I have been an entrepreneur for the last 10 years. When I decided to tread this path early in my career, I was prepared for the hardships, particularly those that are experienced by social entrepreneurs.
I was all of 28 years of age when I dreamt of becoming an entrepreneur. The last time my father gave me any money to spend was about 10 years back. However, as it happens with entrepreneurs, somewhere in my soul I heard my calling.
With just nothing in my hands, I dreamt of creating a fund that would finance social business ventures. I knew that my fund, though will focus on social space, must run like a for-profit organization. I was clear in my mind that we needed to bring in systemic changes in the rural space and create employment.
My partners and I put our minds together. Since we all knew what we wanted to do and what impact it would create, putting together a PowerPoint presentation for the funders was an easy job. Despite the uncertain times, we did manage to raise some money, albeit far below our expectations. The entire money would go into projects and nothing was left to support our personal lives. There was very little money available to pay salaries.
They were traumatic times. The cost of living in Mumbai was putting additional pressures. My daughter was born around that time and there were occasions when we would not know where the money for next days’ milk would come from.
A lot of entrepreneurs go through this phase of life. Even as our belief in the idea and the mission keeps us going, we ask ourselves some tough questions. It is during such times that the moral support that one could receive matters a lot. If I could sail through these challenging times, the credit goes to my wife and parents who did not let me know of the hardships and encouraged me to focus on the mission. Then, of course, you need a partner who tells you constantly that what you were doing was right. I was lucky to have such a partner in Pradeep P.
We had reached a time when raising more money was essential for the sustainability of the organization. And, there came a grant of half a million dollars from an institution. They told us that we were doing a great job and that they were keen in ensuring that we continued our ‘good work’. However, they were not interested in investing in our fund and instead agreed to give us the money in grant so that we were able to tide over our difficult times.
Half a million dollar was godsend for us. However, I was clear from the beginning that Aavishkaar would not accept grants, because we always wanted to remain a for-profit organization. We saw ourselves in a conflict situation. Saying yes to the offer would destroy our belief, while given our financial situation, saying no to the offer was akin to performing hara-kiri. A lot of discussions among us partners followed and we finally decided to say no to the offer.
It is needless to say that our decision plunged us into more serious situation. My mentor Vijay Mahajan told me that if I was to continue I would soon become a martyr. We had to act fast to ensure that our survival was not at stake.
Slowly, we resurrected Aavishkaar. We cross-subsidized it by doing small businesses. We took our assets to $35 Million.
|Name: Vineet Rai
Age: 39 yrs
Experience in business: 10 years, Founded Aavishkaar, Intellecap and IntelleCash
Leadership style: Trust in Youth
Big Learning : When the going’s tough, stick around and believe in your guiding principle come what may
Domain: Social Investment Banking and Advisory
Turnover: 17 Cr
Set up in: 2002
|Intellecap is a venture capital fund which funds social enterprise. The fund itself works as a regular venture capital.|
Looking back, if I had said yes to that offer of grant, we might probably have closed shop by now. The experience taught us the importance of staying frugal, do things in the best possible manner and stay focused on our goal of identifying early rural ventures.
Soon enough, our conviction in our vision was put to test once again.
An investor approached us with the offer of taking majority take in Intellecap. We had set up this organization with a vision that no individual or entity will ever become the majority shareholder of Intellecap. It would always be owned by a distributed set of people. We were a very small company and wanted the investor to come in because we respected them a lot. Their valuation was also very attractive. However, after an internal discussion we declined the offer.
At the time of taking this decision, I involved my young colleagues in the organization, discussed with them the consequences of our decision. It was a great opportunity to create a lasting bond with my people.
Eighteen months later the investor approached us again, this time with a request to take a minority stake in Intellecap with an investment of $8.3 Million. Our conviction found a huge support.
In an entrepreneur’s life, there would be umpteen occasions when his/her strong conviction is questioned. These situations are tough, because they all seem to be logically the right decision to take at that point in time. You need to then tell yourself that not falling in line with the logic is the most logical thing to do. You may sometimes need to review your belief and adjust. Never your conviction.
Whenever I find myself caught in a fight between my head and my soul, I end up taking the side of my soul.
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