WhiteSwan Rural Consulting Group: A Pitch

The Hypothesis
- Developmental sector in India is extremely fragmented. As of today, there are over 1.2 million registered and unregistered Non Governmental Organizations operating in the country. Fabulous transformations are happening at the micro-level, but due to disharmony and deficiency of structure, change has not become integrable. Today's social environment lacks competition and a majority of NGOs lack basic business infrastructure and systems that would aid them in scaling up.

- Social Responsibility departments of Indian corporates face an exceedingly cumbersome task of investing in the developmental sector. Unlike any other investment portfolio, social investments are tricky due to lack of transparency and accountability. Recent studies have revealed that philanthropic investments often result in 8% (or less) social impact. This calls for a more diligent investment methodology.

The Critical Question
When good happens, we fail to understand it's driving efficiency, often because of our mental contentedness. We fail to ask the critical question - "How good is good?"

Vision
WhiteSwan Rural Consulting Group(WRCG) was born when a bunch of socially motivated engineers made an attempt to answer this critical question. WRCG has one primary vision - "To cause enhanced and measurable social impact". We believe that by playing a catalyzing role in producing an integrable social change, a significant impact can result. We enable developmental organizations to perform better.

Key engagements
- Non-Profit Consulting. Providing organizational, financial, IT and HR management services to small and medium scale developmental organizations. The focus is to increase social impact.

- Knowledge Management. Conduct, analyze and share case studies on the performances of NGOs across the country. The focus is to examine and enhance transparency and accountability in the developmental space.

- Metrics and Impact Research. Develop indigenous tools and innovative methodologies to measure social impact for MFIs, NGOs and other agencies. The focus is to cause an integrable change.

- Social Investment Packages. Provide investment packages and advisory services to CSRs in making informed social investments. The focus is to facilitate yielding social investments - what Acumen Fund calls "The Patient Capital".

- Social Leadership. Carefully designed year-long immersion programmes and short-term stints for college students. The focus is to groom a cohort of bright leaders for the social sector tomorrow.

Our Dream
WRCG believes in the big bang theory for development. We dream to integrate and revolutionize today's fragmented Indian developmental space. Such an integration has the potential to significantly impact a billion lives.

Development through Venture Philanthropy: Acumen Fund's Philosophy

Beatrice Nguga, a wide-shouldered woman with a firm handshake and warm eyes, raised eight kids as a single mother in Kibera, a Nairobi slum that is home to more than a million people. In the 1990s, she buried each of her children—and their spouses. All had died of AIDS, leaving her to raise 12 grandchildren. She had no job and few prospects. “At one point,” she said, “I was so desperate, and the world felt so dark, that I could think of nothing but to beg for some money so that I could buy porridge and poison and end the suffering of myself and all of those children.”

In December 2006, Ms. Nguga was overseeing the management of several businesses. She started by selling French fries. She then sold water in the slums. She added rooms to her house with the intention of renting them and started a butcher shop, a hair salon, and a restaurant, employing scores of people. Her youngest grandchildren were in school, and a number of the older ones had graduated from college. Today, she has 11 employees and 21 rooms, most of which she rents for income. She has reached this position by taking small loans from a community organization called Jamii Bora, repaying them in a timely manner, and borrowing again. Beatrice Nguga is a woman of integrity, strength, fierce determination, and faith in life.

Hers is a great success story, but what would have happened to her grandchildren if she too had fallen ill or died? In this sense, her story illustrates a larger theme: one of the greatest challenges in escaping poverty is inadequate health care. The resources, the technologies, and the knowledge to provide adequate medical services to everyone do exist. What we don’t have are innovative and efficient business models to deliver them.

“It was to solve problems of this kind that I founded Acumen Fund”, says Jacqueline Novogratz. Acumen Fund is a nonprofit venture capital firm for the poor started in 2001. The fund, which invests philanthropic capital raised from more than 200 partners, starts from the perspective of people as users or consumers of services. We also believe that health systems must be economically sustainable and scalable, for only then will they reach the poor and the very poor. "We invest in social enterprises experimenting with sustainable approaches to the delivery of health care and clean water, because we believe that integrating the creativity of poor people and the entrepreneurs who serve them is the most efficient way to find some of these solutions."

Solving endemic health problems will require a mix of public and private resources, market incentives, and large-scale public awareness campaigns. For conditions such as malaria, HIV/AIDS, and tuberculosis, the market gives the major drug companies few incentives to research treatments for low-income people. Fortunately, the Bill & Melinda Gates Foundation has pioneered ways of intervening to ensure that this critical research is undertaken. Large-scale vaccination campaigns, like those that eradicated smallpox and are now on the way to wiping out polio, also play an important role in improving health on a global scale.

Innovative business models are essential if we are going to offer good, affordable health services to the world’s poor. Her background as a banker made her realize that to deliver social goods such as health care and clean water, getting the economics right is no less important than it is in any other kind of investment. Acumen Fund buys equity in companies that are carefully evaluated. Any returns are reinvested in the portfolio.

By identifying business models that work for at least a large percentage of the population, Acumen Fund hopes to help lead the way in using private innovation to solve large-scale public-health problems. The fund’s $20 million health portfolio also includes A to Z Textile Mills, Africa’s largest insecticide-treated anti-malarial bed net supplier, which produces 16 million nets a year and employs 6,000 women; Dial 1298 ambulances, Mumbai’s leading ambulance provider, with a service-for-all pricing model that gives free or reduced-cost rides to the poor; and First Micro-insurance Agency (a partnership with the Aga Khan Agency for Microfinance), which aims to provide health insurance to 500,000 customers in its initial two years of operation as Pakistan’s first health micro-insurance provider.

Novogratz says, “We are confident that this laboratory of investments will uncover innovative service delivery models that can be scaled up further through private, semiprivate, or public investment. The goal is expansive but not impossible—to show the world a whole new world of possibilities.”

Excerpts taken from "McKinsey:What Matters"

Mobile Phones and Development: On Grameen Phone

Iqbal Quadir digressed from his New York investment-banking career to return to his native Bangladesh in order to catalyze the country’s development. Quadir looks to European history to determine the formula for evading poverty: the empowerment of citizens coupled with the devolution of authorities. Foreign aid has actually been detrimental to citizens of poor countries because aid disproportionately empowers the government, which becomes reliant on foreign governments’ charity rather than citizens’ tax revenues.

One way to circumvent this scenario is with mobile phones. Connectivity leads to productivity; therefore an instrument of connectivity such as a mobile phone will bolster productivity and concurrently combat poverty.

In 1997 Quadir partnered with GrameenBank to create the GrameenPhone. The company leveraged GrameenBank’s existing network to provide poor villagers with micro loans to purchase mobile phones and sell minutes to fellow villagers. Today GrameenPhone is the largest cellular network in the country and maintains nearly 30 million subscribers. GrameenPhone just announced a 10% year-over-year revenue growth for the second quarter of 2009, and has received approval from the Bangladeshi SEC on its IPO application. GrameenPhone significantly contributes to the national economy of Bangladesh as one of the country’s largest taxpayers and raises Bangladesh’s annual GNP more than foreign aid, exemplifying Quadir’s contention that the key to development is businesses, not aid.

In 2005, Quadir partnered with Dean Kamen to bring to Bangladesh electric generators that run on cow waste to continually output one kilowatt of electricity, which can light 70 energy-efficient light bulbs. Access to light bulbs at night translates into increased productivity for villagers. Furthermore, following the template of GreameenPhone, the energy machine empowers villagers as entrepreneurs who can sell electricity to fellow villagers. Quadir continues his mission to bring entrepreneurship and economic development to poor countries as the founder and director of the Legatum Center for Development and Entrepreneurship at MIT, conceived in 2008. The center is a hatchery for 12 student fellows’ incipient ideas for world development. Quadir will guide the fellows in developing and implementing their ideas for bottom-up, technology-based entrepreneurship-for-profit businesses in the developing world.

* Sourced from TED blog.