By Raina Assainar
Dreams and ambition is what keeps us all going. We all dream of something big or small we want to achieve. Incase of a cycle rickshaw puller, one of his dreams is to have ‘Apna Rickshaw’- his very own rickshaw. And helping thousands of richskaw pullers turn this dream into reality was the vision of Naveen Krishna, who started up SMV Wheels.
Based in Varanasi, SMV Wheels is a social enterprise that serves cycle rickshaw drivers in India. The company sells cycle rickshaws to poor rickshaw drivers on a deferred payment basis so that they can make manageable weekly payments over approximately a one year period. By the end of this period, the drivers have full ownership of their own licensed rickshaw. In addition, by making the weekly payments, the drivers are able to establish a credit history which can prove beneficial if they seek any loan in the future and would be relevant to help improve their financial inclusion. Alongwith this, the company also provides insurance for the driver’s life, disability, rickshaw theft, and accident cover. They also assist them in procuring driving and vehicle licenses as required by government bodies.
Naveen is the founder and MD of SMV Wheels and has a Master’s degree in social work from Banaras Hindu University. He had worked closely with auto rickshaw pullers before starting up his venture and was previously working for the Ministry of Urban Development’s funding arm, CAPART, where he was working with the Centre for Rural Development and was involved as the national coordinator for the Rickshaw Bank project. He assisted the expansion of the Rickshaw Bank in Tripura, Tamil Nadu and Gujarat as well as set up branch offices. During his tenure he facilitated ownership of 1,200 rickshaws in Assam and assisted in the expansion of the rickshaw project in the cities of Lucknow, Allahabad, and Varanasi. It was during this stint with the Rickshaw Bank that he got the idea of starting up on his own. “I saw that rickshaw distribution could be a sustainable business activity which would help drive demand of sales. Instead of pushing new rickshaws into the market through an NGO model. Improving flaws of the existing distribution as well as helping increase the dignity for drivers that came from helping them buy their own vehicle without any charity was my idea,” explains Naveen.
SMV Wheels was established in April 2010 and sold its first rickshaw in November same year. Naveen’s passion for the rickshaw driving community and belief in the model won him the support of international investors. In the year 2011, Naveen led SMV Wheels to win the Sankalp Award, and the First Light Village Capital award. The venture also became a finalist for the Unreasonable Institute and secured $300,000 in convertible debenture funding. The funds were utilized for expanding the company, which setup its first branch in Jaunpur. He has recently taken steps to internalize the supply chain to ensure quality and reduce unwanted expenses.
According to Naveen, providing rickshaws to poor people is not a new concept, but the SMV Wheels approach to rickshaw distribution as a ‘for profit’ company makes it attractive to impact investors who can inject large amounts of capital. The business activity is sustainable as it recycles capital, and the rickshaw drivers get greater confidence as they see their hard-earned money being used to buy a rickshaw on their terms, and makes them free from charity. “SMV Wheels sells a relationship with rickshaw drivers, that has the additional benefits of a livelihood asset, insurance, and legal operation. Our clients can do business in a way that brings them confidence and respect,” says Naveen.
The company makes its money by selling cycle rickshaws at a small markup above the actual price. They also sell advertising space on the back of the rickshaws, which is also shared with the autodriver. SMV Wheels purchases the rickshaw, insurance, and licenses for Rs. 11,500, which includes administrative costs for KYC compliance checks, weekly home visits by field staff, and any other overheads. The clients then make manageable weekly payment, which allows them to obtain full ownership of the vehicle in approximately a year.
SMV Wheels currently has 15 employees working in Varanasi and Jaunpur and has plans to hire three more for a branch in Jharkhand. There are approximately 1,200 SMV Wheels rickshaws on the road and 150 outright owners. “We plan to benefit atleast 20% of the estimated 10 million cycle rickshaw drivers in the coming decade,” says Naveen. The venture recently tied-up with Government of UP to introducing solar rickshaws and have successfully trained 50 solar rickshaw drivers. Naveen also has plans to start his own production unit within five to keep up with the increasing demand of its our services.
While today SMV Wheels is a successful venture, it was not easy in the starting up phase. “Starting phase of SMV Wheels was a tough journey for us. Reaching out to impact investors from Varanasi was a big issue, as we are not city based in, like Delhi or Mumbai. It took atleast 1000 elevator pitches, more than 500 power point presentations in Mumbai and Delhi and a year-and-half to raise the commercial capital,” recollects Naveen. He did all this while travelling in crowded trains and surviving on roadside meals, not to mention the severe social and domestic challenges that came while starting out. But today Naveen looks back at all those travails with much satisfaction, as his venture has not only succeeding in making him a successful entrepreneur, but has also made a difference to the lives of many rickshaw drivers.
[This column is sponsored by Bihar Innovation Forum– one of a kind platform that aims to identify, celebrate and scale up rural livelihood innovations]