DailyJim: Taking the risk to invest in individual leaders as part of a balanced portfolio of giving

Hello everyone, welcome to another Daily Gym. Today is Wednesday, March 12th, 2025. Today I want to talk about taking the risk to invest in individual leaders as part of a balanced.

Portfolio of giving. So the idea here is that I was thinking about this concept, I think they call it modern portfolio theory. And the idea in financial investing is that one should split the risk of investment. So instead of just investing in all very low risk things or all very high risk things, one should balance their portfolio in terms of low risk, medium and high risk ventures for maximal, or at least to try to get the highest financial return. Now, return on investment. And so a lot of people have heard about this, I'm sure. And so sometimes it's investing in different types of risks, sometimes at different industries, things like this. But it's to split one's investment, financial investment, so that not all of one's eggs are in the same basket, if you want to use old axioms or metaphors, whatever. Um, and so I was thinking about this as I was thinking about leading hearts fund and the concept of, uh, giving money to individuals.

And so I was in, uh, I went to church the other day, uh, with the girl that I'm dating and, uh, we were sitting there and I thought, okay, people give money to churches. People give money to, uh, nonprofits. People give money to political campaigns. People give money to, uh, their children. There are different things that people give money to.

And I started thinking about, okay, well, why would they want to give to leaders instead of these organizations or these groups? And then I thought, well, what if it's about giving not instead of, but in addition to? And then I really started thinking about this idea of balancing a portfolio. And I don't know if we think about it so much when we talk about philanthropy or charity or giving donations and things like this. And it's the idea that if we want certain things to happen in the world, so if we're looking for a social return on investment instead of a financial return on investment or a cultural return or emotional return on investment, however you want to frame it, then why not take a more balanced approach to it? If the goal is to maximize the output. I talked to a friend about this and he was like, ah, what are you going on and on about this? It's logical. But I think it's really important actually for some people.

And so if I sit in here and I look at the state of society post-pandemic, we're starting to close off more and more emotionally, run away from conversations, become more conflict avoidant, pretend that things don't exist, turn to alcohol and movies and all these distractions to escape our reality.

Then if I wanted to go in the other direction, what options do I have? Yes, there are the options of giving to very large nonprofit organizations. You can donate money to whether it's something like PBS, which is doing a lot of the research in a public broadcasting system. You could donate to organizations that are focused on mental health. Like I'm sure there's NAMI is one of the largest ones in the U.S., I believe, you can donate to very large organizations. It could be a very large church.

But the challenge with very large organizations is that they tend to do incremental innovation. They tend to move very slowly, tend to be large bureaucratic organizations, which doesn't mean that they don't do a lot in society. They have a lot of momentum. They have a lot of spread. They can achieve a lot of things in society, just like a large company could.

Now, but they're probably not likely to do things that are a bit out of the box. So then I could go with a medium organization, maybe like a startup company or a new kind of innovative nonprofit that's trying to tackle something. Like, for example, my friend's organization, Pavel, Fine Mind. Pavel and David co-founded this organization, and they're just expanding to a refugee camp in Uganda. and the idea is peer-to-peer mental health. And so it's pushing against some of the existing norms that we have when it comes to taking care of one's emotional well-being, especially in the United States. And so that's taking a more innovative approach. Now, if I give money to them, is it guaranteed that what they're doing is going to work? No, it's a little more risky. Not sure how it's going to work, but it's pushing the bounds a little bit and testing things. and there could be a high reward for coming up with a new way of doing things. And then to take it even further, yes, I can go for a more innovative organization, but I could really just go to an individual. And if I think there's an individual that I think is really pushing the limits and really trying to do self-experimentation or really trying to challenge deeply held cultural norms about how we talk about emotions, how we talk about conflict resolution or conflict awareness in general, then...

I could give money to that individual. Now, this one is the highest risk. You know, nonprofits, especially registered ones in the U.S., have financial accounting that they have to follow to be 501c3 approved. And so you give the money, and then there's a pretty public accounting of where the money goes. If you give to an individual, not so much. Maybe an individual could follow that, but it's also not as likely. Um, and yet individuals, uh, can come up with some really innovative things, innovative things, not only tools, um, but just the way that an individual show up shows up can really change society. Think about the people that we admire the most in the past. I don't know, for me, it's the Lincolns, it's the Martin Luther King juniors, it's the Gandhis, it's the Mandelas. it's individuals that have inspired me. Now, that's not to say that large organizations haven't improved my life. But some of these individuals that have been willing to really push the boundaries, especially as individuals, have inspired me and motivated me, which arguably is one thing that can help with emotional health, having leaders as examples. So I guess the whole point of this episode today, I'm going to keep it under 10 minutes, is that when we are giving money to somebody else, when we are giving love, when we are giving power, when we are giving any type of support to somebody else, especially when we have a goal in mind of having a specific impact on society or even on ourselves.

Sometimes i think we can just balance it out a little bit and put a little bit into the more risky categories what if we took say for say for example we give 10 of our income to charity i think that's what catholicism and some other religions call for something like 10 of your income you should give so if you give 10 of your income what if you gave 10 of that so it would be 1 of your overall income to the risky solutions, to the individuals who are really pushing the bounds? What if 1% of someone's, of our income went to individuals in our lives that we believed were pushing society or pulling society in a direction that we want to go?

Yes, this is dangerous because maybe that person, one, themselves, doesn't go in that direction. Two, maybe they don't pull society in the direction. Three, maybe society goes in the opposite direction. Who knows? It's very hard to know. But what if we invested in the individuals? What if we believed in specific individuals in our lives that they could also make an impact on this world and they didn't have to do it through a large organization? That doing it by themselves or, you know, by themselves, right? We're all working with other people, but like doing it in a much more informal, unstructured way can bring huge rewards. Yes, there's huge risk, but it could bring huge rewards. And what if we invested in that? There was a concept back in the day, there was two startups called Upstart and Pave. And their idea was to find, frankly, people who had a lot of money and have them invest in young students who had earning potential in the future. And the idea was they'd give them $10,000, $20,000 and in the future they would get a percentage of their earnings. I think where that failed is that it was about financial return and not social, emotional, cultural return on investment. What if the return on investment we're seeking from these individuals is much more social, cultural, emotional, and we wanted to see their impact on society. Now, I think it makes a lot more sense to invest just a part of our income, just a part of our wealth, just a part of our time, just a part of our energy to give to these people so that they can try to work alongside the other efforts to pull culture in one direction. And for me, that's the direction of being much more loving, much more united, much more excited to live, sparkle in our eyes. So I went over 10 minutes today, as I said, and I didn't want to, but I'm going to stop right here. I just hope this inspires you a little bit to think differently about how you're, if you have any philanthropic or charity goals in life, to think differently about them and see that, just imagine what it'd be like if you give a small percentage to the high-risk individuals or the individuals who are pushing the bounds and recognizing that it could be high risk but high reward. All right, talk tomorrow.