Cities around the world are facing an unprecedented housing crisis and the situation for the urban poor is especially getting worse. In 2009 in India alone, there were 26 million housing units as a deficit, and in 2030 we will have 30 cities of a million population each. You can only imagine what the housing crisis will look like. I was in my second year at Harvard Business School determined to find a solution to this housing crisis. I often wondered, why is the private sector failing to supply affordable housing? What is inadequate in the policy response, the new government of affordable housing for all, why is this not reaching the urban poor? I was going to find out. Before I discuss the case of micro-homes solutions, I would like to summarize four insights from experiences in running a social enterprise that would have some relevance in setting up and starting up sustainable businesses. One: challenging the status quo. Two: working for top-down and bottom-up. Three: fostering cross-sector partnerships and four: empowerment with data: collect, measure, learn, measure. I'm very excited to be sharing with you the mission of micro-homes solutions. It is an interdisciplinary enterprise based on the principles of design, community, and access to finance. Housing left to the market would not produce socially inclusive housing. We only know that land available for low income housing is in the periphery of cities. Often these locations do not have access to basic services, transport, and lack employment opportunities. There was a risk of creating ghetto towns. Definitely not a smart solution for a smart city. Having worked in micro-finance, and as a student at business school during the sub-prime crisis in the US, it made me wonder; Should and would the urban poor in India be willing to access a micro-mortgage? What would the government offer look like? Is the subsidy the way to go? Clearly a one-fits-all solution was not going to be optimal for the diverse housing situation in India. mHS sought to address this problem by creating a portfolio of housing solutions, wanting to address integratedly housing for the homeless, urban planning, as well as low income housing. Clearly it was not a one-fit-all housing policy. Any policy would have to introduce a more portfolio of housing solutions to be more inclusive. What did mHS do? We targeted 70 percent of the urban poor that had home improvement needs and the need to construct and improve their current dwelling. We partnered with the micro-finance institutions Basics and bought technical assistance to improve the quality of the dwelling. This was an action research project kindly supported from a grant by Michael and Susan Dell foundation and the Ford Foundation that helped us to put a pilot in Delhi. The pilot was successful, it served 35 units and showed the commercial market for access to housing and home upgrade loans. The majority of multi-story construction was unengineered, built by unskilled labor from informal sources of finance. Most of all it was highly precarious, especially in the event of a disaster. mHS’s initiative was not one to romanticize slums. It argued for an opportunity in feasible neighborhoods to influence policy while addressing social and environmental sustainability concerns. Unfortunately, ensuring safety of housing was no one's problem. mHS challenged the status quo, and committed to make access to technical assistance a fundamental right for everyone. When mHS started up and we pitched our concept, we were told we were too early for our time, but we were afraid that we might have been too late. So what was our strategy? We sought to work both bottom-up as well as top-down. But bottom up first. We set up pilots with our partner agencies, NGOs and the micro-finance, to show proof of concept, but at the same time we were also working on policy advocacy. Most of our results were pitched and shared with multilateral agencies with the government, and we were very very fortunate to be able to influence the design of 100 million credit line facility of the World Bank to the Government of India. This ensured that housing would be financed, but also technical assistance would be made available to the low income households. For the complex challenges that sustainability has to address, it would be quite foolish to rely on one in-house sustainability expert. At mHS, inclusive cities had the same difficulty. We had to reach out to different agencies and partners in other sectors to collaborate. It meant that we had to create a new paradigm for social housing. For our first product and our first service on technical assistance, we worked with anthropologists, we worked with real estate finance, we worked with the Urban Planning Department at the Delhi Development Authority to be able to create a truly comprehensive model for inclusive housing. So here the takeaway in the inside is cross-sector partnerships. After three years of intense field work, this was time to evaluate results. At one point it was very encouraging. Finally there was traction for our innovative product on improving housing and bringing in technical assistance. The policy environment was changing and was making sure that technical assistance and quality of housing would actually be mandatory. But there was one problem. Delivering technical assistance for mHS, the costs of which were proving to be exorbitant. So what did we do? We took a step back. We used the data we had collected on the field to understand what would be the most efficient way to deliver technical assistance. We also looked at other sectors: health care, education, energy had used digital platforms to make access to technical assistance feasible and cost-efficient. Data for us was key. mHS is currently partnering with J-PAL at MIT to impact and measure our learnings on the field. We are also using digital technology to both collect data, measure, and learn, so we will continue to innovate and open for long term sustainable impact. So well-begun is only half done. Remember mHS’s goal and the huge market out there to influence the 26 million housing we have talked about, and that was only in India. This opportunity to scale lies internationally and globally. So I'm often asked how is it to be a social entrepreneur? And I would say there is a sense of urgency, it requires humility, persistence and passion to keep going. It is definitely a task at hand that keeps me up at night and usually the second thing that wakes me up in the morning. It’s usually the kids that get to me first. For your interest in social enterprise and to learn more about mHS, I will leave two resources: The first is our website: mhscitylab.org and the second is a case written by mHS, “A Social Housing Enterprise” by Harvard Business School Professor Bill Kerr. Thank you.
