There’s a plethora of prodigies in the rural areas of India. New innovations and the desire to build something of their own are inspiring young rural entrepreneurs to launch their own businesses. NGOs and trusts are facilitating their progress by supporting them.
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The Indian rural landscape is witnessing a change. And the people within the community are the ones that are behind this change. Rural entrepreneurship has seen a steep growth with many groups and trusts acting as mediums to help these people. There is a lot of hidden potential in the rural space that only needs a little push to grow. Trusts like Bhartiya Yuva Shakti Trust (BYST), Gramya Resource Center for Women, Dilasa Sanstha etc and platforms like FAARMS, etc. are acting as facilitators in providing the resources and help needed by the rural entrepreneurs in setting up and managing their businesses. The rural entrepreneurs mostly lack the knowledge and expertise that is required to build big corporations.
Farming is one of the biggest economic sectors of the country. With the majority of the rural population indulging in farming and activities associated with it, communication is still a looming problem. FAARMS has stepped in to create an eco-system that enables frictionless communication.
“FAARMS was launched with the mission of creating the ultimate digital platform that provides solutions for all kinds of challenges faced by the farmers. From sourcing farming inputs, financial security and crop-related advisories to logistics, the intention was also to have a platform that brings transparency in the system. It was also aimed at giving access to high quality products which eventually results in better yields, improving the farmers’ incomes and uplifting the entire ecosystem,” says Taranbir Singh, CEO & Co-founder, FAARMS.
Companies are now taking their operations online. More so, after the pandemic. A lot of effort goes into switching operations from manual to automatic. This also requires the companies to either employ technology-savvy people or to hire people who are adept at digitalisation.
“Digitalisation has definitely helped expand our network but we had to work hard on the ground in the remote areas to spread awareness and educate the farmers about its various aspects. The adoption was slow in the beginning but now 75 per cent of our clientele is made up of repeat customers. Our relationship managers still visit the farmers from time to time and arrange awareness camps for them in all the states,” Singh points out.
While talking about these aspects, another area that has been given due attention is the involvement of women. From entrepreneurship to working at an individual level, women are being tasked with roles and responsibilities that are leading them out of the comfort zones of their houses. They are also being taught new skills in various areas such as knitting, cattle farming, etc. that can provide them with a chance to build a career or help them to sustain themselves.
Manjeet Kumari is one such woman who has fought against the odds on her entrepreneurial journey. Starting from creating women’s self-help groups to becoming the owner of a soya nut making unit, her journey is an inspiration for all women. BYST played a huge part in streamlining and guiding Manjeet’s business.
Manjeet completed her training from Krishi Vigyan Kendra in the preparation of soya nuts, after which she was confused on how to use her skills in this field. BYST aided her by helping her to acquire a bank loan of Rs 1,00,000 and also provided her with mentoring support. She used the loan to purchase a large sized processing machine to produce soya nuts and packed and sold them in the local market.
“I plan to expand my business activities by diversification and by farming out more work among my women’s SHG members. My long-term vision and strategy are to scale up the business activities in partnership with SHG members,” says Kumari.
“BYST’s Mentoring India Programme and Mentor Mobile Clinics aim at creating a pool of mentors and helping entrepreneurs in far-flung villages. The Mentoring India Programme service includes screening of future mentors, customised mentor training and assessment, mentor practical training, mentor peer learning, etc. While the Mentor Mobile clinics consists of a group of five to six mentors drawn from diverse backgrounds such as marketing, engineering, finance, agro-products, general management and so on,” she points out.
Women in rural areas have long been working in the fields. They also sometimes manage the cattle and help in the daily necessary activities. But it’s time for them to take a leap and utilise their knowledge and skills to become independent. Besides, it sets a precedent for the other women in the community, inspiring them to do something similar, creating a ripple effect of positive changes.
“In India, 85 per cent of rural women work in agriculture, where a majority of them are involved in labour-intensive tasks, but only 13 per cent of women own a piece of land. They are the key agents for achieving the transformational economic, environmental and social changes required for sustainable development,” Singh asserts.
“In the dairy sector, it is quite prevalent that women are actively involved in animal husbandry activities. They manage the end-to-end operations work of a dairy farm. FAARMS is empowering these women through its tech-enabled platform where women dairy farmers can order the product and receive it at their doorstep with utmost ease and convenience,” Singh tells us.
“One of the key issues in rural India is the lack of financial literacy and inclusion, which continues to be a barrier to the development of rural India,” says Singh.
Understanding the math behind your business is certainly the most crucial part of doing any business. In India, the rural population is not very literate. They don’t hold much knowledge about the math behind the business and thus are not able to earn as much as they should be doing.
Awareness campaigns and sessions are held by the NGOs and trust funds to educate people about the tips and tricks of running a business. With the upliftment of the rural communities, private players have started to come into the arena as well. The involvement of big scale companies has brought a lot of ease into the sector. Now with the association of big companies, new trends will emerge, and technological advancements will also further simplify the manual processes that the people had to toil hard at earlier.
“The agriculture sector was run majorly by the government but in the last few years, many private players have entered the space. The new age start-ups are playing a pivotal role in easing the burden on the farmers by not just introducing modern technology and farming techniques but by digitising various aspects of the farming ecosystem from supply chain networks and financial literacy to even educating and creating awareness among the farmers,” Singh asserts.
Hitender Punyane is an entrepreneur from India. He was raised in Faridabad, in the state of Haryana. His father was an employee in a firm and his mother was a teacher in a local government-run school. His unit, SHN Enterprises is the leading manufacturer, wholesaler and importer of CNC tool stations, inspection tables, industrial trollies, industrial pallets and many such products, which are manufactured using superior quality material with advanced tools.
“When I started my business in 2009, I faced a lot of ups and downs while establishing the company. I faced many challenges like managing the funds for my employees and their livelihoods, vendor payments, payments for the fixed instalments for the loans taken, team retention etc,” Punyane reminisces.
To overcome these challenges, he made some changes to his business while keeping the basics the same. He started giving out discounts on the ready products and also became open to negotiation on the prices of his new products. He focused on marketing by hiring staff for tele-calling and e-marketing. He even entered the maintenance business and also started manufacturing new COVID-related products like a foot-operated sanitiser and foot-operated hand wash booths. Punyane was in touch with BYST throughout the process. They helped him with lots of suggestions, guidance, and handholding.
These inspiring stories of grampreneurs tell us that rural India is rapidly changing. The rural youth too are well informed, are eager to learn, have an entrepreneurial spirit, and quite often have global aspirations as well. However, creating a facilitative eco-system for rural entrepreneurship is the need of the hour.
There is a lot of work that needs to be put into rural development. Start-up culture is becoming a trend these days and it is catching up even in the remote villages. The government, NGOs and trusts are all paying heed to the hurdles that are faced by our rural entrepreneurs.
While the government is helping out with various schemes for them, organizations like BYST and FAARMS are educating these rural entrepreneurs and supporting them to enable them to reach the national stage. In due time, we will see more and more people from rural India embarking on their entrepreneurship journeys. We wish them all the success that they surely deserve.
SME culture in India will gain more momentum in the coming days. With help from institutions and incubators like MAGIC, the growth and development of the start-ups to MSMEs will accelerate.
SME Futures spoke to Prasad Kokil, Founder and Director of Marathwada Accelerator for Growth and Incubation Council (MAGIC) on how it provides impetus to upcoming start-ups and budding entrepreneurs, including the rural ones. He also speaks about the entire process that MAGIC adopts to crystallise an idea, from its inception to its final form.
Here are excerpts from the interview:
MAGIC is not just an incubation centre but also an accelerator and business incubator. It’s an initiative by an industrial association – the Chamber of Marathwada Industries and Agriculture (CMIA). CMIA is a 55-year-old organisation; it has played a catalytic role in the development and promotion of the Marathwada region in the industrial landscape. The idea was to help budding entrepreneurs by giving them guidance and business knowledge. For this, we started an incubation centre in 2015.
To answer this, we must first know what a start-up needs. The most important thing that a start-up needs is to convey its idea and thought, and an ear that will listen to them. People need approbation that their idea is good, and this is something that MAGIC can work on with them to further crystallize it.
If the idea is innovative and good, some pertinent questions arise: Is there a possibility for hand holding? Are incubators willing to give a certain degree of mentorship and time to it? Will they provide space for the setup? Will the startups be provided with workshops, if required? Will anyone provide assistance for industry access? Will we get help and funding for making prototypes of our products? These need to be answered.
We have started an initiative called ‘Saturday Clinic’ to pay heed to these requirements at the fledgling stage of a start-up. For our ‘Saturday Clinic’, we meet around 9 in the morning. It went virtual during the pandemic. Now we’re running it in hybrid mode.
People come to us directly and tell us about their ideas; we keep crystallizing them. We identify the shortcomings in their ideas and suggest ways to plug the loopholes.
During the mentoring sessions, either a person breaks or stands strong for his/her idea. This shows us whether a person is actually serious about their idea or not. When a person sticks with us after 3-4 sessions, it shows that he/she is really serious about the idea. After this, we hold one-to-one mentorship sessions with that person. We provide him/her with 4 hours of mentoring each month: 1 hour per week. If the person feels like there is some concern, we coordinate and allocate the required time to them. The whole process is a journey of 1 -2 years.
The sessions are for 2-3 hours, and we only take in around 3-4 entrants. We ask them for a presentation; we provide them pre-made templates in which we ask various questions. We question them about their product. We ask: What is your problem statement? Is your product a vitamin or a painkiller? What is your target audience? Have you conducted any surveys? How many people did you include in the survey? etc.
A product needs to connect with the audience. Mock drills are held to understand how clear the person is about their idea. This helps us further crystallise the idea. Questioning and focusing on a path helps to further clear the doubts and strengthens the idea’s foundation.
After the idea is conceived, we start working on the making of a prototype, also known as a Minimum Viable Product (MVP). After successfully creating an MVP, the person is keen to start selling their product in the market. We sort out for them their first potential customer and notify them about all the developments. We also help them to send their proposal to the customer, identifying elements like what is the customer base of the product and its business potential? What are the technical and commercial resources associated with it? What are some of the government schemes available in the domain and so on? When the person gets a hold of the market and starts to learn more about it, we suggest to them to start pitching their products to companies to accelerate their growth. They may either get a grant or they need to share their equity to get funds and resources for quicker growth. When the start-up receives a grant, it is well received but it’s a long-winded process.
When the product has completed around 18 months in the market and is performing well, we ask the start-up to acquire loans and funds for their working capital. For this, we have signed an MoU with the Bharatiya Yuva Shakti Trust (BYST). BYST consists of retired bank managers who help to submit the forms to the banks and the banks too approve the loans knowing that BYST carries out thorough checks and thus they trust them with relatively quicker approvals.
Even after getting bank loans, the start-up needs help in planning their layout, sourcing, jig fixture etc. These technical aspects of mentorship are provided by our technical experts. We make sure that the start-up focuses on their annual turnover, and also manages their top-line and profit.
Start-ups have a problem with channel margins: to determine the cost that goes into making the product and then at what price to sell it to the consumers. With cross questioning, we can develop a top process. We have setup a co-working space for 20-30 people in MAGIC where they get table space and common facilities.
The process is free for a year if you are selected in the incubation process. After a year, we charge a nominal rental fee.
We have supported 14+ start-ups that have now moved on to become full scale businesses and currently, we are mentoring around 128 teams. Out of the 128, we have provided co-working space to 28, while the others connect with us virtually. We have start-ups from various institutions like the Bharatiya Hindu University (BHU) in Varanasi, and from states like Delhi (IIT) among many others.
We have tie-ups with around 35 organisations that include Marathwada University, the ICT Mumbai campus, and the Shri Guru Gobind Singhji Institute of Engineering and Technology in Naned among others.
We conduct hackathons every year and it has helped us to reach a pan India level. We use this pipeline to channelize and use the links accordingly.
We support grassroots innovators. We’ve found such wonderful innovations from the rural space. A person made a razor similar to the Gillet’s disposable one for which he won a prize at the national level. Then, there was another innovation which stunned us. A person made devices/apparatuses for a motorcycle that could turn it into a vehicle that could do the tasks that a tractor does.
There’s a pool of rural talent. They know the engineering aspect, but they are not so good at doing business and marketing. We help them by acquainting them with chartered accountants and bankers. They teach them about how to make profits and also dispel their doubts and iron out their concerns.
We give them grades on their tasks and they must acquire a certain amount of credits to qualify for the continuing procedures. They are given further exposure through workshops, where they are taught more about pitching their products and selling them.
One marked change that we have witnessed is that students have started to respect start-ups. They feel excited about doing something innovative and want to try it out on their own. They want to experiment with it. Students from even the remotest of areas want to do something in the start-up space.
People who want to participate in the start-up space need a support system. They need someone to assure them that they are behind them in every step that they take and during every mistake that they make. Support systems, as such, are increasing as well. Many colleges and individual initiatives (like ours) are coming to the fore to act as support systems. Colleges and academic institutions, which earlier focused on packages to promote their institutions, now work to support individual ideas and entrepreneurs as they want such people to come out.
MSMEs are the backbone of our country. It is the most agile, flexible and resilient sector of the country. With government support, and the upcoming and ongoing initiatives, the growth and development of India’s MSMEs will further accelerate.
Talking about the challenges, one of the major problems that start-ups face is to find funding for their prototypes. To have support in the initial stages is very important. Entrepreneurs must be given the chance to prove themselves.
Start-ups have a lot of work on their plate and having to wait for university grants to be cleared is a big demotivating factor.
This is a platform where we want to give. There comes a phase when you earn money and open your business. Then comes the second phase where you want to pave and develop the path that you have come through for the future generations. This is to help the budding entrepreneurs surmount the difficulties (which we already have) in a shorter period of time. MAGIC gains goodwill and acknowledgement and feels proud that more and more people want to connect with it. These are our assets.
We plan to launch our MAGIC Angel platform where we will focus on promoting young entrepreneurs to get associated with it and teach them about investment and reserve funding to enable them to easily venture into the business world.
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