Charitable Venture Capitalism?

Small businesses around the country are suffering due to America’s national economy. Traditional venture capitalists are becoming more and more hesitant to invest in startups that don’t have immediate and short term payouts, due to the likelihood of the company going under before any fruit comes to bear on the investment. The U.S. Treasury Department may have a potential solution, however. It recently put forward a new proposal that, if passed, would allow for charitable organizations to buy stock and make loans to businesses that would further the charity’s aims.

This proposal actually does a lot more than just further charitable aims. By making sources of new income available, more and more small businesses are going to be able to get the money they need to get going. Such an enterprise will create jobs for the otherwise unemployed, thus fueling America’s economy. It also means that charities are going to get returns on their investments, stretching the money they have to benefit their causes. It seems like a Win-Win.

While this seems like it is over all an amazing move for the United States, it’s important that such a landmark decision is accompanied by proper oversight. Just as charities have many more ways to benefit their causes, scam artists have just as many ways to drain philanthropy dollars. It’s not that I oppose the decision of this proposal, I’m simply stating that it needs to be watched carefully, so that nothing goes wrong.


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