Veronica Colondam, a champion of social entrepreneurship in Indonesia and around the world, spoke at Social Impact Lab about how her organization, YCAB, has evolved from a nonprofit to a social enterprise, and how she is shaping the policy environment in Indonesia for others to learn from her experience.
Social entrepreneurship is a vibrant field in Indonesia; there are more than 820 social enterprises developing creative ways to improve economic, agricultural, educational and health outcomes. In analyzing Indonesia’s social entrepreneurship landscape, you cannot get too far before coming across Veronica Colondam’s name, whose organization, YCAB, has been a model for other social enterprises since 1999.
Colondam spoke at SOM to kick off the 2018-2019 Social Impact Lab speaker series, which brings together students, alumni, and leading practitioners to discuss the latest trends and compelling questions in social entrepreneurship and economic development. In her presentation, she spoke about how YCAB is tackling youth development, how the organization manages the classic dilemma of depth versus breadth, and how the social entrepreneurship sector in Indonesia is shifting.
YCAB was established to 1999 to tackle two challenges related to youth development – economic empowerment and education. Colondam sought to link inclusive finance with education and job creation to improve outcomes specifically for Indonesia’s urban poor. Across the country, almost one of every two individuals live on less than a dollar a day, and school dropout rates remain stubbornly high. YCAB originally started as a nonprofit that ran an integrated program on education, healthy livelihoods and job placement. The organization iterated over the years to expand its revenue sources and services to include microfinance, women’s empowerment and vocational training.
Their theory of change is embedded in the principle that “development is never overnight,” as Colondam says, and follows a closed-loop model that is driven by social investment. YCAB uses the social investment it receives, which can take the form of donations, loans or capital, to provide mission-driven microfinance to enable families to keep their children in school, which can in turn build a self-reliant next generation. YCAB focuses not only on youth, but on parents and especially mothers who are a key determining factor in ensuring that children stay in school.
After almost 20 years of operation, YCAB is now focused on how they can continue to expand their impact as a social enterprise. From Colondam’s perspective, it is important that they focus on deepening their impact and double down on their mission to help youth in urban areas advance their education. YCAB is also focused on expanding their microfinance program, especially for strong performers. The organization is testing larger loans of up to $1,500 combined with finance and business skills trainings.
For Colondam, the next phase is not just about scaling YCAB’s work, but also creating a supportive policy and funding environment for other Indonesian social entrepreneurs. Despite the proliferation of social enterprises across the country, organizations still face barriers such as restrictive nonprofit law, difficulties attracting talent, and a lack of funding streams for small and medium sized enterprises. Colondam has been working to change the overarching system through a new piece of legislation, the Indonesian National Entrepreneurship Law. This law would formally define social entrepreneurship and lay the groundwork for additional regulations within the tax code for social enterprises.
This multi-faceted approach is core to Colondam’s work and ethos. She summed up her talk by highlighting three books that have guided her through her journey as a social entrepreneur: “Finding Your True North” by Bill George, “Grit” by Angela Duckworth, and “Option B” by Sheryl Sandberg and Adam Grant. She encouraged students to find their true passion, stick with it even when the going gets tough, and to always have an option B.
By Gillian Leitch