Business Incubators in India Anshul Saxena CINE

What are Business Incubators Incubation is a dynamic process of business development. Incubation is a dynamic process of business development. Incubators nurture young firms, helping them to survive in their early stage. Incubators nurture young firms, helping them to survive in their early stage. Incubators provide: Incubators provide: Infrastructural support i.e. office space, meeting room Infrastructural support i.e. office space, meeting room Platform to do networking Platform to do networking Management assistance Management assistance Other support services, specific to incubators Other support services, specific to incubators

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Benefits of Incubation For Tenant Companies For Tenant Companies For Corporate World For Corporate World The new technology / product gets developed The new technology / product gets developed Informed investment choice Informed investment choice Possibilities for takeover Possibilities for takeover For Govt. For Govt. Economic development Economic development Social benefits Social benefits Encouragement to innovate Encouragement to innovate

Model Linear Model of Innovation: Linear Model of Innovation: Origin of all innovation lies in Research activities Origin of all innovation lies in Research activities Role of universities Role of universities Since Universities receive Govt. grant, so ideas of current national interest incubated Since Universities receive Govt. grant, so ideas of current national interest incubated Apart from R&D support, managerial support also required to develop business Apart from R&D support, managerial support also required to develop business Commercial feasibility to the ideas Commercial feasibility to the ideas Networks in suitable places can prove handy Networks in suitable places can prove handy

Indian Scenario Incubation at nascent stage Incubation at nascent stage Mostly in a college / university, e.g. Mostly in a college / university, e.g. TREC – STEP (NIT, Trichy) TREC – STEP (NIT, Trichy) Society for innovation and entrepreneurship (IIT – B) Society for innovation and entrepreneurship (IIT – B) Nirma Labs Nirma Labs Technology Business Incubators – IITD Technology Business Incubators – IITD (Kongu Engg. college, TN) (Kongu Engg. college, TN) These incubators provide technological support STPI (Software technology parks) STPI (Software technology parks) CIIE, IIMA CIIE, IIMA

Example Main Activities of SINE are to: Main Activities of SINE are to: Incubate early stage entrepreneurial ventures based on technology and innovation. Incubate early stage entrepreneurial ventures based on technology and innovation. Create physical infrastructure and support systems necessary for business incubation activities. Create physical infrastructure and support systems necessary for business incubation activities. Facilitate networking with professional resources, which include mentors, experts, consultants and advisors for the incubatee companies. Facilitate networking with professional resources, which include mentors, experts, consultants and advisors for the incubatee companies. Identify technologies/innovations which have potential for commercial ventures. Identify technologies/innovations which have potential for commercial ventures. Promote and foster the spirit of entrepreneurship. Promote and foster the spirit of entrepreneurship. Carry out activities that facilitate knowledge creation, innovation and entrepreneurship activities. Carry out activities that facilitate knowledge creation, innovation and entrepreneurship activities.

STP Remarkable Govt. initiative Remarkable Govt. initiative Special incubator in software sector Special incubator in software sector Objectives of STPs are Objectives of STPs are To establish and manage infrastructure resources i.e. Data communication facilities, core computer facilities To establish and manage infrastructure resources i.e. Data communication facilities, core computer facilities To promote development and export of software services To promote development and export of software services Fast clearance (single window) for statutory services Fast clearance (single window) for statutory services To train professionals To train professionals Currently in about 34 cities across India Currently in about 34 cities across India

Taking examples from Europe Extensive network of incubators Extensive network of incubators Incubators in or near by famous universities Incubators in or near by famous universities Provides technical and R&D support Provides technical and R&D support Some expertise to offer Some expertise to offer Management Management Technological Technological Networks Networks In fact, Incubators position themselves according to the additional expertise they offer In fact, Incubators position themselves according to the additional expertise they offer

Platform to pitch to VCs and PE funds Platform to pitch to VCs and PE funds Help in preparing pitches Help in preparing pitches Incubators have some VCs as either stakeholders or Board members Incubators have some VCs as either stakeholders or Board members Incubators develop good track record and rapport with certain VCs Incubators develop good track record and rapport with certain VCs Network among Incubators Network among Incubators Incubators develop network among themselves Incubators develop network among themselves Help them in utilizing networks with VCs and other research firms Help them in utilizing networks with VCs and other research firms Some examples: Manchester Business school incubator, IT univ. of copenhagen, London science park etc. Some examples: Manchester Business school incubator, IT univ. of copenhagen, London science park etc.

Govt. assistance Govt. assistance UK trade and investment (UKTI), an arm ok UK foreign ministry works with incubators UK trade and investment (UKTI), an arm ok UK foreign ministry works with incubators Organizes programs wherein motivates young companies to be part of these incubators Organizes programs wherein motivates young companies to be part of these incubators Also invites foreign startups Also invites foreign startups Provides Legal and other statutory services to incubators Provides Legal and other statutory services to incubators

The way ahead Govt. initiatives to develop incubators Govt. initiatives to develop incubators Public-Private partnerships Public-Private partnerships Some benefits and sops to develop and manage incubators Some benefits and sops to develop and manage incubators The return in this business (incubators) come after a gap of time, Govt. needs to fill this gap in PPP The return in this business (incubators) come after a gap of time, Govt. needs to fill this gap in PPP Indian incubators have to think beyond R&D assistance Indian incubators have to think beyond R&D assistance Networks with VCs and other firms also required Networks with VCs and other firms also required

Incubators can be segmented according to the ideas they incubate. Incubators can be segmented according to the ideas they incubate. Infrastructure Infrastructure Taking one step forward Taking one step forward Good infrastructure: a hygiene factor to companies Good infrastructure: a hygiene factor to companies

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