Advice for entrepreneurs

February 22nd, 2010

Address pain points in society to do good and do better

Entrepreneurs looking for growth opportunities should begin by identifying ‘pain points’ in society, say INSEAD Professor Subi Rangan and Shantanu Prakash, the founder of Indian educational company, Educomp Solutions.

In the quest to address that pain point, Prakash set up Educomp in the mid-90s, becoming one of the India’s ‘youngest billionaires’. Educomp’s motto is ‘What learning can be.’ Among other services, the company provides technology-based educational solutions to thousands of schools across India, and is also involved in teacher and vocational training.

“Essentially I think the system is dysfunctional,” Prakash says. “And so when we looked at the system we saw opportunity and we said there is a better way of doing things. And we decided to use technology as an enabler, as a method by which we could improve the existing system. That’s how some of our innovation in the area of multimedia education and even distance learning came about.”

Via INSEAD Knowledge

And,

Rangan says the economic paradigm is changing from a self-regarding, instrumental capitalism to a substantive capitalism, which couples society with the market. In essence, it’s deepening the corporate citizenship role of business enterprises.

“Whereas the Schumpetarian entrepreneur starts with gain, my entrepreneur starts with pain,” he says. “They look at the pain in society and ask ‘how can I now make a business of addressing that?’”

Educomp’s Prakash did just that, building a company which today has a market cap of around 1.5 billion dollars.

Not bad and a valuable lesson to those that what to make money in the 21st Century. So, Prakash states

“I fundamentally believe that businesses of the future that operate in some of these areas like education or health or clean technology, will have to take an important decision about how they price their products, how they deliver (them), so that they can meet the aspirations of their consumers. And in meeting the aspirations of their consumers on price points and on quality and other parameters, they simultaneously meet the expectations of their shareholders and investors.” And his advice to other entrepreneurs? Look for society’s pain points.

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