Microplace

Microfinance is a very popular term and it has become a very lucrative business for many organizations. However, there is a lot of difference between banking institutions having a microfinancing arm and an NGO working towards providing micro loans to people below the poverty line. There have been innumerable discussions on this topic and the whole practice depends on how it is utilized.
On one hand, providing micro-loans to people below the poverty line in groups, provides an opportunity for them to build up their livelihood instead of depending on bank loans (which for various reasons are more tough to get) and on the other side, there have been questions and debates on the interest rates which are being charged.
I am working on a white paper based on my understanding and will publish this soon.
Many major organizations are venturing into this business and e-Bay has recently launched their microfinance arm - MicroPlace. MicroPlace is an organization which has tie-up's with other NGO's who work at the grass root level to provide loans. Users can invest in MicroPlace and then the money is provided to organizations for the kind of investment the user chooses. The user has access to all profiles / organizations which are listed on the site and looking for any kind of investment and decide as to where his/her money goes. The most lucrative aspect of microfinancing is that the repayment rate is close to or more than 98% most of the time.

Social Entrepreneur of Year 2007

The Nand & Jeet Khemka Foundation and The Schwab Foundation for Social Entrepreneurship in collaboration with United Nations Development Program (UNDP) and Confederation of India Industry (CII) give away the "Social Entrepreneur of the Year" award every year. This award is decided by nominations received from across the country. This award carries the title of "Khemka Fellow" and Rs.8,00,000 (Eight Lakhs / Eight Hundred Thousand Indian Rupees).

Nominations for this award for 2007

Harish Hande, SELCO
Climate Change, Rural Financing, Base of Pyramid Economics, Alternative Energy.
SELCO provides solar electrification solutions to the rural people in India. Around 57% of India population do not have access to electricity adding to unreliable power supply. SELCO provides solar electricity to people below the poverty line through a combination of customized home lighting, innovative doorstep financing and understanding the market need. SELCO has reached around 80,000 clients in Karnataka and Kerala and now working with people in Gujarat.

Rajendra Joshi, Saath
Public Private Partnerships, Base of Pyramid Economics, Urban Issues, Livelihood
Unplanned/Unprecedented migration is a major problem in various parts of the world and India being no different. In Ahmedabad alone, almost 40% of the city's residents live in slums without access to basic amenities. Among this population, only 1 in 5 have private bathrooms (latrines) and only 1 in 4 have access to HealthCare and more than 50% rely on in-formal livelihood.
Saath works with Private and Government organization is creating an affordable cost model where people in these areas are not evicted and a small amount is charged for providing with amenities like roads, water, sanitation, lights etc. Saath then worked with private electric company and government to bring out charges which is a third of actual cost to get electricity and provided this to the people in slums. The companies realized a 30% increase in revenue and also the government has benefited with the tax paid. In total, Saath has worked with more than 70,000 families in Ahmedabad including 10,000 people through Slum Networking Project and 40,000 households through Urban Resource Centers.

Pravin Mahajan, Janarth
Education, Migration Issues, Labor
There are more than 30 Million (30 Lakhs) children who are taken out of school as their parents migrate in India.
Pravi has worked in creating education opportunities for these children by creating hostels for children who's parents migrate for work and also Shakharshalas or the on-site schools for children who go along with their parents. These schools are accredited by the government and ensure that students from Shakharshalas are re-admitted into regular schools at any time. Janarth has reached around 10,000 children and proved its quality in education and also is working with Government of Maharashtra to have these schools in every district through out the state.

Chetna Gala Sinha, Mann Deshi Mahila Sahakari Bank Ltd.
Rural Development, Livelihood Development, Banking

The Mann Deshi Mahila Sahakari Bank Ltd(MDMSB) and Mann Vikas Samajik Sanstha (MVSS) together develop systems that rural women need to evolve as successful entrepreneurs and build financial assets. Chetna has established the first Indian rural all women bank through equity within tribal women and also the bank runs by all rural women. The bank works in creating products from their client perspective such as micro-pensions and customized health insurance schemes. MDMSB and MVSS have collectively reached around 58,000 women in five districts of Maharashtra. Expansion plans include states of Karnataka, Goa, Andhra Pradesh and Gujarat.

The WINNER
The Social Entrepreneur of the Year 2007 has been awarded to Mr.Harish Hande of SELCO.

Hope to see more nominations and more finalists in the coming years.

You are read more about the above nominations at http://www.schwabfound.org/india/.

WEF Tech Pioneers 2007

Recently, i was going through the World Economic Forum's Technology Pioneers 2007 list which has been published. This list is published every year recognizing the most innovative enterprises around the world. The list is very interesting and gives us an overview of the organization selected and the reason as to why the organization is listed. 

I am very happy, impressed and also sad to see only 1 organization from India made it to the list - Drishtee. Now, what does Drishtee do and why are they different? 

Dristee is a rural network for delivering information services to Villages, using an electronic information kiosk, known as Drishtee Soochnalaya. These kiosks are run by local entrepreneurs who charge residents for access. 

Changing lives in rural India is no small Vision and it needs loads of dedication to be able to achieve it. Drishtee is very strong in its Vision and has gone past various milestones in the last Seven Years of inception. 

What Does Drishtee do?

The organization has categorized itself into various aspects, but the punch-line is that it is concentrating in providing self-employment to rural entrepreneurs and also providing opportunity for the rural population to have access to the latest information. 

Drishtee's initiation spreads into Education, HealthCare, Employment Generation, Women Empowerment and Micro-Finance. 

BCT - Visit Report

On the 19 September, I visited Bhagavatula Charitable Trust, a Not-for-Profit organization who's vision is "To transform 100 villages in 3 mandalas, viz. Yellamanchilli, Atchyutapuram and Rambilli of Visakhapatnam District, Andhra Pradesh into model villages in such a way that all able bodied persons are gainfully employed, that substantive improvements in the state of literacy, health and economic sustenance take place and that local leadership and facilitation is fully developed."

Here are my notes from my discussions with Mr.B.Sri Ram Murty, Joint Secretary of the organization.

Current Organization strength is around 80.
Villages Covered : 40

Activities of BCT:
Education
Agriculture
Women's Empowerment
Skill Training for Disabled
HealthCare

Going forward, the organization will concentrate more towards Education and Livelihood training for Children and Youth.

BCT believes in Programs and not in Projects. What is the difference?
Ramesh (as Mr.Sri Ram Murty is fondly called) says "Projects have a beginning and an end which comes with a report on how the project has started, progressed and closed, submitted to organizations/people who have funded/supported the project. However, Program is more longsighted and typically does not have an ending. We believe in designing programs keeping the grass-root level problems in mind and work towards making changes in the program if necessary as it progresses".

Let me dig a little deep into the current activities and share my observations.

Education
BCT has been into Education since the beginning (infact, the organization started with a School). BCT schools are categorized as follows:
Class 1-5 : 144 Schools
Class 6-7 : 16 Upper Primary Schools
Class 8-10 : 1 Model High School

As per research information, over 45% of Indians are un-employed and over 95% (very high number) of Graduates are un-employable (There is a lot of difference in being employed and being un-employable, I will explain in detail in another post). BCT has identified three main categories in education system and is working towards building the same and implementing in their schools:

A) Academics
B) Vocational Training
C) Values

Academics are important (Social, Science, Mathematics and Language) and taught in all schools and in all classes.

Vocation Training encompasses providing skill based training to children which will add the value of implementing what they have learned through academics. It is not mandatory that what is taught in school should be practical and implementable, but what is practical and implementable should definitely be taught during the school days.
I find this absolutely correct. If we look back, how many of us agree that what we have studied in our school / collage days is what we implement today? I really don't know and I personally am not implementing most of the things. I did my graduation in Economics and Computer Applications during the days when 'Career' is only Engineering/Medicine and both subjects are of use to me today.

Values - The most important aspect of education and bringing up are "Values". In today's world, most of us are just being for ourself - me and my family. But, we are part of the society and we do play an important role in living in the society. Are we any time taught the principals governing "Society". Values are most important aspect of education and this is what BCT is trying to incorporate into their education system.

One basic question I have is that India has attained independence 60 years back and the education system was build over the period of time since then. We are one of the world's largest democracy. Is there any subject in school/collage which educates children on "Democracy"? We can vote after we turn 18, but before that, are there any classes which teach children on what is Voting? How do you select your leader? What are your responsibilities? (I do know this is what we learn in Civics subject, but that is lot more generic and I do remember what I learned). This is where we need thinking and setting direction.

Now, let us look at what BCT has in its syllabus for inducting Vocation Training and Values into their education system.
Academics - Andhra Pradesh State Syllabus is followed
Vocational Training - Orientation in Agriculture (Bio-Intensive Gardening)
Values - Moral / Ethical / National Values

What is Bio-Intensive Gardening (BIG)?
This is interesting, Each student / group of students are given a 100 Sq.Foot area in which they would need to grow vegetables for a family of 5. All the required education, seeds, medication are provided by BCT and the student(s) have to grow vegetable themselves. This teaches students to be self-sufficient as they grow.

BCT also has KVK (Krishi Vidyana Kendra) which concentrates completely on Agricultural Research.

I have also visited their Baking Department where children are taught to bake biscutes and cakes which are sold in the local market.

They have a campus for Disabled Training program which concentrates on training disabled children in paper-bag making, stitching etc.

Please note that all Vocational Training Programs which generate any money will go to the person/child who has earned the same. Each child has bank accounts which are opened by BCT and any monetary benefit will be deposited in the account.

You can see few pictures of the organization at my flickr account.

If you are interested to know more/contribute to any of their programs, please contact:

Bhagavatula Charitable Trust
BCT Farm Complex,
Haripuram - 531 061
Visakhapatnam District
Andhra Pradesh. India
+91.891.255 0084 Phone
www.bctindia.net
bctindia@yahoo.com

Online Grievances in India

Department of Administrative Reforms and Public Grievances which falls under the Ministry of Personnel, Public Grievances and Pensions has initiated the Online Public Grievance Lodging and Monitoring System which you could use to record any of your grievances to the Government.

India is truly developing and these are small steps to reach there. So, next time when you have a concern, try this. You don't know, it might just work.

7 Types of Poverty

Bhagavatula Charitable Trust (BCT), runs Innovative Experimental Primary Schools (IEP) in 72 Villages in Visakhapatnam District, Andhra Pradesh, India.

What is the difference between IEP and regular Government Schools?
IEP schools, apart from regular academics, work towards education children in the age group 11-15 on the 7 types of Poverty which are required to uplift the quality of life. Our usual assumption of Poverty is only Economic Poverty. However, this is just one of the kinds. We have to even look at the following types to ensure quality of life improved:

1. Economic Poverty
2. Bodily Poverty
3. Mental Poverty
4. Cultural Poverty
5. Spiritual Poverty
6. Political Poverty
7. Societal Poverty

Now, it makes more interesting to understand these aspects. Even though the above are talked about in the BCT Project homepage, I will write again here in my own words and understanding.

Economic Poverty - Lack of monitory demands for providing themselves with Food, Cloth and Shelter. Please note that money need for only the mentioned attributes falls under this category.

Bodily Poverty - Lack of property physical health and access to health living conditions.

Mental Poverty - Lack of thinking, which is resultant of lack of access to education and knowledge.

Cultural Poverty - Lack of coming together in a society. No collaborative activities taking place which leads to disconnect between people.

Spiritual Poverty - surprising right? Yes, lack of feeling of togetherness/brotherhood plays an important role in bringing people together.

Political Poverty - Lack of understanding of how system works. The basic problem is the understanding of how to cast one's vote and elect their leader.

Societal Poverty - Lack of social connectivity.

Dazasya is Born

I wrote about "Web NGO" earlier. After thinking through various thoughts which came across my mind I identified three areas which need collaborated work - Society, Technology, Entrepreneurship.

Read more about Dazasya at its official blog.

This blog will continue to focus on Social Entrepreneurship.

Evening with Subrato Bagchi

Have been to the "An Evening with Subrato Bagchi" organized by TiE. It was really a good evening which gave an insight to being an High Performace Entrepreneur.



The evening started with a 30 minute video which Mr. Subrato made interviewing his top 3 High Performance Entrepreneurs. Mr. Subrato strongly feels that being an Entrepreneur is different and being a High Performance Entrepreneur is different. His top 3 High Performance Entrepreneur's are not from the usual Technology start-up's, but from different sectors:

Mrs. Kiran Mazumdar Shaw - Biocon
Mr. Sidharth - Cafe Coffee Day
Capt. Gopinath - AirDeccan

The video is absolutely fantastic. I liked the the way Mr. Subrato started the evening. The video's were truly inspiring and it was a very good way to start a gathering who are aspiring to be Entrepreneurs.

I tried making notes of key points during the video sessions:

Mr. Sidharth - Cafe Coffee Day

• Was an average student in class.
• Comes from modest family who runs coffee estates.
  
• Completed college and started working. He was hard-working and was working an average of 16-17 Hours/Day, 6 Days a week (many times even 7 Days a week).
• "I knew the estate in & out".
• His passion of creating capital became smart investment.
  
• Today, he manages 10,000 acers of coffee estates.
  
• One day, while in Singapore, he was walking down a lane and noticed students browsing Internet with a Beer can. This was where he thought of starting something similar back in India. As he owned Coffee estates, his idea was to start coffee shop with Internet and good ambiance so that people can spend time and doing what they like. This is how Coffee Day was born.
  
• First Coffee Day was born in Bangalore on Brigade Road in 1996.
  
• In 10 years, today, they have close to 500 Cafe Coffee Day outlets in around 70 cities in India.
  
• When he was beginning his business, people around him did not give a good push. "Who would drink your coffee in a posh store paying more when they could get same coffee at Rs.2 in any coffee joint?". But, he saw a lot of potential in the India consumer and went ahead with his business model.
  
• Over a period of time, there were many competitors and Sidharth felt that they were running out of track. Immediately plunged into action and got Cafe Coffee Day back to track. Today, they have many competitors, but still they maintain key differentiators to ensure they are on track. One of their strategy was to open more and more outlets so that it gets synonymous with coffee and they have been successful. Their competitors are not nearing they fast pace.
  
• In the next 3 years, their vision is to "Be the largest Coffee Company in India".
  
• In the next 10 years, they want to be a Billion Dollar Coffee Company.
  
• In the next 2 years, they want to be a 1,500 Coffee Day outlet chain.
  
• His key to success - "Don't Celebrate success, be calm during downs and THINK BIG.
  

Take away - During the 10 minute video with Sidharth, I could see his passion in his eyes and modesty in his talk. He has his vision clear and he loves to make capital. As Surato mentions in his book - "If you don't Love Money, Don't start a business", this is one great example of making it big with the love for passion and making capital. Good Luck Sidharth, I am sure you have made all of us proud and you will continue the same.

Capt. Gopinath - Deccan Aviation

For a middle-class, school teacher's son, life has been quite different and taken different path's. Capt. Gopinath completed education and joined the India Armed Forces. After his retirement, came back to his village to do something different. They had few acres of land in which he started Organic farming. He has received an award from Central Government for "Ecological Farming".

Capt. Gopinath was not too happy with his farming as he wanted to come out of the debt-trap. In India, most of the farmers are caught in the debt-trap for one reason or the other and this continued to even generations. He was clear that he wanted to come out of this cycle and create something big and different. He has spent most of his time in villages and he did see a lot of change in the livelihood of villagers. Until recently, villages did not see light of a bulb and even today, there are areas in the country where electricity is still a stranger. Over a period of time, he noticed changes. When one day he was flying in a helicopter, he say TV antenna's standing out of huts. Today, when you pass by a village, you will might see at least one/two cars and few motorcycles, however, most of the households have a TV. This made him think.

"Villages have become aspirational and people were wanting more."

One day, when his friend from Army called to tell him that he has got a job after moving out of Armed Forces, which was very different from what he was doing earlier. Capt. Gopinath was happy that his friend could get a job, but was not too happy as he felt that someone was missing a great pilot (His friend was a pilot).

Once, he was in Phoenix airport and was walking along the airport waiting for his pick up helicopter. What he noticed were the number of take-off's and landing which were happening. He felt that Phoenix airport handles more airplanes in a day than all of Indian airports put together at that time. He saw a potential dream - "BILLION INDIANS CAN FLY". This is what no major corporation saw.

Deccan Aviation, was born as a Helicopter Service. Today, they have 14 helicopters which they rent out for various business and are the largest helicopter company in the country.

He wanted to take Deccan Aviation to the next level and Air Deccan was born. His only dream is that "Billion Indians can fly".

When starting Air Deccan, Capt. Gopinath says, that the best thing he did was not to hire a consultant. Because, he feels that if you hire a consultant, you are bound to do what they want and not what you want.
Another key thing which he points to entrepreneurs are the politicians and the way they try to handle you when you are on your way to go big. Simple mantra for this is - "Sell you idea and have the media and Public behind you and the politicians do not come in your way". Quite simple, but this is an absolute reality and fact. So next time you have a big idea, win the confidence of media and public and you are on your way to success.

Message to Entrepreneurs - "Find a way to do, if you cant, CREATE IT".

Mrs. Kiran Mazumdar Shaw - Biocon

Since the beginning Mrs. Kiran wanted to be independent and wanted to make a Professional Career. She studied in India and went to Australia to do her masters in Brewery. When she came back, she could not get a job anywhere. All prospective employers were politely saying no to a women brew-master. She either got a job in Quality Control or other administrative divisions except where she specialises in.
One day, she received a call from Biocon Chemicals Limited, an Irish company who were looking at potential partners to step into India. Kiran was suprised, but wanted to take up the challenge.
In 1978, Biocon started its operations with partnership with Biocon Chemicals (this is how Biocon got its name from its parent company).
The venture began in her garage and then slowly moved to a small place in an industrial area in Bangalore. The company grew strong and steady. After 23 years, Biocon became a Listed company in 2001 on the 18 June.

Mrs. Kiran says "Entrepreneurship is having a Vision and Building the Vision". There is nothing more or less to it. You will have to consistently work towards building your vision and that is what makes you deliver.

Her inspiration - INDIA. She feels that doing these things (what her company does) in India is her true inspiration.

Her Mantra - "Harder I work, Luckier I get" - In my view, this is the absolute key to success and I strongly believe in this.

No wonder why Subrato short-listed the three above as "High Performance Entrepreneurs", they really are.

Mr. Subrato and his Team

After the video, Surato started with his slides. His slides come as key points from his book - The High Performance Entrepreneur.

Here are few key take-aways from his slides:

• Of all entrepreneurial activities, less than 5% are likely to be High Performance Enterprises.
  
• High Performance Enterprise is not an Accident, it comes with dedication, hard work and paying attention to building your Vision.
  
• You will not get pushed into greatness, but you need to be pulled.
  
• "Love Money" - then only you can build your dream.
  
• During the 1st year of inception, organisations fail because of familiarity between the co-founders.
  

What are the key ingredients of an organization?

DNA - Who you are?
Mission - Where you are going?
Vision - Set of time-bound and measurable goals.
Values - Shared code of Conduct.

Key differentiations which MindTree has identified before they started - Domain, Tools, Methodology, Quality, Innovation and Branding.

Subrato feels that for any entrepreneurial activity, there will be key differentiators and these differentiators are like horses pulling the chariot. All of them have to move in the same direction, with the same speed and focus.

Message to Entrepreneurs - "Human being is looking for Danger and that is why you have taken this path. To overcome the danger, you will need to work towards having the ropes tight.

Entrepreneurship is like a marathon. In long distant running, you will need to accept and bare segmented pain.

Now, why did I write this here in my Social Entrepreneurship blog, because Entrepreneurship is Entrepreneurship, be it for a social cause or be it for any other motive. Entrepreneurship is realising your dreams and making them come true.

"Love for Money" - Yes, it is required in any kind of Entrepreneurship. As one of the MindTree Co-founders and CFO Rusto mentioned, you will need money to run your enterprise and also ensure it keeps running, realising your dreams.

Conversations - Part 1

Recently, I was having discussion with Dr B.V.Parameswara Rao, founder of Bhagavatula Charitable Trust. We were discussing on Social Entrepreneurship and tried to address two areas - Micro Financing, involvement of Technology in Rural Development.

Micro-Financing
Dr. Rao feels that this has changed the life of a farmer. This is just not helping him to come out of his miseries, however adding to them. Why? Micro-Financing is providing loans to the poor to help enable them to spend more. What is happening here is, instead of providing avenues for the farmer to add more money to his savings, we are drastically increasing his financial burden. Until recently, if he earns Rs. 10 / Day, his expenses were nearly Rs. 8 and at least on an average, he would save Rs. 2. But, with micro-financing coming in, now he need not run behind banks for a loan. Loans from these institutions come a bit conveniently and add up to his burden. As his loans are increasing, his savings are coming down (Micro-financing institutions also have their eligibility criteria which take care of over-burdening too)

Moving away from Farming
Today, there are many farmers who are selling their land and moving to towns nearby for more money. If on an average, a farmer earns Rs. 40 per day from the crop he has brought up, today, he is working as a daily wage laborer for around Rs. 60. He is looking at the Rs. 20 which he earns more than his usual earning which comes only after he sells the crop, but he is not looking at what he is loosing. If this continues to grow, then one day we will definitely be short of food grains to eat and this would impact one and all.

So, what can be done different to help?
We would need to educate and help rural citizens to realize what they can do and provide a helping hand for the work they would do. We need to tune them to help themselves instead of showing them the colours of easy money. This would have a deep impact on them as an individual and also help strengthen the economy.

Government should only do Governance!
An interesting and very simple thought. We have Government to streamline various activities and provide support to public needs. However, today, Government is getting into various activities and diluting the main cause of its existence. If the Government can concentrate on streamlining funds, providing support to its public by strategic investments, it would help benefit the society.

Education
When China decided to concentrate on providing education for all, it had a very good foresight. During that time, they ensured that every citizen of their country is educated which would over a period of time ensure 100% employment which would strengthen their economy.

Today, in India we have a good education system in place - Right from the Government Primary Education centers to pursuing high degrees. However, there are challenges which are obstructing the quality of education. As an example, today, for 4 teachers appointed in schools at the Primary Education Centers, only 2 are available.


Spend Time in Villages
Today, we have quite-a-few people who live in towns/cities who are showing interest in contributing to provide support to the rural poor. The best way to solve or address rural problems is to understand the actual life of people in villages. We need to spend time with them in person to understand the problem and provide required support.

Note: Thoughts and views mentioned above are purely of my choice. There is no correlation to any activities which happen today or any organizations which participate in any of the above mentioned activities.

Rural BPO

I was reading about this organization in the recent issue of Business Today (India's Most Wired, 22 April, 2007) and have been quite impressed with the young lady's initiative.

Ms.Saloni malhotra, a 25 year old graduate from Bharateeya Vidyapeeth, Pune is inspired by Dr.Ashok Jhunjhunwala's speeches. Her mission is to "turn rural internet centers into BPO's".

DesiCrew.In, based in Chennai, acts as a mediator between the client and the far end BPO. The internet center in a Rural area acts as a BPO. The work is channalised to the Rural BPO through DesiCrew. The BPO is not more than a 3 computer center with Internet and Network. The employed are people living in the area with minimum education/knowledge in English/language which is required to get the work done (Its not that simple, DesiCrew has a rigourous selection criteria) . Kinds of work includes - Data entry, Digitisation of records for Government, proof reading of books and little of CAD work. These BPO's have delivered work for around 20 clients till date (this is just few months old organisation). Work pricing ranges from Rs.20,000 (~$480) to Rs.3,00,000 (~$7,186) and this in return earns around Rs.8,000 ($192) to Rs.12,000 ($287) per month which is quite impressive to begin with. Current strength of the organization is around 60 and Ms.Saloni anticipates that this would grow to around 200 people this year.

This is a very small beginning and DesiCrew wants to build the world's best network of service providers.

Visit the website and it has upto the point information available. The site is very simple, yet elegent. Now, this is what I call SocialEntrepreneurship.

Excellent job...

YHIS

The Yeshaswini Health Insurance Scheme (YHIS) is a unique initiative by Government of Karnataka, India. Under this scheme, HealthCare services are provided to farmers at an Insurance premium of Rs.10 per month.

This article in HealthCare Management outlines the program - http://www.expresshealthcaremgmt.com/200601/focus01.shtml

The following paper provides in-depth information on the same - http://www.isec.ac.in/Karnataka_Kuruvilla16.5.05_aligned.pdf