“Is 91springboard’s focus social enterprises? I never knew it!”
Well below is how we think. Have picked a few sentences we hear in the ‘Impact’ circles and put our thoughts next to it. And yes, we are fine being the odd ones.
- “Impact should be more important (or at least as important) as profits”
I feel this is b*#* s*#. The entrepreneur should keep a single-minded focus on profits, scale, processes, innovation and long term sustainability. We simply go around looking for such entrepreneurs. When they happen to be in a field where they also have ‘impact’, we label them as social enterprises. It ensures we are able to find the relevant investors (read philanthropies, impact funds etc) & supporters for them. But Mr Entrepreneur – you focus in profits & scale & sustainability; We will figure out if you fit the impact bucket or not. Leave that to us.
If impact is your first and foremost priority, then we believe you will not be able to be profitable ever…and…then you better be an NGO.
There is this nice HBS article by Robert Simons (Capitalism & Society) which delves into this debate too.
- “As an Impact fund we are fine taking a lower return if the enterprise is creating ossum social impact”
Well, no prizes for guessing that we think this is b*#* s*# too. Why? ‘Cause it is not like the profit hungry non-impact funds are laughing all the way to bank right now. It is no secret that most of the VCs funds in India are yet to see the happy returns at the portfolio level. Now if you are willing to be lower than them – then you might as well be a charity.
We will work with the best entrepreneurs. Help them make the best companies. And help them create massive returns for us and for themselves. And many of these enterprises will be impact enterprises too.
- “Impact means focusing on the Bottom of the Pyramid / Below Poverty Line. 1 Rs shampoo pouches ensured even poor can access those.”
Selling to poor is not impact! Maybe providing utility stuff (solar lamps for eg) at reasonable price is…but I am not sure if I will call providing shampoo as an impact or not. We feel impact has a trickle-down effect. A business in a village employing 100 villagers will have a massive impact too. Possibly more impact compared to, say…someone providing a solar cell to two farmers. Frankly, we don’t feel impact can be compared like this – but inserted the previous line to just highlight a point.
So how do we define social impact? First, we try to avoid. Then, if forced to, we use the broad definitions (Health, Education, Livelihood, Agriculture….) to begin with, and fine tune it from startup to startup.