ISB plans big for social ventures

This is an article published in The Economic Times on 30 Aug 2007.

Social entrepreneurship is the latest buzzword on business school campuses world over. Top institutes like Harvard Business School, Stanford-GSB, Oxford University's Said Business School and New York University's Stern School of Business are sharpening their focus on ventures that make a difference to societies and communities. And now the Hyderabad-based Indian School of Business (ISB) is all set to spawn entrepreneurs to address that segment of the population.

The school has just signed an MoU with Cornell University to set up a BOP (Bottom of the Pyramid) Lab within the precincts of ISB's Wadhwani Centre for Entrepreneurship. From Cornell's side the centre is being handled by Stuart Hart, the person credited with generating the idea of BOP along with C K Prahalad. The Wadhwani Centre has already incubated several business ventures since its inception in 2001. But with the BOP Lab ISB wants to set its sights on problems faced by a developing country.

Says ISB deputy dean Ajit Rangnekar, "People usually view problems from the point of view of charity but that is not sustainable in the long run. We want to support ventures that meet social objectives and are also self-sustaining.'' What this means is simple: solve a problem and also generate revenues that can be ploughed back into the business.

Take the Jaipur Foot, which is a great concept but there are limits to how far it can go based on its current business model. "As demand for the Jaipur Foot rises, it needs more donors. A better idea would be to take the Jaipur Foot abroad,'' says Rangnekar, whose school has worked on a plan to create a company to expand the footprint of the Jaipur Foot.

The idea of the BOP Lab is simple: take up issues that concern rural India--such as drinking water, clean energy and housing--and set up companies that solve them. "We have already got an enthusiastic response from companies to contribute capital to fund these ventures. But we'll manage the funds ourselves,'' says Rangnekar.

ISB has approached global and Indian firms to generate initial funding for the centre. It needs at least Rs 1-2 crore. They plan to announce the funding by September-October. "In three years, we aim to make the centre self-sustaining,'' says Rangnekar.