Amit recently visited Israel at the invitation of the Embassy of Israel in Delhi, to participate in a startup delegation. The goal of the delegation was improve startup to startup and ecosystem level contact between India and Israel.
Israel is a small country with many geographical and geopolitical challenges. It has made amazing strides in tech, core research and startups. Driven by excellent government support, a great entrepreneurial culture, and a good industry ecosystem, Israel has become a true ‘startup nation’.
This talk will be focused on understanding Israel’s startup ecosystem, some key reasons for its success, and important lessons that India can learn from it.
About the Speaker – Amit Paranjape
Amit is an entrepreneur and a technology professional based in Pune. He has been working in the Software/IT area for over 20 years. He completed his B.Tech in Mechanical Engineering from IIT Bombay, and his M.S. in Manufacturing Systems from University of Wisconsin, Madison.
Amit worked for over a decade in Manufacturing & Supply Chain Software at i2 Technologies in Dallas, in various leadership roles. He moved back to India a decade back and has been actively involved with startups in Pune. In addition to mentoring and advising early state startups, Amit is also involved in his own startup venture, ReliScore, in the skills assessment space.
Amit has a variety of interests including Technology, Science, healthcare, economics, history, geopolitics & strategic affairs. He is very active in blogging, social media and tweets regularly across a variety of topics at @aparanjape
Event Details
The event is on Saturday, 3 March 2018 from 3.45 pm to 5 pm. Venue: Lecture Theatre, Venture Center, 100 NCL Innovation Park, Pashan Road.
Pune-based Government-funded Startup Incubator, Venture Center, (winner of a national award for best technology incubator in 2015) is hosting a seed fund with a corpus of Rs 10 crore under the scheme “National Initiative for Developing and Harnessing Innovations – Seed Support System (NIDHI-SSS)” of the Department of Science and Technology.
The basic idea of NIDHI seed support is providing financial assistance to potential startups with promising ideas, innovations and technologies. This would enable some of these incubatee startups with innovative ideas/technologies to graduate to a level where they will be able to raise investments from angel/Venture capitalist or they will reach a position to seek loans from commercial banks /financial institutions. Thus the proposed seed support disbursed by an incubator to an incubatee is positioned to act as a bridge between development and commercialization of innovative technologies/products/services in a relatively hassle free manner.
Broad Areas to be covered under the financial assistance include:
Product development
Testing and trials
Test Marketing
Mentoring
Professional Consultancy ( To attract Professors of institutions to work with small firms)
IPR issues
Man power for day to day operations
Any other area as deemed necessary and recommended by the Management Committee.
Eligibility Conditions for start-ups to apply for seed support
Incubatee should be a registered company in India
Incubatee has to be an Indian start-up. This support is not meant for Indian Subsidiaries of MNCs/foreign companies. Persons holding Overseas Citizens of India (OCI), Persons of Indian Origin (PIO) would be considered as Indian citizens for the purpose of this scheme.
The share holding by Indian promoters in the incubate start up should be at least 51%.
Selection Criteria:
Here is a list of make/break criteria for applicants:
There must be at-least one dedicated entrepreneur involved in the venture
There must be a formal business plan
The idea and team should be technically sound
The venture and the team must have high ethical & professional standards
The venture must have a strong technology/knowledge component
EHS requirements must be met
The team should show potential and credibility for raising money in future
The venture must be registered as a private limited company, or must be in the process of registration
The amount of funding requested must be less than Rs 100 lakh
The entrepreneur(s) must be willing to share equity in the venture
The applicant must be or willing to be resident incubatee of Venture Center before investment
Applications for the seed fund will be reviewed based on criteria such as (but not limited to):
Is amount of funding requested enough to reach critical milestone?
Does the venture have a clear, potentially significant/singular value proposition
How big/fast growing is the potential market?
Are target customers clearly identified?
How credible is the technology? (Is PoC credible in the opinion of subject-matter experts?)
Are there regulatory/certification/policy risks?
What are the sources of sustainable competitive advantage (eg. novelty, patentability, etc.)?
What is the quality of the business plan (revenue model, product roadmap, market segments, etc.)?
Typical terms for seed funding:
Selected start-up should be/become a resident incubatee of Venture Center and should have completed three months of residency at Venture Center at the time of seed fund investment.
Investment mode: Equity ownership in a private limited company
Investment amount: Up to 100 lakh
BoD representation: 1 Board Nominee Director and/or observer of Venture Center
Reporting: Bi-annual presentation to SEED Fund committee + Annual financials/MIS
The Venture Center, a Pune-based Government of India Initiative that helps technology innovators and startups, has instituted a Rs. 1 crore seed fund that they plan on investing in early stage technology startups (or even innovators with just a science & technology idea).
Investment proposals are being accepted upto 30 November 2011.
The Entrepreneurship Development Center (‘Venture Center’ ) recently received approval under the scheme “Seed Support System for Start-ups in Incubators” of the Technology Development Board, Department of Science & Technology to host a seed fund with a corpus of Rs 1 crore.
The purpose of the seed fund is to provide a technology driven startup with the much-needed early stage financial support for deserving ideas/technologies requiring up-scaling and related work.
Incubatees of Venture Center are encouraged to contact Venture Center for further information.
Quantum of financial assistance to the incubated entrepreneur
Minimum: Rs. 1 lakh
Maximum: Rs. 25 lakhs
The disbursement is normally linked to benchmarks / milestones. Broad Areas to be covered under the financial assistance include:
Product development
Testing and trials
Test Marketing
Mentoring
Professional consultancy to engage Professors / experts with small firms
Filing of Indian/International patents
Man power for day to day operations
Any other area as deemed necessary and recommended by the Management Committee.
Here is a list of make/break criteria for applicants:
There must be at-least one dedicated entrepreneur involved in the venture
There must be a formal business plan
The venture and the team must have high ethical & professional standards
The venture must have a strong technology/knowledge component
EHS requirements must be met
Key Proof-of-Concept must be demonstrated & must be reproducible
The venture must be registered as a private limited company, or must be in the process of registration
The amount of funding requested must be less than Rs 25 lakh
The entrepreneur(s) must be willing to share equity in the venture
The seed funds requested must be for activities such as product development, prototyping, scale-up, developing IP portfolio, test marketing, trials, certification, testing
Applications for the seed fund will be reviewed based on criteria such as (but not limited to):
Is amount of funding requested enough to reach critical milestone?
Does the venture have a clear, potentially significant/singular value proposition
How big/fast growing is the potential market?
Are target customers clearly identified?
How credible is the technology? (Is PoC credible in the opinion of subject-matter experts?)
Are there regulatory/certification/policy risks?
What are the sources of sustainable competitive advantage (eg. novelty, patentability, etc.)?
What is the quality of the business plan (revenue model, product roadmap, market segments, etc.)?
Typical terms for seed funding:
Investment mode: Equity ownership in a private limited company
PuneChips, the community for all those interested in semiconductor design and applications presents an Overview of RFID by Ashim Patil, on 16th April, at Venture Center, NCL, Pashan Road, from 10:30am to 12-noon.
Abstract of the talk – Radio Frequency Identification
Product, people and document identification is now a huge challenge. Radio Frequency Identification (RFID) offers an active ID mechanism that requires no intervention on the part of the user. This presentation will introduce the RFID technology, positioning and its variants. The speaker will also introduce Near Field Communication (NFC) and its differences with regular RFID. RFID and NFC applications across several verticals in India will also be discussed.
About the speaker – Ashim Patil
Mr. Ashim A Patil is the MD & CEO of Infotek Software & Systems Pvt Ltd., also known as i-TEK. Under his leadership i-TEK is one of the leading RFID (Radio Frequency Identification) system integration companies in India. i-TEK has several live RFID sites across verticals like Manufacturing, Banking, Education and Healthcare. i-TEK has to its credit RFID applications like File & Document Tracking, Asset Management, Stores Management, Automatic Vehicle Identification, HNI Tracking and many more, deployed at leading organisations in India.
Mr. Patil has completed his engineering degree from University of Pune in 1998. Fresh out of college, he began his entrepreneurial journey starting an Aptech franchisee which he sold in 3 yrs. After that, he took over an ailing software company in Pune which later on became today’s successful i-TEK under his able guidance. He shifted the focus to RFID when not many were even aware what the acronym stands for.
About Venture Center
Entrepreneurship Development Center (Venture Center) – a CSIR initiative – is a not-for-profit company hosted by the National Chemical Laboratory, Pune. Venture Center strives to nucleate and nurture technology and knowledge-based enterprises by leveraging the scientific and engineering competencies of the institutions in the Pune region in India. The Venture Center is a technology business incubator specializing in technology enterprises offering products and services exploiting scientific expertise in the areas of materials, chemicals and biological sciences & engineering.
About PuneChips
PuneChips is a special interest group on semiconductor design and applications. PuneChips was formed to foster an environment for growth of companies in the semiconductor design and applications segment in the Pune area. Our goal is to build an ecosystem similar to PuneTech for companies in this field, where they can exchange information, consult with experts, and start and grow their businesses.
For more information, see the PuneChips website at http://punechips.com, and/or join the PuneChips mailing list: http://groups.google.com/group/punechips. Please forward this mail to anybody in Pune who is interested in renewable energy, solar technologies, semiconductors, chip design, VLSI design, chip testing, and embedded applications.
Fees and registration
This event is free and open for anybody to attend. No registration required.
Normally, PuneTech does not promote events that have an entry fee, unless the fees are nominal or very low (below Rs. 1000). This Venture Center/Accelerator India workshop for science & technology entrepreneurs, with estimated costs of Rs. 55000 is definitely not free. However, some of the applicants will not only get the workshop fees waived off, but even their travel costs might get funded. If there's one thing we like more than free events, it is paid events where there's a chance to get in for free! 🙂
Venture Center (technology business incubator affiliated to NCL/ CSIR) and Accelerator India (a spin-off of the University of Cambridge, UK) are organizing a workshop titled Accelerated Commercialization of Technology and InnoVation or ACTIV workshop. The workshop seeks to transfer the experience and key lessons learnt in science-based entrepreneurship from Cambridge, UK (which has now become a leading center of science entrepreneurship) to India. Run over 2-days, the ACTIV workshop has a sharp focus on science & technology entrepreneurship and the nucleation and creation of new enterprises. Faculty from Venture Center and other guest speakers shall provide India-relevant experiences and context.
The ACTIV – EE workshop seeks to equip science/technology entrepreneurs with key skills and practical insights to help take technology based ideas to market. The workshop will be held on Sunday, December 12, 2010 and Monday, December 13, 2010 at Venture Center, Pune. More info on the ACTIV-EE workshop: http://venturecenter.co.in/activ/entrepreneurs.php
We are keen that the groups attending the workshops be a focused and determined group so that the workshop also ends up creating a community of cohorts who support, inspire and challenge each other. It is for this reason and the fact that seats are limited that the faculty plans to select the participants carefully.
Venture Center and NCL Innovations invite you to an informative and interactive discussion on the Water industry – specifically the opportunities available for impact in India.
Time: 11am – 12.30pm Registration: The event is free and does not require RSVP, however seating will be on first-come, first-serve basis.
Background: Venture Center's flagship program – Lab2Mkt (http://www.venturecenter.co.in/lab2mkt.php) – seeks to nucleate technology ventures around competencies developed at R&D institutions in India (eg. NCL, Pune). To develop a pipeline of potential spinoffs, Venture Center has raised a Proof of Concept (PoC) fund (http://www.venturecenter.co.in/poc.php) – this enables us to run PoC projects – each of which involves development of prototypes, creation of business models, building the entrepreneurial team, etc. NCL Innovations (http://www.nclinnovations.org/) aims to facilitate the creation of more technology enterprises using NCL know- how, expertise or involvement of NCL staff, students and alumni.
Water: One of the areas of interest for PoC/Lab2Mkt projects is Water – a $500B global industry that offers a variety of challenges & opportunities for investors and entrepreneurs in India. We have spent the past several months researching global & Indian water markets, with the intent of identifying specific market opportunities for new technology ventures.
We would like to share our findings with scientists, entrepreneurs, investors, industry professionals, etc. This is likely to be the first in a series of such water-related talks – we will begin with a high-level overview this time around – and in the future, focus on specific aspects of water (eg. VC-funded tech startups, Indian water treatment markets, etc.).
Anil Paranjape points out why this is important:
This is indeed a great opportunity to learn about opportunities in the water sector. It's one of the most under-rated, under-funded and under-innovated fields in cleantech. But it's also one of the most critically endangered resource. Investors and researcher the world over are rapidly waking up to the challenges and potential in it.
Anyone with an entrepreneurial bent and ambition should definitely learn to see how they can participate in this opportunity. Huge opportunities in water will be created in the next few years/decades. Water is at a stage today that the Internet was in early 1990s: it's absolutely a huge ground-floor opportunity now!
Entrepreneurs, investors, government agencies, domestic companies & MNC executives in India need to think beyond “hi-tech” ventures and creation of IP and should focus instead of adapting existing technologies for Indian needs, points out Kaushik Gala in a new essay he published on his website. Kaushik is a Business Development Manager at Pune-based startup incubator Venture Center, so he does spend a lot of time talking to and thinking about all the players of our technology and startup ecosystem mentioned in the first sentence of this paragraph.
Kaushik Gala, Business Development Manager at Venture Center occasionally writes essays on issues related to startups and small businesses in India. Click on the photo to see more of his essays, and his website
The whole article is definitely worth reading, and we give here a few excerpts from the article to whet your appetite:
So, will hi-tech entrepreneurs & startups drive economic growth & wealth creation in India? Consider this assertion by economist John Kay:
Advancing technology is the principal determinant of economic growth for the twenty or so rich countries of the world. However most of the world is well inside that technological frontier. For these countries, prospects of economic growth depend little on technology and principally on advances in their economic, political and social infrastructure.
Over the two centuries of rapid economic growth in rich states, the pattern has been for one or two countries to join the group of advanced states every decade or two. In the last fifty years or so these new members of the rich list include Italy, Finland and Ireland within Europe and the first Asian economies (Japan, Hong Kong, Singapore) to operate at this technological frontier.
Later, he points out that there are three kinds of tech startups in India: 1) Technology innovators (who are creating new IP at the cutting edge of science & technology), 2) Technology imitators (who are reverse engineering technology from elsewhere and implementing a copy here), and 3) Technology adapters (who take a foreign technology, and then adapt it to Indian conditions. This usually involves significant changes, and there’s usually a key piece of (non-technology) innovation required to make it successful locally).
He gives this example of technology adaption:
My favorite example is Sarvajal. They sell clean drinking water – but with many twists:
They’ve developed a (patent pending!) device called Soochak which combines existing water purification technology with cloud computing.
Their innovative ‘distributed’ business model uses pre-payment, franchising, branding, etc. to make it profitable to sell relatively affordable water to remote rural areas.
Success for Sarvajal is as much – or more – dependent on understanding the psychology of rural customers and village entrepreneurs (franchisees) as it is on the technology.
Kaushik ends by saying that while all three avatars of technology enterprises are required for wealth creation in India, being an adopter/adapter in India offers far more opportunities to excel.
What:NCL & Venture Center Presentation on Technology Development Opportunities for Orthopedic Products in the Indian Market, by Dr. Vijay Panchanadikar, Orthopedic Surgeon. When: Wednesday, 4th August, 3:30pm-5pm Where: Chemical Engineering Hall, NCL, Pashan Road. Map (CE is Hall #10) Registration and Fees: This event is free for all to attend. No registration required
Click on the Venture Center Logo to see all PuneTech articles about Venture Center
The NCL Innovation IDEA Catalyst Workshop Series
This talk is a part of a workshop series (The NCL Innovation IDEA Catalyst Workshop Series), that focuses on exploring technology development and commercialization opportunities by connecting scientists/technologists with people who understand market and industry needs. This talk is the first in this series and features an orthopedic surgeon pointing out opportunities in his area in the Indian market, if only some technologist would develop the technologies needed.
Tech Opportunities for Orthopedic Products
Polymers, ceramics and specialty alloys are increasingly used as bearing and/or volume-filling materials in orthopedic implants such as hips and knees. However, there are several issues with existing products, such as the need for highly skilled surgeons, limited bio-compatibility of implant materials, inappropriate pricing for Indian markets, etc. In this talk, Dr. Panchanadikar will show real life examples of implants used for a variety of orthopedic surgeries, and highlight the problems faced by orthopedic surgeons during the use of implants. He will describe a âwish listâ of products for the orthopedic implant market as well as the need for software solutions to improve the accuracy of guide wire positioning as well as imaging & simulation tools for skills development of young surgeons. This talk is a unique opportunity to bridge the gap between scientists with competencies in biomaterials and surgeons with awareness of market needs and product opportunities.
About the speaker – Dr. Vijay Panchanadikar
Dr. Panchanadikar is an orthopedic surgeon from Pune, who has over two decades of experience in this field, and performs over 100 major orthopedic surgeries each year. His areas of interest include trauma surgery, joint replacement and computer imaging in orthopedics. He has published several papers and has delivered lectures and presentations at several conferences across India. He also teaches DNB students at Sanjeevan Hospital and holds a keen interest in developing interactive learning aids for orthopedics. He holds copyrights in India for imaging software used for accurate positioning of guide wire in surgeries for fractures of various bones.
Under the newly announced PuneCleanTech banner, we’re happy to announce the kickoff presentation by Dr. Balu Sarma (President and CTO of Praj Matrix, the world-class R&D initiative of Praj Industries) on Saturday, 17th April at 10am. We are indeed very fortunate to have an eminent technocrat like Dr. Sarma kickoff this new forum, enlightening us about all things CleanTech (and biofuels in particular). For some background about Praj Matrix, see this PuneTech report from last year.
PuneCleanTech is a special interest group (SIG) of PuneTech focusing on clean tech.
If Information Technology helped Indian Economy soar, CleanTech can push it to stratospheric heights. World over, CleanTech has already replaced IT as ‘Tomorrow’s Technology’. It’s the next big wave. But what is it really? What’s driving CleanTech to be billed as ‘bigger than IT, Bigger than Internet, Bigger than anything the world has seen’? What do esoteric terms such as Biofuels, Geothermal, Reverse Osmosis, Algal Fuels, Passive Solar, PhotoVoltaics really mean? What are the advantages of these technologies? Which of them are relevant to India? Why? And finally, why should we really care about it all?
Come listen to Dr. Balu Sarma answer all these questions and more. Confirm what you know. Understand what you don’t. Meet other CleanTech enthusiasts. Ask Questions. Get Answers. Be Informed. It’s our future we will be talking about!
When: Saturday, April 17th, 10am Where: Venture Center, NCL Innovation Park, Pashan Road. Map: http://bit.ly/VenCen (To reach Venture Center, go past NCL towards Pashan, pass the cricket ground adjacent to NCL and then youâll find NCL Innovation Park / Venture Center on the right hand side.) Registration and Fees: This event is free for all to attend. Free seating on First Come, First Seated basis only Further Info: Contact Harshad Nanal (harshadnanal@gmail.com), Anil Paranjape (amparanjape@gmail.com)
About PuneCleanTech
PuneCleanTech is a special interest group of PuneTech focusing on Clean Technologies. It is an awareness, education, and networking platform to showcase Clean Technologies developed and used in and around Pune, one of the largest Industrial hubs in India. The network brings together technology professionals, entrepreneurs, students, policy makers, investors, and citizens interested in Energy Efficiency, Renewable Energy, Waste management, Water Management, and Environmentally-Friendly Design/Development/Delivery Alternatives to Traditional Products and Services. PuneCleanTech is run by Harshad Nanal (harshadnanal@gmail.com), Anil Paranjape (amparanjape@gmail.com)
with support from PuneTech and NCL Venture Center.
About NCL Venture Center:
Venture Center – a CSIR initiative – is a not-for-profit company hosted by the National Chemical Laboratory, Pune. Venture Center strives to nucleate and nurture technology and knowledge-based enterprises by leveraging the scientific and engineering competencies of the institutions in the Pune region in India. The Venture Center is a technology business incubator specializing in technology enterprises offering products and services exploiting scientific expertise in the areas of materials, chemicals and biological sciences & engineering.
Kaushik Gala, Business Development Manager at Venture Center is looking for all innovators in the areas of biology, chemical, and material sciences.
I want to estimate the number of innovative enterprises in India, and look into their (in)ability to access risk capital.
Why? Because I’d like to know how many Indian enterprises may offer higher returns than FDs, bonds, mutual funds & stocks. But with a lower risk than a VC funded startup.
Why? Because I believe it is possible to raise & deploy a large amount of risk capital to a large set of Indian companies. $1B+.
Why? Because 95%+ of innovative enterprises lack access to risk capital. And 95% of ‘rich’ Indians / NRIs lack access to private equity investments in India. That’s my hypothesis.
So what? Well, there’s a business model in here somewhere.
Definitions & Numbers
I’m mixing up the various terms used to describe relatively young & relatively small (by revenue) companies. These include: startups, Micro, Small and Medium Enterprises (MSMEs), Small Scale Industries (SSIs), new ventures, spin-offs, spin-outs, etc.
Per the 2006-07 census, there are over 26 million MSMEs in India. ~ 97% of these won’t show up in MCA statistics since they are unregistered or operate as sole proprietorships / partnerships.
A company is Micro, Small or Medium depending on the amount invested in plants & machinery. MSMEs employ ~ 60 million people (= 3 Mumbais) and contribute ~ 20% to India’s GDP.
Of these, over 98% are ‘Micro’ enterprises. The majority are ‘one-man shows’ that provide services to local markets with minimal investment. They use traditional techniques, have no formal management practices and lack access to bank credit.
The numbers are huge from a micro-finance perspective. But I’m looking for candidates for risk capital. Time to narrow down the potential market.
Innovative (M)SMEs
How many MSMEs have an innovative business model or technology, that is fairly scalable? Who knows! Let’s make a few random assumptions and pick numbers out of thin air. ‘Micro’ enterprises are less likely to be significantly innovative given their constraints. That leaves say ~ 0.5 million Small & Medium Enterprises (SMEs) to choose from.
Ignore stuff like product vs. service, urban vs. rural, geography, etc.. Let’s assume that at least some % of these 5 lakh SMEs are innovative enough. To qualify, they should have products/services with some ‘edge’, which provides growth & profits. These SMEs were ‘Micro’ at birth, and since they are still around, they must be doing something right.
Maybe 2% of SMEs meet this criteria. That’s 10,000 innovative (and perhaps risk capital worthy) enterprises across India.
My assumption of 2% may be wildly off, but remember that I left out 25.5 million ‘Micro’ enterprises. If even a fraction of those get added to the ‘innovative’ pool, the 10K number suddenly looks small.
Risk Capital for Innovative (M)SMEs
Most MSMEs rely on family, friends & personal networks for funding. Only a select few have access to risk capital from angels, VCs, and certain schemes from government/banks. For example:
On average, < 100 Indian companies get VC funding every year.
On average, angels & angel networks (eg. Mumbai Angels) fund ~ 50 startups every year.
On average, government schemes for startups (eg. DSIR’s TePP, TDB seed funds) fund ~ 100 enterprises every year.
On average, ~ 50 companies get listed (via IPOs) on our stock exchanges every year. Of the ~ 2000 companies that traded publicly, 80%+ are quite illiquid.
On average, bank lending to MSMEs accounts for < 10% of total commercial lending. It’s usually in the form of secured, collateralized debt – not ‘risk’ capital. With personal guarantees from borrowers. And probably only to the ‘Medium’ enterprises.
By any measure, this is hugely insufficient in the context of my 10K estimate. And it gets worse:
The average VC deal size in India is ~ 20 crore. That puts the average pre-money valuation at 40 – 60 crore.
To stand a chance of an IPO on the NSE or BSE, a company must ideally have revenues of over 100 crore.
While governments & banks may be more open to smaller deals, they offer a different set of challenges – slower processes, risk-aversion, stringent spending terms & conditions, limited exposure to risk capital, etc.
SMEs need to invest 10 lakh – 5 crore in their businesses. In the Indian VC world, this would count as ‘seed funding’ or ‘early stage funding’. It is supposed to be followed by Series A, B, C, … on its way to a 100-1000 crore valuation. But not every SME is a glamourous, Silicon Valley style, tech startup. Not every SME is addressing a 1000 crore market. Or even a 100 crore market. So all this talk of ‘seed funding’ is irrelevant.
Bottom-line: There is a tremendous shortage of risk capital – in the 10 lakh to 5 crore range – for innovative (M)SMEs.
[Caveat: Then again, how many of these business owners are willing to part with equity?]
For the MBA/VC types, here is what the SAM (serviceable/sellable available market) looks like: 10K SMEs * say Rs 50 lakh per SME on average = Rs 5000 crore = $1B. Maybe much more!
Demand is not a problem. What about supply? Time for Essay #2.
