With a population of over 1.2 billion, every third Indian still bereft of even basic necessities like nutrition, education and healthcare, and millions who are still unemployed and illiterate, the situation is indeed alarming.
With a population of over 1.2 billion, every third Indian still bereft of even basic necessities like nutrition, education and healthcare, and millions who are still unemployed and illiterate, the situation is indeed alarming. India, clearly, faces myriad problems and long-standing issues that have remained unresolved over the decades, despite efforts by both the institutional and government sectors. One of the ways to solve such problems is to have more social entrepreneurs joining hands with the government in its efforts towards creating a more prosperous society.
Social entrepreneurship, of late, has been taking a firm shape, with an increasing number of young Indians experimenting with the same. In fact, social entrepreneurship has seen exponential growth over the last decade; today, a large number of skilled men and women are coming up with out-of-the-box solutions to improve the lives of the underprivileged. Among other things, such individuals are working towards providing the underprivileged with access to technology, investors, mentorship, government agencies, local partners and business development support. They are also using innovative ideas to help the poor access services such as water, education and healthcare.
However, since financial sustainability is fundamental to solve these problems in the long run, one practical approach is to create business models revolving around low-cost products and services.
The key sources of capital for social enterprises are non-institutional debt, equity (mostly self-finance), institutional debt and grant funds. Ironically, more often than not, social entrepreneurs are under government radar, depriving them not only of key investments, but also of incentives such as tax breaks. One of the major areas of concern for social entrepreneurs is finance. So, how to overcome this shortage of funding?
Social entrepreneurs must have a business model to generate funds on a regular basis. While government support is crucial, there also has to be an angel network for assistance. The government, on its part, must work towards creating an ecosystem by providing basic infrastructure and easing doing business.
Risk goes hand in hand with failure, and yet without risk there can be no lasting change. I would urge the government to create an environment where social entrepreneurs can experiment and fearlessly try to create a society where everyone has an equal opportunity to grow. While there are some brilliant ventures out there—changing India in a small way, every day—there are still a lot of places in the country that can do with a social initiative, by an entrepreneur who is courageous enough to go out there and bring about a change.
The author is founder & president, Action For India. He has been working towards making social enterprises a scalable business model