A Q&A Session in the Bombay Hub (8/8/2011)
On Monday it just seemed to all click and make sense. My worry of Social Entrepreneurship having a high failure rate and being just a fad was put to an end after meeting with Unlimited India and Acuman Fund. I was reassured that individuals have the power to make a social change and start a business from the ground up. It starts with a simple idea in a given community, a dash of entrepreneurial skills, along with a great deal of passion to follow through with the idea. In India, to be a social entrepreneur is no walk in the park, there is a lack of cultural support and available funding opportunities along with the fact that many do not come from a business background and therefore do not know how to write a business plan let alone run a business. That’s where investment companies like Unlimited India and Acuman Fund come into play.
“Our seed financing and incubation support is designed to help you develop as a leader and successfully launch your social venture. We meld the passion of the social sector with the rigour of the business sector” –Unlimited India
We met with leaders of Unlimited India that further explained to us their views on social entrepreneurship and how Unlimited helps with the process of becoming a social entrepreneur by providing funding and support. We met with Pooja Warier, the co-founder and director of UnLtd India, along with associates, Roshan and Karen D’Souza. When asked about the definition of social entreprenuership, Pooja explained by comparing a social entrepreneur with an activist. She gave the example of people going hungry. “An activist”, she said “only addresses the symptoms while a social entrepreneur on the other hand, gets to the root cause and asks ‘why are you hungry’”. However at the end of the day, the title means little to nothing. The support that Unltd provides goes far beyond rupees or dollar signs, their program offers a yearlong package. They provide seed funding, hands-coaching and training and high-value connections. Therefore not only are they paying for start-up costs but they also help with financial planning, governance and marketing. My favorite part though is that they stress the importance of mentorship. Unltd prides itself in coaching and connecting their investees with mentors, training clinics, peer learning, and experts in the field. They have a 3 level support system as follows…
Level 1: Develop Leaders (given up to 80,000 rupees)
· After the investee proves that he/she has done the due diligence proving that the idea is needed. Unltd provides a sustainable initiative plan along with “160 hours of hands-on support over the course of a year.”
Level 2: Prepare for scale (given up to 2,000,000 rupees)
· Boost the project “towards greater impact and sustainability”. At this level investees are given of “220 hours of hands-on support over a year.”
Level 3: Accelerate Support (given up to 20,000,000 rupees)
· Gives a social business fund of up to 20,000,000 of loan financing (“repayable over three years, along with a customized support package over the period of the loan”) allowing the business to be sustainable and continue to grow and provide an impact.
All of the funds given at each level are all low interest loans that are repayable over 3-5 yearsAfter hearing about this promising system of support, and with my eagerness to make a social change in the world, the question was “How can I be an investee?”
The selection process is just as organized as the support system. They begin by working with NGOs to find legitimate leaders that are passionate, have done the ground research, and have a structure for an idea. An investee cannot be illegitimately or politically motivated. In addition he/she must be at least 16 years of age and the business must be grounded in Mumbai so that the leaders and mentors of Unlimited can meet with the investee face to face. And lastly there is an executive panel, represented by people of the corporate and social sector that does the final selection by following a four part assessment criteria.
1. Entrepreneurial Capabilities
a. Will he/she connect to the community? Does he have a vision? Will the idea not only be able to generate money but more importantly attract funds?
2. Potential of the Idea
a. Is there a need for the idea?
b. How is it different from what is out there already?
3. Match
a. Do the person and the idea match?
4. Value
a. Will he give back to Unlimited India or another start-up in the future?
The organization sounded so flawless and systematized that we were curious as to know whether Unlimited India faces any challenges?
I remember Pooja smiling and nodding her head yes. She explained that investees of Unlimited face budget, business plan, and legal challenges but their main challenge comes from the home of the investee. She told us about family pressure and how the main reason for failure of an idea is when an investee buckles into family pressure. This could be a spouse disagreeing with the idea of a social entrepreneurship endeavor or the chance that there would be a lack of income. The other reason for failure is when the investee realizes that that a startup business will require a great deal of attention and as a result quits because he/she cannot be 100% devoted. Unlimited gave us examples of their successful social entrepreneurs
Moreover they explained the key elements of a business plan that aims to make a social change are:
· Problem
o What’s the problem?
· Approach
o How are you going to fix the problem? What method are you going to use?
· Impact
o How are you going to measure your results and what are your results?
Instead of waiting for NGOs or the government to come along and fix a problem affecting a community Unlimited encourages individuals to take action for themselves. It’s about changing that initial question of “what’s the government going to do” instead to “what can I do about this.” Pooja explained: that in every social entrepreneurship business plan, there needs to be a balance between thinking scale and thinking social change. Both Unlimited India and ACUMEN Fund India want to raise philanthropy, fund a sustainable business model, and measure the impact. However what we found was that ACUMEN Fund did not really have any hard evidence or research on the impact of their businesses. This missing piece, I believe, is crucial. Nonetheless, the energy that these leaders had was infectious. Unlimited and ACUMEN Fund both believe that it’s worth investing in individuals that are looking to leave a social impact on a given community. Change-makers is what they call them. The advice they gave to us in order to help businesses like the ones they fund is to volunteer long-term and to make donations to legitimate organizations. This conversation alone sparked ideas of my own for my upcoming business plan for the final project of this class.
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