+91 9871772386
admin@givfunds.com

Blog

Inspired by Prof Muhammad Yunus: How Givfunds began

Reading Time: 2 minutes

It all started from a visit I took to a slum school in Bangladesh. Studying in a classroom barely 10 square meters in size, 20 lively children were abuzz with the foreign visitors who popped in for a class. Despite the cramped conditions, the children in that classroom were more enthusiastic then any I have encountered – and I’ve met children playing with new technology in my previous life as an education-technology entrepreneur.

 

My subsequent conversation with the school’s Managing Director, told me that they ran on a cross-subsidization model where schools in the city would subsidize those in the slums and rural areas. However, it was not until I heard the number that I my jaw dropped. All it took to subsidize the education of child was $2 a year. However, at that time, they could not scale their model because of the lack of capital to expand – something that was immensely ridiculous to me.

 

My future travels from the slums of Bangladesh to the villages of India to the pagodas of Myanmar allowed me to visit over a hundred social enterprises and speak with hundreds more who run incredibly impactful and financially sustainable businesses. It hurt that, like the school, most could not grow their organisations due to the lack of capital. These social enterprises solved problems ranging from poverty and hunger to education and lack of sustainable energy.

 

 

This, I found out later, was a huge problem which many do not see or understand – something called the “pioneer gap”. Many people assume that there are enough funds in the social sector, with donations growing Year-on-Year and the rise of impact investing. But what many do not realise is that the vast majority of small-to-medium social enterprises often do not have access to these funds.

 

However, it was not until my time in Bangladesh on a program with Yunus Centre that I had a glimpse of a solution. Largely inspired by a conversation I had with the Nobel Peace Laureate, Professor Muhammad Yunus, the idea of Givfunds in lending low-cost loans to social enterprises was by no means unique. In Bangladesh, various offshoots of the Grameen Family have loaned low-cost loans to hundreds of social enterprises for over a decade with an extremely high repayment rate. These loans helped these social enterprises scale to create much greater impact.

 

The birth of Givfunds came when I met Irwan on a third-class sleeper train in India. We thought that, if such a solution is scaled up to lend to thousands of social enterprises or more, we would have a decent shot at solving the “pioneer gap”.

 

Links:

  1. https://www.muhammadyunus.org/index.php/visitors/immersion-program

Post a comment