However, in countries such as India, the disconnect between citizens and their governments has reached an all time high.  This is no surprise.  Represented amongst the 543 elected members of the 15^th Lok Sabha are 150 with criminal records across 36 political parties. The first Parliament of India in 1947 still holds the dubious distinction of being the most educated Parliament in the history of independent India!  In the 2008 Transparency International survey on corruption, 61% of Indians surveyed admitted to paying a bribe to a public official in the past year.  As a result, most middle and upper income Indians and businesses would rather avoid government at all possible costs.  The use of “middlemen” to register property, obtain a license, or incorporate a company have become all too common.  Reliance on the private sector for education, security, water, garbage disposal, power and health care have become the norm.  India is one of the few democracies in the world where the urban middle class have a lower voter turnout than the rural poor, despite urban polling stations being significantly more accessible.  Politicians have become quintessentially despicable!

Over the years, there have been many-a-politician at the local and national level that has made an attempt to drive reform, with integrity and transparency.  However, they are usually lone posts in a sea of miscreants, which tends to render them dysfunctional or simply drives them away.  Social ventures are today evaluated by what is called the “triple bottom line,” referring to their profits, social impact and environmental impact.  In order to sustain change over generations, they will need to add a fourth bottom line—political impact.  While it may seem a distraction from their original charters, social ventures are in a unique position to gently, but definitively support fresh local political talent.  Successful social ventures tend to command high degrees of respect in the geographies where they operate.  They also develop deep insights on the people in their communities.  Large developing nations such as India have no shortage of respected, high integrity prospective candidates.  They need to be inspired and supported. More often then not, social ventures steer clear of the “politics” of their locality.  But this defeats their purpose.  By encouraging and supporting the right talent at a local, legislative level, social ventures would be ensuring their programs stand the test of time—through good governance.  Most importantly, social ventures and those involved in them are constituents too.  They must play a role in shaping their governments.

The World Bank estimates that over $1 trillion is spent globally on bribes every year.  According to Transparency International, $40 to $50 billion per year is spent on “mega-corruption,” or corruption between big businesses and government officials in India alone.  In countries like India, bribery takes place at every level—from procuring a cooking gas cylinder to gaining entry into a hospital to acquiring a contract to build an airport.  The impact of corruption is well established.  Most research suggests a direct correlation between corruption and increasing income disparity.  The reason is obvious. Corruption limits access to basic infrastructure, promotes injustice and disparages merit in society.

Unbeknownst to many, it is possible and beneficial to do business and carry out life corruption-free in countries like India.  It simply requires a strong stomach and a slightly longer-term view, and many successful individuals and institutions have demonstrated that.  While still underdeveloped, many countries like India do have a strong enough legal infrastructure to operate with full transparency.  This is where Bribebusters comes in.  For a fee, an individual or an institution, when confronted with a request for a bribe, can hire Bribebusters to prevent it from taking place.  Bribebusters uses only legally established means to stop the action.  For example, the recently passed Right to Information Act allows any citizen to request public information from a government body, which must revert within 30 days.  So far, Bribebusters has handled about 100 cases successfully, mainly in its home state of Kerala.  Interestingly, in many cases the perpetrator simply backs off after Bribebusters makes first contact.  At this stage, the cases are smaller ones, ranging from getting a passport renewed to registering a new company.  Over the next several years, Shaffi plans to take Bribebusters national, and with his keen eye for injustice, will certainly make anyone in a position of power think twice before asking for a bribe.

In 2007, Stanford MBA graduates Sam Goldman and Ned Tozun embarked on a journey to change all that.  As part of a class at Stanford’s Institute of Design, they designed a low cost solar-powered LED lamp prototype.  They decided to commercialize the project with the launch of D.light Design, and in less than 3 years have sold to over 1 million consumers in 30 countries.  D.light launched in India with a product called Nova.  The Nova provides up to 12 hours of bright light on a day’s charge, and doubles up as a mobile phone charger.  It is 8-10 times brighter than a kerosene lamp, 30-50% more efficient than a fluorescent light and costs about $30. Today, D.light has 3 products including the Solata and the Kiran.  The Kiran provides 8 hours of light on a day’s charge and is 4 times brighter than a kerosene lamp.  Launched in October 2009, the Kiran is dubbed the “kerosene killer.”  It costs just $10, making it the most affordable quality solar lantern in the world.  It provides 360-degree illumination, which is good for cooking, working, studying or traveling.

D.light is unique amongst companies in its space, in that its products are designed with tremendous consumer focus and using the world’s best design principles.  For example, the Kiran is portable, can be hung from a wall or ceiling, or placed on any surface.  The Nova was designed to be water resistant and protect from dust and large insects.  With 80 people and offices in India, China and Africa, the company has also built a deep sales and distribution infrastructure.  It has the backing of major venture capital firms including the Acumen Fund, Nexus Venture Partners and Draper Fisher Jurvetson, giving it the financial muscle to move quickly.  D.light aims to touch 100 million consumers by 2020.

D.light’s social impact is far reaching.  First, its products completely eliminate the need for kerosene lamps.  Low income households spend 5-30% of their income on kerosene, so D.light products pay for themselves in as little as 6 months.  Second, bright light supports income-generating activities such as agriculture and retail.  The United Nations Development Program estimates that families with improved lighting have up to a 30% increase in income due to improved productivity at night.  Next, D.light customers report that children’s study time increases by a factor of 2 to 4 times after purchasing a solar lantern, resulting in greater learning and higher test scores.  By removing the need for kerosene lamps, D.light products also solve the problem of indoor air pollution.  The UN Millennium Development Goals Report estimates that indoor air pollution from kerosene lamps claims the lives of 1.5 million people each year.  They are also the cause of numerous deaths from suffocation, burns and fires.  Finally, every kerosene lamp removed from a household removes 1 ton of carbon dioxide emissions into the atmosphere over 5 years.  Kerosene lamps are currently responsible for 100 million tons of carbon dioxide emissions into the atmosphere, making it amongst the largest sources of greenhouse gases in developing nations.  Planet Earth will certainly not miss them!  To learn more about D.light, visit http://www.dlightdesign.com.

Through a unique combination of expertise, a passion for change, and a compelling business model, LifeSpring Hospitals aims to drive a wedge through those numbers. As a joint venture between public sector contraceptive maker Hindustan Latex and New York-based social investor Acumen Fund, LifeSpring was set up to be a chain of maternal care hospitals for low-income households.  Its first hospital was set up in Hyderabad in 2005 and it now has a total of 9.  It plans to have 18 hospitals by the end of this year and 150 hospitals by 2015.  Each hospital can serve about 10,000 women per year, so the impact LifeSpring will soon have is tremendous.

At LifeSpring, a regular delivery can cost as little as Rs 2000 (about $45).  A Caesarean section costs as little as Rs 7000, which is just one-fifth the cost of a private hospital.  All this and the hospital chain is profitable—simply by applying principles of business that would be intuitive in almost any other company.  LifeSpring sets up small hospitals, with typically 20 to 30 beds each, primarily near slum localities.  This way, real estate costs are low, the hospitals generate high footfalls and vacancy rates are kept low.  LifeSpring doctors, on an average, perform four times as many operations as their peers in other private hospitals.  By focusing on just maternal care, the hospital chain is able to standardize clinical procedures and kits, further bringing down costs.  Then, like other social ventures, LifeSpring utilizes a cross-subsidy model, where higher income women can choose a more expensive semi-private or private room, allowing procedures for lower income women to be cheaper.

Unlike most hospitals in India, private or public, LifeSpring is uniquely customer focused.  Its medical professionals are forthcoming in their communication and cheerful in their approach.  As CEO Anant Kumar says, “After all, pregnancy is no disease.  So, why should we call them patients?” With its aggressive growth plans, LifeSpring is constantly looking for obstetricians and gynecologists, radiologists, surgeons, pediatricians, anesthesiologists, nurses and other health care professionals.  With Indians accounting for 5% of America’s physicians and 10% of America’s medical students today, LifeSpring could be an excellent opportunity to gain experience and give back all at once.

From a preventative health care perspective, making school lunches healthy is obvious.  Obesity-related diseases account for 10% of America’s health care bill and that number is expected to double over the next 20 years.  In recognition of this, the 2010 Child Nutrition Act was recently approved by the Senate Agriculture Committee and is expected to be voted on this summer.  Currently, the reimbursement rate for free lunches served to low income children is $2.68 per lunch.  The bill will raise the rate by a measly $0.06 per lunch.  Experts believe the rate needs to be increased by $0.35 just to keep the quality of lunches the same, and by at least $1 to make lunches healthy.  One of the main reasons schools have vending machines is to generate revenue to make up for the shortfall from the government’s current reimbursement rate.  As most vending food is unquestionably unhealthy, this is only exacerbating the problem.  The bill will also give the USDA expanded authority for setting nutritional standards in both cafeterias and vending machines.  Assuming the department does not succumb to the lobbying interests of large food companies, there is much to choose from the fledgling natural and organic industry—low sodium chips from Cape Cod or Kettle, energy bars from Lara Bar or Clif Bar, or preservative-free ready meals from Amy’s Kitchen or Tasty Bite.

As upcoming legislation will not deliver the sweeping reform that is required, it is still up to local school systems to deliver examples of change.  One such example that the country should pay attention to involves the efforts of Tony Geraci in Baltimore. As Director of Food and Nutrition for the Baltimore City Public School system, Mr. Geraci is re-shaping how the city’s 83,000 students perceive food.  His approach involves students at every level.  As part of the curriculum, students design lunch menus that meet strict nutritional requirements for each day of the school year.  The design of these menus weaves in science and nutritional learning to further engage students.  He cancelled contracts for pre-made lunches and has prioritized the school district’s $35 million budget for fresh and local food.  Last year, Mr. Geraci convinced the city to donate a 33-acre piece of land to the school system, where he built the Great Kids Farm.  The farm, which is run by students, will serve as an incubator for organic school gardens around the city.  As an experiment in entrepreneurship, he is also launching 3 student-run restaurants that will serve the farm’s produce.  In grade schools, he has introduced a concept called “no-thank-you bites.”  At the end of each line in cafeterias are sample cups of a high nutrition food such as lentils or radishes.  If students try them and don’t like them, they simply say “no thank you.”  If they do like them, they would have broadened their palates.  For each bite students taste, they get a star next to their name, and at the end of each month, cafeterias hold “constellation parties” to honor the winners.  Now, in order to scale his approach, he is lobbying the state for a large centralized kitchen to serve flavorful, nutritionally designed meals across the system.  By thinking outside the box, challenging the bureaucracy and simply making food fun, Mr. Geraci aims to transform the health destinies of an entire population.  Legislators and local school systems need to take notice.  Independent filmmaker Richard Chisolm is currently directing and shooting A Recipe for Change, scheduled for release this fall, which documents the transformation of the Baltimore public school food system.

The 100K Competition boasts its own set of impressive statistics.  In its 20 years of existence, it has facilitated the creation of 120 companies with aggregate exit values of $2.5 billion and a market capitalization of over $10 billion.  This year’s Development Track finals featured six unique businesses with students ready to relocate to Africa, Asia and Latin America to create profitable impact.  Some examples included Salud del Sol, which has developed a solar powered autoclave for sterilizing medical equipment in rural clinics with no access to electricity.  PerfectSight, another finalist, has developed a low cost tool for automated diagnosis of common refractive eye disorders.  On the services front, there was Doodh Bandhar, which is looking to provide breeding, feed and veterinary services for rural families to enhance productivity of indigenous cows in India.

The winner of the competition was SolSource 3-in-1.  SolSource has developed a patent-pending appliance, which uses solar energy for portable cooking, heating and electricity generation.  Today, 2.5 billion people in the world still rely on biomass such as wood and dung as their primary source of fuel.  In such households, women tend to spend 4 to 8 hours a day collecting fuel.  Moreover, it is estimated that 1.6 million people die each year of biomass emissions in or near the home.  The SolSource 3-in-1 appliance is just 6 kilograms, is emissions-free, and costs just $26.  Most strikingly, the team has been balancing graduate studies with spending up to six months each year for the past four years in the Eastern Himalayan region of Southern China.  They have piloted 10 devices in the region, and have fine-tuned their product based on a rigorous understanding of the problem.  SolSource has already received a number of accolades.  It was ranked as one of the “40 Transformative Design Projects of 2010” by ID magazine.  It is also the recipient of the MIT IDEAS Award for innovative design, the Yunus Innovation Challenge for indoor pollution abatement, and the Clinton Global Initiative Outstanding Commitment Award.  As the new winner of the MIT Development Track Business Plan Competition, SolSource is ready to launch!

In today’s world of university competitions, teams must have much more than a plan to get to the final rounds.  They must have the expertise, a prototype of a product, one or more pilot customers, and a team that is committed to the venture upon graduation.  In that sense, it is much more than a student competition—it is a commitment toward being a change-maker as an entrepreneur.  Given the strengths of this year’s finalists, as judges, we had great difficulty in choosing just one winner. So, we chose two.  We decided that $25,000 would go to a venture called Water Canary and $75,000 would go to the venture America Smiles.

Water Canary was set up by a team of NYU business students and scientists that have developed a low cost water testing device for use in disaster relief.  Currently, it takes relief organizations days to determine whether the water supply in a particular locality is contaminated after a natural disaster.  Currently available testing equipment is also expensive and requires expertise to operate.  Water Canary has developed a device that can determine whether the water supply is safe in just one minute.  It requires no prior expertise to operate and can transmit that data wirelessly to relief organizations.  This way, relief organizations can map out a geography quickly and move fresh water to the most affected areas first, greatly increasing their efficiency.  Water Canary has partnered with UNICEF and begins pilot trials of its device in Uganda early next year.

America Smiles was set up by a team from the NYU College of Dentistry.  Currently, over 40 million people in the US lack timely access to dental care.  From a preventative health care perspective, this is a huge problem, as poor dental health can lead to a variety of diseases ranging from heart disease to diabetes.  Starting with a partnership with the NYU College of Dentistry, America Smiles plans to set up makeshift dental clinics in poor neighborhoods, with resident dentists providing oral care.  According to America Smiles, resident dentists are under-utilized and need more practical experience.  By providing oral care to the poor on a rotational basis, they get additional training, and the uninsured get a desperately needed service.  The revenue model for the venture is also quite intriguing.  Currently, most dentists in America do not accept Medicaid patients because of the low reimbursement rate.  However, for America Smiles, the rate of Medicaid reimbursement is sufficient as the cost of resident dentists and other inputs are comparably low.  We also expect that the model will attract attention from state and federal governments given the current focus on preventative health care approaches.

Congratulations teams and we all look forward to hearing about the success of your ventures down the road!

Few would predict that once a social venture has demonstrated impact in a small geography, that its ultimate scaling partner could become the government, even the most notorious of them.  Driven by innovation, social ventures that are successful start attracting attention from constituents to policy institutes to the media.  Increasingly, governments won’t want to be “left out” and with their reach could help social ventures scale disproportionately.  This post outlines two early stage examples in the field of health care where this is happening—1298, a private ambulance provider in India, and Partners in Health (PIH), a health care provider operating in 9 countries.

1298 was set up in 2004 by a group of young professionals determined to make a dent in unnecessary deaths in emergency situations in India.  30% of accident victims in India die due to a delay of transportation or during transportation, primarily because of primitive service. In 2004, the city of Mumbai had only 50 life support ambulances.  That compares to 600 in the city of London, which has half the population.  Since its inception, 1298 has commissioned over 90 life support ambulances (which includes a defibrillator, ventilator, E.C.G., and cardiac monitor) in Mumbai, Kerala and Bihar.  The company has made an impact in saving over 50,000 lives in Mumbai alone.  1298 has a cross-subsidy model, where the wealthy pay a premium and in turn, subsidize the poor with free service.  This model has proven profitable and attracted several rounds of private equity in the business.  Though it currently only services a small percentage of India’s population, 1298’s success has not gone unnoticed and state governments are waking up.  The government of Rajasthan just awarded 1298 a contract to manage over 300 ambulances in the state.  This would involve upgrading existing ambulances in the state, procuring new ones and managing calls through 1298’s high-tech call center.  In a short period of time, the number of ambulances operated by 1298 will quadruple and the population served with high quality emergency care will double to up to 100 million.

Partners in Health (PIH) was set up in 1983 by medical visionary Dr. Paul Farmer in Haiti.  While still a student at Harvard Medical School, Farmer made frequent trips to Haiti to set up his first clinic.  As an infectious disease doctor and medical anthropologist, he pioneered a variety of unique community-based approaches to health care.  For example, in Haiti, many people believe the source of disease is voodoo and stop taking their medicines once they feel better.  This can be detrimental in the case of diseases like tuberculosis.  So, PIH would send local community workers to administer drugs, provide stipends and nutrition-rich food at the household level.  Over the years, this approach saved hundreds of thousands of lives and PIH’s impact has been the source of much literature including the best-seller Mountains Beyond Mountains by Tracy Kidder.  From its grass-roots beginnings in Haiti, PIH now operates in 9 countries and has funding from the Bill and Melinda Gates Foundation and the Clinton Foundation.  In recent years, with its track record and influence, governments have taken notice.  Today, partnering with the government in the countries it operates in has become central to PIH’s strategy.  In Haiti, in partnership with the Ministry of Health, PIH operates 10 hospitals and clinics and is probably the largest health care provider in the country.  It set up operations in Peru in 1994 in the slums of Lima and now serves an estimated population of 700,000.  It also advises the Peruvian government on national policies for the prevention and treatment of multi-drug resistant tuberculosis and HIV; and provides the training required to help implement those policies.  PIH has similar government partnerships in Russia, Rwanda, Lesotho, and Malawi.  This is allowing PIH to drive change both “bottom-up” and “top-down” addressing both short and long-term issues.  As social ventures continue to innovate and change lives, a little bit of attention certainly doesn’t hurt, particularly if they can wake up governments to fulfill their fundamental duties.

In the US today, the biggest contributor to health problems and the rising cost of health care is overeating.  Nearly two-thirds of Americans are overweight and one-third are obese.  According to the Center for Disease Control, one in three children born after the year 2000 will develop early onset Type 2 diabetes.  Health problems ranging from heart disease to cancer to depression are on the rise mainly due to unhealthy food consumption habits.  The US now ranks 50^th in the world for life expectancy, and has the highest per capita health care cost of any country in the world.  However, in a society where freedom of choice is a central tenet, it is difficult to draft legislation which curbs or controls consumer consumption.  So, taxes on “junk foods” or limiting the use of certain ingredients by food companies could be legislatively controversial. Consumer movements, on the other hand, are a sustainable way to drive change.  After all, in order to survive, restaurant chains and food companies have no choice but to cater to consumer demands.  Legislation that promotes transparency and equity in the food industry will help spawn such movements.

The health care bill of 2010 is an important start in creating transparency.  In the fear that even a small percentage of consumers will resist the impulse to order a high calorie menu item, restaurants and their food suppliers will be forced to fundamentally alter the way they look at product development.  They will no longer simply be able to take the “lazy” approach of luring consumers with excessive sodium or fat.  Instead, they will need to start exploring the world’s tremendous biodiversity in order to marry good health with good flavor.  In many ways, the natural and organic industry, now over $25 billion in size, has shown the way.  Ethnic food companies have also been trendsetters by drawing on the myriad vegetables, legumes, herbs and spices that the world has to offer.  In addition, the bill will put a halt to the “Super Size Me” trend of the past 30 years.  According to a University of North Carolina study, portion sizes in restaurants for all key food groups grew dramatically between 1977 and 1996.  Soft drinks grew by 6.8 ounces, hamburgers by 1.3 ounces, and french fries by 0.5 ounces.  During this period, restaurants and food companies took advantage of the fact that consumers were willing to pay more for larger portions at an almost linear growth rate.  Meanwhile, the cost of goods for greater portions tend not to rise at a linear growth rate, resulting in greater margins.  Since consumers tend to finish food that is lying in front of them, restaurants and food companies gradually increased baseline portion sizes over the years, increasing their operating margins.  With mandatory calorie declarations, this is likely to reverse course.

Creating equity between food groups is now the next major legislative challenge.  After World War II, the US government began subsidizing commodity crops including corn, soybean, wheat and rice to create a low cost industrial agricultural system.  The system worked so well that customers can purchase many of these commodities, particularly corn, at a price that is less than what it costs to produce.  As a result, meat processors began replacing pasture grass-based feed with corn, causing the cost of animal protein to drop and making it amongst the cheapest food groups in the market.  The result—the average American now eats 190 pounds of meat a year!  Paradoxically, America is amongst the only places in the world where obesity is primarily a low-income household problem.  As Michael Pollan, author of Omnivore’s Dilemma, says, “We’ve skewed our food system to the bad calories.”  Unfortunately, the problem is only getting worse.  The meat processing industry has consolidated into a few powerful companies, and Washington continues to provide over $20 billion in farm subsidies per annum.  Obesity is not the only fallout of US farm policy.  Farm subsidies have created mega-farms in the US that are over-dependent on fuel, making commodity prices vulnerable to rising oil prices.  Also, cheap corn being fed to cattle is likely to be the reason behind the recent growth in E.coli outbreaks.   A corn diet does not suit cattle.  It acidifies their digestive system in a way that permits E.coli to survive.

Phasing out commodity subsidies in the US is necessary to create a level playing field between food groups.  As long as broccoli is more expensive than beef, America’s health crisis will continue to deepen.  Organizations worth getting involved in that are lobbying for policy change include the Union of Concerned Scientists, Corporate Accountability International and Oxfam America.

Yacouba Sawadogo was amongst the few who decided to remain on his farm and dedicate his life to “greening the desert.”  In 1981, he, along with a small group of farmers, began experimenting with ancient techniques to restore the soil.  There were two simple techniques at the core of their approach.  The first was called cordons pierreux, which involved laying long lines of stones (each about the size of a fist) on the field.  These cordons would cause rainfall to pause long enough to percolate through the soil.  Seeds would be sowed along these lines of stones, and growing plants would slow the water flow even further.  Within a few years, a simple line of rocks could restore an entire field.  The second approach was to hack thousands of foot-deep holes in the fields during the dry season.  These were called zaï.  Each zaï would be pitted with manure, which attracted termites.  The termites would digest the manure, making nutrients more available.  In each hole, Sawadogo would plant a tree.  Within three years, Sawadogo had transformed a piece of barren land into a 12 hectare productive farm and forest with a large variety of species.

While Sawadogo was initially dismissed by his peers, his success did not go unnoticed, and his approach quite literally went viral.  Sawadogo went on a campaign to educate farmers across the region on his approach.  In under 20 years, it is estimated that over half a million hectares of desert has been converted to fertile fields by indigenous methods in Burkina Faso and Niger, impacting over three million lives.  Desertification is still often viewed by experts as an irreversible process triggered by declining rainfall and destructive farming methods.  However, teams of researchers from University College London, University of Copenhagen and Free University, Amsterdam assert that satellite images indicate that there has been a steady reduction in “bare ground” with “vegetation cover, including bushes and trees, on the rise in the dunes.”  This is being witnessed across the Sahel from the Atlantic Ocean to the Red Sea 6000 kilometers away.  Today, a variety of aid organizations ranging the World Wide Web Foundation to the United Nations are studying these ancient greening techniques and working with farmers across the region to help implement them.  There’s little question that stories like that of Yacouba Sawadogo are what Margaret Mead had in mind when she said, “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.”