Hi everyone
Here is a question that is rarely asked: What are you going to do with all your millions, once you've made them?
No-one ever seems to seriously discuss that question.
The way I see it investing is a game. The score card is the pile of money in your account at the end of the day and the more money you make the more skilled you are at playing the game and therefore the cleverer you feel!.
The game is great fun - I play it and I know how much fun it is.
But I see winning the investment game as just part A.
Part B is doing something with the pile of money.
I'm interested in finding out how people plan to "deal with" their money.
I know this is a delicate topic, and whenever I ask it, people get uncomfortable. I don't know why!
Here are some answers people give:
1. use the pile of money to make more money!
2. treat themselves: buy rolls royces, boats, holidays, multiple residences, especially the villa in France!
3. leave a huge nest egg for their children and grandchildren - this plan could be the result of inertia as much as anything
4. participate in venture capital projects
5. give to charity
6. create businesses
I actually can't think of anything else.
I think options 1, 2 and 3 are probably the most attractive for most people, and require little effort or creativity.
The last three are the most challenging but offer huge opportunity to leave a legacy and creat an impact.
They are difficult though.
For example, about 40 -50% of venture capital projects fail. Lots of businesses fail too and even those that don't fail are often just making money for the owner and leaving the customers worse off e.g. casinos, cigarette makers, donut shops, sellers of inferior clothes!!!
And how many charities actually give you great returns for each dollar you donate?
I argue that Part B of the game - finding smart ways to put your winnings to good use - - is a lot harder than Part A.
I am interested in hearing what other people have done in the way of spending their winnings well.
For instance has anyone creatied and operated their own charity? Stumbled across a great charity that they'vefelt delighted to give lots of money to? Invested in a venture capital business that succeeded or started up a successful business that is a geniune win-win for everyone concerned?
I'm looking for inspiration here!
Today I did find some. It was on the front page of the Business Australian.
Here is the article:
Venture capitalist learns to pick good people
Private equity ventures into scholarships for bright Aboriginal students, writes Glenda Korporaal
--------------------------------------------------------------------------------
October 02, 2006
WHEN Waverley Stanley walked through Philip Latham's door two years ago, he was the first Aborigine the English-born venture capitalist had ever met.
The conversation did not initially show much promise. Stanley wanted Latham to tell him how Aboriginal enterprises could attract venture capital.
Latham, who founded RMB Capital Partners in Sydney in 1998, initially put him off. It was hard enough for big-city enterprises to get venture capital - let alone small struggling Aboriginal businesses, he explained.
But that was not the end of their work together. During the course of the meeting, Stanley told Latham about his experience as a child growing up in Cherbourg, a former Aboriginal settlement 250km northwest of Brisbane. Stanley explained that his big break had come about because his white teacher had personally lobbied the headmaster at Toowoomba Grammar to give him a scholarship.
So instead of concentrating on venture capital, Latham worked with Stanley to back his real passion - helping bright, young Aboriginal kids get scholarships to top boarding schools.
Last year, they set up Yalari Limited which aims to raise the money to support some 250 Aboriginal kids at boarding schools over the next decade.
Latham convinced the Australian Private Equity & Venture Capital Association (AVCAL) to adopt Yalari (an Aboriginal word for "child") as its charity and at last week's conference, AVCAL members donated $60,000 to buy an Aboriginal painting to help Yalari's small, but growing, coffers - a repeat of the fundraising that started at its 2005 conference. In total, Latham estimates that local private equity investors have already donated almost $400,000 to the cause.
The first five Aboriginal kids started school under the scheme this year at Toowoomba Grammar and the nearby Glennie School for girls.
In the process of building Yalari, Latham was forced to scurry off to bookshops to teach himself about Aboriginal history as well as visiting Aboriginal schools in Queensland to get some first-hand experience. Yalari also brought together the likes of actors Bryan Brown and Rachael Ward who also help Aboriginal children.
"It's been an eye opener," Latham said in his office on Friday with a touch of English understatement.
"Being English, I hadn't grown up with any knowledge of Aboriginal culture."
In Cherbourg, he met a teacher who told him how almost half of her class of 20 had either physical problems such as deafness, or learning disabilities, and found out how often Aboriginal girls dropped out of school after getting pregnant. At the same time he met "some wonderfully determined families who just want to find a way for their kids to succeed".
Latham and Stanley are on the verge of getting the Australian Tax Office to approve Yalari as a charity, after which they plan to hit the big end of town for serious donations to raise $12 million.
"Anyone I have spoken to about this, who has bothered to learn what is going on, comes away wanting to do something. There's a lot of goodwill."
((skip a bit!)
Latham approaches Yalari in the same way he approaches private equity, drawing up a list of rules on how it should operate including a strict set of guidelines on how it selects kids to receive the scholarships.
There is no shortage of Aboriginal parents wanting their kids to take advantage of the program.
"There's not a lot of mystery to private equity," he says.
"It's a lot of common sense. You don't over extend yourself. You don't take silly bets.
"More than anything else - you learn how to pick good people."
Yalari's own success in picking good people could determine if some bright Aboriginal kids become the Aboriginal role models and even maybe leaders of the future.
___________
The charity actually has a home page: www.yalari.org
I just read it a few minutes ago. I have a thousand questions I would like to ask them. I feel a bit miffed by this project as this idea was what I always planned to do! It's OK though as I have a million pet projects!
Don't you think it would be hugely satisfying to actually create something clever like this with your squillions? I do - - and it isn't even pure altruism as it would give your ego a real boost to think that because of what you did lots of other people are better off.
You would get the same buzz from getting a worthwhile business idea up and running or creating your own worthwhile business idea where you project left people better off.
What are people's thoughts about this stuff?
Cheers Carol
Here is a question that is rarely asked: What are you going to do with all your millions, once you've made them?
No-one ever seems to seriously discuss that question.
The way I see it investing is a game. The score card is the pile of money in your account at the end of the day and the more money you make the more skilled you are at playing the game and therefore the cleverer you feel!.
The game is great fun - I play it and I know how much fun it is.
But I see winning the investment game as just part A.
Part B is doing something with the pile of money.
I'm interested in finding out how people plan to "deal with" their money.
I know this is a delicate topic, and whenever I ask it, people get uncomfortable. I don't know why!
Here are some answers people give:
1. use the pile of money to make more money!
2. treat themselves: buy rolls royces, boats, holidays, multiple residences, especially the villa in France!
3. leave a huge nest egg for their children and grandchildren - this plan could be the result of inertia as much as anything
4. participate in venture capital projects
5. give to charity
6. create businesses
I actually can't think of anything else.
I think options 1, 2 and 3 are probably the most attractive for most people, and require little effort or creativity.
The last three are the most challenging but offer huge opportunity to leave a legacy and creat an impact.
They are difficult though.
For example, about 40 -50% of venture capital projects fail. Lots of businesses fail too and even those that don't fail are often just making money for the owner and leaving the customers worse off e.g. casinos, cigarette makers, donut shops, sellers of inferior clothes!!!
And how many charities actually give you great returns for each dollar you donate?
I argue that Part B of the game - finding smart ways to put your winnings to good use - - is a lot harder than Part A.
I am interested in hearing what other people have done in the way of spending their winnings well.
For instance has anyone creatied and operated their own charity? Stumbled across a great charity that they'vefelt delighted to give lots of money to? Invested in a venture capital business that succeeded or started up a successful business that is a geniune win-win for everyone concerned?
I'm looking for inspiration here!
Today I did find some. It was on the front page of the Business Australian.
Here is the article:
Venture capitalist learns to pick good people
Private equity ventures into scholarships for bright Aboriginal students, writes Glenda Korporaal
--------------------------------------------------------------------------------
October 02, 2006
WHEN Waverley Stanley walked through Philip Latham's door two years ago, he was the first Aborigine the English-born venture capitalist had ever met.
The conversation did not initially show much promise. Stanley wanted Latham to tell him how Aboriginal enterprises could attract venture capital.
Latham, who founded RMB Capital Partners in Sydney in 1998, initially put him off. It was hard enough for big-city enterprises to get venture capital - let alone small struggling Aboriginal businesses, he explained.
But that was not the end of their work together. During the course of the meeting, Stanley told Latham about his experience as a child growing up in Cherbourg, a former Aboriginal settlement 250km northwest of Brisbane. Stanley explained that his big break had come about because his white teacher had personally lobbied the headmaster at Toowoomba Grammar to give him a scholarship.
So instead of concentrating on venture capital, Latham worked with Stanley to back his real passion - helping bright, young Aboriginal kids get scholarships to top boarding schools.
Last year, they set up Yalari Limited which aims to raise the money to support some 250 Aboriginal kids at boarding schools over the next decade.
Latham convinced the Australian Private Equity & Venture Capital Association (AVCAL) to adopt Yalari (an Aboriginal word for "child") as its charity and at last week's conference, AVCAL members donated $60,000 to buy an Aboriginal painting to help Yalari's small, but growing, coffers - a repeat of the fundraising that started at its 2005 conference. In total, Latham estimates that local private equity investors have already donated almost $400,000 to the cause.
The first five Aboriginal kids started school under the scheme this year at Toowoomba Grammar and the nearby Glennie School for girls.
In the process of building Yalari, Latham was forced to scurry off to bookshops to teach himself about Aboriginal history as well as visiting Aboriginal schools in Queensland to get some first-hand experience. Yalari also brought together the likes of actors Bryan Brown and Rachael Ward who also help Aboriginal children.
"It's been an eye opener," Latham said in his office on Friday with a touch of English understatement.
"Being English, I hadn't grown up with any knowledge of Aboriginal culture."
In Cherbourg, he met a teacher who told him how almost half of her class of 20 had either physical problems such as deafness, or learning disabilities, and found out how often Aboriginal girls dropped out of school after getting pregnant. At the same time he met "some wonderfully determined families who just want to find a way for their kids to succeed".
Latham and Stanley are on the verge of getting the Australian Tax Office to approve Yalari as a charity, after which they plan to hit the big end of town for serious donations to raise $12 million.
"Anyone I have spoken to about this, who has bothered to learn what is going on, comes away wanting to do something. There's a lot of goodwill."
((skip a bit!)
Latham approaches Yalari in the same way he approaches private equity, drawing up a list of rules on how it should operate including a strict set of guidelines on how it selects kids to receive the scholarships.
There is no shortage of Aboriginal parents wanting their kids to take advantage of the program.
"There's not a lot of mystery to private equity," he says.
"It's a lot of common sense. You don't over extend yourself. You don't take silly bets.
"More than anything else - you learn how to pick good people."
Yalari's own success in picking good people could determine if some bright Aboriginal kids become the Aboriginal role models and even maybe leaders of the future.
___________
The charity actually has a home page: www.yalari.org
I just read it a few minutes ago. I have a thousand questions I would like to ask them. I feel a bit miffed by this project as this idea was what I always planned to do! It's OK though as I have a million pet projects!
Don't you think it would be hugely satisfying to actually create something clever like this with your squillions? I do - - and it isn't even pure altruism as it would give your ego a real boost to think that because of what you did lots of other people are better off.
You would get the same buzz from getting a worthwhile business idea up and running or creating your own worthwhile business idea where you project left people better off.
What are people's thoughts about this stuff?
Cheers Carol
