How were 400 impoverished shoemaking families from a village in southern India transformed into entrepreneurs whose products go toe-to-toe with international competitors? The story is told in the latest case study by CEIBS Associate Professor of Entrepreneurship Ramakrishna Velamuri, entitled Toehold Artisans Collaborative: Building Entrepreneurial Capabilities to Tackle Poverty.

Slated for inclusion in the Asian Case Research Journal, the paper (co-authored with NIIT Professor Sindhu Shanmugam) documents the development of Toehold Artisans Collaborative (TAC) since its establishment in 1998. In particular, the paper outlines the challenges TAC has faced and the impact it has had on the artisan community in the southern Indian city of Athani.

Prof. Velamuri’s work emphasizes the role entrepreneurial capacity-building can play in poverty alleviation. It offers valuable insight into TAC, a project launched by the Bangalore-based non-governmental organisation Asian Centre for Entrepreneurship Initiatives (ASCENT).

In his study, Prof. Velamuri points out that although TAC is made up of 14 self-help groups for women, its impact pervades the entire community because efforts are made to include and involve local men. For example, males are treated as co-preneurs for all inputs, and receive exposure at international fairs.

The results of the community-based initiative are impressive. Before ASCENT established in Athani in 1998, the town’s artisans were in dire straits: most could not afford two square meals a day and could not send their children to school. Their low income had led to economic and social stagnation and, in turn, triggered low self-esteem as a community. The incidence of alcoholism among the males was high. TAC turned their lives around both economically and socially by more than doubling their household incomes from an average of 18,000 Indian rupees (US$450) in the year 2000 to 42,000 rupees (US$1050) in 2006. Most of this additional income supports better nutrition, better healthcare and children’s education, creating a dramatic impact on individual families and on the community at large.

In spite of this impressive progress, two major challenges remain, according to Prof. Velamuri and his co-authors. The first difficulty lies ensuring the sustained viability of the business model. The second concerns the scalability of the model; today, many more shoemaking families living on subsistence incomes seek to join Toehold.