Shruti Chakraborty
If you have an idea that could help make a change in the world and the only reason you haven't worked on it is because you don't have any support, Pooja Warier and Richard Alderson may have a solution for you. Warier and Alderson are Co-Founders of UnLtd India. "Sometimes, the people that don't have anything have the best ideas and can do a lot of good work," Warier says. "The only thing stopping them is a lack of access to funds and support. That's where we come in."
Back in 2005, Warier was volunteering with UnLtd in the UK and was reporting to Alderson, who was a consultant there. At that time, UnLtd, which was funded by British government grants to support social ventures, didn't have the mandate to invest overseas. It was here that Warier realized that India needed something similar and that early-stage social entrepreneurs in India had very little in the way of institutional support.
"We wanted to focus on really early stage startups," she says. In 2007, she and Alderson set up UnLtd India, which while sharing its core beliefs with the British one, works and operates independently. UnLtd India today provides support to social entrepreneurs in the form of financial and non-financial means. It gives three levels of support, depending on the stage of growth the organization is in.
Leveling The Playing Field
Level 1 is for the idea-to-pilot stage. Aspiring entrepreneurs who have an idea to start a for-profit or not-for-profit organization can pitch their ideas to UnLtd India. "Level 1 is like our laboratory," Warier says. "You need high risk, low pressure capital at this stage," she adds.
Ideas and models evolve through the incubation process, she says. An entrepreneur gets Rs. 80,000 at Level 1. This is a one-year incubation that can extend up to three years. The organizations also receive non-financial support in the form of workshops, training in various aspects of business and active support from an associate from UnLtd India on all aspects of setting up of the organization. UnLtd India also helps organizations get access to various experts in relevant sectors and connects the entrepreneurs to investors. At Level 2, the firms looked at are usually a little further along the chain, have a proven model and are looking to grow. At this stage, UnLtd India gives up to Rs. 2 lakh to the firm along with non-financial support. In the case of both Level 1 and Level 2, the funds are like a grant and are not given in exchange for equity.
The companies are expected to repay the amount in case they are successful or give back in the form of mentoring or other kinds of support to subsequent batches of the incubation program. If they fail though, the amount is written off.
At Level 3, UnLtd India selects companies that are ready to scale and need capital. The organisations are given Rs. 20 lakh at this stage.
This support is issued in the form of convertible debentures, given on a zero to ten percent interest rate.
Different from Others
Anoj Viswanathan, Co-Founder, Milaap, a peer-to-peer micro lending platform was introduced to Warier in 2010. Since the company was based in Bengaluru, it could not become a part of UnLtd India's incubation program in the early two stages as that is only for entrepreneurs based in Maharashtra. But once Level 3 was launched in 2011, the company became a part of the pan-India program. "Pooja helped us connect with Dasra and to create a strong case to be a part of the Dasra Social Impact program," says Viswanathan. Dasra is another incubator for social businesses in India that works with entrepreneurs which would fit in the Level 2 and Level 3 type at UnLtd India.
Warier says that the difference between Dasra's program and theirs is that UnLtd India has a much more vibrant delivery model, supporting entrepreneurs actively and that those of the Level 1 type don't find support at any other organization. After being a part of Dasra's program, Milaap was incubated at UnLtd India in 2011. "UnLtd India has supported us even after the one-year period was over," Viswanathan says. The support, he says, has been in the form of corporate associations and other connections that have helped Milaap's business grow. "In terms of loans disbursed, we are now eight times what we were before the incubation," Viswanathan informs.
Connecting The Dots
UnLtd Indis is grant-funded so far by organisations like the ICICI Foundation, Marshall Foundation and recently, the Rockefeller Foundation. UnLtd India may look at creating revenue models eventually, Warier says, once the team of 17 expands. The organization gave out loans worth Rs. 79.71 lakh in FY12-13 to 106 organizations and is in the process of setting up affiliates in Tamil Nadu, Hyderabad, etc. Besides the incubation facility, UnLtd India also runs Bombay Connect -- a co-working space in Bandra, a suburb in Western Mumbai. It hosts entrepreneurs who need a place to work and conducts workshops and sessions that they can be a part of as well. Entrepreneurs can use the office space for about Rs. 9,000 for a mainstream business and Rs. 8,300 a month for a social business. Bombay Connect is looking to break even next year, but what's more exciting for Warier, she tells us, is that the space allows all entrepreneurs, even the mainstream ones, to think about how they can give back to society. "It's so exciting to bring the social and commercial businesses together in the co-working space and to see their teams grow together," she adds.
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