It’s time for budding wealth creators to unleash a new era of giving | Jobs Recent


Startup entrepreneurs, as well as a few in leadership positions in these startups who have acquired considerable wealth and can contribute to India’s development history, are increasingly seeking opportunities for meaningful engagement, write Nikhil Kamath and Jyotirmoy Chatterji.

With over 100 unicorns and 80,000 startups, India is the third largest startup ecosystem in the world. Wealth creation by start-ups in India continues its upward trajectory, with unicorn and gazelle founders amassing greater amounts of wealth at a much younger age. The IIFL Wealth Hurun India Rich List 2022 lists 100 startup founders with a combined net worth of INR 5 trillion for the first time in a decade. Interestingly, the average age of startup founders was just 40, and out of those 100 startup founders, five made it to the top 100 in the 2022 list. In fact, the cumulative wealth contributed by unicorn and gazelle founders to the wealthy list has increased by 35 percent this year.

The increase in wealth creation among this dynamic and entrepreneurial cohort is a trend that could have positive implications for India’s philanthropic sector. According to the India Philanthropy Report 2022 published by Bain & Company and Dasra, India’s total private philanthropic endowment is estimated to grow by about 12 percent annually over the next five years. The 2021 issue of the report noted that the average age of giving in India is declining every year, indicating an earlier introduction of the next generation of donors to philanthropy.

Moreover, the disproportionate increase in wealth during the pandemic has pushed Indian founders and start-up entrepreneurs into philanthropy much earlier in their careers. The potential of giving to this vibrant cohort of groundbreaking hits remains largely untapped and could potentially unleash a new wave of philanthropic leadership to reimagine giving in India aimed at meeting national social sector funding requirements.

Changing the perception of wealth

Indian startup founders have unlocked the country’s dynamic innovation ecosystem. Today, these entrepreneurs, as well as several in leadership positions in these startups who have amassed significant wealth and can contribute to India’s development history, are increasingly looking for opportunities for meaningful engagement. The pandemic has made it clear that life is uncertain and time is finite, so they must contribute and give back to society in any way they can.

The desire to leave wealth to future generations is diminishing and less desirable among this cohort, therefore it offers them many opportunities to positively use their wealth and solve many pressing social problems. In fact, they are willing to leave a legacy because of the social influence they have, not because of their wealth. This generation of entrepreneurs and start-up wealth creators wants to make efforts to reduce the huge inequalities that prevail in our country. It’s not about doing one big thing in one year; it’s about giving consistently over a long period of time to bring about lasting change.

Increasingly, we are witnessing many of them engage in philanthropic endeavors that have the potential to change the approach to giving, thus ushering in a new era of bolder, innovative and even more catalytic philanthropy in India. An interesting example worth noting is ACT Grants, a collective of venture capitalists, tech entrepreneurs, start-up founders and social impact leaders who came together in 2020 to support COVID emergency response. Today, it is a solid community that creates innovations capable of solving complex social problems on a large scale in various sectors. Another example is Mekin Maheshwari, who uses his skills, time and effort to build the Udhyam Learning Foundation and the Global Alliance for Mass Entrepreneurship that are driving innovative change in education and entrepreneurship.

The Rainmatter Foundation, another start-up team social initiative, funds scholarships and organizations working to restore the environment through direct action, research, advocacy and climate policy. The Rainmatter Foundation also funds community projects and site conservation and restoration activities.

Untapped philanthropic potential

This spirited cohort has all the ingredients to reimagine India’s philanthropic landscape. They are tech-friendly, have a greater appetite for risk, and are willing to invest their time, money, and effort in solving complex development challenges. What is most exciting is that they inspire their personal networks, other startup founders and entrepreneurs to engage in philanthropic work by exploring new approaches to giving and talking publicly about their efforts. The Young India Philanthropic Pledge is a manifestation of this. The pledge is intended to inspire the Indians below aged 45 to make thoughtful philanthropic investments by choosing projects that have an impact and investing their funds, experience and expertise in them. Taking a pledge becomes a lifetime commitment and helps ensure the continuity of strategic philanthropic intervention.

Another characteristic of this cohort is their willingness to deepen their knowledge about the philanthropic sector by connecting and engaging developed philanthropists and industry experts. This helps to create a sense of community among donors so that they can share their learning experiences and discover synergies in joint donation. An example of such a network is GivingPi, which provides philanthropic offerings and a robust ecosystem to support family donors in realizing their philanthropic vision. A space of trust, openness and honesty to share experiences, explore collaboration opportunities and enable trusted connections will be of incredible value to those entrepreneurs who are increasingly involved in philanthropy and significantly involve their families as they shape their charitable efforts.

The need for an ecosystem to accelerate giving

As the startup ecosystem in India continues to rise to new heights, unlocking the potential of this segment will be crucial. Their willingness to engage in philanthropic activities should be nurtured and supported with appropriate resources. In this regard, it is important to work with them and understand their aspirations and challenges. Strengthening the philanthropic ecosystem with credible NGO data, insights, donation vehicles and networks supporting this cohort will go a long way towards realizing their giving potential.

India’s startup founders and wealth creators, armed with perseverance, innovation and ambition, are well positioned to rebuild India into a nation we’ll all be proud to leave behind for future generations. It’s time for intention to meet the ability to build the future that awaits India@100.

-Authors Nikhil Kamath is the co-founder of Zerodha and True Beacon; and Jyotirmoy Chatterji is the boss, Giving Pi, and co-director at Philanthropy Labs. Views are personal.

(Edited by : CH Unnikrishnan)

First published: IST



Source link