The bug of entrepreneurship makes a person see opportunities even in a grain of sand. Entrepreneurship even has power, as its fire-in-the-belly vigour makes one go deaf to comments of being bizarre, unworkable or far-fetched. Serious planning, right ways of arranging and investing funds, all packed with a never-give-up approach is what one needs to turn a challenge into a well-deserved opportunity. Most of these attributes were ingrained in Shaffi Mather, Ravi Krishna, Sweta Mangal, Naresh Jain and Manish Sacheti, who, after getting degrees from Ivy League institutes and having worked with some of the world?s well-known blue chip companies, preferred to be changemakers in India. Their venture, 1298 Dial For Ambulance was a success in the pilot phase itself. It was their way of serving society.
Being floated on the lines of a business, the so-far-so-good story finally came face to face with the biggest challenge an enterprise faces. Problem of sustainability and expansion, to enable the mission serve better. The prime challenge: finance; the second: from whom, how much one has to pay back, and by when; the thought ? what if things don?t fall through. The solution: a partner in risk-taking and a mentor that can help one go steady. ?We knew grants from trusts like Ford Foundation and Tata may not come when one is talking about a profit venture. Banks, though much faster now, will not compromise on their interest rate. We needed a partner who not only funds the venture, but also feels for it. Finally, we got a partner in Acumen Fund,? says Mangal.
Today, 1298 is backed by a $1.5 million funding from New York?s Acumen Fund, a non-profit venture fund, which invests in sustainable, scalable solutions addressing poverty in South Asia and Africa. Using the skills of business, the flexible capital of philanthropy, and the rigour of the marketplace, the six-year-old fund aims to develop and deliver systems-changing solutions to the world?s problems. Following equity investment, its approach focuses on organisational sustainability, leadership and scalability through managerial support and investment. The reason for Acumen Fund to support the Mumbai-based ambulance start-up was the impact it promised to make. ?Probably the first for-profit, private sector ambulance service in India, 1298 brings an easy access to ambulance services by just dialing 1298,? says Varun Sahni, India director, Acumen Fund.
Ziqitza Healthcare Ltd, which owns 1298, employs a sliding-scale pricing system based on the kind of hospital to which a patient is taken. Those who go to free public hospitals do not pay, while those who ask to be taken to the city?s more expensive hospitals, pay accordingly. It uses a mix of grants, equity and loans to enhance its service.
From here begins the list of success stories, which now are encouraging other entrepreneurs to float a venture with a social bent of mind. Viraj Gandhi, known for his pharmacy retail chain, Medicine Shoppe also logged on to the Acumen Fund to support his venture Sehat. The chain of healthcare clinics, set up in the low-income belts of Mumbai, now brings to people medical consultation at a nominal fee. For Swati Bhogle, CEO of Technology Informatics Design Endeavour (TIDE), Bangalore, it is time to look at ways that can give her venture large-scale dissemination. Her society identifies environment-friendly technologies and adapts them so that they are sold by rural entrepreneurs. Assigning herself six months, she is currently finding funding organisations that can support her programme further. ?Though not clear what we will take finally, the idea is to go for working capital from banks and venture capital for building infrastructure,? she says.
?With varied instruments available to social entrepreneurs today, this current phase is the best to float a social venture,? says Don Mohanlal, president and CEO, Khemka Foundation. Pointing to Thomas L Friedman?s third edition of The World Is Flat, he says, ?one finds a reason in the writer updating his new book with a chapter on social entrepreneurs. With the world recognising their existence and contribution, the fund market too is getting more teeth. Besides veteran like Ashoka and Bellweather becoming more generous, one sees the new ? especially those from the corporate world (from Gates and Buffets to Gururaj Deshpande and Vinod Khosla) ? coming forward to redefine ways to help social ideas.?
Khosla Ventures has pledged some of its investment proceeds to achieve a social difference. Funding impact maximisers instead of profit maximisers, the fund puts the equity in a non-profit trust. The fund today has interest in microfinance, environment, education, health, affordable housing and others.
The fund avenues for a social entrepreneur are many. They could range from old-style grants, returnable grants, soft loans, commercial loans to equity and venture capital. Vijay Mahajan of BASIX, goes back 40 years to recall the day donors like the Ford Foundation launched programme-related investment (PRI), which could help one get 10-year-long loans. ?Considering PRIs as a good start, the last five to seven years have seen the new-generation philanthropists coming forward to help the young and make a difference to the society they are part of,? he says.
As experts advise, the choice here depends on the project one has in mind. If a social venture is not-for-profit, writing a grant proposal to generous trusts makes more sense. However, if the idea is to make profits, trying commercial lending, equity and venture fund are advised. ?In the case of clean technologies, employment generation, etc one may reap benefits quickly. But in sectors like education and health, the results may take quite a while to show up. So going for loans that have high interest may not be a good idea,? says Mahajan.
Padmanabha Rao, founder, RIVER, Madanpalli, Andhra Pradesh, agrees. Through his multi-grade, multi-level methodology, his venture has been working with the government to provide quality education to children. ?Unlike urban cities, the rural ventures don?t have much funds in the so-called opportune scenario. In our case, public-private partnerships have helped us improve standards. Education is still a virgin market to invest in,? he says.
Sohini Bhattacharya, director, South Asia Partnerships, Ashoka, advises entrepreneurs to hold on their goals. ?Not profits, one must look at how a venture impacts society. Over the years, the ventures supported by us have made policy changes. That?s the way to go,? she says.
To accomplish both profit and impact, Vineet Rai, Aavishkar, advises entrepreneurs to give up conventional thinking. ?Today, our venture gets over 100 requests from entrepreneurs. Still, it is just the tip of the iceberg. I hope the trend of mesofinance (investment capital to enable social enterprises to expand) takes on the same success path microfinance has in the recent past.?
