PR Ganapathy

Beware of Strangers Bearing Gifts: Social entrepreneurs often fail to realize not everyone is as altruistic as they are

My phone rings one evening. I recognize the number as the co-founder of one of the social enterprises I’m mentoring. I answer it immediately.

Kiran (fictional name) sounds incredibly excited, even a little breathless. “Guns,” he said, addressing me by my nickname. “I have great news!”

I break into a grin. Kiran’s enthusiasm, even from 1,000 miles away on a scratchy phone line, is always infectious. “Super, old chap. What’s happening?”

“Supracom are interested in our technology! They are coming over the visit our lab next week!”

Kiran’s social enterprise is using some breakthrough new technology to benefit farmers. I know Supracom (also a fictional name) is the global major in this field, a German company with a strong for-profit orientation.

I decide to play along. “That’s great! What are they talking about?”

“Everything! They are interested in considering a strategic investment! Collaborating on taking our products to farmers around the globe using their distribution network!”

Kiran and his co-founders have just about made their technology work reliably in the lab. A production prototype is still at least six months away, and commercial sales maybe a year away. I try hard to keep the concern out of my voice. “That’s great to hear! Err… Why are they coming to your lab?”

“They want to learn more about our technology before getting into more concrete discussions. They are just great, you know. The guys I spoke to, they really get it. They’ve been breaking their heads on this for years, and they know how hard it is. They really appreciate what we’ve achieved.”

My skepticism meter, already on ‘high’, begins to go beserk. “That’s super, Kiran, I begin,” mustering my most calming tone. “But tell me, how much you have revealed to them already?”

“Not a lot yet. You know Vijay wasn’t available to talk to them, and I’m not that technical. But next week we’ll go into all that in the lab.” Vijay is Kiran’s co-founder and CTO. He’s the geek behind the technology.

I drop my voice and adopt a gentle tone for my next question. “Aren’t you just a little worried that they might only be interested in learning what you’re doing so that they can replicate it themselves, and are not really serious about the collaboration?”

When Kiran replies, I can sense his enthusiasm has come crashing down, and I feel sorry for him. “Hmmm. Hadn’t thought about that.” After a long pause, he adds: “maybe. Could we maybe get them to sign an NDA?”

“Have you seen those documents?” I ask him. “They’re full of exclusions and loopholes. Supracom is a €5 Billion company. Do you really think you will successfully sue them for violating an NDA?”

Hi voice is soft. “Oops. No. But what do we do? The visit is already scheduled. They’re flying in from Europe to see the lab.”

“It is an important relationship; there will be a time in the future when you can collaborate with them,” I begin. “But before that you have to prove your technology works, customers are willing to pay for it, and evaluate every option for a strategic relationship such as this one.”

“Right. So what do we do?”

“Set their expectations now itself that you are not comfortable showing them the core technology, so that they are not disappointed when they visit. Tell them that you’ll be more forthcoming in a year or two, after you demonstrate success in the field. They’ll understand.”

“Are you sure?”

“If they get agitated, you know what they were in the first place,” I reply, a smile on my face.

“Hey thanks, Guns. We almost just shot ourselves in the foot.”

“No problem, man. Your speed, agility and innovativeness is your secret sauce – and it’s what the big companies lack. They’d love to learn from your work and help shortcut their own development processes. When the time comes to partner with them, make sure you do it on your terms, after you’ve proven your technology and commercial value, and have created a bit of a feeding frenzy among the possible suitors so that you’ve got the best possible deal.”

“Makes sense. Bye Guns.”

“Bye. Take care man.”

He called me a week later. The team from Supracom had canceled their trip because of a sudden series of “meetings” in Switzerland that they couldn’t avoid. Kiran and Vijay were chastened by their experience. They’ve become a lot more circumspect about talking about their work and technology.

Social Entrepreneurs are driven by their selfless desire to make the world a better place. They often fail to realize that not everybody out there is as altruistic as they are. Start-ups embody innovation and inventiveness. They are close to their customers and rapidly design and iterate useful products that meet their customers’ needs. Big corporations, with their large R&D budgets and corporate bureaucracies, move slowly and are not exactly hotbeds of innovation or customer insight. They are always on the lookout for an interesting new product or technology that can enhance their portfolio and bottom line. But they’re not always likely to use the most fair and ethical ways to obtain it.

Therefore, always be careful of strangers bearing gifts.

P.R. Ganapathy is the chief operating officer of Villgro.

business development