Dr Muhammad Yunus, the founder of Grameen Bank in Bangladesh, recently partnered with the Indian Institute of Management- Ahmedabad (IIM-A), a public business school, to pool a INR 50 crore (USD 10.1 million) investment fund for social ventures. According to Dr Yunus, a social business is one that reinvests all of its profits into the business, whose purpose is to address social needs, without paying a dividend to shareholders. Examples of established social businesses include joint venture between Grameen Bank and French food products firm Danone that provides fortified yogurt to poor children at a low cost and another with French water company Veolia that sells low-cost drinking water to people in Bangladesh.
The alliance with IIM-A is a result of a year-long discussion with its Centre for Innovation Incubation and Entrepreneurship (CIIE), which will partner with Grameen Creative Lab, an organization that aims to promote social business, to create a mentoring network and incubation program that will aim to assist entrepreneurs in planning and building social businesses.
Fundraising for the pool has not yet started.
By Charlotte Newman, Research Associate
About Grameen Creative Lab
Grameen Creative Lab (GCL) was founded in 1999 as a joint venture between the Bangladeshi Yunus Centre and German consulting company circ-responsibility. GCL, which is based in Germany, aims to fight poverty by accelerating social business, which Dr Yunus defines as a company that does not pay dividends to shareholders but rather reinvests its profits into the company, whose purpose is to serve social needs. GCL’s three main activities are advocating social business, further developing the idea of social business and assisting companies and investors in the creation of social business. Financial information for Grameen Creative Lab is not available at this time.
Sources and Additional Resources:
Economic Times: “Muhammad Yunus, IIM-A Set to Floan Rs 50 Crore Fund to Seed Social Business,” http://articles.economictimes.indiatimes.com/2012-02-16/news/31067071_1_muhammad-yunus-social-business-social-sector
MicroCapital.org story, January 23, 2012, “MICROCAPITAL BRIEF: Muhammad Yunus International Centre for Microfinance and Social Business Launched at Okan University in Turkey,” https://www.microcapital.org/microcapital-brief-muhammad-yunus-international-centre-for-microfinance-and-social-business-launched-at-okan-university-in-turkey/
MicroCapital Universe Profile: Grameen Creative Lab
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