In July, we took Mr. Omidyar to task for not walking his talk, so we are now absolutely thrilled to report that he may well have triggered a watershed in microfinance investment.

His $100m donation to Tufts University will be managed as a for-profit fund dedicated to microfinance. This constitutes the largest single for-profit microfinance fund in existence. More importantly, it is done right.

First, the for-profit approach enforces market discipline on the microfinance institutions (MFIs) that receive the investment. What we call "microcapital". Second, Tufts will benefit from the returns on the microfinance fund. Third, Mr. Omidyar gets his tax write-off, thus keeping the money from government "investment" which has ruined microfinance decade after decade. Lastly, this represents a break through into endowments, the holy grail of investment capital.