‘Bengaluru start-up ecosystem has had trickle-down impact on rural Karnataka’s entrepreneurial aspirations’

The low women’s labour force participation has been slowing India’s economic growth, but the future looks positive, says Anand Sri Ganesh, CEO of NSRCEL at IIM Bangalore

October 17, 2023 09:00 am | Updated 11:41 am IST - Bengaluru

A woman entrepreneure at the Swavalambane programme.

A woman entrepreneure at the Swavalambane programme.

India has been riding the start-up and entrepreneurship wave for a while now, however, the share of women entrepreneurs has been significantly low. While NITI Aayog figures from 2022 peg the number of women entrepreneurs running micro, medium, and small enterprises at around 20 percent, other reports note that the share of women entreprenurs in India have been hovering around 14 percent.

NSRCEL, the incubation arm of IIM Bangalore, in collaboration with the Karnataka State Rural Livelihood Promotion Society (KSRLPS), recently launched the Swavalambane program designed to scale and support women-owned non-farm businesses in rural Karnataka. The programme provides scaling opportunities to 150 women entrepreneurs.

Anand Sri Ganesh, CEO of NSRCEL at IIM Bangalore, spoke to The Hindu about the programme, the need for more women entrepreneurs, and the trickle-down impacts of Bengaluru’s start-up ecosystem.

Tell us a bit about the Swavalambane programme and what it aims to achieve

The Swavalambane programme stems from the realisations of the National Rural Livelihood Mission (NRLM) that entrepreneurship could play a great role in improving the quality of life in rural regions or hinterlands. The NRLM team reached out to us almost a year back to co-develop a programme for the same.  

The idea of incubating nano entrepreneurs was a new concept. At NSRCEL, our idea of entrepreneurship has been very innovation- and technology-driven However, they wanted to partner and create a product design that might help rural woman entrepreneurs to create and scale great beautiful businesses. They wanted to pilot it and scale it nationwide later. It was an opportunity we couldn’t say no to. 

We decided to focus on non-farm product ideas for the first pilot. So, that defined the boundaries of the programme – an incubation programme that would help women entrepreneurs with non-farm products to scale their businesses.  

That also meant we would look at businesses with some revenue traction. While we considered an annual revenue of ₹15 lakhs initially, we realised it was not practical when we into the field. So, we divided it into three segments with thresholds of less than ₹5 lakhs, ₹5-15 lakhs, and above ₹15 lakhs.  

We went to all 31 districts of Karnataka to understand the nature of entrepreneurship in those places and worked very closely with the state livelihood mission. We got a sense of the bottlenecks and opportunities and that helped us create a programme design and structure. When we rolled it out we received an overwhelming number of around 40,000 applications. We funneled it down to 150.  

The product categories range across apparel, silk textiles, toys, jewelry, home décor, food products, and so on. 

Anand Sri Ganesh, CEO of NSRCEL at IIM Bangalore.

Anand Sri Ganesh, CEO of NSRCEL at IIM Bangalore.

How would the programme help the entrepreneurs? 

One is through financial support in the form of grants and loans.  

The programme also offers strong capability building in terms of creating an entrepreneurial mindset. There is also a large social context as women entrepreneurs have to work with their communities as well as their families. Capability building focuses on building entrepreneurial mindsets and on venture capability building. 

The third dimension is mentorship and personal capability building. We are working with partners to engage grassroots mentors who can work with the founders every week on very contextual problems. 

In addition to that we are buddying every founder with another NSRCEL alumni.  

It’s a 12-month program. We hope for at least a 15 per cent increase in revenue within the 12 months itself. 

Which regions of Karnataka are the women entrepreneurs from?

They are from across the state. There were a high number of applicants from Tumkur, Davangere, Bangalore rural and Ramnagara this time. It could be different next time. 

Do the ventures run by the women have cultural linkages to where they are from?

At least 70 per cent of the businesses have deep local roots. You’ll see artisanship, craftsmanship, manufacturing techniques and so on. 

The second aspect is that, so far, the market of these products would have been within, say, a 10-km radius. So, while they are deeply rooted in local cultures, the market has also been local in nature. If we can unlock it further, there could be a much larger opportunity. 

Women entrepreneures at Swavalambane programme.

Women entrepreneures at Swavalambane programme. | Photo Credit: The Hindu

Reports suggest that the share of women entrepreneurs in India is as low as around 14 per cent. What are your views in this? 

Depending on what report you read, women’s labor force participation could vary from 13 to 26 percent. This is not necessarily a societal challenge. Our challenge is an economic challenge. If less than half the population of the country is not coming to economic parity, then how do we grow from being a lower-middle-income country?

Our per capita income is $2,600. In the US it is $71,000; in China $12,800; in Bangladesh $4,500. We could be a 5-trillion economy because of population, but a per capita income of $2,600 is just not okay.  

However, from a macroeconomics perspective I think it is also an opportunity. If we look at the progress over the last five to seven years, it has been incredible both from an innovation side and at the grassroot levels. 

Of course, Karnataka, compared to other states, is a relatively higher-income state. But, the inequity between large economic clusters and rural hinterland is still very stark. The model of encouraging rural women entrepreneurs has to hit a national scale. And there will be, I’m sure, a tipping point.

Other countries like Vietnam and Mexico have done it. They were on a similar journey and the moment the labor force participation tipped over, the entire economy tipped over. Now they’re in a different per capita income growth trajectory. 

Has Bengaluru being the startup hub and Silicon Valley of India had any impact on the rural regions of Karnataka? 

Massive. Aspiration levels are extremely high. If you talk to the children of the women entrepreneurs who are part of the programme you’d see that they know companies like Infosys. They know how an Indian company has made it.

So, role models have been created and along with that, the sense of confidence that other people who look like us and talk like us have done it, so we also can. That is a cultural barrier break. While the Bengaluru entrepreneur environment is strongly technology and innovation-driven it has had definitely a trickle down effect.  

Do you think the number of women entrepreneurs have been rising?

For sure. Over the last five to seven years it has definitely been rising. There are quite a few factors contributing to it.  

Sometimes timing makes a difference. Entrepreneurship culture is being more respected lately. 

The second factor is that probably some of our societal norms are getting unlocked. Today, if I’m a woman entrepreneur, I can tell my family that I’m setting up a silk embroidery business and it is quite likely that, at least in many pockets, you will get a very positive response. Today if you go to a bank - I’m not saying it’s so well penetrated - but there are opportunities like the MUDRA scheme, the Standup India scheme, and so on. I I don’t want to say it’s completely hunky-dory, but at least windows are opening up if not doors.  

India as a market for India is really opening up. So many of us are appreciative and desirous of products and services made by Indian for Indians and it doesn’t have to be a government rhetoric.  

So cultural nuances, markets opening up, government initiatives and of course the larger startup environment in the country have together created a good perfect storm. You have long way to go, but it is creating a very positive momentum. 

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