How addressing these 4 areas can help social enterprises scale up

27th Apr 2016
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The growth of India’s spirited social innovation ecosystem in the last decade or so has been nothing short of inspiring. Entrepreneurs—first-timers and veterans—are starting initiatives to tackle social and environmental missions, with profit not necessarily being the prime focus. The positive transformation that many players are accomplishing in the social landscape is an evidence of the vital space they hold in the economy, today.

Aravind Eye Care System, which has carved itself the place of the world’s largest eye-care provider, has treated two-thirds of its over 20 million patients in the last three decades for free. Or the more recent d.light’s solar solutions, which has empowered nearly 58 million lives, too is a clear indicator that social innovation systems with the right approach are capable of large-scale, sustainable impact. However, social organisations are always exploring mechanisms for spreading their impact, to become economically sustainable, form a team that has the mind of a ‘corporate’ and heart of a ‘social’ among many other emerging needs.

Thus, as discussed during the recent Sankalp Forum 2016’s session ‘Building partnerships for last mile delivery’, it becomes critical to identify the many needs of social innovation organisations as well as address synergies amongst different stakeholders such as the government, financial institutions and donors. Drawing out from the experience of multiple stakeholders, here are a few pressing ones that emerged –

Sharing knowledge- According to a World Bank representative,

Learning happens on a continuous basis across organisations. But what doesn’t really happen is cross-learning, which is critical for capacity-building.

The organisation claims to have mapped over 6,000 social business models and has been witness to innumerable similarities, in terms of strategies, successes and failures that cross-learning can help embrace or avoid, and accelerate scale in a timely and effective fashion. Towards the same, an e-learning platform is being built, which will basically be a repository of everything that’s needed to be a social entrepreneur in India.

 Building and maintaining the right partnerships – According to Revati Deshmukh, Manager-Development of Educate Girls, a Rajasthan-based non-profit that has grown from 500 schools to 8,000 schools in less than a decade tackling gender inequity,

Building and thriving on the right partnerships is paramount to scale. In our case, we complement the government and not override it and working in tandem with them has helped both partners – we have managed to foray into some of the most backward districts and carry out our programmes with ease, whereas the government has adopted many of our best practices such as our activity-based and life-skills curriculum into their models.

On the other hand, in the non-government space, Educate Girls has also collaborated with organisations such as Pratham, Dasra and UNICEF, including their practices into the programme.

The second important partnership Revati mentions is,

involving the community members, developing and continually building their capacities so they drive the cause.

Educate Girls empowers village communities through community volunteers and school management committees to improve the overall quality of girl child education.

Finally, a third partnership that needs to be looked in the right spirit are, “the donors – often, the relationship with a donor is restricted to funds, but social organisation need to look at donors from capacity-building perspective as well.”

Involvement of the private sector – It’s well-established that a social enterprise can sustain only if there’s a business model and it can scale only if there are defined processes that can be replicated across multiple, diverse contexts. With the current Companies Act 2013, which mandates a company ‘having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more’ will contribute two per cent of its profits towards social activities, companies are on the lookout for path breaking solutions to adopt. A good example of this is the Defence Research and Development Organisation’s (DRDO) Biodigester toilets, the technology of which breaks down human excreta into water and gas through anaerobic process. The solution has been adopted by more than 70 leading industries as well as the Indian Railways which, in 2012, signed an agreement with DRDO to build these toilets in 50,000 coaches over five years. Thus, the private sector too can play a significant role in scaling the social impact.

Financing models – Currently, the financial market for social enterprises has limited options i.e., debt or equity, which is often challenging. There is an urgent need to diversify and include a bouquet of financing options such as quasi-equity and venture loans models as well. These options can aid when others are too onerous for social enterprises.

There isn’t a better time for a social entrepreneur in India. And with multiple players showing promise of collaboration and introducing newer mechanisms, scale and impact can’t be far away.


Read More:

Sustainability and scaling up – Is it possible?

Hybrid value chains: how to blend social entrepreneurship with business scale

Collaborative networks: how to successfully tap platforms, marketplaces and peer communities

Four lenses of innovation: how entrepreneurs can get creative insights for business success

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