Going social for a cause

A new breed of entrepreneurs is using business acumen to solve social problems

Did you think that the term ‘social’ in the lexicon of the rich only referred to balls and banquets? Meet the new breed of entrepreneurs with strong business acumen who have made their money and directed their passion into resolving social issues. Sure, many of India’s affluent try to address social problems through foundations, trusts and personal charity. But we spoke to a few individuals who are diving in and getting their hands dirty, to actively run social ventures that fulfil a felt need.

Focus area

‘Social entrepreneurs’ are an emerging set of tech- and business-savvy individuals who have found a way to marry their social concerns with their business and technical skills. And this is helping them bring about palpable changes to society’s age-old problems.

Take the case of the poor standard of education, especially scientific education in municipal schools. While many non-profits conduct science exhibitions and camps, there has been no sustained improvement from these well-intentioned initiatives.

That made Krishna Srinivasan, who had founded and successfully exited two multi-million dollar start-ups in the US, sit up and take notice. He and his wife Chokanath Hymavathy have been a driving force behind Everest EdusSys in 2011.

So, what is different about their solution? They integrate various science experiments and models with the school curriculum to offer an ongoing science lab programme.

The idea was a big hit with the administrators and students at the corporation schools in Chennai. Over 20,000 kids in more than 100 schools use the programme today.

But not all social entrepreneurs start out with a chosen cause. Chandrasekar Mishra, founder of Crux Power, a renewable energy solutions company had a strong urge to ‘do something’ for the tribal people near his family home in Odisha, but did not know what.

The light literally shone on him when he realised how solar power could be used to make a difference in the remote hamlets that have no access to electricity from the state grid.

He quit his investment banking job and set up a small solar unit at a training school for tribal children in Madhya Pradesh. The company has since expanded to offer water pumps and purification solutions using solar power.

Not for charity

While the idea may be a success with the beneficiaries, a social enterprise needs to be profitable as well. Only that ensures that the venture is self-sustaining. Vardhaman Jain, who was the Managing Director for Dell Services BPO operations worldwide, has effectively managed this tight-rope walk. His company Laurus Edutech has provided vocational skills training through 216 centres to over 1.5 lakh under-privileged candidates and enabled them to earn a livelihood. The company has not taken any external funding and has scaled up operations with its own cash.

The secret, according to Jain, is not losing track of the finance and sticking to one’s core business plan. “There is a great temptation to overspend on fancy features and a desire to conquer the world in the early years,” he says.

Likewise, Srinivasan’s mantra of going ‘inch-wide mile-deep’ has helped his start-up thrive. He decided to focus on middle-school students first and deployed a lot of resources — including researchers from IITs, IIMs, Teachers College at Columbia University, US, as well as venture capitalists such as Lok Capital — into finding the solution. The scaling up came later.

Crux Power had to handle a difficult business environment that involved dealing with Naxals. Troubled by high set-up and maintenance costs, the company had to find a creative way of managing the financing problem. Crux tapped into Corporate Social Responsibility initiatives of larger companies, government subsidy and the local area development funds.

Winning solutions

Besides the umpteen issues faced by small companies, social start-ups too have to jump over a few extra hoops. For instance, as the end-users are usually in rural locations, it may not be easy to reach them quite easily.

“Finding partners who will offer channels to distribute your product or service is important,” notes Srinivasan. E

verest, for example, works with many teacher training colleges in semi-urban locations, who later take the initiative of introducing it in their village school.

Often getting caught in cool, technical solutions may prompt you to offer a pound of cure, where an ounce will do, as Sameer Segal, founder of Artoo, a technology start-up that develops mobile and cloud solutions for micro-finance institutions, realised.

Instead of adding an ‘amazing feature’ that has no value, his firm now pares down the features and focuses on making the tool more intuitive.

For example, when field agents fill out loan application papers, they don’t go about it sequentially. Rather, they have a conversation with the client and fill in the responses in the relevant places.

Observing this helped Artoo improve the user experience on its app that collects data, says Kavita Nehemiah, Director of Business Development at Artoo.

Journeying on

If you are able to take these issues in your stride, the results can be rewarding — both emotionally and financially.

For instance, Artoo’s solution has helped to reduce loan turnaround time for small borrowers by as much as 80 per cent. Fewer errors in the application forms have helped Ujjivan, a micro finance provider to reach more customers. Artoo’s revenue doubled last year and achieved operational breakeven.

The emotional rewards can be high, says Mishra. When cyclone Phailin was about to hit Odisha last year, his team un-installed the solar panels and commissioned them immediately after the cyclone passed. Power from the solar units was used to support the rescue work in the blackout.

The opportunities to change things and grow the venture are sizeable. Jain is thinking of taking the skill development model to other developing countries such as Africa.

Jain notes that often trainees don’t praise the program. Not because they don’t appreciate it but because they are not aware of the changes skills training can bring.

He says this was a ‘great revelation’ about the depth and urgency of the problem.

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