VisionSpring, vision entrepreneurs

by Anjali Sastry on November 12, 2010

Several years ago, thanks to an innovative class pioneered by my MIT Sloan colleague Simon Johnson, MIT students had a chance to partner with finalists in the World Bank Development Marketplace business plan competition. Student teams worked directly with promising entrepreneurs, mostly from the developing world, to address a development challenge posed by the World Bank team: the MIT folks assisted finalist entrepreneurs. It was a formative experience for the students involved–and for me, as a one-time collaborator. I learned about Scojo, an early winner (their 2003 winning entry) and we just took a look at the organization they have developed into, now called VisionSpring. VisionSpring supports microentrepreneurs in selling low-cost eyeglasses to low-income consumers in India and elsewhere. Some entrepreneurs work with other organizations and get VisionSpring’s “business in a bag” alongside their other products and commodities; others work only with VisionSpring. This model has been called “microfranchising.” Take a look at this working paper, Microfranchising at the Base of the Pyramid, for more.

By the way, Development Marketplace is still going: the World Bank Institute sees value in the bottom-up model for socio-economic development fueled by social entrepreneurs.

For a story of how Scojo went from an idea to a growing organization, see this recent INSEAD story.  A recent piece, What Works: Eyeing Talent, from the Stanford Social Innovation Review adds more, describing how VisionSpring picks promising social entrepreneurs to restore the eyesight of poor people. A recent VisionSpring blog post entitled Needs vs. Demand: Social Marketing Strategies in India explains the importance of demand generation as part of the organization’s strategy.

We learned from our research that VisionSpring sought investors via a process known as a growth capital offering. Here’s VisionSpring’s 2008 Growth Capital prospectus. To learn more about what this process entails, the Nonprofit Finance Fund explains their Sustainable Enhancement Grant (SEGUE) approach to accounting for nonprofits. According to a recent Fast Company piece, SEGUE

tracks growth capital separately and does not count it towards general revenue. As capital is used, the funds are moved back into the revenue line. This allows a nonprofit to distinctly account for money going to build the organization’s platform.

“We’re trying to decriminalize sound financial practices for nonprofits,” explained Craig Reigel [Partner of NFF Capital Partners, who just succeded George Overholser as Managing Director.]

For social entrepreneurs seeking to develop their capabilities, the non-profit equivalent of an IPO offers a vehicle for raising needed investments–and gives us a chance to learn more about the organization’s performance and plans. We were glad to find the VisionSpring Growth Capital Offering. Take a look and tell us what you make of it.

And note that US-based non-profits, possibly with the exception of some faith based organizations, need to report annually to the IRS in what is called a form 990 and disclose revenue, expenses, assets, directors and some salary information along with some other info.  The 990s tend to have a year or two time lag but can be publicly accessed via a website called www.guidestar.org.  You have to register, but it is free. Thanks to Nicole Zenel for sharing this resource!

{ 4 comments… read them below or add one }

Joost Paul Bonsen November 14, 2010 at 6:08 pm

Nice survey piece about VisionSpring / Scojo and their progress over time.

I hope they know of our Media Lab colleague Ramesh Raskar and his students NETRA project — http://web.media.mit.edu/~pamplona/NETRA/

–Joost

Paul M November 15, 2010 at 12:21 pm

VisionSpring is an impressive organization that organizations, both large and small can learn from. At first glance the cynic in me notices that the vision entrepreneurs have only accounted for a small amount of the delivery of eyeglasses and that the real delivery vehicle is the firms and other NGO’s that they partner with. I called into question whether the organization had an honest goal of scaling their vision entrepreneurs or they used them as a means to appeal to donors.

Upon further investigation, I found that VisionSpring did in fact have an honest goal of scaling their vision entrepreneurs. From a blog post (http://bit.ly/wYPap) Praneetha Manthravadi noted that , “What started in 2006 as a small operation with 50 women grew into a network of 2,000 entrepreneurs by2009.” The organization also clearly shared it aspiration of scaling to 80,000 entrepreneurs within a couple of years in 2009. From the most recent statistics from their website, it appears that they are well on their way, with over 9,000 entrepreneurs already in 2010.

Beyond their ability to scale, VisionSpring has a secret weapon that many companies, even the most successful large organizations in the US, do not have. They actually listen to their customers. From the beginning, even though there were not many vision entrepreneurs on the front line, they were able to get instant feedback and find out immediately what their customers wanted. This is especially valuable in global health, as markets can vary from country to country and even village to village. Their top down vision of delivering affordable eyeglasses to poor communities around the world combined with the bottoms up way they react to their customers makes a very sustainable business model. This has enabled them to successfully implement this in five countries already and is a model that other global health organizations and even large corporations in the developed world can learn from.

Pamela November 17, 2010 at 9:29 am

Some great videos, note the BRAC delivery ones at the end.

http://www.pbs.org/wgbh/rxforsurvival/series/video/index.html

Ira Glass January 25, 2011 at 5:55 pm

Micro-financing seems like the only way lower income countries are getting help, but you can’t argue with results. Bigger loans are usually more than some countries and small business owners need and with the lack of great infrastructure in other countries the size and scope usually taken with a big loan is too large for success. Thus leaving micro-financing as the best option. And by providing glasses for those who couldn’t afford it, we give them the gift of site which is often overlooked even here in America.

I would like to know what the financial figures are for VisionSpring, how much do they bring in or loose with their loans?

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