Serial entrepreneur Ronnie Screwvala, whose many successful ventures have become part of India Inc’s folklore, said the successful listing of a project by his non-governmental organisation, Swades Foundation, on the Social Stock Exchange (SSE) has given him “a different high”.
This is because Screwvala, who is also the Co-founder of edtech upGrad, feels there “should be much more value creation [from the Swades listing] than just getting a pop on a stock price.”
Swades, which began life 15 years ago as SHARE (Society to Heal Aid Restore Educate), raised Rs 10 crore from the SSE, making it the biggest listing on the exchange so far. With 150 individuals across industries contributing to the fundraise, it has also seen the widest participation among the eight projects listed so far on the exchange.
Screwvala said about 700 more NGOs have now registered to get their projects listed on the exchange.
Pic credit: Swades Foundation
The SSE on the National Stock Exchange of India provides social enterprises engaged in eligible activities a unique opportunity to register themselves and raise funds. It was Finance Minister Nirmala Sitharaman who first mooted the idea of an electronic fundraising platform under the regulatory ambit of SEBI as part of her 2019-20 Budget Speech.
“I think what [the] National Stock Exchange and SEBI have done here with this one is they’ve created a very credible system, because one of the key things when you want to give back is credibility and impact,” said Screwvala in an interview with Shradha Sharma, Founder and CEO of YourStory.
“So anyone wanting to donate feels they’re giving it and it’ll be used for the right purposes. And the second one is that you have to submit and show the proceeds of your funds. You have to figure out where it goes. You have to file an impact report at the end of it. So the ROI [return on investment] is ‘impact’.”
He said there were similarities and differences between raising funds on the SSE by social impact organisations and the traditional IPO route taken by for-profit organisations.
“Well, the similarity is the same sense of rigour, the same sense of scrutiny. It took four months before we got the approval to do that,” he pointed out. “You know, every single element of the project, where the money was going. How did we do that project before? What impact reports have we done before? So the commonality is great, great, great depth of diligence.”
The difference, he said, is that when you’re listing a for-profit company, the shares become a tradable commodity going forward. But on the SSE, it’s not the company or the foundation that is getting listed, but a specific project.
Swades Foundation with its 300+ strong team and 1,000+ volunteers hopes to lift a million people in rural India out of poverty every six to seven years. Screwvala said he was keen to make a difference in the geographies they work within six to seven years.
“It was not the million as much as ‘every six to seven years’, because to me, the most important part was how do we change, and then leave and empower people to move on,” he said. “But if you’re working on a village or a school for 20 years, 30 years, that obviously means you haven’t made that permanent change.”
Swades Foundation is currently engaged in various projects in rural India covering areas, such as sanitation, education and livelihood. It has reached around 3,310 villages across Raigad and Nashik districts of Maharashtra, benefiting nearly 12 lakh people till now.
The Rs 10-crore fundraise saw the participation of individuals from diverse segments. From the corporate world, Infosys Co-founder Nandan Nilekani, former HDFC Chairman Deepak Parekh, and Mahindra Group Chairman Anand Mahindra participated in this issue. Startup founders like Zerodha’s Nikhil Kamath and Nithin Kamath; Myntra’s Mukesh Bansal, and Lenskart’s Peyush Bansal chipped in with their contributions.
This issue also had participation from the entertainment industry with the likes of Abhishek Bachchan, Vidya Balan, and Meghana Gulzar contributing to the fundraise.
“I think what we did was we worked really hard to bring in a large plethora of people to participate. And I think it was a privilege to have a lot of people contribute because I think that’s when credibility builds in,” said Screwvala. “When industrialists, heads of business, heads of startup companies, celebrities and others contribute to a cause, it gets everybody else feeling, this must be good, this must be safe…”.
The upGrad co-founder highlighted that the strongest point of SSE is that organisations can approach this platform multiple times to raise capital for different projects. However, he cautioned that it is important to build credibility first.
Screwvala was very hopeful that SSE would be able to mobilise $2 billion over the next four to five years. “That will be real India contributing,” he remarked.
