Social business, impact investing and much more
It is now two weeks since I attended Sankalp, but I think I’m still reeling from spending two days in Mumbai with hundreds of social entrepreneurs, investors and companies pursuing inclusive business. To give you a flavour, have a look at this session that was taped for a TV show. Great fun, but also very serious in its intent.
Such was the range of activities, the fast-paced agenda and the many fascinating conversations that I enjoyed, I don’t really have one big learning to share. Here, then, are some of the things that have stayed with me the most since I left Mumbai, in no particular order!
Know the jargon: social business, I learned, is quickly generating it’s own jargon. As in any context, that is mostly because jargon is extremely useful at expressing complex ideas in short-hand to those that understand them! As a sample – ‘impact investing’, as facilitated, for example, GIIN– the Global Impact Investing Network, where there are also some very helpful definitions. Nearly every speaker referred at some point an ‘ecosystem.’ I quickly guessed that they weren’t all biologists, but that this was a very useful term to describe all the elements of a system required to promote and support (say) social business. See, for example, the section on impacting investing ecosystem on the Impact Investment Exchange Asia website (www.asiaiix.com). I should add that our own jargon ‘inclusive business’ was also making headway at Sankalp!
Scale, scale, scale: whilst the number of social entrepreneurs at Sankalp was an impressive reminder of the scale of this sector in India, what was on a lot of people’s lips was that going to scale for any one enterprise is a huge challenge, and that there is still a lack of examples across many sectors of enterprise solutions to poverty that have really got big. Maybe impact investing will provide an answer, but I suspect (don’t groan) that it is more than one element of the ecosystem that needs to change.
The exception that proved the rule? Thinking of inclusive business that is going to scale, the Vodafone mPesa product comes to mind. One the most interesting talks during the conference was by Nick Hughes, who co-founded mPesa. Nick reflected on some of the reasons why many of the other money transfer schemes that followed mPesa did not go to scale as mPesa did. He mentioned three factors in particular – different regulation regimes, companies trying to do too much too soon , and that fact that many phone operators are just so busy doing other things that the money transfer business don’t get enough attention. Nick also talked about the difficulty of getting business case together to get support within a big company, and how donor input such as that from the Business Innovation Facility can be so valuable. I’m also eager to learn more about his latest venture with Signal Point Partners, where he is innovating around everyday products which can be ‘seen’ by a mobile network and thereby allow pay-by-use payments. Nick signed off by suggesting that successful innovation is about knowing the market – and replicating what people are doing anyway but at lower cost and with higher utility.
Know your market Last, but not at all least, Manu George from Intellecap led a session on inclusive business that built on my understanding of the BOP market with some excellent analysis. She pointed out that BOP customers are far from a homogenous group, but that companies need to have a sophisticated understanding of the different segments and how to reach them.
So here’s to Sankalp– a great event, very stimulating and with lots of take home messages to reflect and build on. Highly recommended.