BackThe early do-gooders
A look at how the pace of creating wealth influences philanthropy, especially when it comes to India's growing number of young millionaires
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During his recent role as the chief revenue officer of mobile ad network InMobi and before that as Google’s head of mobile business for Japan and the Asia-Pacific, Atul Satija travelled to Beijing more than 30 times, yet he never visited the area’s biggest tourist attraction, the Great Wall of China. “I’m neither a traveller nor a foodie. I don’t want to see the world, or enjoy the experiences money can buy," says the 39-year-old.
His monumental ambitions lie closer home: to work towards sustainably lifting one million Indians out of poverty by 2020. The/Nudge Foundation, his three-month-old, Bengaluru-headquartered not-for-profit, aims to do this by setting up gurukuls, fully residential learning centres, that will impart a combination of life skills, literacy and livelihood skills to young adults. The first gurukul is scheduled to launch next month in Bengaluru, and nine more are planned across the country by the end of 2016.
A mechanical engineer from the National Institute of Technology, Kurukshetra, and a management graduate from the Indian School of Business (ISB), Hyderabad, Satija has benefited from the tidal waves of growth that the technology and mobile Internet industries have witnessed. Robust salaries and stock options have allowed him to build enough of a financial security net, he says, to work full-time in the social sector, a lifelong aspiration. “It used to be a retirement dream, then it became something I thought I could probably do in my 40s. The best use of my time isn’t to earn more money that I know I won’t use," says Satija, who has already raised upwards of $350,000 (around ₹ 2.3 crore) for his foundation, with substantial contributions from Infosys Ltd co-founder Nandan Nilekani ($200,000), InMobi ($75,000), payment services provider Paytm ($40,000), and the Great Wall Club ($50,000), an international network of executives from leading mobile companies.
Hearing stories about his paternal family’s struggle to build a life in India post-partition—his relatives ran small shops and rickshaws—triggered his interest in the development sector. “You can either desensitize yourself completely when you break out from that or there is a small wound within that keeps hurting if you don’t do something about it," Satija says.
Mekin Maheshwari, chief people officer at e-commerce website Flipkart, is prepping for a similar trajectory. In early September, Flipkart said Maheshwari, 35, had decided to move out of the company by the end of the year. An angel investor in Sheroes, a career community for women, Rang De, a crowdsourcing platform, and mGaadi, a commuting service, Maheshwari recently donated an undisclosed amount to Satija’s The/Nudge Foundation, and is also planning a venture in the social sector. “For me, it’s about working on harder problems that might not give us monetary returns but will create an impact that will eventually benefit all of us," he says. In any case, he doesn’t view his investments—in The/Nudge or mGaadi—through a filter of whether they are for-profit or not-for-profit as long as he believes in the cause.
What new money can do
India is poised to create new wealth builders, such as Satija and Maheshwari, at a rate faster than any other country in the world. According to the “World Wealth Report 2015", India recorded the largest gains—in the Asia-Pacific region and globally—in the high net worth individual (HNWI) population (26.3%) and wealth (28.2%).
Amit Chandra, managing director of private equity firm Bain Capital India and an active philanthropist, believes this accelerated wealth creation at an age younger than ever before bodes well for philanthropy. According to management consulting firm Bain and Co.’s “India Philanthropy Report 2015", India is already a “global outlier with a larger percentage of its population making charitable donations than other countries at its level of prosperity elsewhere in the world".
Data from the World Giving Index, an annual index compiled by UK-headquartered Charities Aid Foundation, showed that in 2009, “only 14% of the adult population across India donated cash and some 12% donated their time.... In 2013, 28% of the adult population donated money and 21% donated their time. This means a staggering increase of more than 100 million more Indians making donations in cash or time than in 2009".
New wealth builders will deepen this engagement, says Chandra. “Younger and first-generation wealthy, especially professionals and entrepreneurs, are much more conscious of social change and the need for solutions; they’re willing to invest both time and money. These green shoots are evident," he says.
A case in point is the Ashoka University, a not-for-profit that aims to deliver world-class liberal arts education in India, and which admitted its first postgraduate batch in 2011. Of the ₹ 425 crore that has been raised so far for the university, located in Sonipat, Haryana, more than 70% of it is first-generation money, says Pramath Raj Sinha, one of the founders.
Sinha contrasts this with the composition of funds raised 15 years back for the ISB in Hyderabad—he was its the founding dean. “The more significant donors then were the large Indian business families and corporations such as ITC and HUL (Hindustan Unilever Ltd). About 30% of the money raised for ISB came from first-generation entrepreneurs, many of whom were NRIs."
Sinha says two things have changed from then: The quantum of personal wealth created by professionals and entrepreneurs in India is much larger today. This enables them to give more. “Also, there is a certain sense of humility, almost guilt, that drives an obligation to give back. They are eager to support scalable, impactful initiatives."
The triggers for giving
Satija doesn’t completely agree. In his limited experience with raising funds for The/Nudge Foundation over the past few months, he says he hasn’t seen the correlation that people who have more at a younger age will automatically give more. “They do feel liberated from fear and might take bold risks in start-up ideas but I haven’t seen philanthropy drive many of the wealthy, first-generation entrepreneurs in their 30s that I’ve spoken to."
Nor has he found that people in senior management roles, mostly under 40, in the start-ups that he has accessed either give more as a percentage of their earnings, or that more of them give, compared to employees overall. “I’ve actually found people in their 50s and 60s to be more engaged with the idea of giving," Satija says.
That’s true across the world, says the World Giving Index. Since its first report in 2010, the index has consistently found that older people (above 50) are more likely to give money to charitable causes.
Chandra says people give at different points in their journey, so one should be careful of being judgmental about who should give how much and when. What does work is creating a pull that prompts giving. That pull is certainly becoming stronger today, with a fresh dose of inspiration provided by entrepreneurs such as Wipro Ltd’s chairman Azim Premji, or the founders of Infosys, as well as redefining what society admires. “I’ve often seen people behave according to what their perception is of what society values. For a long time, society was more focused on wealth creation; respect was earned there. Today, people are more interested in what you do with that money," says Chandra.
Maheshwari says the generational shift is mostly a function of how people compute risk and the fear of the future. “My parents’ generation saw money very differently," he says. “When you have lived through times of scarcity, the saving for a rainy day mindset won’t let you give much. Today, people take more risks in general; philanthropy flows from there as well."
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