Emerging Entrepreneurs

Villgro: nurturing social enterprises

N Ramakrishnan | Updated on January 23, 2018 Published on October 19, 2015

BL20_Startups.jpg

Provides incubation services such as mentoring, talent acquisition and investor network

It started off as Rural Innovations Network (RIN) in 2001, but within a few years was re-branded as Villgro. As RIN, the focus was on making grassroot enterprises commercially viable. In the new avatar, as Villgro, the focus is on incubating innovations and enterprises with a potential for large-scale growth and social impact.

Paul Basil, who started Villgro and who runs it as its CEO, says Villgro focuses on health, education, agriculture and energy, as these are the broad areas with enormous scope for problem-solving solutions. “While we provide seed funding up to ₹65 lakh, Villgro also provides intensive incubation services like mentoring, talent acquisition and investor network,” says Basil.

Villgro is based at the IIT-Madras Research Park and it can incubate around 15 companies at any given time. It does not have a limit on the number of start-ups it admits every year. There is a continuous process of scouting around, evaluating and having companies join its portfolio. In a financial year, five to six companies join Villgro’s portfolio, according to Basil.

The ventures admitted for incubation spend between one and three years and a few up to five years. “Our companies are located all over India, so only a few Chennai-based ones have worked out of the physical space,” says Basil.

While evaluating a venture for incubation, Villgro looks closely at: the entrepreneur and the founding team – their background, skills, qualification and passion; the innovation – the product or service being sold, how is it innovative and how can it create more impact; social impact – is the product or service going to help the poor or marginalised communities directly or indirectly, how will it work and what is the goal; business feasibility – who are the customers, what is the revenue stream, is it a strong business model; and, scalability – does it have the potential to grow and can it be replicated in different locations.

Villgro has on board more than a dozen mentors with diverse background who help out the ventures. They include Amitava Ghosh, Economist and Investment banker; K Ravishankar, a finance professional; KL Mukesh, who founded a healthcare start-up; and Rama Kannan, a director on the board of Beyond Capital Fund, which invests in social enterprises.

The investors that are on board are Ankur Capital, Unitus Seed Fund, Acumen Fund, Grassroots Business Fund, Accion, Aavishkar, Upalya Social Ventures and Beyond Capital Fund.

Offers seed funding

According to Basil, Villgro provides seed funding of up to ₹65 lakh in the form of grants and equity. It gets money for this from various donors and CSR foundations. Its donors include The Lemelson Foundation, Michael and Susan Dell Foundation, Artha, Biotechnology Industry Research Association Council, Mahindra Finance, Marico Innovation Foundation and Aspen Network of Development Entrepreneurs.

Some of the start-ups that have been incubated by Villgro and that have made it big are Uniphore, Skymet, Biosense and Promethean Power.

According to Basil, thanks to the buzz around start-ups and entrepreneurship more people have taken to entrepreneurship and there has been a proportionate spillover into the social enterprise space.

There is a lot of interest and innovation happening in the social enterprise space, but the challenge is in making these ventures sustainable and commercially viable. It takes a longer time for social enterprises to show profits when compared to other start-ups.

“That is the stage we are in now, where we are seeing a lot of idea-stage and early-stage businesses but are a couple of years away from scale,” says Basil.

Published on October 19, 2015
This article is closed for comments.
Please Email the Editor