Invest in What Matters

Invest in what matters

Why would you separate your investments from your values?


Editor’s note: Fernando Valenzuela award winning educator and investor shares his personal views and thought leadership insights on the high rate of return in investing in education to uplift and drive entrepreneurship.

What is happening?

Many emerging economies around the World were in the process of achieving higher standards of living for millions of families that were transitioning out of poverty towards finally, being able to access improved levels of education, goods and services that were outside their possibilities just a few years ago.

Just as this positive perspective was finally at sight, a technological revolution fundamentally altered the way they live, work, and relate to one another.

In its scale, scope, and complexity, this transformation created an environment unlike anything humankind has experienced before.

Now, many upcoming middle class families are disillusioned and fearful that their own incipient improved incomes, and those of their children will go back to poverty levels. 

Let us take Latin America as an example: 

Until recently, Latin America was well on its way to becoming a middle class region. 

During the ten years before 2012 over ten million Latin Americans joined the ranks of the middle class every year. In 2014, barely a third of that figure –three and a half million– achieved that feat, and we have not been able to ignite enough growth in our economies since then.

Had the trend of the golden decade continued, the middle class would have become the largest group of Latin Americans by 2020. 

Unfortunately, based on current trends it is unclear when such a milestone could be reached. 

In addition, other social gains have also slowed down: 

For example, the economic downturn has been accompanied by a lower income growth for the bottom 40 percent of the population. 

We have seen a substantial increase in the group that is not in poverty but not yet in the middle class, known as the vulnerable

This group, characterized by exhibiting a certain likelihood of falling into poverty in any given year, not only continues to be the largest group in the region accounting to almost 40% of the population. 

In other words, the vulnerable grew three times more than the middle class. If, by definition, the vulnerable are more at risk of falling into poverty than the middle class, helping minimize such risks will be an important agenda across the region as it adjusts to the new economic environment.

SOURCE: LAC Equity Lab

On top of these challenges, our unsolved historical burdens: gender inequality, climate change, corruption and violence, among others, add a significant dimension to the already huge vulnerabilities and pains.

Given their complex struggles in the recent past, this relevant segment of the population is increasingly experiencing and voicing a pervasive sense of pain, dissatisfaction and unfairness with a wider and faster gap creation between the ones who have and the ones who do not. They also witness violence closer and more frequently and they are first hand recipients of the tectonic forces of corruption in their communities.

In this environment, technology will not be of much help…

Robots, autonomous vehicles, virtual reality, artificial intelligence, machine learning, drones and the Internet of Things are moving ahead rapidly and transforming the way businesses operate and how people earn their livelihoods. 

For millions who work in occupations like manufacturing, services, retail sales and driving, machines are soon to either replace or significantly transform their jobs.

The near-term effect will be a significant occupational polarization resulting in an ever growing number of people moving back from their recently acquired mid-skilled jobs into lower wage or larger informal work.

skilled vs. unskilled worker

Who may be setting the agenda?

As we clearly see now, the emergence of dangerous visions of populism, nationalism and dictatorship styles come back and hunt our democratic progress. 

The moment of truth

A populist politician would start with ready-made confrontations between the “people” and the “elite” based on the gaps that are sharpened. 

Also he/she would amplify the pains of unfairness: the set of highly educated  “elites” who make a very good living, the corrupt public and private leaders who put “the people” at risk by their limitless and unethical hunger of power. 

Once a gap is established, it endows a country with a set of unfair advantages. A combination of associated factors promote the consolidation of power, raise barriers of access, and make it virtually impossible public policy to reduce the gaps.

The result is a cascading effect caused both by: 

1. fueling the rise of unprepared and undemocratic leaders to power, and also by

2. further undermining the position of the disadvantaged. 

Clearly, a fertile ground for a deeply reactionary form of politics unsuited to the complex times in which we live.

This combination will alter the balance against the most vulnerable and it will have a profoundly negative impact on the development of new skills to adjust to the new forces of development. 

A perspective that the vulnerable are not able to understand or foresee as they are “more concerned about the end of the month than they are about the end to the World.” Walter Longo

Next page- Is there Hope? A call to action. A plausible and possible future > making money matter.


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