Finding venture capital can be a real struggle for Irish entrepreneurs. Yet the effort pales in significance when you consider what women living in India’s slums must go through to secure support for their microbusinesses.
Someone who is in a unique position to compare and contrast the fortunes of both is San Francisco-based Sheetal Walsh.
Walsh, a recent guest in Dublin of SMBC Aviation capital, is an angel investor and in a previous life created the venture capital relations team at Microsoft in the US and later in Britain. What fuels her passion now is Shanti Life, an international charity she has founded that provides the poor in India with access to financial literacy, hygiene training, sanitation facilities and seed capital for small enterprises.
"Many of the women we wish to support don't have access to sanitation and face a long journey to use a toilet where they risk getting bitten by a snake or being sexually assaulted," she tells The Irish Times. "Providing an eco-sanitation toilet is often the first vital step in their journey to independence."
Shanti Life also provides such women with loans to start businesses. That can be difference between a down-payment on ownership of a rickshaw to provide a more sustainable venture than leasing one. Other typical projects involve finance for buying a sewing machine or helping artisan develop their textiles for sale.
Loans not grants
The model is one of loans rather than grants and the aim is that the money is recycled into other local ventures.
“These women often have no collateral and no other reliable source of funding at sustainable rates. Repayment rates are almost 100 per cent and the women become role models in their community, creating a network effect,” she explains.
Shanti Life provides loans ranging from $100 upwards and has a range of interest rates capped at 10 per cent.
“Our metric of success is not our return but the level of repayment so that we can recycle the loans to help others,” she says.
As well as money, the charity provides access to financial literacy. In some cases, this prevents vulnerable people falling into the hands of loan sharks.
Ironically for someone involved in providing finance, one of the most common problems she encounters in India is a reluctance on the part of borrowers to come forward despite their acute needs.
“There is a certain suspicion as to why outsiders would want to help them. There is a humbleness and certainly no automatic feeling that they deserve to be financed,” she says.
That’s very different to the attitude she encounters on the west coast of the US. “There is a much greater sense of entitlement there and an expectation that their businesses should be financed.”
Walsh’s major investment interest at the moment is metacert.com, which provides security tools for companies that use messaging apps.
Passion and insight
When assessing an investment, she says that she looks for promoters that display passion while having insight and a compelling proposition.
“I like projects that will affect people’s lives and where there is a game-changing element.”
In her view, one of the biggest mistakes that budding entrepreneurs make is their attempt to go it on their own, without a strong number two.
“You only have to look at the great successes in the tech sector. There’s generally a strong number two from the start and a quick desire to build a team. It’s very hard if everything is invested in just one person.”
From the promoters’ perspective, she favours finding investors who provide more than just finance.
“There are a lot of angel investors out there but it is key to take smart money - money that comes from angels who will open doors not just locally but internationally. Because of the increase in angel investors, it is also important to do your research when considering co-investors. How angels will collaborate and help you build your business is key,” she says.
Making sure there is a good fit personally between angels and promoters in terms of their vision and goals is also key, she says.
“My advice is to take funds from angels you want to work with, those who have had successes and failures and those who will have your back. As an entrepreneur you also don’t want them getting in the way of your vision – they need to trust you and enhance your growth, not hinder your passion.”
Walsh has several connections with Ireland. Born Sheetal Metha, she is married to Wexford-born entrepreneur Paul Walsh. Many of the donors to Shanti Life are Irish.
Earlier this year, following a presentation to the Ireland-India Business Association, she was invited to join the advisory board of the UCD Smurfit Business School.
“Niall FitzGerald asked me to join the board as they are looking to get a greater degree of diversity and to have a more global perspective,” she explains.
Walsh has received a string of awards for her work, including an Asian Women of Achievement honour presented by Prince Charles. She is involved with the UK Trade and Investment’s Global Entrepreneur Programme and lectures frequently on the topic of entrepreneurship, women in technology and access to funding.