Finding Opportunities in Social Good
Date: Thursday , September 30, 2010
A lot has been discussed on opportunities at the bottom of the pyramid, originally a concept professed by late C K Prahalad. The launch of ‘Tata Nano’, the Rs. 1 Lakh car, has put the 100 year old Tata Group on the world map, with their aspiration of building an affordable car for the masses. Similarly, microfinance companies are spawning new opportunities to serve the poor and the underserved, while creating huge value for their shareholders. A great example is SKS Microfinance, which recently went IPO with great fanfare and excitement from investors. In an announcement at the World Economic Forum in Davos a couple of years back, Bill Gates highlighted the notion of ‘creative capitalism’ to address the needs of the underserved.
I wish to discuss opportunities for budding entrepreneurs to target social entrepreneurial causes, with hybrid models of for-profit and non-profit, creating a double profit line of social good and economic profits. Immense opportunities exist for the bold and the brave to look under the hood, looking beyond the obvious high growth, and for high paying consumers or enterprises to discover new markets and needs that can be sustainably addressed through entrepreneurial energy in the long tail of the human population that manages to live with under $2 per day incomes.
Microfinance (lending capital) for accelerating rural entrepreneurship has now opened up a range of new entrepreneurial ideas. Some of these ideas are obvious and merit deeper investigation. For example, micro insurance for the poor might be ripe for the taking, or helping improve the ‘food supplies’ for the road-side ‘dhabas’ and turning them into ’subway’ style branded cooperatives might be worth studying. If you are looking for bolder thoughts, we can leverage village Internet kiosks into game changing education engines for the rural economy by delivering ‘distance education’ over the Internet. SiliconIndia itself is trying to create virtual training centers around the country, through a network of franchisees to help drive professional learning and growth. Do we know that over 40 percent food in India gets wasted and spoilt in transportation, a perfect opportunity for the entrepreneurially minded to solve. At this time of evolution of India, we need far more entrepreneurs and students of rural economy to help us unearth these hidden gems of creative capitalism. A number of promising ventures like SKS Microfinance are leading the path to transform the lives of the poor. Skoll Foundation and Omidyaar Foundation (founders of eBay) are also doing a great work in this area. Organizations like Unitus (http://www.unitus.com) are also supporting many social ventures with hybrid models of profit and social good, should you need to raise capital for your social venture.
Over the last 2 to 3 years, we have seen a number of talented technology entrepreneurs who otherwise would have focused on classic for-profit businesses, who have now embarked on the road to social ventures. The economic climate for such social ventures is ripe, India is riding high, and abundant capital is available for the bold entrepreneurs who have a strong belief in their social vision of change. As with everything in life, these social ventures are not easy to pull off. They take much longer and are typically harder to scale. However, if you are successful, the paybacks - both financial and social - are quite significant. Can you imagine Mohd Yunus, starting with under $100 of capital 25 years back, turning Grameen Bank into a multi-billion dollar microfinance powerhouse that has touched millions of lives? To get this type of rewards one would have to venture off the beaten track and find those sustainable business ideas, which address a deeper need for the poor while providing for a sustainable and scalable business model. Any one for an ‘ad supported’ textbooks project for the rural students, which can be distributed free? Or creating ‘food parks’ in the rural farm lands? Ideas galore, we need more entrepreneurs to take up the challenge.
We at the SiliconIndia.com community are also committed to starting our own SiliconIndia.org, a non-profit initiative built to become the agent of change. Hopefully, we will find many more of you embarking on your journey to rural and social entrepreneurship. SiliconIndia.org just launched this month, September 2010, and will hopefully democratize corporate social responsibility over time in India.
The author is the Chairman of SiliconIndia.com and MetricStream. An internet pioneer, he was the co-founder and President of WhoWhere? Inc., a Internet directory services company acquired by Lycos in 1998 as well as eGain, an online customer service company. Sinha can be reached at firstname.lastname@example.org