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This case describes the evolution of MHFC, a player in the Indian informal housing sector. As a new entrant offering micro home loans to the financially excluded lower income families of urban India in 2008, MHFC had grown to an annual number of 18,000 loans worth INR 8 billion with an average ticket size of INR 0.43 million (USD 6,000). With a 53.5% purchasable equity stake in MHFC, Chopra and his team were left with certain decisions to make. Should the company on-board a new social investor? Or should it bring on the more readily available and capital-rich private equity investors interested in the lucrative prospects of the microfinance housing sector? The case discusses two key objectives: (1) to understand the entire entrepreneurial journey of a group of entrepreneurs and how they plan to exit the venture, and (2) to enable classroom discussion on how to develop a business model from scratch, get it funded, achieve scale and then exit.
This case is useful in discussing the entrepreneurship process, and concept of finding product-market fit, social business models, scaling up requirements and deciding between different options to exit the venture. It provides a good basis for discussion on various issues (market related, competition and industry related, manpower related) from the business model perspective. This case is useful for discussion in a session on Scaling up social business model within Entrepreneurship related courses. It can also be used in accelerator programmes and bootcamps for startups in the social impact sector. The case can also be a good addition as a case of entrepreneurship in emerging markets context.