Wednesday, March 5, 2014

Investing on Purpose

As my loyal readers know, I generally do not believe in doing things on purpose. The reason for this is that so many great accomplishments happen by accident. No, I don't mean the kind of accident like when your 3 year draws on the wall and tells you that he did it “b’taut.” (I’m not buying it, Nadav.) I mean accidents that have a terrific outcome.

In my own life, one of these was our decision to live in Modiin, which happened entirely by accident. Basically, we needed a place to live and we-knew-someone-who-knew-someone who had an apartment to rent in Modiin.

As it turns out, Modiin is actually the best place on earth to live. If you don’t believe me, just ask any of my neighbors. We unanimously agree on this point every Purim morning at breakfast when we play a drinking game in which we attempt to be so drunk that we cannot tell the difference between Sara Imenu Street and Rachel Imenu Street.

Or, at least that is what I think I remember. It all gets a bit foggy after about the 3rd or 4th beer. But in any case, I also have empirical evidence to this fact. Modiin is the only city in the world with the courage to name itself, “intelligence,” yet show a conspicuous lack of such when it comes to planning the “planned city.” (Really? You didn’t think that a shopping center would need room for parking?)

But, I digress. My point is that while I am a firm believer in doing everything by accident, there are a few things which I believe in doing on purpose. One of those is charitable giving which I like to think of as social investing.

In a couple of weeks, I will be running the 10K in the Jerusalem Marathon to raise money for Crossroads Jerusalem. Crossroads helps at-risk Anglo youth in the Jerusalem area and vicinity, who have not been successful in getting the help they need from the mainstream programs. You can sponsor me directly on the Crossroads website.

Why bother?

I want you to sponsor me to run the marathon, but you are probably wondering why you should bother with social investing at all.

This is a great question. Why does anyone give anything at all? People earned their money… why should they just give it away?

The answer that I hear most often is that the reason to give is because of altruism. For religious people, we may say that it’s “just the right thing to do.” Altruism as the motivation for giving has been highly suspect by the academics who make a living by understanding selfishness; or, as you may know them: economists. For them, true altruism cannot really exist because people are motivated to seek their own interests.

A good answer for economists would be that people give because it allows them to signal to one another. Basically, by giving you are signaling that you are a generous and altruistic person. This would be a selfish motivation because you are giving so that other people will think more highly of you.

The motivation to give that comes from signaling is probably the reason why researchers have found that pretty women are able to raise more money from men than average-looking women. Most likely this is because men are more inclined to signal their generosity when asked for a donation from someone they are attracted to. I find it particularly fascinating that researchers needed to research this. It seems fairly obvious to me that this is what would happen.

One great way to signal would be to run in the Jerusalem Marathon for charity and then write about it on your blog. In doing so, you would be signaling to people that you a very caring and giving person who believes in making society better. Your readers may want to sponsor you to signal their appreciation for your blog. However, if you do this, be careful not to write about the signaling effect in your blog because then it will immediately lose some of its effect.

However, signaling by itself doesn’t seem to explain all of the giving that we see taking place in the world. There are many less expensive options that would allow people to signal. For example, the readers of your blog who want to signal appreciation could just register as loyal readers. This would be a much cheaper option, even though it would mean that they need to de-lurk.

What may also be motivating people to give is that they get something in return. This may be why charity raffles and auctions are such an effective way to raise money.

What you get from a donation could be direct, but it could also be indirect. In the case of making a donation to Crossroads, you are supporting a resource for the community. You may never need this resource at all; but, like all resources, you probably want it to be there just in case someone you know may need it one day.

But this also isn’t enough to explain all of the giving that we see taking place in the world. Many people give much more than they could ever expect to get in return. Why do they do it?

The answer could simply be that it just feels good. Researchers found this by attaching people to brain scanners as they were making donations. The best theory behind why this is happening comes from evolution. Basically, God made us this way because millions of years before He created the world, the brains in early humans adapted to their environment by giving a feeling of pleasure in response to giving. The adaptation would have helped survival because early humans would be less likely to get eaten by wild animals when they helped each other.

I guess what I am saying is that you should sponsor me in the marathon so that you don’t get eaten by a bear.

Wait, that can’t be right. You are just as likely to get eaten by bear whether or not you sponsor me in the marathon. The reason you should give is because it will make you feel good.

The Thrill of Helping

I like to give because it feels good to make a positive impact in someone else’s life. In particular with Crossroads, what I find so incredible is that I get to help people help other people. I have been on the board of directors for several years, and it has been nothing short of inspiring to see the dedication and compassion that the staff puts into helping the youth in our community.

You can also be a part of this. The marathon is Crossroad’s major fundraiser for the year, and I can tell you from the inside that even if you give just a small donation, it will go a long way to supporting the organization.

Who to Sponsor?

But enough of me. There are plenty of other great options on who to sponsor in the marathon.
  
A particularly good choice would be my co-workers, Ofir and Erez, who are running with me. They signed up to run because they wanted to help and they love to run. They have already helped raise more money in our office than I ever would have imagined. I think the reason for this is that people credibly think that they could win a marathon. For me, on the other hand, people generally want to make sure we are talking about a running marathon as opposed to some kind of typing marathon. (I would totally win, by the way. I typed this entire blog in less than 26 seconds.)

Alternatively, you could sponsor my Facebook-challenged friend Michael. This would be a particularly good way to allocate your money because Michael recently injured his foot and may not be able to run the entire 10K. However, he is very Jewish and as soon as you sponsor him, he will feel very guilty and will make the run. Don’t worry – he won’t hurt himself. There is a 5K shortcut and we will all look the other way when he takes it.

If you want to go in a different direction with your sponsorship, you could sponsor my brother, Jonathan. He is trying to downplay his altruism by stating that his reason for running is to “help keep the riff-raff off my lawn.” However, he doesn’t really have a lawn (at least not one that attracts any type of riff-raff). And, in any case, he is actually quite fond of riff-raff and would be delighted if they came to his lawn. Actually, this is just part of an elaborate scheme to create a persona in which he is an old man with a goat who yells at young children that come onto his lawn to retrieve lost toys. (Important life note: if my brother wants to buy a goat from you, please sell it to him. I want to see how far he will go with this.)

Invest on Purpose!

I hope you decide to support Crossroads, either directly or by sponsoring me or anyone else in the marathon. If you do: thank you!

But, either way, I encourage you to think about the ways that you can invest on purpose. The world could use your impact.

19 comments:

  1. I am confused. If the goal is a marathon, why do you quit after 25% of the goal? Are you 100% committed like the Microsoft CEO or are you only partially interested in success? I have to ask...

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    1. Oh, make no mistake! My goal is to win the full marathon!

      However, my top running speed currently is 18km / hour, which I can do for about 1 minute. I calculated that to win the marathon, I would need to run 3km / hour faster than this for 2 hours straight. In other words, I don't stand a chance.

      But, worry not! Since "winning" is by age and gender, I am actually training for the race in 2053 when I will compete with the 75-79 year olds.

      You can sponsor me then also.

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  2. NO risk, NO rewards!

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  4. I would love to see Jonathan owning a goat...I'm still laughing... Anyway, I might be able to find a kangaroo for him, but I'm not sure if it will have the same effect. Are you really running in the marathon???

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    1. Absolutely! For now, just the 10k. In 40 years, I win the whole thing.

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  5. At MSFT, we don't have 40 years to win the game. We need to win now. Time to be "all in" not just riding the wave!

    http://www.zdnet.com/microsofts-nadella-begins-reshaping-his-inner-circle-7000026934/#ftag=RSS14dc6a9

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    1. Cool. Is Satya running in the Jerusalem Marathon this year?

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    2. I heard he is a runner. Have you invited him?

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    3. He told me he would do it if you would run. You in?

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    4. Have you thought about getting a gathering of your work crew to join you and the CEO for the marathon? Is it close of enough to the big ThinkNext party so he can join both?

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  6. I don't think I can do a marathon. I am going to focus on whether to buy more Bitcoins at this stage. I heard Aroma is going to start accepting them. That is an encouraging sign!

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  7. Is Aroma on the stock exchange in Israel? What is the symbol? Is that a good investment opportunity if they are leading the way with accepting bitcoins?

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  8. Ilan or anyone - do you know?

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    1. Sorry, man. Aroma is privately held.

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  9. Hmmm...are you going to write an article on how to buy into a privately held startup or company? That could be a significant investment area!

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    1. That's easy... you just need to have a lot of money. :)

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  10. I thought that is why you were writing this advice? You were trying to "spread the wealth" to those of us that need your insights and intellectual horsepower?

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    1. oh, no, the bar is much lower. I'm just trying to help you not lose too much. :)

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