The/Nudge Institute
View Brand PublisherGAME’s Ravi Venkatesan decodes the power of mass entrepreneurship to drive India’s growth
Ravi Venkatesan is the founder of the Global Alliance for Mass Entrepreneurship (GAME), a platform for mission-aligned partners to learn, innovate and collaboratively build a self-sustaining mass entrepreneurship ecosystem. By identifying and scaling breakthroughs with partners, GAME is working towards building a movement for creating and sustaining 10 million job-creating ‘mass entrepreneurs’, half of whom will be women. GAME focuses on the “missing middle” of the entrepreneurship spectrum, those who typically employ 5-20 people and have been the engines of job growth in a majority of dynamic economies.
Ravi is also a UNICEF Special Representative for Young People and Innovation and the founder of Social Venture Partners India, a pan-India network of philanthropists and is a partner at impact investor Unitus Ventures.
As the former chairman of the Bank of Baroda, Co-Chairman of Infosys Ltd, Chairman of Microsoft India and Chairman of Cummins India, Ravi has led transformative and impactful initiatives. He also helped establish the Cummins College of Engineering, India’s first engineering college for women. He is the author of an acclaimed book Conquering the Chaos: Win in India, Win Everywhere, published by Harvard Business Review.
Today, Ravi has become synonymous with GAME’s efforts to catalyse a mass entrepreneurship movement in India. In an insightful interview with YourStory, Ravi details the challenges, opportunities and limitation of the contemporary entrepreneurial movement, and why there is need for entrepreneurship to expand its scope to truly become a mass movement.
YS: Do you think there is a marked difference between self-employment and entrepreneurship?
Most self-employment in India is a disguised form of unemployment. People get into it because it is driven by necessity, as opposed to opportunity. That’s why we see most self-employed businesses failing to grow or innovate. Today, in India, the term ‘entrepreneurship’ is often only used for the tech-enabled businesses that are built on innovation at the core and are driven by the ambition to become unicorns. However, people who really drive India’s growth are the millions of entrepreneurs driving businesses that serve the most basic needs of people and are productive and capable of growing at the same time. That’s why at GAME we are working towards creating 10 million entrepreneurs - 50 percent of them women - to generate 50 million jobs by 2030. Anything less, we will not be able to drive the impact that we need.
YS: Where does India stand today with regard to entrepreneurship?
If entrepreneurship is viewed solely from the lens of tech entrepreneurship, then India is doing reasonably well. We are the third-largest startup ecosystem in the world. We have a growing number of unicorns and the startups are also attracting a good amount of venture capital.
Compared to 10 years ago, we have made considerable progress and built excitement about entrepreneurship. But, it’s time to build further from these early successes. The challenge is that entrepreneurship as a phenomenon is concentrated largely in a few cities. The other challenge is that while these enterprises are important for wealth creation and for the economy, they're not creating enough jobs yet. That’s why the country needs millions of new enterprises. While these businesses may leverage technology, they need not necessarily be tech businesses. They could be addressing everyday needs of the people, but with a presence across smaller cities and towns. We need to make entrepreneurship much more mass and widespread.
YS: To address the current economic crisis and thereby the uncertainties associated with employment especially among economically and socially vulnerable communities, do you see entrepreneurship as the only solution?
There's no such thing as the ‘only solution’, but I think promoting entrepreneurship is a hugely important part of the solution. Today, we have seen that small businesses have been disproportionately impacted by the current economic crisis accelerated by the onset of the pandemic And, the reason why this is particularly true in India is because 90 percent of these businesses are non-formal businesses. They are not a registered entity. They don't have a bank account, nor do they pay GST and much more. This means they cannot avail credit from the schemes that the government has announced. Interestingly, most of the amenities in the schemes are earmarked for companies that already have a loan facility that they were responsibly repaying until the pandemic hit. Today, nearly two-thirds of the SMEs have run out of cash. Most of them are now dipping into their personal savings. More than 10 percent of businesses have already shut shop permanently. My guess is that it will be closer to 30 to 40 percent by the time COVID-19 subsides. What we are staring at is a giant unemployment crisis. In March, surveys had already indicated that unemployment was at a 43-year high and now, we have another hundred million people who will be adding to the ranks of the unemployed. When you think about it, entrepreneurship is the biggest lever to address these challenges.
YS: Do we have the infrastructure and resources to support and facilitate mass entrepreneurship? If not, what will it take to make this possible?
The answer is yes and no. Today, with regard to infrastructure, we have physical connectivity - access to roads, energy, internet - in more than a million cities and towns. We also have adequate resources. But, we have never addressed the role of culture and values in entrepreneurship.
Take the example of Bengaluru, which has a thriving entrepreneurial culture. The city is open, cosmopolitan and has a belief that everybody is capable of doing something. People aspire to start their own business, and more importantly, there's a tolerance for failure. But, if you go to some of the other cities, you will see that caste hierarchy comes into play and acts as an inhibitor. The focus for most is on getting a job and anyone who wants to start a business is considered ‘crazy’. So, in addition to the infrastructure and resources, cultural attitudes play a foundational role in creating a favourable climate for entrepreneurship. And, the best way to shape this culture is to showcase the stories of successful entrepreneurs from that location because it inspires others and sends a message that ‘It is possible’.
In addition to the culture, the other key element that plays an important role in facilitating mass entrepreneurship is the ease of doing business. GAME released a report in June 2020 that highlighted the challenges faced by the SME sector. One of the key findings was that on an average, a factory has to adhere to 750+ compliance standards in a given year. Which means many just give up while many others don't even try. Unless we figure out how to make it easier to enable people to start and run a business, entrepreneurship is not going to flourish.
YS: Why is there a big opportunity to extend the reach of entrepreneurship in India?
A huge source of inspiration is the work of the Nobel Prize-winning economist Edmund Phelps. He has written two phenomenal books —Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change and The Dynamism of Nations: Toward a Theory of Indigenous Innovation. In these books, he explains why economies become extremely prosperous. If we think about Britain in the 18th century, America in the 19th century and America and China today, the reason they have flourished is that they have, accidentally or with intent, created conditions where the most ordinary person with no particular resources or education is able to tinker, invent, or pursue their ideas or start a business. And, when many of them start tinkering, inventing and starting businesses, some of them become really important and successful. That is why it is called mass flourishing. So, everything I do is influenced by this thinking and this body of evidence. In India, we have the great advantage of having a huge young population that is talented and has potential but is restless because there isn't enough economic opportunity.
YS: You will be speaking at The/Nudge Forum (global edition). Why do you think a platform like this is much more relevant today; and why do you think the average citizen must participate in these dialogues and conversations?
The most important thing about citizenship is that you should be aware of what is happening around you and your country. Today, we are seeing an extraordinarily positive development where people are plugging into webinars and online conferences on developmental issues. They are learning things they don’t know about. Some of them are beginning to delve further into it. After speaking at each one of the development forums and workshops, I get hundreds of expressions of interest on LinkedIn asking how they can contribute or become a part of the movement. This is phenomenal.
Unless we have active and informed citizens we are not going to get a functional democracy. I strongly believe the only thing that will drive change are engaged and thoughtful citizens.
The/Nudge Forum (global edition)
On August 15, Ravi will be speaking at The/Nudge Forum (global edition), a first-of-its-kind, 24- hour event that is bringing all stakeholders together for collective thought and action towards large-scale social change and thereby accelerating India’s development journey.
At The/Nudge Forum (global edition), Ravi will be speaking on why revitalising the economy in rural and tier-2/3 towns of India is a big priority for the country and the big opportunity to extend the reach of market-based economic empowerment beyond the urban centres. In the session, he will also discuss mass entrepreneurship, skill building, digital and financial inclusion as means to achieve this objective, and what it will take to improve access and linkages for market-based models across India.
While development is a shared agenda, there is a lack of active, sustained, shared spaces for dialogue. The/Nudge Forum (global edition) is aiming to address this gap by building a stronger foundational layer to support India’s development journey by bringing the ecosystem together.
Presented in partnership with The Rockefeller Foundation and the Skoll Foundation, The/Nudge Forum (global edition) will see diverse experts coming together to discuss India's development journey, the opportunities which lay ahead, and a blueprint for the way forward. Leaders speaking at The/Nudge Forum (global edition) include Prof. Abhijit Banerjee, Ford International Professor of Economics, Massachusetts Institute of Technology; Dr. Arvind Panagariya, former chairman NITI Aayog;
Dr. Gururaj "Desh" Deshpande, Founder, Deshpande Foundation; Prof. Hernando de Soto Polar, President, Institute for Liberty and Democracy; Reema Nanavaty (SEWA), and Madhav Chavan, Pratham Education Foundation.