Tag Archives: villgro

Notes from Sankalp: Identifying the Value of Social Enterprise Incubators

sankalp
Picture courtesy: Eleanor Horowitz

Last month, I had a chance to attend India’s largest and leading impact investing and social enterprise conference, the Sankalp Unconvention Summit, in Mumbai on April 17th and 18th. The conference, which attracted 1,000 attendees, plays host to several social impact awards, serves as a venue for entrepreneurs to meet investors, is a massive networking opportunity, and offers a quasi-think tank environment through panel sessions that bring together thought leaders from all ends of the world.

One of the buzzed about panels that I attended addressed the topic of “Incubating the Incubators” – a title aimed to stir up debate about the value proposition of social enterprise incubators in India and the efforts needed to scale them up. India’s leading social enterprise incubators include Dasra, UnLtd India, Villgro, IIT-Madras’ Rural Technology Business Incubator and the relatively new Khosla Labs.

Speaking on the panel were Dave Richards, Founder and Managing Partner of Unitus Seed Fund (USF), Ross Baird, Executive Director of Village Capital, Manfred Haebig, Head of Private Sector Development for Germany’s international development arm GIZ, and Umesh Sachdev, Co-Founder of Uniphore. The panel was moderated by Villgro Innovations Foundation COO “Guns” Ganapathy Pr.

The general feeling was that a successful incubator will take you on a journey of growth, exploration, and un-learning. A valuable incubator will help you fill in specific business gaps and expand your professional network into a strong peer-to-peer support system.

Here are some of the highlights from each panelist:

  1. Representing the voice of the entrepreneur and a former incubator participant, Uniphore’s Sachdev provided the advice that incubators can guide, help and mentor, but at the end of the day the success or failure is the responsibility of the entrepreneur.
  2. According to USF’s Richards, India is on the cusp of an incubator bubble. Many incubators will be launching and expanding in India in the coming years, which is both a blessing and a curse. Over time, incubators will differentiate and leaders will emerge, but in the near term, entrepreneurs need to enter incubators with defined goals in order to maximize the value of their experience.
  3. Manfred Haebig from GIZ emphasized that the key to successful incubators are good filters. Realistically, he said, not all aspiring entrepreneurs are destined to succeed, and not all of them should be incubated. The weakness of new incubators is that they are still incubating themselves. As a result, many struggle to get enough applicants to be selective and don’t restrict their programs to the strongest and most promising entrepreneurs.
  4. Through the experience of running 18 Village Capital incubator programs across six continents, Ross Baird and his team found that residential incubators focused on a “sage on stage” were often too inspiration-heavy, leaving participants moved, but not changed. Instead Village Capital aims to be a “guide on the side” providing constant feedback to constructively improve the business plans of the participants at all times.

Overall the feeling was that incubators are neither one size fits all, nor a passport to success. Entrepreneurs need to be smart in selecting which incubators to participate in, and cannot just assume that having a badge of “being incubated” will guarantee either investment or revenues.

A quick summary of this year’s conference highlights:

http://www.youtube.com/watch?feature=player_embedded&v=VNSOu6a9a34

(This guest post is written by Eleanor Horowitz, who is currently a Frontier Market Scout with Unitus Seed Fund. Previously, she built a clean water business in Ghana and worked in the corporate sustainability office of a Chinese supply chain manager. Eleanor received a degree in Chemistry and Environmental Studies with a minor in Global Health from Middlebury College. She also holds a graduate certificate in Enterprise Development and Impact Investing from the Monterey Institute of International Studies.

Follow her on Twitter @eleanorhorowitz)

Paul Basil: A true pioneer in the world of social entrepreneurship

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Pic courtesy: http://www.changemakers.com/

Paul Basil, founder of social enterprise incubator Villgro (previously called Rural Innovations Network or RIN), is a giant in the world of social entrepreneurship. Trained to be a mechanical engineer, Basil had his first taste of the hinterland when he went to the Indian Institute of Forest Management (IIFM), he joined the Kerala Horticulture Development Program thereafter, where he worked on several innovations. He launched a “farmers’ market”, kick-started a franchising system and introduced the sale of fruits and vegetables in supermarkets.

From his experience in rural areas Paul realized that there was plenty of innovation in rural areas but hadn’t been commercialized because of a lack support. This inspired him to found RIN, in 2001, a non-profit incubator focused on mentoring and funding rural innovations.

Basil’s career highlights include incubating 60 companies, launching the social enterprise conference Unconvention | L (UL), setting up the Centre for Social Innovation and Entrepreneurship at IIT-Madras and championing the India chapter of ANDE (Aspen Network for Development Entrepreneurs). He was made an Ashoka Fellow in 2002.

In a freewheeling interview, Basil spoke candidly about his origins, motivation, current state of the social entrepreneurship ecosystem in India, inspiring students and his future vision for Villgro.

Here are the edited excerpts.

What inspired you to start Villgro? What has kept you motivated all these years?
Very early on, I asked myself. If one is educated, makes enough money, and lets say not greedy, what should one be doing at a very high level? It was to take up causes, and make a big difference to the poor, but not by doing charity. Not because I didn’t like that, but I’m more kicked about models that are sustainable, economically. While it is about being market friendly, its not all about market forces, but also about innovation. If it were just about the market, then private enterprises would have served that purpose.

We need new solutions to century old problems of malnutrition, illiteracy and power. Villgro stresses a lot on innovation: what has been done in the past has not worked, its not just the idea or execution. Innovation is really required and Villgro is all about innovation. Younger entrepreneurs, their energy and enthusiasm are a source of constant inspiration.

Would you want to help create a billion dollar company or impact a million lives?
I am respectful of wealth creation. If Jerome Lemelson hadn’t created wealth, he wouldn’t have been able to fund these pressing problems, through his foundation. Somebody has to be rich to create a positive impact on a million people.

The question is how to create these companies. At our incubator, we incubate a lot of companies. Some will fail, and a few will become successful. This collective investing is exciting and has far more chances of survival as you de-risk your portfolio. The idea is not to stop with impacting a million lives.

When gunning for scale, how to manage investor aspirations and what’s good for the enterprise? The SKS Microfinance controversy showed us that going for scale doesn’t always end well, more recently, the founder of Rangsutra questioned the timing of Aavishkaar’s exit, which she claimed resulted in an increased valuation and thereby made it more expensive for their artisans to buy shares.

All of us are trying to crack one problem at a time, but a lot has been taken on. There are these dual or blended goals of for-profit, building scale and stakeholder interest. In the case of SKS Microfinance and Rangsutra clearly these goals were not aligned. Venture capital investing only works with certain entrepreneurs and business models. The question is whether Rangsutra was ready for venture capital and the VC model was good for them.

Compatibility between the companies and VCs may have not matured enough. But this is learning. There will be uncertainty and acrimony, before progress will be made. It will take some time, what’s needed is open communication without negative implications.

Larger networks like Global Impact Measurement Network (GIIN) GAIN and Ande (Aspen Network of Development Professionals), have the agenda to spread the message on impact metrics. The question is how fast can they reach the message.

What is the vision for Villgro?
I think there is large capital available like Aavishkaar, Grassroutes and Lok capital and it needs to be bigger because when companies become big mainstream funds wont cut it, social VCs need to invest at this point. Therefore we see impact investing has started seeing scalable business models, going forward, more funds will be required.

What’s needed is investment in the $100,000 to $200,000 (Rs 54 lakh to Rs 1.08 crore) range to prove new business models. We need to make economic sense of markets for poor. Most business models are about cost cutting or upping the quality of life, when we are working with the poor our concern is also how to improve incomes through livelihood creation, like Amul did. We need plenty of investments to enhance incomes.

If I had a pot of money, I would use 60-70 per cent to build scale and the rest of the 30-40 per cent should go into high-risk models.

We need investments in the early stage because funds are 10-12 year funds and they close in 3-4 years, so ventures need to grow so rapidly so that they are able to absorb $1 million.

Investment is important to incubate diverse business models that are innovative and different. If there is a lack of investment at this early stage in experimental ideas, there is a danger that the sector will run out of ideas even if there is more capital coming in the next few years:

What are Villgro’s future plans?
We dream of building a fleet of incubators that maybe Villgro branded that will be launched in India first, and then in other countries like Latin America and Africa.

Both in terms of quality and quantity, there are not enough incubators. We envision a network of incubators; we shall provide incubation services like capital, mentoring, and right talent.

Not exactly sure on how will it pan out; whether it will be giving them money, know-how, the challenge is the model. Currently our customers are entrepreneurs, as we enhance our scope, incubators will become our customers. We will be clear about the model by the end of next year.

The other piece is an entrepreneur-in-residence program for early stage budding entrepreneurs. The middle-class doesn’t understand villages, the needs and thereby lack customer insights. What we do is to take a bunch of younger entrepreneurs who are inspired to create change but not investment ready. This program may take sometime to launch, we are piloting something and have started seeing applicants.

How do we motivate more students to consider social entrepreneurship as a career?
In the world of student entrepreneurship, the culture is not supportive and parents are not encouraging.

Students are influenced by faculty, we should show people who have just graduated and have been successful in social enterprises. The problem is that faculty does not understand social entrepreneurship. Parents are also not convinced, as they don’t see it as a way to make money.

They need to nudge them in the direction of taking up a career in social enterprise. Changes are needed. Educational institutions need to support social entrepreneurship. There has been a start with business competitions like iDiya at ISB, the Global social venture competition (GSVC) and Eureka! at IIT Mumbai and also social entrepreneurship related courses at colleges like Loyola Institute of Business Administration (LIBA), IIT-Madras, Xavier Institute of Management- Bhubaneswar (XIM-B) and IIM-C. We have been doing our bit, the course we helped co-design at IIT- Madras in social innovation and entrepreneurship is one of the most sought after minors.

We need for these courses to spread, the faculty to understand what social entrepreneurship is about and engage in more research related activities. Currently consulting companies are doing research, this is the role of academics, whatever is being done currently is shallow, what’s needed is committed faculty focused on research. We are slowly engaging with faculty motivate them to do more research.

How is UL progressing?
There have been a few conferences; it has been helpful to all stakeholders. UL is a great brand, which is building the sector, but not everybody has the opportunity to make it and if they don’t then they have to wait for a full year. We felt that we needed smaller formats and thereby we had them at cities like Lucknow and Bhubaneswar. The focus is to create a deep platform on capacity building, creating awareness and interest among youngsters about what social entrepreneurship, and create a pipeline of new entrepreneurs.

This is a great opportunity, smaller towns are closer to the problems, we don’t need to sensitize entrepreneurs there are the problems, and they are more realistic and not very idealistic.

When we organized an UL in Bhubaneswar in association with TiE (The Indus Entrepreneurs) and National Entrepreneurship Network (NEN), 90 people turned up. We need to be patient, it takes time to become a platform, we can’t do it with brick and mortar, a tech platform would be apt. It needs to be scalable like a TED platform; UL could be the TedX of the social entrepreneurship world.

By the end of 2013-14, we hope to conduct 10 events, with 100 people attending each and discovering 20 such entrepreneurs.

Announcing Villgro’s annual fellowships for social entrepreneurs

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Pic courtesy: Villgro website
Applications for the fifth installment of the annual Villgro Fellowships are now open. The fellowship provides professionals, with a one-year Leadership Development program, to get a taste of what it feels to work in the social entrepreneurship space. The program is a mix of classroom sessions, forums, field trips, hands-on mentoring and a close working relationship with a social entrepreneur. Its certainly a immersive, roll up your sleeves and get your hands dirty experience, that promises to give fellows a first-hand experience of what it takes to be a social entrepreneur. For the talent-starved socent industry, this is a great way to get access to world-class professional talent, in various areas like finance, marketing, HR and IT.

Since 2008 there have been Villgro 29 fellows, and a whopping 62 per cent of them have stayed back in the social enterprise (socent) sector. David Schafran, for example, was a fellow at rural BPO company Desicrew, and upon finishing his fellowship he went on to found his own social start-up

Want to know experiences of the 2012 Villgro Fellows? Follow all their experiences on the blog here

If you are convinced or just curious find more details on the Villgro fellowships here.

Other fellowships similar to Villgro’s include Acumen Global Fellows Program, Idex Accelerator Program, Dasra Fellows and Frontier Market Scouts.

Villgro background
Villgro (earlier known as Rural Innovations Network), was started by Paul Basil 11 years back, as a way to mentor and commercialize village innovations. Currently, they provide a variety of services, including mentoring, talent support, funding, marketing and access to socent networks. To date they have incubated around 64 companies and provided $40 million in seed funding. Villgro, also used to organize Unconvention, one of India’s largest socent conferences, till last year. It has partnered with Aavishkaar organized Sankalp, to form India’s largest socent summit, Sankalp Unconvention summit 2013. To support the ecosystem beyond Delhi, Bangalore and Mumbai, Villgro has launched Unconvention|L, which is targeted at uncovering socents in smaller cities and towns. The social incubator’s other initiatives include SEED, which gives unsuccessful social entrepreneurs a second shot at making it work, through a 8-month incubation that aims to sharpen the entrepreneur’s vision and raise first round of funding.

Welcome to Sankalp-Unconvention 2013- the Davos of the social entrepreneurship world.

sankalp
Courtesy: Sankalp website

First they were two. Then they became one. Sankalp-Unconvention Summit 2013 (SUS2013), the union of two of India’s biggest social entrepreneurship conferences into one mega event, is two weeks away. It will be held from April 17-18, at Hotel Renaissance, Powai, Mumbai.

Sankalp and Unconvention were both started in 2009 and have blossomed into events that bring together social entrepreneurs, investors, academics, foundations and other stakeholders. Sankalp, touted as Asia’s largest social enterprise conference began in 2009. It is the brainchild of Intellecap, a Mumbai-based company that provides investment banking, business consulting and knowledge service solutions for social enterprises. Unconvention, which debuted in the same year as Sankalp, began with a similar agenda of bridging the world of entrepreneurs and investors. Villgro, one of the pioneers in the social enterprise is behind Unconvention.

The organizers of SUS2013 claim that it’s the largest social enterprise focused conference globally with over 1000 entrepreneurs, investors, donors, policy makers and other stakeholders expected over three days. Speakers this year include Bala Deshpande, senior managing director of New Enterprise Associates India (NEA), Jayant Sinha, managing director of Omidyar Network India Advisors, Watanan Petersk, director, Lien Centre for Social Innovation and chair, Ashoka Singapore Advisory Council, Afeefa Sayeed, senior advisor, US Agency for International Aid (USAID) and Jayesh Parekh, co-founder of Sony Entertainment Television.

The theme for this year is Looking Beyond Impact: Seeking Transformational Change.’ SUS2013 will dwell on the fact that while metrics for measuring impact are important, are they also, in some ways restrictive? Does the industry gun for scale and replication or does it pause to refine the strategies and tools that currently in operation? Have the lives of individuals at the bottom of the pyramid really been positively impacted? Difficult questions to be answered in just two days perhaps, but SUS2013 will open up a debate on how social entrepreneurship will play out in the next few years in India.

If you haven’t registered yet, do it here. You can catch all the updates on Facebook.