Telling a personal story of
Talking Less, Doing More.
Telling a personal story of
Talking Less, Doing More.
By Deepti Chadda and Dipika Prasad
Home to 3.6 Bn people, almost every country in Asia is undergoing a profound socio-economic transformation. A region rich with people, resources and culture is growing increasingly restless in the face of multiple development shortfalls. While traditional methods of alleviating poverty continue to receive impetus, a fresh movement based on an alternative development approach is emerging. Building viable business models with affordable products and services that cater to underserved populations in sectors such as health, education, energy, is finding its place as an instrument to further sustainable and inclusive growth in Asia.
Several trends across Asian countries underline the growing popularity of this new approach, widely known as ‘social enterprise’. In Malaysia a survey of over 6000 young people showed that 75% considered themselves social entrepreneurs aiming for financial and social outcomes. Driven by Information and Communication Technologies (ICTs) and social media, budding social enterprise networks are linking investors, entrepreneurs and policy representatives across countries, such as the Social Enterprise Network Asia (SENA). Schools in Asia now include social enterprise in their curriculum and organize social business plan competitions, like iDiya by the Indian School of Business and the INSEAD Social Entrepreneurship Catalyst.
The growth of these social enterprises is also starting to attract interest from double and triple bottom-line investors (impact investors). According to a report by Avantage Ventures, the potential market size that can be captured through impact investing in Asia is estimated to be between USD52 to USD158 Bnby 2020. The report also concludes that the six key sectors that would benefit most from impact investingin Asia include affordable housing, primary education, rural and elderly healthcare, agri-business, water and sanitation and rural energy.
While social enterprise is still nascent in the region, some countries like India, Thailand, Indonesia and other South East Asian countries have emerged as front-runners in this movement. What’s interesting is that many of these countries face similar challenges of scale and sustainability. Some of the common constraints include access to the right type of funding, attracting and retaining superior talent, weak or non-existent supporting infrastructure, navigating the regulatory environment and building a collaborative approach towards market driven development.
While the policy environments, the financial services structures, the development needs and potential and geographical conditions vary widely across the region, emerging anecdotal evidence shows that some of these challenges have been tackled well in specific geographies.There is both a growing need and an opportunity to build a corridor of communication and learning between social enterprises, investors, policy-makers and other market enablers in India and South East Asia. Sharing best case practices,learnings from failures, finding solutions to common problems, speeding up the flow of funding across countries, and sharing intellectual capital are founding blocks for this Social Enterprise Corridor.
The case for building a social enterprise corridor between India and South East Asia
When it comes to innovation in technology and business models, India is one of the market leaders in the social enterprise space. A robust private sector, and focus on R&D could mean that there is an opportunity for these technologies and models to be replicated across other regions in South East Asia. For e.g. SME Renewables, a social enterprise that promotes renewable energy technologies and market biomass gasification power generation systems in Cambodia, imports its technology for rise husk powered electricity generators from India. It cites cost effectiveness, and time saved on developing indigenous technology as the primary reasons behind its buy-decision.
India has traditionally struggled when it comes to making public-private partnerships work. There are opportunities for it to learn from successful examples of these from countries like Cambodia and Indonesia. For instance, although there are millions of fully subsidized household biogas units installed in India, most are dysfunctional due to lack of maintenance and accountability from civic organizations. On the other hand, a biogas program led by Hivos with blessings from the government of Indonesia has achieved 100% functionality rate and 100% loan repayment rate. Initiated in May 2009, it aims to build a minimum of 8,000 domestic biogas plants in at least six Indonesian provinces by the end of 2012. The program is sustainable because the biodigestors are only partly subsidized, and focuses on facilitating credit in partnership with the government, NGOs, cooperatives, and MFIs. The focus on linking players, building a market and ensuring sustainablility after the grant monies run out is a clear learning for India.
There are opportunities for learning and communication to flow along the India-South East Asia corridor when it comes to policy as well. For e.g., the Thai Government has developed the Thailand Social Enterprise Master Plan 2012 – 14 to be delivered by the Thailand Social Enterprise Organization (TSEO), with the aim of furthering sustainable development.TSEO’s vision is to build a learning environment for social enterprises in Thailand, create capacity building interventions, and develop a path to capital and resources for social entrepreneurs. It is in its early days, and there are opportunities for it to learn from both successes and failures in other countries. Perhaps most importantly, there are opportunities for all countries in the region to learn from failures of policy. For instance, in Indonesia, private sector off-grid solar lighting initiatives have failed as the market was distorted by free distribution of similar products by the government, and lack of a supportive environment for the growth of the local industry.
Though the regulatory mechanisms are disparate, uncertain and ambiguous when it comes to flow of financial capital across the region, there is certainly merit in building robust deal flow pipelines across the region. Investors like Unitus Seed Fund, Aureos Capital, LGT Venture Philanthropy have a portfolio of investee companies in the regionHowever, given the nascence of the social enterprise space, the cost of aggregating, and building capacities of these businesses to create a pipeline for investors is almost prohibitively high, and there has been very little pan-region activity to create one. Philo Alto, Founder Asia Value Advisors says, “In my experience as a recent jury for the GSVC-SEA competition, the winners tend to be those who have been coached by business practitioners who are able to provide a real life sanity check on valuation, funding requirements, and expectations of potential investors that enable the social entrepreneurs to reframe or adjust their plans and organizational culture over a period of time as they scale their firm. I would say that the cost of search for viable social ventures remains elusive from the perspective of would be impact investors.”
The exchange of intellectual capital and talent is another building block for the corridor to be successful. There are opportunities for technical assistance and market building facilities/projects to be created, staffed by experts from across the region who can support idea and early stage ventures. For e.g. from a recent field visit to Cambodia, our team at Intellecap found that most social enterprises were founded and managed by expatriates, while the locals tended to focus on NGOs and non-profit models. There was a clear need for local home-grown experts in the field, but no learning environment or platform existed.
Some ways in which the Corridor can be built
Asia’s geographical and cultural diversity creates a need for platforms that can connect investors and entrepreneurs from across countries, playing the role of intermediaries. As aggregators, these platforms reduce transaction costs for investors in identifying and conducting due diligence, and improving the chances of enterprises to access funding by helping them build capacity and scale. Philo of Asia Value Advisors says, “Most social enterprises need mentorship support and advice to help them achieve the scale needed for future funders that are more commercially oriented, in addition to scaling their social impact. By engaging with intermediaries whose role it is to share with the SEs as to how they can be ‘impact investment ready’ in the coming years, social enterpriseswill be able to adapt their business models accordingly, with enough lead time and speak the same language as the more commercially oriented impact investors.” Initiatives like Sankalp Forum and Change Fusion are playing a pioneering role in building such platforms.
Creating capital markets for social good and channelling capital efficiently towards social ventures, is a significant part of building this Corridor. With access to funding identified as one of the top challenges faced by social entrepreneurs in India and South East Asia, organizations that aggregate funding sources and create enterprise-friendly processes to access this funding will be instrumental in scaling social enterprise in the region. Impact Investment Asia (IIX) is home to Asia’s first public and private platforms for social enterprises to raise capital efficiently. The Asian Venture Philanthropy Network (AVPN) aims to develop the venture philanthropy movement to meet specific enterprise requirements in Asia.
Both India and South East Asia need to appreciate each other’s local realities as well. Forging friendships and strong working relationships is critical to building any successful cooperation. Immersion programs, which provide an opportunity for both sides to interact and learn from each other, serve this purpose. AIESEC and Potencia Ventures run an immersion program for young people to learn about social enterprise through international internships and interaction with the impact investment domainacross countries. Student exchange programs through academic institutions like business schools are also a potential opportunity to build immersion programs that will found the basis of an India – SE Asia Social Enterprise Corridor.
Bridging Information Asymmetry is another critical building block and the Ayllu Initiative is a step in this direction – it aggregates processes and shares data so that funders, entrepreneurs and other sector actors in social enterprise can make informed decisions. Access to such information will make it easier to share learning, build areas of cooperation and establish a strong social enterprise corridor between India and South East Asia.
Authors’ Note:This article was written with inputs from Rashi Agarwal, Srikanth Pulavarthy, and Bharat Bongu from the Intellecap Business Consulting team, and from Philo Alto of Asia Value Advisors. The authors would like to express their thanks to all of them for sharing invaluable first-hand accounts of working in the field. The authors work on the Sankalp Forum at Intellecap, and were inspired to write this article based on their observations from extending Sankalp’s platform to 5 countries in the South East Asian region. This is also a subject that will be discussed in a special side-session at Sankalp’s upcoming Annual Summit on April 12 and 13. To find out more about how you can participate, click here.
Editor’s Note: This article is written by Dipika Prasad and was published on the Sankalp Forum blog as well as Next Billion. It captures the work I have been doing for the last two years.
Early stage businesses thrive best in an environment that brings together and facilitates efficient working of all players for them to grow. The favorite, and oft-quoted example of such an enabling ecosystem is Silicon Valley. But there are examples closer to the developing world as well – like the information technology industry in the Indian cities of Hyderabad and Bangalore, and the vibrant start up communities growing around academic institutions like the Indian Institutes of Technology (IITs) and Indian Institutes of Management (IIMs). Social enterprise in India took off in 2005-06, but is still in the margins, and grapples with a complex set of challenges. The challenges start right from understanding who’s part of this space – the entrepreneurs, funders, enablers – to making it easier for them to work together. If double and triple bottom line businesses, which many of us believe are tomorrow’s models, are to make a dent in mainstream markets, they need to aggregate in big numbers, and show tangible change. Which leads to the question – why stitch together the social enterprise mosaic?
Sankalp Forum was initiated by Intellecap in partnership with Rockefeller Foundation, SIDBI, NABARD, and others, with the belief that social entrepreneurs have a role to play in development and inclusive growth. In those early years our founding team learned the first lessons in the importance of building an ecosystem. The entrepreneurs, funders, policy makers, academicians, service providers and grassroots organizations that were chasing common goals had to be brought together; and an environment that it made it easier for them to work together had to be built.
Three big goals drive us in our attempts to create this convergence of key players in the social enterprise space. The first is cohesion and collaboration to drive capital into double and triple bottomline businesses. The second is to make peer-to-peer learning and market linkages possible. We believe this is key to creating supply chains that work – bringing together large businesses, social enterprises, and non-profit grassroot level organizations. Our third driver is to bring new converts to this growing space – large businesses curious about making markets work for the poor, foundations that are looking beyond charity as a means to create impact, mainstream angel networks and venture capital funds who want to explore impact investing as a growing asset class.
The next obvious question then becomes – what does it take to stitch together the social enterprise mosaic in India? In 2009 we took the first steps towards building this ecosystem for entrepreneurship lead development solutions through the first annual Sankalp Summit and Awards. While we’ve evolved and expanded both programmatically and geographically, the social entrepreneur continues to be at the centre of everything we try to do through the Sankalp Forum. In the last four years, we’ve sourced over 400 social enterprises from India and South East Asia into the Sankalp platform, using our awards process as a pull for enterprises working in sectors of agriculture, food and rural business; clean energy/ technology; education and vocational training; healthcare, water and sanitation; and technology for development. This aggregation of high potential social enterprises has in turn attracted other players from the sector – over 300 investors, and 500 service providers like strategy consultants, investment advisors, lawyers, and design and media consultants. For a social enterprise looking to understand the market space, Sankalp Forum has evolved to become a one-stop-solution that answers four basic needs:
A lesson we learned early on in our journey was that very little was possible without collaboration. We’ve worked with over 50 partners including incubators, investment houses, networks, media, and other social enterprise platforms to make Sankalp Forum possible. A good example of the efficacy of this collaboration is the capacity building services we are able to provide all this under one umbrella. Our partners range from early stage incubators with sector specific focus to those with expertise in legal issues to those who investment bank for early stage businesses. Entrepreneurs who are part of our platform get access to mentorship and handholding across an entire range of challenges. In the past three years, more than two dozen of our enterprises have received investments, and over 160 others have been made investment ready through mentoring and capacity building programs. These enterprises enter the Sankalp Forum platform through multiple channels. While we run year-round interventions like capital raising workshops, and investor – entrepreneur clinics across India, the annual Sankalp Awards is the largest entry channel to Sankalp Forum.
In 2012, 100 for-profit social entrepreneurs from India, Indonesia, Thailand, Cambodia, Vietnam and Malaysia invested over 600 hours in filling applications to the Sankalp Awards. Cumulatively and individually, this data forms an invaluable decision making aid to multilaterals, foundations, policy makers and other market makers in this space. Each application was put through a quality check by the Intellecap team, and entrepreneurs were helped with thinking through aspects of their business they hadn’t necessarily prioritized. As we helped applicants figure EBIDTA, PAT and margins, we realized many of them were doing this exercise for the first time. Not all went onto become Sankalp Award Finalists of course, but we believe we got them started on the right track.
At the first evaluation stage of the business plans, 35 investors from 29 investment houses volunteered one day of their time to look over every business that applied to the Sankalp Awards. The evaluation process itself resulted in the generation of over two dozen investor interest queries. At the end of this process, 31 finalists were announced. The news of this announcement through Intellecap and Sankalp emails, blogs and social media channels alone reached an audience of over 50,000. We partnered with leading publications in this space like NextBillion, YourStory, Startup Central and others to amplify this number by 4 to 5 times.
The great value add to Sankalp Award Finalists, and also the inspiration behind this post, came from a first of its kind bootcamp that we organized for our 31 finalists at the Indian School of Business on March 9 and 10. Over the course of a two-day residential bootcamp, the entrepreneurs were exposed to capital raising basics like “knowing your business”, “approaching an investor”, and “structuring investments”. Over 18 investors, successful entrepreneurs, and advisors travelled to Hyderabad to volunteer time for this bootcamp. What’s great about this model we’re building is that its win-win – experts from different fields spend time with our entrepreneurs to find high quality deal flow pipelines, understand on-field trends better, and create awareness about their work. After the bootcamp, Vijay Vaidyanathan, CEO of one of our 2012 finalists class wrote to us saying, “Sankalp Forum is not only bringing together all the pieces of the social enterprise ecosystem, it forms the mosaic and gives the background in which the entire picture would shine.”
As one of the fastest growing free-market democracies in the world, India’s growth rate of 8.2% is likely to continue. With this growth, the gap between energy demand and supply is also widening. While the liberalization and privatization of the 1990s has transformed the Indian economy, its lack of focus on rural electrification is posing to be a huge challenge to India’s development process today. Various studies have shown that access to electricity has direct human and economic benefits. Not only is it a basic human need for quality of life, but it also fuels productivity and employment generation activities in rural areas. Today, more than 40% of the Indian population has little or no access to commercial electricity to carry out their daily routines. Globally, of the 1.4 billion people who do not have access to electricity, 612 million or 42% live in South Asia. India, Pakistan and Bangladesh constitute more than 90% of those lacking access to electricity. It is apparent from the Government’s efforts that the provision of secure, sustainable and affordable energy is a critical economic and human development challenge for the country. The role of renewable energy in India is no longer that of ‘alternate’ energy, but has become a mainstream solution, driven not just by the Government but by local enterprise as well.
In this context, off-grid energy solutions have taken on a larger role in addressing the energy challenge. Rural and remote areas in India are not connected to the national grid. These communities take to manufacturing their own power using a range of local generators including fossil fuels and renewable technologies such as wind, hydro, solar PV. Off-grid electricity often serves a dual purpose of providing affordable renewable power solutions to disconnected areas, as well as generating employment for the local community. In the past, market incentives for profit-seeking companies in rural electrification profits were extremely limited. Dispersed customers, higher cost of supply, geographical remoteness, low consumption and low ability to pay are some of the other barriers that have restricted the entry of private players in this space. However, led by a generation of young entrepreneurs, India is pioneering off-grid energy solutions today. These success stories pave the way for rural development and environment preservation. The uniqueness of these solutions is not just the innovative technology, but also the distribution, ownership and revenue models on which they are based. These stories are freeing energy from the grid, and lighting up the lives of millions of rural poor in India and in other parts of the developing world.
Husk Power Systems has changed the lives of 150,000 people in rural India, impacting 25,000 households and reaching out to 250 villages by installing 60 mini power plants that use discarded rice husks to generate electricity. Further, they have trained and employed more than 300 people to run and manage these power plants. By 2014, Husk Power Systems plans to impact 6,500 villages, save 750,000 tons of CO2, create 7000 local jobs and save over $50MN in cash for over 5MN people by replacing kerosene and diesel with its renewable energy technology. HPS is creating a paradigm shift in social enterprise where it pays the community in cash twice the amount it receives from them. To support HPS in achieving its ambitious targets, Acumen invested $125000 and IFC invested $375000 in them over the past year. [Husk Power Systems is a 2010 Sankalp Alum]
Promethean Power Solution’s prototype of a chilling center is helping farmers in rural India to boost supply by reducing spoilage. The technology is a solar- powered refrigeration system for cold-storage in areas that do not have access to the energy grid. Having won numerous awards, the founders of Promethean started off in a village in Goa and are now looking to expand their services across India. They received $10,000 funding initially, followed by a $1 MN investment. [Promethean Power Solutions is a 2011 Sankalp Alum]
Onergy provides complete renewable energy solutions to BoP customers in rural India by focusing on quality products and servicing and innovative distribution and pricing. Onergy’s main focus is on off-grid solutions through LED lighting, cooking and electrification with the aim of impacting 1 million lives by 2016. Project Zero Kerosene replaces kerosene lighting with off-grid solar LED lamps, Solar home lighting and Solar home electrification. Project Smokeless Village replaces traditional wood-cooking with efficient, affordable and renewable ways of cooking. Finally, the Project Decentralized Generation sets up Biomass Gasifiers of 10 – 100 KWe catering to local energy demands. Onergy is currently looking for investment to scale up operations. [Onergy is a 2011 Sankalp Alum]
D.Light Design is a story founded in inspiration derived from extreme hardship. The experience of using a kerosene lamp for light, inspired the founder to look for an alternative solution. D.Light provides a solar powered LED lantern that’s safe, affordable and bright. Today D.Light has 3 products priced between INR 500 to INR 1600, and sells its products in 30 countries including India. Education on renewable technology and last-mile delivery are the key challenges the company faces. Their long-term ambition is to impact the lives of 100 MN people by 2020. D.light has raised an investment of $5.5 MN from Omidyar. [D.light is a 2010 Sankalp applicant]
Selco enhances the quality of life of underserved households through the provision of sustainable energy solutions. Selco’s success has proved that poor people can afford and maintain sustainable energy technologies and that profitable social enterprise is a viable business model. Since 1995, Selco has serviced and financed 115,000 solar systems increasing human productivity, creating pivotal financial schemes for the poor to access solar technology, generating awareness about solar power, and improving the quality of life of millions. Selco not only customizes its technology to suit customer requirements, but provides high-quality service, as well as secures access to finance for customers. In 2011, the founder of Selco won the Ramon Magsaysay award.
I come from a family of well-educated engineers, doctors and civil officers. I grew up in a sheltered environment, learning about the significance of a credible education, of stability, and of planning as far ahead as possible. Most of my extended family relocated to study in the U.S, and have built comfortable lives there. If I was writing this a decade ago, I might have had a similar story to share.
But I have grown up in the “new” India, and in this land of expanding opportunity, I chose the road less traveled.
In my 26 years I have traveled the world, started a not-for-profit, spent a month in the Antarctic and have chosen a career that attempts at “good” business. Turning down several opportunities to continue working abroad, I chose to return to India. The emergence of a pulsating, dynamic new India has triggered a reverse brain drain. Indians living in different corners of the world, who had gone looking for opportunity, chose to return to a vibrant, exciting land of promise. So did I. I came back to an India ‘whose faith in success was far greater that her fear of failure’. An India that was poised as the fastest growing free-market democracy in the world. Globalization with all its challenges and opportunities had created a country of paradox, success, failure and hope. The development of a young, new India in the face of a globalized world economy has greatly influenced my thinking and life choices.
India opened its doors to the global economy, transforming the lives and aspirations of its people. This evolution came to life with A.R Rehman winning two Grammy Awards, Kalpana Chawla being the first Indian-born woman to fly in space, and Slumdog Millionaire winning an Oscar. The world was looking at India with curiosity, and inter-cultural connections multiplied exponentially. Consequently, my dream of traveling the world became a reality. I worked with an international team in Rotterdam that led a global organization to achieve 45% growth in results. Our mantra was ‘Connecting to Deliver’, and we leveraged technology that supported people across the world to learn, share and achieve. I developed programs that mobilized youth to experience new economies and cultures. Recognizing these successes, I was awarded a scholarship to participate in a sustainability leadership program in the Antarctic. This would have been unheard of for a young woman in the India that was. The world had literally become my playground, and these experiences completely changed the way I viewed my country, my future and myself.
Today, India is riding high on its so-called “demographic dividend”. While India’s youth hold significant promise, the lack of education, inadequate infrastructure and skewed employment prospects present a daunting task. Young India needs empowerment, training and access to livelihood opportunities. Being a young Indian, my work has focused on youth mobilization for social impact. Recognizing the need for ethical and sustainable leadership, my work in AIESEC was directed towards exponentially increasing the quantity of leadership experiences the organization provided young people in India and globally. While leading the Global Entrepreneurs Program, my team trained aspiring Indian entrepreneurs and gave them a platform to develop business skills by interning with growing enterprises. Today my work leverages India’s demographic dividend through social enterprise. The enterprises I support are transforming the lives of unemployed youth through door-step business training, providing technology-based interactive education to disadvantaged communities, and generating employment in rural India through BPOs.
India’s entrepreneurial spirit is being harnessed in whole new ways. The world is attempting to learn from Indian innovation or ‘jugaad’ in Hindi, as a tool to find uncommon solutions to common problems. Earlier this year, a business acquaintance from Accra experienced Dharavi, Asia’s largest ‘five-star’ slum as part of a global initiative on Urban Poverty that I managed. He reflects that ‘Dharavi’s future is different from the slums in Ghana because Dharavi has the ability to grow organically through the entrepreneurial spirit that is being nurtured there.’ This observation isn’t limited to Dharavi, but is the energy that drives India. The deep-rooted ambition, innovation and risk-taking ability of my people set them apart. As an actor in India’s entrepreneurial story, the traits that define the country, define me. I’m an innovator; I practice the art of lateral thinking, of resilient creativity and of improvisation in the face of adversity. I enjoy trial-and-error and making things work with limited resources. I’m excited by opportunities with an element of risk, which I believe is critical to unraveling the complex challenges of today’s world. India’s tryst with ‘jugaad’, as one part of its entrepreneurial success, has deeply influenced my development in recent years.
My connection to India’s complex growth story is best described in these lines – ‘There are 2 India’s in this country. One India is straining at the leash eager to spring forth and live up to all the adjectives that the world has been showering upon us. The other India is the leash. One India says give me a chance and I’ll prove myself. The other India says prove yourself first and maybe then you will have a chance….’ The two India’s are slowly drifting apart – one rich, the other poor; one living in luxury while the other struggles to sustain itself. The future of our country depends on closing this gap. My work in social enterprise aims to increase conversions from one India to the other side. I co-create sustainable solutions with grass-root innovators to transform the less advantaged to assertive customers, thus contributing to build a more sustainable growth curve for the country. I support enterprises that provide low-cost sanitary napkins to rural women, deploy easy-to-use water wheels in villages, and empower rickshaw pullers to be owners. Choosing social enterprise has been a natural career path. With all its challenges, I draw immense satisfaction and learning from my work. The India phenomenon and my choice to return to it, has been a profound influence on my thinking, learning and actions.
From Beyond Profit
A few decades ago when Joe Madiath started Gram Vikas, he was labeled a “social activist,” a type of rebel. Today, he and other entrepreneurs have become lynchpins in the social enterprise sector. In the ’80s, social entrepreneurship was a concept in the making; now it’s at a pivotal point. Many entrepreneurs presented their visions of the sector’s future at the Villgro Unconvention 2010.
Social enterprise in its current avatar presents a business opportunity—a lucrative chance to marry commerce and change. Two decades ago when Shrashtant Patara, Vice-President at Development Alternatives Group, was looking for an opportunity to apply his technical skills in a business that has positive social impact, Development Alternatives seemed to be the only option available. Today, there are thousands of such opportunities in the market. The response that Yashveer Singh has received to the National Social Entrepreneurship Forum, or the growing number of applications that the Tata Jagriti Yatra receives only go to prove that.
Although the buzz is around market-based commercially viable solutions for change, Ashish Karamchandani, Partner at Monitor Group, believes that we are still in the relatively early stages. We have only a handful of successful models, such as microfinance. Further, it took microfinance 30 years to scale. Creating new scalable models is not easy, but it is what the social enterprise sector needs. Another question to ask is whether markets are the solution for everything? There are millions of Indians in the interiors of the country who are still in the pre-market stage—bartering for goods and services without currency involved. Investing in these millions and preparing them for the market stage, will be key in the success of scalable and sustainable social enterprises.
One of the important elements that has evolved in the space has been that of talent attraction. Yesterday, a fistful of individuals with passion in their hearts entered the space cautiously; today it is fashionable to work for a social enterprise. According to Bindu Ananth, IFMR Trust, the diversity of young talent that the sector is attracting is a fantastic sign. At the same time, as a sector we need to recognize the importance of bringing in professionals with the experience of building businesses, focusing and scaling.
Experts’ take: the future of social entrepreneurship
The future is about shifting from fail safe models to safe fail models—to be successful, we need to throw up as many balls in the air as possible.
—Shrashtant Patara, Vice-President, Development Alternatives Group
Taking on harder problems battled by more people will separate the high quality enterprises that scale from the mediocre ones.
—Bindu Ananth, President, IFMR Trust
The sector will see some sort of consolidation, as more enterprises compete for limited resources. Mergers and acquisitions and stress on transparency and better managerial practices will be upcoming trends.
—Yashveer Singh, National Social Entrepreneurship Network
There aren’t real failures in social enterprise, there are temporary setbacks. We need to build a support system for entrepreneurs who initially face hurdles, which will give them staying power and the ability to follow through.
—Joe Madiath, Founder & ED, Gram Vikas
Recent allegations against Indian microfinance institutions (MFIs) by the media and the State have thrown sector stakeholders into a crisis. Accusations against MFIs include coercive practices, lack of transparency, and “usurious” interest rates. These accusations have resulted in the passage of an Ordinance by the State Government of Andhra Pradesh (AP). Intellecap, an India-based social business advisory firm and publisher of Microfinance Insights, has released a White Paper in response to the crisis. Thought-provoking and informative, the White Paper analyzes the buildup to the crisis in AP, attempts to revisit some fundamentals of the business, and questions the effectiveness of radical approaches to multiple bottom-line business by the State and the media. We welcome your comments.
Download Intellecap’s White Paper here.
(Credit: Microfinance Insights)