“I am not telling you this because I need anything. I have learned to be satisfied with the things I have and with everything that happens. I know how to live when I am poor, and how to live when I have plenty. I have learned the secret of being happy at any time in every thing that happens” – Philippians 4:11-12

As Pastor A. R. Barnard says; “Happiness is a choice – it depends on how you interpret life. To be happy, you must learn to interpret the world and its events in a positive fashion. This means that you begin programming yourself to see the good in everything – no matter what happens, no matter what goes down. Then, when you find the good in every situation, you take that good and you build upon it”.

It is reasonable to expect that, as we find the good and build upon it, we are embarking on a journey that leads from poverty to holistic wealth and into the realm of plenty. This is desirable once we know how to live when we have plenty. In Barbados last week a single individual won a US$ 2.2 million lottery, let us hope that he or she will quickly learn the secret of “how to live when he or she has plenty”.

Poverty is a scourge that we must continually address. In the autobiography of Muhammad Yunus, a Bangladeshi economist from Chittagong University and founder of the Grameen Bank, www.grameen.com, it is reported that he led his students on a field trip to a poor village. They interviewed a woman who made bamboo stools, and learnt that she had to borrow the equivalent of 15p to buy raw bamboo for each stool made. After repaying the middleman, sometimes at rates as high as 10% a week, she was left with a penny profit margin. Had she been able to borrow at more advantageous rates, she would have been able to amass an economic cushion and raise herself above subsistence level.

Realizing that there must be something terribly wrong with the economics he was teaching, Yunus took matters into his own hands. In Bangladesh today, Grameen has 1,084 branches, with 12,500 staff serving 2.1 million borrowers in 37,000 villages. On any working day Grameen collects an average of $1.5 million in weekly instalments. Of the borrowers, 94% are women and over 98% of the loans are paid back, a recovery rate higher than any other banking system. Grameen methods are applied in projects in 58 countries, including the US, Canada, France, the Netherlands and Norway.

Former US President Jimmy Carter observed that by giving poor people the power to help themselves, Dr Yunus has offered them something far more valuable than a plate of food. He has offered them security in its most fundamental form.

The Norwegian Nobel Committee awarded the Nobel Peace Prize for 2006, divided into two equal parts, to Muhammad Yunus and Grameen Bank for their efforts to create economic and social development from below. Lasting peace can not be achieved unless large population groups find ways in which to break out of poverty.

Venture capital is a type of private equity capital typically provided by professional, institutionally-backed outside investors to new, growth businesses. Generally made as cash in exchange for shares in the investee company, Venture capital investments are usually high risk, but offer the potential for above-average returns.

Mezzanine financing offers a way for publicly and privately held companies to attain financing without going public and potentially ceding ownership of their company. It is a blend of traditional debt financing and equity financing, reaping some benefits of both. Like equity financing, mezzanine financing is an unsecured debt, requiring no collateral to be put up unlike traditional bank loans. Like debt financing, mezzanine financing is very fluid and does not necessarily involve giving up an interest in the company. Mezzanine financing relies on very high interest rates in the 20-30% range to make it profitable.

Seed financing is money used for the initial investment in a project or startup company, for proof-of-concept, market research, or initial product development. There are many such projects in the emerging private sector of potentially high performance enterprises but where the entrepreneurs have no money. Here is an opportunity waiting for a visionary like Muhammad Yunus. The public and private partnership should step up to the plate.

It should be observed that micro-lending, venture capital, mezzanine financing and seed capital are all high risk, high return financing mechanisms which can transform small state economies. The main challenge is mitigating the high risk. The answer is “Management as collateral”.

The CBET ‘shepherding’ model speaks to this. It is recognized that the triad ‘entrepreneur’, ‘money’ and ‘management’ must work in tandem for successful enterprise development. Very often the money is made available to the entrepreneur but, in the absence of sound management, the enterprise still flounders and fails. We cannot afford the luxury of such failure. We must make sure that all management resources are applied when needed to engender high levels of business success among the emerging enterprises. The cost of this is included as an expense in determining the viability of the project.

In this way we can take the good and build on it for the betterment of mankind.