START-UP ISLAND. Impact is high when VCs, entrepreneurs see eye-to-eye

Continuing from previous editions of this column, we’re looking at the potential of entrepreneurship in semi-urban markets and this time, zooming in on the social enterprise and elements key to its success.

The entrepreneur-VC relationship plays a pivotal role in impact businesses functioning like any other business, as the partnership between Drishti, an eye care provider focused on underserved markets, and Lok Capital demonstrates.

“When I first took money from Lok, and they said they’ll deliver more than money, I laughed because that’s just how (limited) my expectations of the VC world were,” quips Kiran Anandampillai, founder of Drishti.

It’s plain logic that if products and services are targeted at the right segment, there’s no reason why a social enterprise will behave any differently from any other business. Aditya Sharma, Director, Lok Capital, says, “businesses based on perceptual problems land up going so far and no further. And if you build from ground up rather than impose a problem, the breaking even, the paying back, all of it can work as with any other business.”

Anandampillai adds, “Lok has been with us as we’ve grown. And we’re delivering impact by design. We’re in the business of eye care and we’re delivering to a different set of markets, but you can’t have a complete NGO mindset in a social enterprise.”

While Drishti aims to deliver affordable eye care to smaller markets, the company works to build “a self-sustaining paying model” in those areas. Healthy revenues create a base for the company to run social programmes that are grant-funded. “About 72 per cent of the population in any district is in the villages, and an average village size tends to range from 1,000–3,000 people, at best 5,000. It’s impossible to build infrastructure at that level and remain economically viable,” says Anandampillai on why Drishti won’t be in some places.

At its hospitals, which are in district headquarters, while keeping prices low, consultation services cost ₹100 and low-cost cataract surgeries ₹3,000.

But in villages, for people with BPL cards over the age of 60 who have no insurance cover, surgeries are free of cost. This is made possible by a donation of ₹1,000 from donors. Grants help the company also cover around 20,000 children in each taluk it serves.

“With Lok, we debate organisation structure, assess who we can hire, discuss if we should open two hospitals or ten, whether we should pick location A or B,” Anandampillai says of the working relationship with the venture capital firm.

Of the results, Lok Capital’s Sharma says, “When we launched the first Drishti hospital, it broke even in 12-13 months.

“The third hospital broke even in three months… clearly, even with an impact business, the problem to solve shouldn’t be a figment of the entrepreneur’s imagination.”