Akshay Verma grew up in Bihar, one of India’s poorest states, but went on to work as an investment banker with UBS in London after getting degrees at Columbia University and Oxford University. While he enjoyed a privileged life, images of poverty in Bihar continued to haunt him. In 2013, the millennial left his job and returned to Bihar “to change things and make it better.”

Verma took the “teach a man to fish” adage literally to found Agratam, a fish-farming social enterprise he started in 2012 while still a student. He has initiated what he calls a “Blue Revolution” to convert some 9,000 square kilometers (3,500 square miles) of waterlogged wasteland into productive fish-farming units. Verma set up demonstration fish farms and hatcheries, educated fish farmers in modern techniques and facilitated loans as well as access to life and health insurance for them as part of a sustainable ecosystem.

Today, Agratam is connected to 500,000 of Bihar’s 15 million fishermen. Verma wants to bring more people into his ecosystem, improve market linkages and set up distribution centers and fish feed mills.

Agratam won third place in the 2017 Ideas for Action competition, which recognizes financeable, sustainable and innovative projects that align with the United Nations’ sustainable development goals. Ideas for Action is a joint competition from the World Bank Group and Wharton’s Zicklin Center for Business Ethics Research. (Ideas for Action – or I4A — is looking for social entrepreneurs to pitch ideas before Feb 28 for its 2018 competition.)

Agratam won third place in the 2017 Ideas for Action competition, which recognizes financeable, sustainable and innovative projects that align with the United Nations’ sustainable development goals. Ideas for Action is a joint competition from the World Bank Group and Wharton’s Zicklin Center for Business Ethics Research. (Ideas for Action – or I4A — is looking for social entrepreneurs to pitch ideas before Feb 28 for its 2018 competition.)

Verma spoke about Agratam’s journey with Knowledge@Wharton in a recent interview. An edited version of the conversation appears below.

Knowledge@Wharton: What is Agratam? What inspired you to start it?

Akshay Verma: “Agratam” is a Sanskrit word that means “advanced, forward, No. 1,” and that was the mission with which I had founded this social enterprise in 2012.

I come from a region in India that is very backward, poor and underdeveloped, so while I was growing up that was something of which I was constantly reminded. I was fortunate to get a good education. I went to premier institutions in India and abroad. I worked in investment banking for about four years, and did really well as the quintessential Indian boy is supposed to do.

But one thing I was always reminded of was where I came from and the problems that (Bihar) always had. That was the inspiration to change things and make it better. We have a glorious history, but the present doesn’t look as glorious. We’re going through a downward trend, but we have to bounce back up.

Knowledge@Wharton: What is Agratam? What inspired you to start it?

Akshay Verma: “Agratam” is a Sanskrit word that means “advanced, forward, No. 1,” and that was the mission with which I had founded this social enterprise in 2012.

I come from a region in India that is very backward, poor and underdeveloped, so while I was growing up that was something of which I was constantly reminded. I was fortunate to get a good education. I went to premier institutions in India and abroad. I worked in investment banking for about four years, and did really well as the quintessential Indian boy is supposed to do.

But one thing I was always reminded of was where I came from and the problems that (Bihar) always had. That was the inspiration to change things and make it better. We have a glorious history, but the present doesn’t look as glorious. We’re going through a downward trend, but we have to bounce back up.

Knowledge@Wharton: What was the problem you saw in Bihar? How did you turn it into an opportunity?

Verma: When I started visiting Bihar in 2012, I realized that the numbers didn’t make sense — “130 million people, 85% below the poverty line [and that] one dollar a day is the poverty line.” These were just theoretical numbers. When I went there, I realized how bad the situation was and how visibly poor the state is, how malnourished the children are, and how there’s no access to anything. That makes you start thinking as to how do you solve this? Is it better policy? Better social interventions? Economic lending? What do you do?

“We take unproductive, waterlogged land and convert it into profitable fish farms.”

After a lot of internal debate and discussion and reading and talking to people, I realized that creating a means of livelihood was the most important step. Of course, [I remembered] the old saying, “Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime.”

Bihar consumes a billion dollars-worth of fish every year. But we produce only 50% in the state, and the rest comes in through unorganized retail. We have 9,000 square kilometers of waterlogged, unproductive land, an area as large as Cyprus. We have all that land just sitting there, contributing zero to the lives of 1.2 billion people in India and 130 million people in Bihar.

We could take that unproductive, waterlogged land, which has no use — you can’t do agriculture, you can’t build a hospital or school on it or [create some sort of] industry on it — and convert it into profitable fish farms, because it’s good only for storing water. The demand for fish is huge, and it addresses malnourishment and provides food security. A lot of problems get solved by that simple solution.

We started our first fish farm in 2014. In the last three years, we’ve grown significantly. Fish farming is very profitable, and it spits out cash. The yields are about 16 times higher than the [average] agricultural yield in Bihar. We reinvest whatever [profit] we make to prove a point about the potential. The task ahead of us is to build the whole value chain. There are shortages of good quality inputs, and so we’ve had to set up hatcheries. Bihar doesn’t have a single fish-feed mill, and they need to come up. And then, when more people produce [fish], we need market linkages, distribution networks and common resource centers.

Bihar has 15 million fishermen, and we are connected to only 500,000 – [looks like] a huge number, but in the context of Bihar or India, a small number.

We send them text messages about diseases to look out for, or when it’s a good time to fish, and what rates are prevailing in the markets. There’s a lot more that needs to be done.

Knowledge@Wharton: How do you measure the impact of your efforts? There’s what is called a “triple bottom line,” where you look at the impact in business terms, the impact on the environment, and the impact on the lives of people. If you were to think about the impact Agratam has had so far, and are potentially about to have, how would you put it in that framework?

Verma: This [provides] a better return on capital than any other business I know. I used to work in private equity, and I have invested in many companies. You double your money every time you go into a new crop. The only risks may be that you get a delayed return, because the market wasn’t there. But unlike a crop, fish doesn’t have to wait for a certain age or time before you can sell it. It’s a cash crop. Whatever weight it has, it sells.

“The demand for fish is huge, and it addresses malnourishment and provides food security.”

It’s very easy for bottom-of-the-pyramid entrepreneurs to do this, because they don’t need access to a great amount of capital. The turnaround is quick, and they’re never against a corner. In agriculture, you’re against the corner because you have to wait for the weather; you have to wait for market linkages. Here, you sell some fish, and you have money. It’s always easy.

From that perspective, it’s a very solid business. In Bihar, we also have the fish insured — the only state in India where fish is insured. It is insured against flood, drought, disease, poison, and theft. That was a lot of hard work, but that gives our farmers more security. It guards the bank’s interest in case [the fish farmers] get [bank] credit — which they don’t [right now].

From a livelihood impact, it radically enhances income levels. In agriculture, even if you have the best quality land and top produce, the market rates are given, and at best you can make $385 of income in a year (per acre). That’s about one dollar a day. With fish, if you put your fish and go to sleep, and come back after a year and just net what you have, you make about $3,000 a year. That’s about 10 times [bigger].

Farmers with small holdings who own such land were getting no yield from their assets. [Now], they make a fixed rental yield with which they can set up shop and do [other types of] farming or whatever else they want to do, if they don’t want to indulge in fish farming

Knowledge@Wharton: What kind of capital investment is required to convert that land into a fish farm?

Verma: To develop a 20-acre fish farm, you need about $200,000. That includes the one-time development cost of the asset, which will last 20 to 29 years; and the operating capital you’ll require initially to buy the fish and the feed. Once you start selling, your first crop makes all the money that you put in. Your operating capital and fixed investment can be recovered by your third crop. So within 18 to 24 months, you have fully recovered [your investment].

We recommend that a five-acre farm should be the smallest [size] because [it allows the] economies of scale to start kicking in. It also gives you a lot of security. Nothing can happen to your fish on a five-acre farm. It can’t get damaged. Nobody can poison that amount of fish. Disease can be controlled. Of course you have insurance, but you don’t want to see your fish die.

“[Fish farming provides] a better return on capital than any other business I know.”

Apart from the direct impact, you have all these traders who come up [as well]. People who had no jobs and no way to earn suddenly have an assured supply of fish — they buy your fish, and they sell it onward. A 20-acre farm can easily cater to 500 or 600 traders a day, and that is only to meet local demand. Then there are ancillary industries like net-making, transportation and infrastructure that start coming up. You’re also feeding people fresh fish, good fish. Imported fish takes about 18 days to arrive, and that is injected with preservatives, and is not fresh.

[From the standpoint of the] environment, we are creating large water bodies and don’t disturb the ecosystem at all. It is land that only had water, and we just reworked the contours a little bit so that it can hold fish. Creating these fish farms helps us get rid of a lot of natural animal waste that lies around. It also creates these large water bodies that dissolve the carbon gases.

Knowledge@Wharton: How have you tried to scale what you’re doing? What challenges did you face and how did you overcome them?

Verma: The first challenge was just a change of mindset. In Bihar or in places that are so used to [receiving] aid, the first question is [typically] “What is the subsidy?” or “What is in it for me?” It took me quite some time to explain to people that subsidy or not, this is a great business. You do it because you can better your families, and you can better your living standards. That took us about a year or two.

Access to capital is absent. I lobbied a lot of banks. We even got fisherman credit cards instituted. I helped [arrange] lending of $1 billion dollars in the area. Not one loan defaulted, but no new loan was made. We got fish insured, and we had to create infrastructure. But then I realized that we needed a private sector intervention to truly let it happen.

Now as we scale, we need to start creating access to good-quality inputs. We need to set up hatcheries, and a fish-feed mill. Currently fish feed comes from a different state. And, education needs to happen.

Capital is a roadblock, but this is something others have done before. So we’re aggressively looking for knowledge partners and information partners. We don’t need to reinvent the wheel. We want to be the gold standard. We have to get access to other people who’ve done it.

“I keep telling our farmers that the game is to produce in rupees and sell in dollars. That is the only way Bihar will catch up.”

Other than that, there’s no roadblock. This land is freely available. We can take it. The big guys can’t take it, because they’re not local and native, and generally people don’t trust the bigger industrial groups with their land. But they trust the locals. So for us so far, [there have been] no major roadblocks except capital and knowledge access.

Knowledge@Wharton: What is your dream for Agratam?

Verma: Verghese Kurien, who started Amul and the big cooperative movement [in milk] in India is very inspirational to me. I feel like I can beat him at it in 10 years with the numbers that we’re talking about today, and how easy it is to do it with fish, as opposed to cows and milk. He had a lot of government support; we’re hoping for non-governmental support, and [not function as] cooperatives — each unit has to be profitable and sustainable by itself.

We could create an equitable distribution network. That is what the dream would be — in 10 to 15 years, change how Bihar is viewed. We can be the hub of producing fish for India and abroad. I keep telling our farmers that the game is to produce in rupees and sell in dollars. That is the only way Bihar will catch up.