Stanford Business magazine

A Professor’s Lasting Influence

Disillusioned by seeing thousands of poverty-stricken people every day in the slums of Brazil, investment banking employee Jacqueline Novogratz moved into nonprofit work. In Africa, she became frustrated by the unsustainable nature of charity aid for the poor. So in 1989, Novogratz entered Stanford Business School hoping to "gain the confidence and skills" to fuse the two sectors. There she met John Gardner, a professor emeritus who mentored her until his death at age 89 in 2002. Here is Novogratz's account of what she learned from Gardner. It is excerpted with permission from her 2009 autobiography, The Blue Sweater.

In 2001, Novogratz founded the Acumen Fund, one of the first nonprofit global venture funds that tries to bridge the gap between grant-based philanthropy and capital markets. An article about the Acumen Fund appeared in the May 2007 issue of Stanford Business magazine.

By Jacqueline Novogratz, MBA '91

Before each semester at Stanford, professors give a preview of their upcoming classes to aid students in course selection. At one session, a tall, graceful elderly man in a gray suit and a fedora stood up to speak. He looked like he had been an athlete in his youth. His figure was lithe, his step easy. He carried a sense of gravitas that made it impossible not to listen to what he had to say.

"Why do civilizations rise and fall?" he asked, moving his hand in an elegant arc above his head, and then paused. I thought of the Taj Mahal, of the contrasts I'd seen in different countries. I wanted to talk to him about them.

"Why do some people stop growing at age 30, just going from work to the couch and television, when others stay vibrant, curious, almost childlike, into their eighties and nineties?"

He paused again, and I was hooked; I felt he was speaking to me directly. Though I had no idea who this man was, I knew that he was going to play a role in my life.

That afternoon, I went to the professors' offices and found his name on the door: Professor Emeritus John Gardner. I knocked and heard a voice tell me to come in. John was sitting at his desk, hat off, jacket still on, reading a paper he put aside when he saw me. I stammered through my introduction and explained to him why what he had said had resonated so clearly with me. He'd been talking about the kind of person I wanted to be. I was craving more discussion about just those issues and, well, might he ever have the time to talk to me about some of them?

The room was quiet, and he stared at me with the kindest eyes I'd ever seen. "My dear," he said, "of course, we can talk. Sit down. But first I have to ask you if you knew you were wearing two different earrings?"

I told him I did, that I thought it made people think for a moment, and that might be a good thing — didn't he think so?

He laughed, and I sat down. We didn't stop talking until he died more than a dozen years later.

It was only after my first meeting with John that I learned he'd been secretary of health, education, and welfare under Lyndon Johnson. After resigning from the Johnson administration as one of the most powerful government officials in the country, he founded a grassroots citizens' organization, Common Cause, at age 56. John Gardner understood what self-renewal was all about — he lived it.

He also founded the Independent Sector as an umbrella group for nonprofit organizations; the White House Fellows to promote leadership in the young in Washington, D.C.; and the National Civic League to encourage citizen participation. Everything he did was about releasing human energies at all levels of society. His greatness came not from any title, but from the way he lived his life, with a rare combination of vision and drive, humility and grace.

John never stopped learning. I have a vivid image of him standing at the front of the class with pen in hand as he took notes each week on what the 10 people in the seminar had to say. It certainly made me pay more attention and listen more carefully. If he were writing down what my classmates were thinking, then there was probably wisdom in it for me, as well. John spoke about the civil rights movement in the United States, about how social movements need both insiders and outsiders to make change happen, about how important it is to learn to talk to one another across lines of difference — ethnic lines, religious lines, class lines, ideological lines.

After classes, I would sit in his office for hours. I did independent studies with him as well, learning about leadership and starting organizations not for personal profit but to benefit a greater community. He always had time to talk, whether it was about major social movements or about the importance of living with integrity, of treating everyone with the respect they deserve. And he taught just by being who he was. I would sometimes see him on campus, talking with a former secretary of state. John would call me over and give me a hug, even if I tried to walk by without him noticing, not wanting to interrupt his important matters. As he once said of a friend of his, John made the world better just by being in it.

Our most frequent topic of conversation had to do with community, what it meant, how to foster and build it. John believed humans thrive in relationship to each other and that communities in which each individual feels a sense of belonging and of accountability are key to our individual and societal success.

When I was considering what to do after business school, my choices were to accept a fellowship at the Rockefeller Foundation to explore enterprise-development strategies for low-income communities in the United States, or to move to Czechoslovakia to work on a fund that would build small enterprises in that newly freed country just one year after the fall of the Berlin Wall. With my tendency toward wanderlust, I leaned toward working in a new land during a historic moment.

John felt I should instead accept the fellowship with the Rockefeller Foundation. "It will give you an important vantage point on what philanthropy is, both domestically and internationally," he said. "And you already have worked in a developing country building enterprises. Life at your age should be about putting new and different tools in your toolbox. You already understand that communities today transcend geography and that you belong to multiple ones — Stanford, women, the community that cares for Africa. But to be truly effective, especially internationally, you must root yourself more strongly in your home's own soil. It is time for you to know this country, as well. Only by knowing ourselves can we truly understand others — and knowing from where you come is an important part of knowing who you are."

"Surely there are enough people interested in this country," I told him. "My contribution will come from focusing globally."

He shook his head. "You should focus on being more interested than interesting" — something I'd heard him say countless times. "What happens overseas is profoundly influenced by what happens here, especially now. And the reverse is true, as well."

Following John's advice, I accepted the Warren Weaver Fellowship at the Rockefeller Foundation and spent a life-changing year looking at microenterprise and small and medium enterprise efforts in the United States, comparing them to what was happening in Bangladesh and India in the realm of microfinance. It was a year of sitting on factory floors in the Midwest, visiting Indian reservations in South Dakota, and talking to ex-prisoners working on an organic farm outside San Francisco. The same themes continued to emerge: Business was a powerful way to bring discipline and rigor to solutions that could lead to a greater feeling of independence and choice among people too often seen as invisible. And John was right: It didn't matter if the people lived in Bangladesh or Bangor, Maine. Everyone wanted the same things. And low-income people the world over were challenged by many similar constraints. …

After a stint at the Rockefeller Foundation where Peter Goldmark, its president, encouraged her to consider how to evolve philanthropy over the long run, Novogratz went to work for a large philanthropic trust and was disappointed by the results.

"I learned quickly that giving away money effectively can be much more difficult than making it, especially when decisions are made by a committee and not an individual. Moreover, philanthropy can appeal to people who want to be loved more than they want to make a difference," Novogratz writes. She wanted to depart for the for-profit sector but Goldmark challenged her to improve the nonprofit sector instead. "It was impossible to say no to Peter."

After months of traveling around the country, discussing with philanthropists their own hopes and desires for learning, I started the Philanthropy Workshop at the Rockefeller Foundation. We would train a corps of philanthropists and provide them with the skills, knowledge, and networks needed to tackle tough problems. We knew our effort would be global; we would dive into many different issues and explore what had worked historically as well as what might be needed in the future.

Of course, I couldn't start anything until I spoke with John Gardner. I traveled back to Palo Alto to seek his advice. At a local coffee shop, I happily watched his deliberate movements, how much attention he paid even to making a sort of ritual out of a daily visit to a coffee shop: When John was with you, he was fully present. Though he didn't dress like a monk and could not have been more active in the world, he moved from a place of spiritual stillness that I craved in my own life. After listening to my dreams and plans for the workshop, he nodded with approval and said he thought it could make an important impact. Then he took a breath before imparting his thoughts.

"The one thing for you to teach," he said, "is that the most important skill needed is listening.If philanthropists don't first listen, they will never be able to address issues fully because they will not understand them. Second, philanthropists should focus on supporting others to do what they already do well rather than running programs themselves. There is such a disease among the newly wealthy especially, who think they are the only ones with good solutions. They should think about investing in great people in the social sector just like they invest in great people in the financial sector. That would help things a lot," he smiled, adding, "but the ego is a powerful burden."

I nodded in agreement, trying just to listen.

"Finally," he continued, "philanthropists should find innovations that release the energies of people. Individuals don't want to be taken care of — they need to be given a chance to fulfill their own potential. Too many projects create dependence that helps no one in the long run."

When I told him he was preaching to the choir, he laughed. "Then think about the choir. Think about community. People need to feel responsible to one another. Otherwise, we will breed successful individuals who don't feel connected enough to the greater society."

He paused and looked at me. "Think about how the middle and working classes fit into society. The intellectual elites who run society — the analysts and number crunchers and people who thrive on symbols and technologies — often have very little empathy for people with less. And when they do think empathically, they focus on the poorest of the poor and not the lower middle portion of society, though it is so critical to societal change."

In today's world, the elites are growing even more comfortable with one another across national lines, yet at the same time, less comfortable with low-income people who share their nationality. How we create those bonds of community that are truly global as well as national is one of this generation's great challenges.

I heeded John's advice and spoke to thinkers and doers across the country to put together a 4-week course given over a 10-month period. Each workshop would take 8 to 10 philanthropists who demonstrated a commitment to learning and to giving strategically. In the first year, they came from across the country, from Boston and Virginia, California and New York, ranging in age from 28 to 50, all with intrepid souls, to try a new course that included days spent in housing court in an effort to understand the perspectives of poor tenants and landlords alike, long discussions into the night, weeks away from home, and international trips. Today, more than 150 people from countries across the world have attended.

At the Philanthropy Workshop, we studied Rockefeller, of course, and Andrew Carnegie, another American industrialist who believed that men of great wealth had a duty to contribute to social, cultural, and economic life and improve the world. He wrote that "the man who dies, leaving behind him millions of available wealth, which was free for him to administer during life, will pass away 'unwept, unhonored, and unsung.'"

We read and discussed Aristotle and Socrates, Martin Luther King Jr., and Gandhi. We explored how best to make grants and investments, how to say no with grace, how to conduct a site visit, and how to understand nonprofit budgets. The idea was to ground individuals in substantive knowledge about issues and also to provide a framework for strategic thinking and moral understanding of how best to effect social change.

International trips were an essential part of the program. In India, we visited some of the most innovative programs in the country focused on education, on HIV infection prevention, on protecting the environment more effectively. The days were hot, long, and transformative. Two hours outside Calcutta on a 120-degree F day, our bus stopped in the middle of nowhere. We were on our way to visit an extraordinary community organizer to understand youth movements and the role of philanthropy in supporting them. The air was so hot you could see it. A few hundred meters in the distance, we saw a long ribbon of saffron along the pale horizon. Our guide pointed to the colorful line and started walking.

As we neared the line, we could hear ululating and singing. Gradually, we saw women dressed in oranges and reds and yellows standing in two lines, waiting to welcome us. As we walked through, the women danced and sang even louder, throwing marigolds over us. My white cotton blouse was streaked with the bright orange that seemed to melt into my skin and hair. The heat and passion and color and noise made me feel almost like I was hallucinating.

Inside the village, we sat together with the women and were handed cool coconut water — which had never tasted better. The women stood in the sun and made presentations about their work fighting for rights and for freedom. When they finished, they performed a beautiful Hindi song for us. The leader then turned to us and asked if we would do them the honor of singing something, too. All of the Americans looked at one another, none of us being used to spontaneously singing songs in front of strangers.

"Is there a song we all even know?" someone joked. Finally, we chose "We Shall Overcome." It felt appropriate, and at least we all knew the words.

We started singing, embarrassed and tentative at first, but gaining steam with each word. Suddenly, some of the village women stood to join us in their native language, clearly knowing the words. Midway through those determined lyrics, every person standing held hands and sang as loudly as he or she could in a mix of languages, yet with a singular spirit — 50 Indian women smiling, and 8 Americans in tears.