This post is also from my earlier blog from June 2010.  The debate is here:

http://whatmatters.mckinseydigital.com/the_debate_zone/should-social-entrepreneurs-adopt-the-language-and-practices-of-business

One thing I found interesting is how Bunker Roy mentioned the National Rural Employment Guarantee Act. I didn’t know it was the result of grassroots activism. It has undoubtedly been beneficial to the rural people, but it is so much less effective than a more “market-based” solution, but has ironically spurred the creation of a VC funded company (A Little World) that has helped create bank accounts for rural villagers, which will arguably do more good in the long run than the act itself.

Apparently there is a condition to the act which does not allow workers to work with certain types of tools, so they are not able to work on anything infrastructure related.  There are tons of people who are being paid by the government, but the jobs they are being asked to do don’t always fill a need – like cutting bushes in one case.

However, this nationwide scheme triggered an entrepreneurial idea called A Little World.  To get the employment funds to the workers, the government paired with “banking correspondents” which are non-profit organizations that deliver the funds to the rural villages. In an effort to keep this process corruption-free, the government requires a technology-based system.  A company called A Little World (which I wrote a case on) created the rural bank-in-a-box, which is essentially a cell phone, fingerprint reader and printer that creates real bank accounts for the villagers and allows them to receive funds.  Because A Little World used the language of business in their talks with external VC investors and banks, they are able to fund this project.  Thanks to the government program, they are able to reach a lot of people with their technology. Now the technology solution can be used to transfer money from the village out in a corruption-free way, which is helping lay the foundation of financial literacy in rural India.

I think that’s proof – passion, commitment and business savvy are ALL important.