Venture Philanthropy and the War on Terror

Venture philanthropy has its champions and detractors. Detractors say capitalism and charity shouldn't mix. Proponents say it applies principles of accountability much needed in the nonprofit sector. Oh, and it may also be a potent weapon in the war on terror.

Stop the presses. Venture philanthropy fights terrorism? So implies moderate religious leader, venture philanthropist, and businessman the Aga Khan in a piece in Sunday's New York Times. The Aga Khan is chairman of Akfed (the Aga Khan Fund for Economic Development), a strategic for-profit philanthropy. Akfed, which funds projects such as hydroelectric dam systems in poor, underdeveloped countries like Uganda, is "developing protection against extremism," in his words, by creating a way out of poverty. Poverty, according to Khan, "is the driver of tragic despair, and there is the possibility that any way out will be taken."

Kudos to the Aga Khan and others who follow in his footsteps. It is well-known that extremists have made inroads in the Muslim world through their philanthropy, building schools and community centers, so it is heartening to find out that moderate Muslims are seeing to it that religious extremists no longer have the market cornered.

As Oxford economist Paul Collier says, "He gets a multiplier effect from his investments that's really lacking in foreign aid."

If one of the effects is reducing terrorism, that's a mighty big return on his investment--one in which we are all shareholders.