Funding a Social Venture – Thinking it ThroughTeam YS
By Jacob Chandy VargheseI am given to understand that India has perhaps the highest number of registered NGOs. Now while on one side it is good to see that there is a high focus in India towards development in the social sector, it also would make an individual or an organization who would like to fund socially relevant ventures even more cautious. Many of these philanthropists and organizations are keen on taking best steps to ensure that they are funding a venture that will last. The decision making becomes even tougher when there are no parameters such as revenue, past history of success of the founders in the social sector etc. Seeing this need among many, there is a 7-category evaluation questionnaire which I have prepared, a part or whole of which would be useful not just for the funding agencies, but also as an introspective checklist for the founders of the venture as well.
[Note]: The word ‘community’ is used to refer to the target group for which the venture is created.
1. Relevance of the venture as a social project
What is the defined community which will find this venture beneficial?
Does the community really need this, or is it just a fancy dream of the proposer of the venture which is not connected to reality?
How large is the reach of the service offered by the venture to the community?
Are there job creation opportunities?
What are the opportunities of involvement by members of the target community?
2. Sustainability of the venture
What are the various eco-system partnerships possible for this venture?
What is the long term relevance of this venture? How long is ‘long’?
What are the possible expansions possible with this venture? What are the potential future mergers & acquisitions possible?
What are the various motivations and rewards for the various stakeholders of this venture? How does that help sustainability?
What are the cross-application, cross-geography possibilities?
3. Current competition
What is the current alternative that the community has, in the absence of the proposed venture? Why then do we need something new?
Are there any for-profit players in this sector addressing the needs projected by the venture?
Has any partnership been explored with the for-profit players?
4. Innovation of the idea
Is there any innovation in any of the aspects of the venture, like frugal innovation, optimization of resources etc.?
Is there any reuse of an idea or a pattern which has been successful either in the for-profit or non-profit world?
Is there a smart use of an existing technology model which can be optimized for this venture?
5. Passion of the founders
What is the background and motivation for the social passion of the founders?
What is the strength of the social passion in terms of getting it to last long enough till the rubber meets the road?
6. Marketing / Branding Strategy for the venture
How are the founders of the venture proposing to market this service as something beneficial for the community?
Are there existing channels or ecosystems they can partner with for marketing or branding?
7. Project Execution Plan
Is there an execution model in place, with the right set of starting processes?
What is the readiness of the plan for execution?
Are the right resources, both human and capital, available within the required funding?
Are the right dashboard metrics listed to track progress and success?
While the categories and questions are not fool-proof, they can still help the founders and the funding agencies to think through the various aspects and even work together on having a mature and sustainable plan in place. Once that is done, further actions related to goals and metrics definition, as well as detailed project execution plan can be laid out and tracked. With the plethora of NGOs and organizations, it is very important that one more venture does not get started as a duplicate effort, just to increase a mushrooming nature in this sector. These questions also have a ‘social’ bent to them, in planting a mind of collaboration with other ecosystem players, and eliminating projects which have vested interests of the founders in mind.
I take lessons in western classical vocals, and one of the things we are always told is that before we start to sing, our mouth and throat should be positioned for the best resonance at the highest pitch. If we then start singing, even the lower notes will sound good, and the whole song will be a good experience for the singer as well as the listener. I believe the same principle of preparedness apply in the area of starting a social venture too, where the readiness for the various stages of the project can be thought through right in the beginning. The whole approach of questions will make the thought process much clearer before getting started on the venture, yet not introduce high lead-delays in getting started. This will also reduce the probability of failure for reasons which could have been thought upfront.