would be required or advisable? Nevertheless, it is an interesting idea.