Slow Money - Or, Why It's Not Just How Much or How Little Money, But
the Speed of Money, that Defines Who We Are as a People
and Where We Are Heading as a Civilization
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Woody Tasch is chair of Investors' Circle,
a national network of individuals who provide risk capital
to early-stage companies that address social and environmental
problems. He is also chair of Chelsea Green Publishing,
a leading publisher of books on sustainable living. He has
previously served as treasurer of the Jessie Smith Noyes
Foundation and chairman of the Community Development Venture
"Civilization" is a big word. Thinking about
something as big and as abstract as where a civilization
may be heading is not something I do every day. Every other
day, maybe-call them the "odd" days. On the "even" days
I spend time worrying about money. Not so much about where
money is heading as about how fast money is traveling -everywhere
I worry because, as money is "speeding up,"
it is commanding-with increasing insidiousness and invisibility-ever
more of our attention, and is therefore negatively affecting
our human potential. It is compromising our ability to control
our destinies, individually and collectively.
What do I mean when I say that money is
speeding up? Consider this: From the beginning of human
history to the year 1900, the world economy grew to $600
billion in annual output. Today, the world economy grows
by this amount
every two years
. More than $2 trillion
circulates around the world
As a venture capitalist interested in companies
that help solve social and environmental problems, I am
concerned about the speed of money, since venture capital
typically is invested in companies that are ready to "take
off." The analogy of a rocket accelerating to reach escape
velocity from the earth's gravitational field has some relevance:
Companies that can grow within a few years to billions of
dollars of market capitalization and reach the "orbit" of
the public marketplace are what drive the 20% return benchmark
that is commonly used as the measure of successful venture
As money circulates the globe with
ever-accelerating speed, it sucks oxygen out of
the air, fertility out of the soil, and culture
out of local communities.
Just as we need traffic calming
measures to slow the traffic passing through our
neighborhoods, we need money calming measures to
slow the money passing through our portfolios.
As the 20th century was the century
of scaling up and speeding up, the 21st century
will be the century of disaggregating and slowing
What is the difference between
the time it takes an investment to take off and
the time it takes a new way of thinking to take
By Woody Tasch
compared to day-trading, venture capital may seem slower,
more patient. After all, a venture investment takes years,
not hours or days or months, to appreciate. But viewed through
the lens of sustainability, through a longterm lens that sees
on the horizon population growth, the greenhouse effect, and
disequilibria caused by the unprecedented explosion of financial
wealth and global consumerism of the last few decades, venture
capital is nowhere near patient enough.
in my office at home, off the grid, on a small island, I
work overlooking my raised bed garden, connected over the
electronic superhighway to distant investors and entrepreneurs.
It seems an appropriate place from which to move back and
forth across the boundary between natural systems and financial
markets. This boundary, it seems to me, is defined primarily
by time and its corollary, speed. Natural time versus money
time: seasons and generations on the one hand, and fiscal
year quarters and product life-cycles on the other; the
time it takes water to flow through soil and aquifer versus
the time it takes money to cycle through mutual fund and
to me that many of the problems that the social investment
initiatives of recent years have been aiming to address
could be more fundamentally understood as a problem of the
speed of money. Screened portfolios and shareholder advocacy
both work to heal the wounds caused by globalization, industrialization,
and "corporatization." As critical as these means of redress
are, they remain, to some extent, an exercise in what I
call "wake management." Most of their benefits are achieved
not through slowing down the economic speedboat but rather
through minimizing some of its impact as it speeds through
degradation, a throwaway consumer culture, cheapened food
(rich in empty calories and chemical additives), politicians
who live by polls, media programmers who live by ratings,
nightly news reports that cover daily fluctuations of market
indices-these are the inevitable by-products of an economy
whose decision-making is driven by the imperatives of financial
markets. It is an economy in which money, unleashed through
the power of technology and unfettered by either connection
to place or the human face of exchange, has taken on a life
of its own, a speed of its own.
to see if it is possible to imagine another way. We need
to see, in the words of one Investors' Circle member, if
it is possible "to bring money back down to earth."
might this mean in practical terms? Where might we begin?
begin in the food sector, with enterprises that promote
organic agriculture and support healthy, local food systems.
This is, quite literally, a place where money comes back
down to earth. This is also where my thinking about Slow
year, Investors' Circle sees dozens of early-stage food
companies, from new organic branded products to organic
food restaurants and retailers, to agricultural technologies
that support sustainable food production. Unfortunately,
few of these investment opportunities meet the criteria
of "fast" venture capital. They do not fit easily into investment
portfolios designed to deliver returns that are competitive
with the venture capital industry as a whole. Hence the
need for a "slower" approach: for an allocation of capital
that respects the natural dynamics of this sector and that
is willing to design its expectations of financial return
around those dynamics.
thinking about Slow Money was galvanized by the mission
of Slow Food, an international, Italy-based nonprofit organization
that arose in response to the opening of a McDonald's in
Rome. The Slow Food Manifesto is a feisty, far-flung articulation
of values that underpin the Slow Food organization's programs.
The manifesto integrates an appreciation of fine food with
a commitment to heirloom varieties of produce, small-scale
artisanal production, and biodiversity. It reads, in part:
century, which began and has developed under the insignia
of industrial civilization, first invented the machine and
then took it as its life model.
"We are enslaved by speed and have all
succumbed to the same insidious virus: Fast Life, which
disrupts our habits, pervades the privacy of our homes,
and forces us to eat Fast Foods.
"To be worthy of the name,
should rid himself of speed before it reduces him to a
species in danger of extinction.
"A firm defense of quiet material pleasure
is the only way to oppose the universal folly of Fast
is no Slow Money Manifesto. However, a few dozen food entrepreneurs,
investors, philanthropists, activists, and I are exploring
the possibility of starting a new fund that would steer money
towards sustainable food enterprises in more appropriate ways.
These explorations are being conducted under the auspices
of the Investors' Circle Foundation, which is a philanthropic
arm of Investors' Circle; it supports research on social venture
capital and incubates new strategies for sustainable investing.
I certainly take the spirit of the Slow
Food Manifesto to heart, and would be delighted if such
a thing as Slow Money could come into being, introducing
such values into financial circles. I believe that, as society
struggles with the impacts of globalism, corporatism, and
consumerism, there is an urgent need for effective change
agents who can steer us toward alternatives to our usual
approaches to investments and financial transactions. It
is my hope that the concept of Slow Money might motivate
early investors, who will demonstrate that it is possible
to re-integrate what E. F. Schumacher called ?gmeta-economic
values?h into the daily business of living. I hope that
Slow Money may prove to be an effective idea for facilitating
new strategic alliances, new collaborations, new thinking,
and, perhaps, a new funding vehicle or two.
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