Villgro adopts a multi-pronged approach to help social entrepreneurs scale up

S. MEERA

Since independence, government schemes, NGOs and philanthropists have been attempting unsuccessfully to address the social evils that have been increasing the gap between the haves and the have-nots. While lack of innovation plagues the public sector schemes, NGOs lack the required funding and philanthropists seem unable to make a large-scale impact.

Chennai-based Villgro was started in 2001 to address these limitations and support social ventures with a profit model to make them self-sustaining even while making a change. It also believes that entrepreneurs who come from the grassroots would have a better understanding of the problems in their environment and, therefore, address it better. “By 2006-07, we had supported 55 entrepreneurs,” recollects PR Ganapathy, but realised that though the ventures addressed certain problem areas, they were not game-changing ideas and did not have a far-reaching impact. The funding amount was also less, further restricting the growth potential.

Therefore, in 2007, the company changed its model and decided to support ideas that could scale up, and also increase the funding amounts. The first venture they funded, a rural BPO – Desicrew Solutions, which is profitable, has a large-scale impact and has a growth trajectory. Currently, the entrepreneurs Villgro backs are those with a willingness to take the risk. “The quality of entrepreneurs has also improved and solutions being offered range from medical technology to energy solutions, education and agricultural implements,” states Ganapathy.

In its Entrepreneur-in-Residence (EIR) program, Villgro incubates ventures by providing them office space, funding and mentoring by experienced professionals for a year so that the social venture can have a sound financial, operational and customer centric focus.

The Multi-pronged Approach

The flagship program of Villgro is incubation where up to Rs 60 lakh of funding is provided. In addition, mentoring is intense as the experience of this funding venture is that though the social entrepreneurs are well educated, they lack experience. Mentoring helps them come up to speed and avoid pitfalls.

SEED (Social Entrepreneur and Enterprise Development), Villgro’s eight-month program, helps those entrepreneurs who may have a good idea but have not thought through completely. SEED helps them develop a feasible business model, tighten their operational plans and get them started on developing a scalable model.

Through inspirational talks, Villgro tries to reach out to people who have ideas but are hesitant to take the plunge. These talks by successful entrepreneurs help those sitting on the fence to take the plunge, and seek Villgro for further support, if they need it.

In its Entrepreneur-in-Residence (EIR) program, Villgro incubates ventures by providing them office space, funding and mentoring through experienced professionals for a year so that the social venture can have a sound financial, operational and customer centric focus.

Unconvention is an important event organised by Villgro in 15 cities in a year to trigger ideas and inspire people who have not given social venture a thought. An annual event is conducted in New Delhi in April.

Fellowship program is for those who want to be in the social space but do not know what to do. They could be employed elsewhere. Villgro provides them with one year of Fellowship to work with a social venture, giving them the opportunity to explore and understand this segment while addressing a need of the venture these professionals can fulfil. Many a times, these professionals extend their stay and switch careers.

Documenting and knowledge sharing is the other important area Villgro focuses on to help people working in this space with or without Villgro.

The selection criteria for deserving beneficiaries of funding from Villgro is very methodical and specific. Detailed feedback is given to all entrepreneurs so that those who do not meet the criteria can revise and revisit their plans before approaching any social venture-financing firm.

Touching lives

The venture has seen dramatic growth in the last one year in terms of portfolio and programs. From 8-10 companies they worked with last year, it has grown to 29 and is expected to touch 150-200 ventures in the next five years, some of them in the poorest states.

The Villgro team has expanded too, from 10 (some of them part time) in the beginning to 20 this year and is expected to touch 30 next year. “The calibre of our employees has also expanded and we have people with relevant experience having worked in the social sector leading our efforts,” says Ganapathy.

TiE members have been forthcoming in mentoring Villgro incubates. The government of India uses ventures like Villgro to disburse funds to support ventures in the social space. The company has been funded to the tune of Rs 12 crore this year as against Rs 6-7 crore last year. Apart from the government, Villgro has also been receiving grants from social funds such as Aavishkar, The Rockefeller Foundation, the Lemelson Foundation and Technology Development Board – Government of India. Through its partnership with The Global Social Benefit Incubator (GSBI) network, Santa Clara, there is mutual knowledge sharing.

Villgro has touched over five million people through the 94 ventures it has supported and created 4000 jobs. “But most importantly, we made it possible for the best minds to address social issues without compromising their lifestyle,” says Ganapathy. He feels enabling wealth creation while touching lives is the greatest contribution of the company.

Going forward, the company plans to intensify its present activities of solving the real pain of the people. It will use this experience to reach out globally and replicate the model.

Snapshot

Venture: Villgro

Focus: Funding and mentoring social ventures

Funds disbursed: Rs 12 crore (20013-14)

Concept in brief : 

Villgro was started in 2001 to support innovative business ideas to alleviate social problems. By 2006, realising that the existing ventures were localised with ideas that they could not scale or had no interest to scale, Villgro changed his business model to back ventures that had game-changing ideas and could make a larger impact. Today, the fund has supported 94 social ventures and extended fund to the tune of Rs 12 crores. But its greatest satisfaction is in being able to mentor the entrepreneurs who had no prior experience running a venture, to open up relevant networks to them and to enable wealth-generation even while addressing social issues.