Pay It Forward

Pay It Forward

With Lumni, investors participate in professional and academic advancement students. The goal is to reduce the student's risk while attracting investors.
NBS April 14, 2015

How to Invest in Future Generations with Lumni

Burdened by unsustainable business models of the past, future leaders and entrepreneurs will need to re-invent what it means to succeed.

That can’t happen, however, if the next generation isn’t equipped to do so.

In 2002, businessmen Miguel Palacios and Felipe Vergara recognized a pervasive problem; they noted that youth faced incredible barriers to success in Latin American industries. In response, they started  Lumni, a certified B Corp, that prepares and supports future leaders.

So how does Lumni solve this pervasive problem?

Financing the Future

In Chile, financing is one of the primary reasons students drop-out of college or university. Talented students are unable to access university-level education, preventing them from developing important skills and insights. Lumni's response is to invest in human capital by providing financial opportunities to burgeoning leaders with scarce resources.

Interested investors can participate in the professional and academic advancement of a student with the agreement that once they begin work, the students will return a percentage of their salary for a short period of time. It is not considered a loan, but a contract. The goal is to transfer risk away from the student while making the process attractive to investors.

Additionally, the student receives support and mentorship in the early stages of their career.

Investors also have the option to work with for-profit and non-profit funds. This gives interested investors the opportunity to choose from an investment-based fund or to simply donate the money as a “social value investor.”

From First-Generation Student to Future Leader

In its 10-year history, Lumni has created human capital contracts with more than 2000 students, maintaining default rates of less than one percent. More than half of the people funded by Lumni are first-generation students – the first members of their family to attend college or university.

This is a clear indicator of how Lumni's investment model triggers a cycle of education and empowerment. For Lumni, it’s not just about creating future workers; the organization aims to build a foundation of support for Latin American families and economies. 

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