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joshjacobson comments on Can we apply start-up investing principles to non-profits? - Effective Altruism Forum

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Comment author: joshjacobson  (EA Profile) 04 July 2017 03:08:55PM 0 points [-]

To me the biggest thing missing from this is recognition of different incentive structures. The markets are very, very different because in this analysis:

  • 99%+ of investors are selecting for-profits based on their financial return, and 99%+ of for-profits are optimizing for their financial return

  • <1% of donors are selecting non-profits based on their statistical impact, and <1% of non-profits are optimizing for statistical impact

As part of the <1% of donors, you're examining a sector that largely is not trying to optimize for your goals, which creates significant differences relevant to nearly all aspects of this discussion.

Comment author: Peter_Hurford  (EA Profile) 04 July 2017 06:17:10PM *  0 points [-]

Thanks. I tried to capture some of that in the sections for:

Non-profit investing lets you arbitrage based on your values, whereas for-profit investing does not

and

More people are trying a lot harder to “beat you” in for-profit investing than non-profit investing

Do you think I still missed an important aspect there?