Innovative initiatives supporting inclusive innovation in India: Social business incubation and micro venture capital

In India inclusive innovation through social entrepreneurs is currently booming. However, these entrepreneurs suffer from a lack of finance since the bank system as well as the microfinance sector are unwilling or unable to finance them. However, pioneering finance initiatives have been emerging recently to bridge this gap. This paper discusses these emerging alternative financing initiatives which are forming an innovation eco-system of support for inclusive innovation and social entrepreneurship. It highlights two instruments in particular that are used in conventional innovation support: business incubation and venture capital. Two case studies are undertaken in order to provide evidence on how such instruments can operate with a ‘dual bottom line’ in supporting inclusive innovation and social entrepreneurship.

► Inclusive innovative entrepreneurs are facing a financing gap but in India pioneering finance initiatives have been emerging to bridge that gap.
► These organisations are forming an ecosystem of support for inclusive innovative entrepreneurs.
► Inclusive business incubation and micro venture capital support different kinds of innovative entrepreneurs at different stages.
► Some ventures ‘graduate’ from business incubation to micro venture capital investment.