‘A lot more doors open up when you are running a social business’ – Suresh Krishna on how Yunus Social Business Fund boosts social entrepreneurship


Suresh Krishna, Co-founder of Yunus Social Business (YSB) Fund Bengaluru, speaks on the idea behind the fund, its targets, and notable trends in the space of social enterprise.

Suresh Krishna, Priya Shah, Saloni Mittal: YSB Fund

Suresh Krishna is the Co-founder and CEO of Yunus Social Business Fund Bengaluru and Co-founder and Partner of Yunus Social Business India Initiatives. He was previously Managing Director at Grameen Koota, and co-founded the microfinance industry associations, namely Microfinance Institutions Network and Association of Karnataka Microfinance Institutions.

He has also co-founded Grameen Affordable Shelters, and is the Managing Trustee of Navya Disha Trust. Suresh serves on the board of BinaArtha (MFI in Indonesia), Mifos.org (open source core banking software for financial services) and SAS Health Care.

In this interview, Suresh talks about the mission of YSB fund, invested social businesses, and emerging opportunities for social innovators in India. See also our review of the book A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions by Muhammad Yunus, and coverage of the Impact Investment Conclave, Acumen, and impact investors.

YourStory: What was the vision behind setting up the YSB Fund, and what are some of the targets?

Suresh Krishna: YSB Fund Bengaluru is a social business fund set up to provide patient capital in the form of long-term debt or equity to early stage social businesses across multiple sectors: education, healthcare, livelihoods, clean energy, agriculture, water, and sanitation.

We are part of a global network of YSB Funds, which have been established in Uganda, Kenya, Brazil and Colombia, and with a head office in Berlin, Germany. YSB Global was co-founded in 2011 by Nobel Laureate Professor Muhammad Yunus, with a mission to turn donations into investments for sustainable social businesses worldwide.

A social business is a company with a social mission at its core, set up to solve a specific social problem for people from low income households. A social business aims to be financially self-sustaining and reinvests profits made back into achieving its objectives. A social business is a business that either creates income for people at the Bottom of the Pyramid (BoP) or provides them with essential products and services.

YS: What is your assessment of the social impact sector in India? 

SK: We are excited about all the sectors that we invest in the Indian market. There are some particularly interesting innovations in the early education and skilling sectors in which we plan to have a larger footprint.

In terms of skilling, the issue of under-employment is a large one in India: there are 12 million under-employed youth in India at present who should be eligible for skilling across all sectors. It is inspiring to see the government focus on this sector and private companies establishing skilling centres and using cutting-edge technology to scale.

YS: Who are some contributors to the Fund, and what are their expectations?

SK: The major capital contributor into this fund is TMT Community Trust, a public charitable Trust along with Vinatha Reddy and myself. The idea to support more social businesses was seeded with the inspiration of Prof Yunus’ work in microfinance and social business.

The origins of the objectives to solve social problems with sustainable business solutions began when running the MFI Grameen Koota. In 2015, discussions began with Professor Muhammad Yunus on how to support social businesses in India. Subsequently, upon exiting Grameen Koota, YSB Fund Bengaluru Private Limited was started with an initial investment of $2.5 million in 2016.

This now forms the corpus of the YSB Fund Bengaluru's NBFC. The underlying thesis of investing in early stage debt into social businesses is quite a unique and niche idea in the Indian impact space, given that most impact funds in India are focused on equity.


YS: How does the YSB India fund connect with or complement similar funds for other countries?

SK: The YSB Fund Bengaluru takes all the best practices and lessons learned from the YSB global network of funds across East Africa and Latin America, and applies them to the selection of social businesses, investment criteria, and portfolio management in the Indian context.

YS: What would you say are the key opportunities for social entrepreneurs in India?

SK: To develop social businesses that have both the ability to create large impact and be financially self-sustaining.

YS: What are the key challenges facing social entrepreneurs in India, and how are you bridging this gap?

SK: Access to the right type of patient financing is always a challenge – whether it is equity, debt or grant funding. In addition, for early stage companies, finding the right talent, especially when you are at an inflexion point to scale, is also a challenge. As part of our post-investment management, we identify the most critical gaps and provide support by accessing our networks and global expertise.

YS: What non-financial support would YSB give its funded startups?

SK: Our Grameen family of companies has decades of experience in building social businesses globally, and YSB taps into these vast resources to support our portfolio. We offer strategic guidance, operational advice, as well as industry connects within the relevant sector but also the wider Grameen network.

We also connect them to similar social businesses in the YSB portfolio but situated in other markets: Colombia, Brazil, Uganda and Kenya. We help our companies source the right kind of talent, offer product management support, and general capacity-building.

YS: Will you be investing in NGOs as well, or only social enterprises?

SK: No, we only invest in social businesses that have a clear goal towards financial sustainability. However, if the NGO is running a sustainable social business, we can consider supporting them.

Ignis Careers

YS: Are you using a cohort-based model to select applicants?

SK: No, we select applicants based on active sourcing, through referrals, and applications received. We have also developed sector landscapes, which allow us to pinpoint which sub-sectors will be most interesting and impactful for us to invest in.

YS: What are the selection criteria for applicants? 

SK: We invest in post-revenue companies, not the pilot or proof-of-concept stage. We are ideally looking for companies that have a social mission, impacting Base of the Pyramid populations and consistent with Prof Muhammad Yunus’ philosophy of social business.

They should also be financially sustainable, with a topline revenue of at least Rs 1 crore annually, as well as potential to be game-changing and achieve scale.

YS: What is the profile of some of the initial investees?

SK: We have invested in three social businesses since we launched operations in 2017.

Cashpor Microcredit is in the business of financial inclusion, providing formalised access to credit to BoP women. Cashpor has adapted the Grameen Bank, Bangladesh, model of joint liability group lending in Eastern UP, Bihar, Jharkhand, Chhattisgarh, and Madhya Pradesh.

Waste Ventures India is helping 1,500+ waste pickers in the city of Hyderabad lead a dignified life by providing opportunities to increase their income and provide better working conditions while simultaneously driving waste away from landfills.

Ignis Careers runs English language and life skills programmes for affordable private schools using tool-based teacher training and class participatory activities, promoting purposeful education and joyful learning. Ignis has worked with over 300 schools in Andhra Pradesh and Telangana, and uniquely builds teacher capacity in these schools.

YS: How will you be measuring the impact and success of funded organisations?

SK: For us, the most important thing is to be aligned with the entrepreneur’s vision, which we do during the diligence phase. We work with Professor Yunus' philosophy of social business, combined with an impact-first approach to investing. A mission-alignment is very important from the beginning, as well as the focus on the BoP segment (those customers / producers living at below $5/day).

In terms of regular social KPI monitoring, we develop monthly reporting with our portfolio companies which measure the “breadth of impact” delivered during the operating activities of the business, such as number of waste pickers reached, number of students taught, number of teachers trained.

During the diligence phase, we also look at “depth of impact” by utilising a theory of change to understand what would be the long-term impact of the good or service produced by the social business on quality of life, economic productivity, and income earned.

YS: What are your recommendations for policymakers to speed up social innovation in India?

SK: There is potential for more regulatory structures that can support social businesses and encourage their development, such as the channeling of CSR funds towards these social business structures.

Waste Ventures

YS: What are some notable trends in the space of social enterprise?

SK: An interesting new innovation in the social impact space is results-based financing, typically characterised as Development Impact Bonds or Social Impact Bonds, which have been launched by other players in India. YSB has, in fact, developed something similar in Uganda, called a Social Success Note (SSN), with a company called Impact Water, which provides clean drinking water to schools in Uganda.

In this first pilot of the SSN model, the social business benefits from funding that will not be only pressure for financial performance, but also provide support to reach pre-agreed social objectives. This allows the entrepreneur to balance financial sustainability and social impact. More information is available online.

YS: What are your words of advice for aspiring entrepreneurs?

SK: A lot more doors open up when you are running a social business because you start thinking differently. You start to think creatively, and to become financially sustainable while addressing a social problem at the same time.

Through social business, we can stand out and we have an opportunity to prove something to the world, which doesn’t always happen in purely commercial businesses. As Professor Yunus says: “Making money is happiness. And that's a great incentive. Making other people happy is super-happiness”.


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