A group of professionals is unlocking venture capital doors for small town entrepreneurs
The story of Aavishkaar is a fine example of sophisticated paying back by educated, affluent Indians spread all over the world. They realise it was India's knowledge-edge that leveraged them to good lives and so they have sought to widen that edge, by funding small town Indians whose innovations can increase productivities and wealth in the countryside. Aavishkaar itself is a notable innovation. It pioneers the idea of barefoot venture capitalism, so to speak. It bets on the Indian mind. Its experience so far has been that it's a safe bet.
An IIM caucus:
At the Indian Institute of Management at Ahmedabad [IIM-A] , Prof. Anil Gupta pioneered the idea of mining rural India for marketable innovations. He identified the knowledge and skills with India's poor as an untapped resource, thus unlocking a huge treasure which everyone suspected existed but no one had bothered to pursue. His work resulted in a vast and growing database of simpleton inventors. [You can read the full story of his work here]
Early 2000, when Prof. Gupta was visiting Singapore a few IIM-A alumnus met him informally. And the talk veered around to how difficult it was for the small innovator --often little educated-- to find patrons. Gupta's Honeybee network had identified many commercial opportunities. And his GIAN was labouring away trying to connect investors with entrepreneurs. Present at the meeting were Dr. V Anantha Nageswaran, Prof Mukul Asher, and Meenu and Arvind Singh. Out of that meeting was born Friends of Sristi in Singapore [FoSS]. It would be a micro venture capital [MVC] firm! A novel concept for India.
MVC is a cousin to micro-credit, but a bold and different variant. Micro credit movement in India is a runaway success. Several million Indians --almost entirely women-- have been benefited by the availability of small, low cost loans to earn micro incomes. But the lenders and borrowers are members of small groups. They are risk averse. FoSS on the other hand, would bring the rigour of modern management to evaluate ideas and then risk investing in them. The business model that fueled the growth of high tech industries was about to be down-sized and right-sized to meet the needs of an entirely different sort of entrepreneur: one rich in ideas but with few skills to develop them for the market. FoSS was entering virgin territory and hoped to learn and grow as it went.