Face-to-Face with Comat technologies

TC-I Fundwatch has recently reported a Rs. 60-crore investment by Omidyar Network and Unitus Equity Fund (UEF) on Comat technologies, a profitable social enterprise doing business with the rural poor.

The CEO of Comat technologies Sriram Raghavan recently talked to NASSCOM Emerge Blog and offered some good insights into Comat’s success in becoming a profitable social business.

Sriram’s answer to one question explains the business model of Comat technologies succinctly.

Q. Your own business is built around the Rural Business Centres. What exactly are these?

SR: It is a very simple concept. The rural business centre is primarily an access point for rural citizens, where we use technology to deliver different kinds of services – only those that help improve the quality of life in villages. We don’t want to sell soaps and consumer goods.

I’ll give you two examples. Take government certificates such as birth, death, land and property related papers. If you have to get one from the taluk or the district office, you have to go to that particular office, wait in a long line and follow cumbersome processes. We deliver it to the village directly – it takes about five minutes for the same cost, i.e., Rs. 15 per certificate. This makes a very big difference to the rural consumer.

The other area we are in is education. There are teachers in rural areas, but the quality of education is very poor. Our centres bring live classes from best teachers in cities who broadcast their lessons online, much like the erstwhile UGC programmes. Except that here, we have two- way interaction and the students and teachers can speak to each other.

Sriram Raghavan also shared a few of his experiences with rural consumers that can come handy to a new social enterprise venturing into the villages.

In a typical agrarian set up, income generation is a twice-a-year cycle – unlike in urban areas where we earn monthly salaries.  It is important to bear this in mind as you have to position your product around this insight.

With a turnover of Rs.55 crore while improving the lives of about 10 million rural inhabitants, there should be little doubt about the success of this unique business model. But the best aspect about the venture is that it has identified one critical handicap of the Indian villages and working successfully towards eliminating it. Better said by the man himself.

All these years, rural India has been isolated; they have been “informationally disabled”. It is now time for a change and we want to ensure that.

Update: Envirofit is taking it up a notch

Not long ago, we had written about Envirofit, a company that manufactures and sells clean burining high-efficiency cookstoves to consumers in India.

Nextbillion reports that they have already sold 10,000 stoves and are ramping up production quickly. Of course, its a drop in the ocean, but definitely a great start. Congrats!

TC-I Call to Action: Net Impact Fellows Program

The Net Impact Fellows Program is a 12-month part-time fellowship for two individuals dedicated to using the power of business and a network of like-minded individuals to change the world. Fellows will help Net Impact scale its impact internationally with a specific focus on India, China, Brazil and Western Europe. [Thanks, Nitin]

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Soundbites from Nancy Barry, former President and CEO of Women’s World Banking

Last night I had the good fortune of sitting in on a talk given by Nancy Barry, a pioneer in the field of creating private, market-based solutions to poverty alleviation for women across the globe. Her talk was very powerful and on many points, spot on accurate in my opinion.

A veteran of the World Bank, she was the second president of of Women’s World Banking from 1990 to 2006. In the fall of 2006, Nancy started launched Nancy Barry Associates–Enterprise Solutions to Poverty, which works with major corporations, emerging entrepreneurs, and leading business schools to build business models that engage low income producers as suppliers, distributors and consumers of products that build income and assets. Simply put, her views come from a career of practice knowledge and her points should be taken with great seriousness.

Below are some highlights from her speech, which was titled “Microfinance and Beyond: Enterprise Solutions to Poverty,” and some of my own disagreements.

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TC-I Fundwatch: Omidyar Network and Unitus invest Rs. 60 Crore in Comat Technologies

The market for double bottom-line investments in India is becoming hotter and hotter. Interestingly, its not just the microfinance institutions who are attracting the capital. We reported earlier in TC-I about MokshaYug Access, securing $2 million in funding from Unitus and the ISB based SME fund set-up by Google.org in partnership with Omidyar Network and Soros Economic Development Fund. 

This time it is Comat Techonologies, a Bangalore based social enterprise dedicated to providing easy access to essential information and transformational services to Rural India. Comat just secured Rs. 60 crore in funding from Omidyar Network and Unitus Equity Fund (UEF)

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Creating a road to the City – and better living?

[Story Source: Livemint] [More information: Ejeevika Website]

A startup incubated by Rural Technology and Business Incubator (RTBI), a society established under IIT-Madras,  plans to connect people living in rural areas with job opportunities presented by urban explosion – and make money out of it.

ejeevika HR Pvt Ltd, started by Richa Pandey Mishra, follows a simple business model:

Identify entrepreneurs through village council heads, non-profits and self-help groups(SHGs)

Offer them a franchise – a franchise requires one to invest on a couple of personal computers, a broadband connection and power backup – which entails an investment of around Rs 50000

Franchisees identify potential candidates who are trained by ejeevika as per clients’ requirements

ejeevika aims to:

Bridge the labor shortage in high growth industries by providing skills to rural youth, increasing employment opportunities in the rural space and thereby increasing individual and community income.

At present, ejeevika is imparting training on retail sailes to youth in the districts of Tirivallur and Cuddalore in Tamil Nadu. Going by its founder’s claims, ejeevika plans to train and find jobs for some 200,000 people in the next couple of years through a network of around 1,000 franchisees in the rural districts of India. An idea like ejeevika is a potent way to tap and channelise the potential of rural youth.

At the same time, there are a few questions we need to raise and find answers for. Last year was a landmark year for rural to urban migration – for the first time urban population overtook that in rural areas. What is and should be the ‘policy of the government’ and ‘our thinking as citizens’ – is such large scale urban migration desirable? Especially when most of our cities do not plan for such an inflow. Will urban migration have an affect on agricultural production? Will it lead to a reduction in our green cover?

Thumbs up, thumbs down for Microfinance

Thumbs up: Obopay and Grameen Solutions partner together to provide microfinance services to clients. The initiative will be called the “Bank A Billion Initiative.”

The premise of the project is to provide access to basic financial services through cell phones, reducing the need for costly personal contact between financial institutions and their customers. The initiative hopes to take advantage of the rapid spread of cell phones in developing areas, especially in areas without access to microfinance services.

Thumbs down: Hot off the heels of their decision to stifle mobile banking services, the RBI has now increased the capital adequacy requirements for MFIs, which have concerned many of them in the field.

The Reserve Bank of India (RBI) recently tightened capital adequacy standards governing microfinance institutions (MFIs) in India, and several local MFIs worry the change may lead to the need to raise additional capital and increase interest rates.