GUJARAT · 2020. 9. 11. · Gujarat has been evaluated on 7 distinct pillars which largely...

GUJARATBEST PERFORMER

STATE/UT STARTUP RANKING EXERCISE 2019

GUJARAT | BEST PERFORMER2

TABLE OF

CONTENTS

1. Overview of State Startup Ecosystem ...................05

2. Snapshot of State Performance ..............................06

3. Pillar Wise Assessment ...............................................07

3.1. Institutional Support ..............................................................07

3.2. Simplifying Regulations .....................................................10

3.3. Easing Public Procurement ............................................12

3.4. Incubation Support ................................................................14

3.5. Seed Funding Support ........................................................16

3.6. Venture Funding Support ................................................18

3.7. Awareness and Outreach ...............................................20

5GUJARAT | BEST PERFORMER

OVERVIEW OF STATE STARTUP ECOSYSTEM

The state of Gujarat has a well-structured startup ecosystem with specific focus on incubation, regulatory support and awareness as well as outreach initiatives. The government launched the state’s startup policy in 2015 under the Industries and Mines Department. The policy offers benefits and incentives across various areas of intervention to startups.Gujarat is one of the few states in the country to outline sector specific startup policies such as Electronics & Information Technology (IT) Policy and Student Startup and Innovation Policy (SSIP). The state has many prominent startup incubators and accelerators which have contributed to the strong growth of the startup ecosystem. Such organisations have come through partnerships between the state and educational institutes such as the Indian Institute of Management (IIM), the Indian Institute of Technology (IIT) and the National Institute of Design.

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SOME OF THE KEY ASPECTS OF THE STARTUP ECOSYSTEM IN GUJARAT ARE:

The nodal department for startups is the Industries and Mines Department and the nodal officer for the same is the Industries Commissioner

The educational institutions in Gujarat have given the state a platform to launch some of the most prominent incubators and co-working spaces in India such as iCreate, Venture Studio, CIIE.CO, Dev X and The Address

Gujarat has an active investor community which consists of various investing organisations, such, as the Gujarat Venture Finance Limited (GVFL), the Gujarat Angel Investors Network (GAIN) and individual angel investors

The favourable policies devised by the Gujarat government have resulted in many startups emerging in the state, such as, Infibeam, Lendingkart, Menstrupedia, Berdo, Torchit and Reelo

The Electronics & IT policy devised in the year 2016 has the following objectives:

− Facilitation of at least 2000 startups through the policy

− Construction of one million square feet of incubation space

− Facilitate investments worth USD one billion to startups

− Establish at least 50 incubators in Gujarat

The state’s startup portal is http://www.startupgujarat.in/. It includes features such as:

− Startup registration − Nodal institution registration − Mentor registration − Relevant guidelines and

notifications − Dashboard showing current state

of Startup Ecosystem of Gujarat

The Student Startup and Innovation Policy (SSIP) devised in 2017 has the following objectives:

− Build capacity for at least 200 premier educational institutes in Gujarat

− Convert at least 1% of graduates into job creators

− Support at least 1000 student led innovations every year

− Harness 500 student startups in the next five years

− File at least 1000 patents from universities in Gujarat every year

http://www.startupgujarat.in/


SNAPSHOT OF STATE PERFORMANCE 02

Relative Performance of the State

Performance of the Best State in the pillar

Venture Funding Support

Seed Funding Support

Easing Public Procurement

Simplifying Regulations

Institutional Support

Awareness and Outreach

Incubation Support

The following representation details status of Gujarat’s implementation on each of the 7 pillars of assessment. Data presented below is the percentile score.

Gujarat has been evaluated on 7 distinct pillars which largely contribute to the growth of the startup ecosystem in Gujarat. The representation as expressed above depicts the relative performance of Gujarat in each of the seven pillars in comparison to the performance of the best state in that pillar.

As shown above, Gujarat has shown impeccable performance in the pillars relating to ‘Incubation Support’ and ‘Awareness and Outreach’ by being in the 100th percentile. The range of impact generated through ‘Institutional Support,’ ‘Venture Funding Support,’ ‘Easing Public Procurement’ as well as ‘Simplifying Regulations’ are also noticeable through this graph. Although significant efforts have been made to enhance the startup ecosystem, ‘Seed Funding Support’ initiatives by Gujarat require significant improvements since results have been negligible in this pillar.

Detailed analyses of this snapshot can be viewed in the subsequent section, with extensive insight into the initiatives taken by the State to uplift its startup ecosystem.

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PILLAR-WISE ASSESSMENT

The state has well-defined startup policy with specific focus areas and a sound online implementation system for registration of startups and for them to avail incentives offered by the state government. All the policies are publicly available on the state’s startup portal and have clearly defined benefits and incentives (both fiscal and non-fiscal) to be given to startups, incubators, nodal institutions, educational institutes etc. The state has a thorough and clear definition of ‘startup’ in the startup policy according to which a startup is defined as:• An entity shall be considered a startup up to a period of ten years from the date of incorporation/registration; if it is

incorporated as a private limited company or registered as a partnership firm or a limited liability partnership in India• Turnover of the entity for any of the financial years, since incorporation, should not exceed INR 100 crore• The entity should be working towards innovation, development or improvement of products or processes or servicesAll the details of their startup policy are available online through a dedicated portal for startups (startupgujarat.in). The state has an online mechanism to connect mentors to startups. This includes a list of mentors registered on the state startup portal, along with their contact details. According to the state government, more than 150 startups have received mentorship over the period of consideration.

KEY FACTS

1. INSTITUTIONAL SUPPORTInstitutional support envisages provisions and execution of the state’s startup policy including information on the nodal team within the state, online implementation system, registration of mentors and their listing on the state startup portal. The states are evaluated based on the laid provisions along with parameters of availing benefits through state intellectual property rights portal, establishing partnerships with institutions, providing special incentives for women led startups and entrepreneurship

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KEY STRENGTHS

INTERACTIVE ONLINE IMPLEMENTATION SYSTEM POINT TO COME HERE

• The state has a strong system in place to provide intellectual property assistance to startups in terms of provision of subsidies for filing patents/ trademarks

• The government of Gujarat offers IP support through its Education Department which has issued the Student Startups and Innovation Policy (SSIP) which provides various provisions to extend intellectual property rights’ support to startups. Following benefits related to IP support are provided in the policy:

− University Level: Financial support for a period of five years up to INR 5 crore for state universities and INR 2.5 crore for private or self-financed universities to help startups in filing patents

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− Institute Level: A grant of up to INR 2.5 lakh for filing an average of 10 national patents per annum and an additional grant of up to INR 2.5 lakh for filing international patents. Further, a grant of up to INR 40 lakh to be disbursed to a maximum 40 eligible institutes per year

DEDICATED TEAM FOR GUIDING STARTUPS

• The state has a robust startup cell which comprises of a dedicated team to provide assistance to startups

• In April 2018, the Industries Commissionerate was assigned as the nodal agency and the Industries Commissioner was assigned as the nodal officer

• Contact details of nodal department/agency and officers (with designation) and the profiles of the dedicated team assigned for any startup are made available on the startup portal


COMPREHENSIVE STARTUP POLICY

• The state’s startup policy is very comprehensive in terms of its coverage of all the aspects of the startup ecosystem. It has clear guidelines on the definition, the registration process and the incentives available for startups

• Further, the policy is sector agnostic as the incentives and benefits offered to startups are not restricted to specific sectors

• Also, the state has announced sector specific policies for startups, specifically in disruptive sectors. Some of these policies are listed below:

INTERACTIVE ONLINE IMPLEMENTATION SYSTEM

• The state’s startup portal is startupgujarat.in. It is a highly interactive platform created to initiate seamless registration of startups with the government of Gujarat

• The startups can submit their application for registration by submitting all documents online. The status of the application is also reflected online in real-time and can be tracked accordingly

• Once the startup is registered successfully, they are issued a registration certificate with a Unique Registration Number (URN)

• A robust startup helpdesk has been set up under the Gujarat Startup Cell at the Industries Commissionerate office to receive and resolve queries via phone, e-mail and through the online portal

• The details of incubators and mentor registered with the portal are displayed in the public domain

• The details of the policy implementation dashboard are displayed on Gujarat’s startup portal

COHESIVE PARTNERSHIPS TO FOSTER GROWTH OF STARTUP ECOSYSTEM

• One of the key aspects of the state’s support system for startups is the number of incubators and accelerators which have grown through partnerships between the state government and various business enterprises and educational institutions

• The business enterprises include both private and public sector organisations. Companies, such as, Google, Cisco and Claris Capital are some of the renowned global organisations that have established partnerships with state supported incubators in Gujarat

• Stanford University, University of Toronto, Israel Institute of Technolog are some of the educational institutes that have established partnerships with the state

• Startups have benefitted immensely under these partnerships through professional services, mentorship, access to libraries and labs, software/ hardware tools and other lab equipment, knowledge exchange, technology transfer and market linkages

• Details of partnerships along with contact details are available on the state’s startup portal

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GUJARAT BIOTECH POLICYThe state has formulated a Biotechnology Policy in order to promote the biotechnology sector in the state and create entrepreneurial opportunities in the same. The policy also aims to encourage research and development of technologies in the field of biotechnology and thereby create a strong intellectual property driven technology base in the state. The incentives under the policy include incentives for biotechnology park, biotechnology units and biotechnology incubators

GUJARAT STUDENT STARTUP AND INNOVATION POLICY 2017The Student Startup & Innovation Policy aims to create an integrated, state-wide, university-based innovation ecosystem to support innovations and ideas of young students and provide a conducive environment for optimum harnessing of their creative pursuit. The policy synergises complementary efforts by different stakeholders while making strong efforts towards cultural change amongst students, pre-incubation support and other necessary measures required in creating and nurturing student innovations and support towards self - sustenance

GUJARAT SCIENCE, TECHNOLOGY AND INNOVATION (STI) POLICYThe policy aims to incentivise startups with an aim to evolve solutions to complex issues of the public sector, which otherwise are difficult to implement in the public sector due to lack of adoption opportunities or presence of procedural challenges. A dedicated Innovation Fund has been created under the policy which will cater to the requirements of two schemes – one for supporting research and development and the other for pilot deployment and testing of technologies

ELECTRONICS & IT/ ITES STARTUP POLICY 2016The state devised a separate policy for IT and Electronics in order to meet the requirements for additional support and nurturing for Electronics & IT/ITeS startups. The policy aims to nurture the growth of incubators and facilitate investment opportunities for startups in this field


WAY FORWARD

From the list of initiatives carried out or proposed by the state as detailed above; the state has performed well in this pillar. There are additional steps that the state could take in order to build upon the initiatives further.

Towards this end, the state can prioritise actions required in three categories: short, medium and long term. Action required in each of these categories are summarised below:

MEDIUM TERM ACTIVITIES (4-6 MONTHS)The activities suggested in this category are important and will take relatively more time for implementation. Through dedicated efforts, results can be achieved within four to six months. Activities suggested under this category are as follows:

Women Entrepreneurs • Although the state has a proactive approach to startup policymaking, there is relatively less focus on special incentives for women

entrepreneurs. The state could implement specific schemes and incentives focused to encourage and empower women entrepreneurs

Intellectual Property Support:

The state could expand their network of Intellectual Property Facilitation Centers and include new activities to create additional awareness


2. SIMPLIFYING REGULATIONSSimplification of regulations considers mandatory requisites for state level approvals and clearances for registering and operating a business or startup online. In order to make compliance for startups friendly and flexible, simplifications are required in the regulatory regime. It encapsulates regulatory issues faced by registered startups which have been identified through an interactive online mechanism subject to approving action by regulatory agencies. The states are evaluated based on the support provided to startups by introducing a list of rules, regulations or Acts in the state, including amendments in the Acts and regulations with requisite details to create a conducive environment for the state’s startups.

ROBUST BUSINESS COMPLIANCE INFORMATION SYSTEM

• The state has a robust Business Compliance and Information System (BCIS) in place to guide entrepreneurs in registering and operating a startup

• The state’s online portal (http://www.startupgujarat.in/know-your-approval.htm) with an interactive mechanism to find information on all the state approvals and clearances required for registering and operating startups across various sectors. The portal has a specific ‘Know Your Approval’ feature which guides the startup in understanding detailed government approval requirements based on their sector and other related requirements

• This portal also acts as a one-stop shop for startups to comprehend the approvals and clearances required for starting a business, obtaining seed funding or venture funding, guidelines for public procurement, partnerships, self-certifications, relevant rules and regulations by the state government

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The state has strong mechanisms in place to identify regulatory challenges faced by startups in various sectors, and they have subsequently worked toward simplifying the policies and regulations to promote the growth of startups. The state has proactively worked towards identifying regulatory hurdles faced by startups in the disruptive sectors and has introduced new policies to promote innovation. The state has institutionalised an online mechanism to connect with disruptive startups and to understand their regulatory issues.

KEY FACTS

KEY STRENGTHS

http://www.startupgujarat.in/know-your-approval.htmhttp://www.startupgujarat.in/know-your-approval.htm


FAVORABLE REGULATORY ENVIRONMENT THROUGH AMENDMENTS IN RULES AND REGULATIONS

• There have been multiple rules, regulations, and Acts introduced or amended by the state government to support the growth of startups. Some of these amendments are:

− Exemption to startups for producing ‘Solvency Certificate’ for obtaining Electrical Contractor Licence

− Amendment in Self-Certification cum Consolidated Annual Return Scheme: The government has added the following acts in the scheme as well:

• Building and other Construction Workers Welfare Cess Act, 1996

• Building and other Construction Workers (Regulation of Employment and Conditions of Service) Act 1996

• Payment of Wages Act 1936

• Maternity Benefit Act 1961

− Incentives to women-led startups: Special incentives to women-led startups include 75% reimbursement for organising annual promotional event and additional monthly sustenance allowance

− Regulations for startups in disruptive technologies: Gujarat Pollution Board has adopted an online application disposal system by the name of Xtended Green Node (XGN) for speedy disposal of consent applications received from industrial units. The time limit for disposal of applications has also been reduced from 30 days to 21 days

PROACTIVE MECHANISM TO INVITE OR IDENTIFY REGULATORY ISSUES FROM DISRUPTIVE STARTUPS

• The state has a proactive mechanism in place to identify regulatory issues faced by startups. The time-bound process of addressing these regulatory issues has been listed below:

• The government seeks feedback from startups during various events, such as, mentorship events, workshops, and seminars. The feedback and highlighted regulatory challenges are collated by the government

• Additionally, the state government also has an institutionalised online mechanism in place to connect with disruptive startups and understand the challenges faced by them, through an available grievance redressal form on the website

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The software called Xtended Green Node (XGN) has been developed by the National Informatics Centre (NIC) and has been in use since June 2008. The software connects the regional and head offices of GPCB with around 17,000 Industries spread across Gujarat, hospitals (private and government), and waste treatment facilities.

XTENDED GREEN NODE (XGN)

Within 7 days of submission of the query, Gujarat Startup Cell asks for any additional information required to understand the regulatory issue in detail

The draft policy/ regulation is published on the department website for the period of 60 days

Publication of final policy/ regulation and circulation of the copy to all entrepreneurs, incubators, nodal institutes and government departments

The detailed note is then submitted to sub-committee members, who provide feedback within 15 days before the sub-committee meeting. Meeting is held under presence of high-level committee

Approval from high level committee to be taken within 30 days of making the policy public

WAY FORWARDFrom the list of initiatives carried out or proposed by the state as detailed above; the state has performed well in this pillar. There are additional steps that the state could take in order to build upon the initiatives further.



Interactive online portal• The state could make the portal more interactive by adding a chatbot to the main site. This will help in real time problem-solving for

the startups and they will be able to get customised responses instead of standardised Frequently Asked Questions (FAQs) currently available on the website

Resolution of sector specific regulatory issues• There is a need for quarterly roundtables/workshops to resolve sector specific regulatory issues. This could include a two-way

communication between startups and relevant government departments aimed at direct consultation and grievance redressal. This could include specific focus on startups in disruptive technologies as well


3. EASING PUBLIC PROCUREMENTEase in public procurement simplifies criteria to ensure participation of startups in government tenders. The states are evaluated based on the support provided to startups in resolving issues related to state public procurement as norms of Earnest Money Deposit (EMD), prior experience, and prior turnover which prove to be barriers for participating startups. Easing of such norms enable startups and entrepreneurs to avail exemptions and share an equal platform with established organisations.

The state has made the requisite relaxations for experience, turnover and submission of EMDs in order to encourage startups to participate in public procurement. The state through a resolution in April 2018 has removed the criteria of “prior experience”, ‘’prior turnover” and “submission of EMD” for startups. The state also has a strong mechanism in place to address all grievances of startups with respect to public procurement.

KEY FACTS

ROBUST GRIEVANCE REDRESSAL MECHANISM

• The state has developed a robust online mechanism for receiving grievances and providing resolutions on matters related to public procurement

• Startups can raise grievances on the state’s startup portal and communication of resolution of the grievances is undertaken through the same portal

• For each grievance submitted, a timeline is specified for the resolution

• The Commissioner of Industries and Coordinator - Startup Cell Gujarat has been appointed as a dedicated officer for resolving grievances

AWARDING WORK ORDERS

• The state has awarded work orders to 20+ startups in order to encourage their participation in public procurement

• Some of the startups that form part of this list are Orion, Brook and Blooms, Hubili, i create, Lutalica

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WAY FORWARD




Organising demonstration days for startups

The state could consider organising annual events where startups, especially in the disruptive technology domains, can demonstrate their capabilities directly to the government and subsequently take part in public procurement activities


4. INCUBATION SUPPORTIncubation support is an integral element of the startup ecosystem that supports entrepreneurs to grow their businesses and assists new startups to succeed. In order to promote startups, the state governments collaborate with organisations, corporates or industry associates to establish incubators, to support startups in the form of capital expenditure or operational expenditure. The evaluation is based on setting up of incubators supported by the state governments to release funds to the startups, thereby creating a unique mechanism to provide subsidised incubation and operate acceleration programmes in partnership with the industry.

The state is strongly focused at initiating the startup incubators as centers for developing entrepreneurial skills amongst the youth. The state has strong mechanisms in place to assist in setting up of new incubators and upgrading of existing incubators. The key policies to support the growth of incubators are:• Startup and Innovation Policy 2015 by Industries & Mines Department• IT & ITeS & Electronic Startups Policy 2016 by Department of Science & Technology• Student Startup & Innovation Policy 2017 (SSIP) by Education Department• Biotech Mission Policy 2016 under Gujarat State Biotechnology Mission (GSBTM)The state has supported various incubators through financial grants and these operational incubators have allocated seats to startups. Under the incubation offerings, startups are provided with various facilities to expand their business at the selected incubator.

KEY FACTS

STRONG SUPPORT FOR SETTING UP OF NEW INCUBATORS AND UPGRADING OF EXISTING INCUBATORS

• The state has devised a high-quality incubation support system to nurture the growth of startups. Through such systems, entrepreneurs are able to obtain funding and any other form of support such as market research and understanding required to grow their businesses. The state ensures to provide the essential benefits of setting up new incubators and upgrading the existing incubators. Furthermore, an incubator in Gujarat has the option of obtaining incentives either under the startup policy of Industries and Mines Department or under the policy for IT and Electronics

• The support to incubators is in the form of financial grants and/ or reimbursements on capital expenditure which can be utilised for development of incubation area and/or operational expenditure

• Under the IT & ITeS & Electronic Startups Policy 2016, the state provides the following subsidies to incubators:

− One-time capital assistance at the rate of 50% of Gross Fixed Capital Investment (subject to a ceiling of INR 50 lakh), excluding cost of land, for setting up an incubator

− Mentoring assistance of INR 5 lakh per annum

− A matching grant of 25% of the funds mobilised by them from non-governmental sources, subject to a ceiling of INR 1 crore per annum for meeting their operational expenses

− The state supports the procurement of key software required for development and testing purpose at the incubator attached or associated with educational institution or universities at the rate of 50% of software cost subject to a ceiling of INR 1 crore

• Currently the state supports 80+ incubators in form of capital and operational expenditure during the period of consideration. Out of these, 30+ incubators have allocated 2000+ seats specifically for startupsKE

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THROUGH SUBSIDIZED INCUBATION

• Under the Startup & Innovation Policy, subsidy is provided to eligible startups is in the form of sustenance allowance (seed funding). The subsidy may be utilised for paying the incubation fees (if any) to the nodal institute (NI) to avail a subsidised incubation

• It has also been mandated that all the institutes/universities receiving grants under the Student Startup and Innovation Policy (SSIP) 2017 must provide “Free Incubation Support” to the startups/ students for at least three months from the date of enrollment of startup/student with the institute

DRIVING GROWTH OF STARTUP ECOSYSTEM THROUGH ACCELERATION PROGRAMMES

• The government has conducted various acceleration programmes in association with industry players through organisations such as iCreate. Ahmedabad-based iCreate is an autonomous technology business incubation centre that identifies and nurtures aspiring entrepreneurs. The support provided to Startups under acceleration programmes by iCreate involves access to iCreate labs, office space, mentors, market access as well as seed capital for projects it incubates.

• iCreate aims to “solve for different developmental needs of India”. The centre is working with entrepreneurs, technology enthusiasts, and innovators in the Internet of Things (IoT), machine learning (ML), and artificial intelligence (AI) sectors.

• Currently, iCreate is running iELT Accelerator programme, which is a two-and-a-half-week programme focused on very early stage startups and innovators to quickly understand whether their innovation can become a successful business. Selected participants would be guided through a series of steps that include intense classroom sessions, real customer feedback and one to one mentoring. This will enable them to validate whether their idea is feasible and improve their chance of success.

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WAY FORWARD




Improve enrollment in acceleration programmes

The state could encourage enrollment of startups in acceleration programmes to provide startups with the opportunity to connect with investors, engage in skill development and obtain knowledge support. This would provide benefits in the form of networking opportunities with investors and mentors.

Subsidised Incubation• State is encouraged to support more startups through provision of subsidised incubation

• State is also encouraged to allot more grants that complement funds/grants by corporates, academic institutions or Central Government


5. SEED FUNDING SUPPORTSeed funding can be in the form of a direct grant, subsidised loan, product development and marketing financial assistance, monthly sustenance allowance or even equity seed funding. With seed funding, the evaluation is based on the states’ endeavor to help a business grow and generate its own capital by establishing a guiding document . The states need to ensure that startups scale with the right velocity in order to achieve leading positions, through state investment and startup’s entrepreneurial knowledge.

As part of the 2015 Industrial Policy, the state government has developed a scheme for aiding startups and encouraging innovation. With fund allocation of INR 250 crore, it aims to support 2500 startups over a period of 5 years. Under such a scheme, an individual/ group of individuals having an innovative idea or concept and institutions (universities/ education institutions, Incubation centre/ PSUs/ R&D institutions/ private and other establishments) will be eligible for financial support and mentorship. Major objectives of this scheme include:• Develop entrepreneurial skills in youth by providing mentoring services & incubation facilities• Create a favourable ecosystem for startups, innovation and technology transfer

Quantum of assistance under the scheme is given below:

KEY FACTS

MENTORING SERVICE

INR 5 LAKH to Nodal Institution for mentoring services

SUSTENANCE ALLOWANCE

INR 10,000 PER MONTH to the innovation team as sustenance allowance for a period of 1 year, for projects recommended by the Approval Committee of the Nodal Institution

DEVELOPMENT/PROTOTYPE/PROOF OF CONCEPT

INR 10 LAKH for development/ prototype/ proof of concept. The Nodal Institution may use this for purchasing materials, equipment and sources for market development


SPECIALISED SCHEMES OFFERING SEED FUNDING SUPPORT TO STARTUPS

• The schemes provide support to innovators by offering mentor services, incubation facilities, sustenance allowance, and product development support to startups. The innovator gets free access to educational universities and startups can apply to the scheme online by registering their innovations; followed by posting their current projects and ideas, which are ultimately assessed by the nodal institutions

• The portal details out the eligibility criteria, quantum of seed funding, application procedure for the seed funding. There exists an online mechanism for startups for online tracking of application status and communication of approvals. The process flow of obtaining benefits of the scheme are given below and are spread over a period of three months:

• Assistance post the commercialisation of idea/ concept - After the stage of seed funding and after the commercialisation of the idea, startups can also obtain assistance through the following:

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Funding Assistance in getting Angel Funding and Venture Capital

Marketing/ Publicity

Marketing/publicity assistance of up to INR10 lakh for introduction of product/service in the market

VAT Related incentives

Reimbursement to the extent of 80% of Net VAT paid (excluding Additional Tax & Reduction of ITC as per GVAT Act 2003)

Other benefits as per MSME schemes also available

WAY FORWARD




Comprehensive seed funding guidelines• The operational guidelines do not contain specific provisions for startups from Tier-2 and Tier-3 cities. Since these startups have relatively

less access to the market, it could be useful to have separate guidelines for them for facilitating effective funding

Provision of seed funding• The state may consider conducting dedicated annual events for provision of seed funding to early stage startups

• The state could consider other models for seed funding such as subsidising interest payments on loans obtained from commercial banks

Post funding mechanism

After the seed funding is provided to startups, there could be a mechanism to follow-up on the progress made by the enterprise (except for the startups that have commercialised). This can be in the form of timely feedback mechanisms and follow-up reports. This could enable the government in outlining the success stories

• The state has provided seed funding under the startup policy to 465 startups


6. VENTURE FUNDING SUPPORTVenture capital funding support is provided to the startups from state supported funds. The states are evaluated based on the establishment of the Fund of Funds (FoF) with approved operating guidelines and signing a memorandum of understanding (MoU) with the fund manager along with a concrete budget allocation. Venture funding provides strong growth potential to startups wherein the fund is used for the all-round development of startups and to levitate the startup ecosystem of the states.

The state has a very active investor community which consists of various investing organisations such as the Gujarat Venture Finance Limited (GVFL), the Gujarat Angel Investors Network (GAIN) and individual angel investors.

KEY FACTS

PROACTIVE SUPPORT TO VENTURE FUNDS

• The state has been highly proactive in its initiatives and actions to help startups grow and scale-up. Some of the startup funds supported by the Gujarat government are given below:

− GVFL Startup Fund: Founded in 1990, GVFL was the first venture capital to be set up in India. Set up in Ahmedabad, GVFL has raised eight venture capital funds which have supported over 91 companies. The fund focuses on highly scalable innovative business models across, sectors which use technology as an enabler or differentiator and are backed by credible teams. The fund makes equity and quasi-equity investments in startups through a sector agnostic approach

• The GVFL Startup fund has been extremely beneficial in driving investments in startups in Gujarat. The fund has a target corpus of INR 250 crore (including INR 50 crore green-shoe option). Government of Gujarat has intended to invest a total of INR 75 crore in the Fund. The investments are made in early growth stage startups with a potential for major growth within investment horizon of 4-5 years

• The investment from the fund is in the range of INR 2 crore to INR 20 crore in single or multiple rounds as per business needs. The median investment is in the range of INR 10 crore to INR 15 crore

• Gujarat Biotechnology Venture Fund was launched in 2005 under the initiative of Gujarat State Biotechnology Mission. The fund identifies startups, early stage and existing companies in areas of Biopharma, Agri-Biotech, Contract Research, Industrial Biotechnology and other potential areas in biotechnology.The fund has invested in four companies and exited from one

• Gujarat IT Fund was formed in 2000 to promote IT companies present in the state. Profiles of the investee companies ranges from Pure play Mobile VAS to radio frequency identification products to solar based lighting. The fund has invested into 10 companies and exited from four out of the same

• Gujarat Venture Capital Fund (GVCF 1997) was launched for the small sector with emphasis on IT industry. The duration of the fund was 12 years. The fund supported innovative software product-based companies across India. Investments were made in companies ranging from chip designing to telecom-based products. It has been liquidated with profits in 2008

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SUCCESS STORIES OF GVFL

iNurture provides graduate and post-graduate degree courses in new and emerging areas with focus on employability in partnership with leading Universities and Colleges across India and abroad. The revenue is shared with the college/university for providing infrastructure and certification while delivery and content is managed by iNurture. iNurture has a highly scalable, asset light business model and Ascent Capital and Bertelsmann have invested in the company, post GVFL’s investment

Axio Bio-solutions is engaged in business of Haemostatic Medical device dressing with brand name of AXIOSTAT and Sure Klot. It belongs to an advanced class of wound dressings that would stop traumatic external bleeding within few minutes of application by providing an active mechanical barrier to the wound site, thereby stopping haemorrhage. GVFL exited from Axio Bio Solutions with a return of 7 times of its investment. Against its investment of over INR 1 crore, GVFL realised INR 7 crore with about 39 per cent internal rate of return

E-infochips is one of the leading product engineering and software R&D services company with global presence. It has to its credit 500+ product developments and over 400+ deployments across 140 countries. GVFL exited from e-Infochips, with a massive return of 7.4 times of its investment

WAY FORWARD




Support to Venture Funds

The state could create a Social Impact Fund which could impact potential investing and help generate financial returns to further support organisations to create social and environmental benefits.

Startups funded from Venture Funds

In order to increase the number of startups availing state supported venture funds, the state could consider deploying certain measures such as offering a success fee at a fixed rate to startups for availing investments through such state supported funds.


7. AWARENESS AND OUTREACHIt is the endeavor of state governments to raise awareness about the Indian startup ecosystem and increase its outreach throughout the state. The states are evaluated based on awareness of startups created through workshops, national and international events including bootcamps and hackathons/ grand challenges. In order to promote startups, the state encourages participatory and inclusive processes for linking startups with angel investors and high net worth individuals. Maximum participation is encouraged for exchange of valuable knowledge amongst startups, and pitching sessions for angel investments with widespread propagation.

The Government of Gujarat has been quite proactive in its initiatives and measures to help startups grow and scale-up. Cities such as Ahmedabad, Vadodara and Surat have many universities providing student innovators with awareness programmes to develop a sense of starting-up. The Government of Gujarat organised the following events to boost its entrepreneurial ecosystem–

BOOTCAMPS

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KEY FACTS

FOSTERING ENTREPRENEURSHIP THROUGH BOOTCAMPS

• The state implemented the first-ever Student Startup and Innovation Policy in 2017 to assist young innovators from the state

• Through funds received under this policy, the education department of Gujarat conducted 60+ bootcamps spread across 33 districts

• Such entrepreneurship focused programmes enable students to learn crucial life skills such as problem-solving, teamwork, and empathy

• The bootcamps primarily focused on ideation sessions, mentor workshops, pitching sessions and benefits under startup India

• Special women-focused bootcamps were also conducted to inculcate entrepreneurial skills with an aim of strengthening women entrepreneurs both in rural and urban India

KEY

STRE

NG

THS

KEY STRENGTHS

HACKATHONS

10+ANGEL INVESTMENT WORKSHOPS

10+NATIONAL/INTERNATIONAL EVENTS

20+


S. No. Name of Event

1 Gujarat Industrial Hackathon, Auro University, Surat

2 Gujarat Industrial Hackathon, BVM, Anand

3 Gujarat Industrial Hackathon, IITRAM, Ahmedabad

4 Gujarat Industrial Hackathon, Marwadi University, Rajkot

5 Gujarat Industrial Hackathon, PDPU, Gandhinagar

6 Student Open Innovation Challenge, iHub, Ahmedabad

7 EarthXHack, iCreate, Ahmedabad

8 CRIDAH Youth Connect 2019

9 Smart India Hackathon 2019

10 Dewang Mehta IT Hackathon

11 Biothon 2018

12 Let's Hack 2019

S. No. Name of Workshop

1 Angel Investor Meet 2019

2 Empresario 2019 - Angel Investment Workshop

3 Finding the Funding

4 Highway to A 100 Unicorns: Microsoft for Startups

5 Investment101

6 Investor Connect 2018

7 PitchDeck101

8 Venture Leap 2019

9 VGSTS 2018 - Angel Investment Workshop

INSPIRING CREATIVITY THROUGH HACKATHON OR GRAND CHALLENGES

• Gujarat has focussed on its technology talent and conducted hackathons to put data to better use in a way to crowdsource business ideas and solutions to specific problems

• In these hackathons, students across various universities made meticulous efforts to solve technical and digital challenges shared by SMEs, large industries, corporate and public sector enterprises

• The Education Department of Gujarat has taken numerous initiatives to design and develop innovation processes across its affiliated colleges and universities

• 10+ Hackathons were organised in Gujarat by the Higher & Technical Education Department across various institutions and incubators. Some of these are mentioned below

FOSTERING FUNDING SUPPORT THROUGH ANGEL INVESTMENT WORKSHOPS

• The investor community in Gujarat has taken active participation in helping innovative ideas from the state develop further. The state is equipped not only with many investing organisations but also angel investors

• The government has made free access available for seminar hall with a facility of projector and internet connectivity for startups. This increases interaction between angel Investors and startups. The locations are –

− iCreate – GMDC Campus, Ahmedabad

− Gujarat University Startup & Entrepreneurship Council (GUSEC), Ahmedabad.

− Savli Bio-Incubator, Vadodara

− Innovation and Incubation Centre, Gandhinagar

− R.K University, Rajkot

− Startup Cell, Gandhinagar

• A total of 350+ startups got a chance to participate in the following angel investment workshops conducted by the government in association with industry partners.

KEY

STRE

NG

THS

• Some of the investors who were part of these workshops are given below:

Z-Nation Labs Individual Angel Investors

Ah! Ventures Nasscom

India Angel Networks Exactlly

Lead Angels Manthan Software

Venture Catalyst GVFL

Unicorn Adventures Blume Ventures

Acumen Venture Catalysts

Mumbai Angels Ivy Cap Venture

Tipping Point

• Some of the workshops are mentioned below:


NATIONAL OR INTERNATIONAL EVENTS

THE STATE HAS CONDUCTED 23 NATIONAL/INTERNATIONAL EVENTS

2 May 2018 Rajeev Circle Fellowship

27 June 2018 to 5 July 2018

International Planetarium Society Conference (IPS 2018), Toulouse, France

10 June 2018 National Business Plan Competition

28 June 2018 Downselect Competition – (IIGP) India Innovation Growth Programme

8 August 2018 Workshop on Social Entrepreneurship

7 October 2018 Women Entrepreneurship and Empowerment Mentorship Programme, WEE Foundation

11 – 13 October 2018 Vibrant Gujrat Startup and Technology Summit 2018

2 December 2018 Energy International 2018

27 December 2018 ACEIS Plus Med-Tech 2018

10 January 2019 ARTECH

11 January 201915th International Conference on Distributed Computing and Internet Technology (ICDCIT-2019), KIIT, Bhubaneswar, India

18 February 2019 National Leadership Summit on Women & Education 2019

30 – 31 March 2019 Empresario Startup Summit 2019

12 April 2019 Unplugged

12 April 2019 TiECON 2019 – Pune

3 August 2019 Start Up Tank 2019

14 – 17 June 2019 India Machine Tools Show - 2019

15 – 17 March 2019 Festival of Ideas, Surat

17 January 2019Exhibition on Futuristic Technologies, Science City, Ahmedabad

20 March 2019 Project Expo 2019

26 – 29 April 2019 Startup Turkey, Istanbul, Turkey

ICCIG 4The Fourth International Conference on Creativity and Innovation from Grassroots [ICCIG 4]

30 – 31 March 201945th NRDC Meritorious Innovation Awards Ceremony & Conference on “Connecting Inventors, Innovators, Incubators and Investor for Accelerating Growth of Start-ups, EDII, Gandhinagar


MARKETING ASSISTANCE FOR OUTREACH EVENTS:

Out of home Media - marketing to people

in public places, hoardings

Marketing Services Expenses (treated as

consultancy fees)

Television Advertising Expense

Coupon Development

Expense

Brochure Printing Expense

Pamphlet Printing Expense

Direct Mail Expense

Printing of Business Card Expense

Billboard Advertising Expense

Correspondence Expense

Sales Salaries Expenses (treated as

consultancy fees)

Publicity Material Expenses

Radio Advertising Expense

Sales Promotion Expenses

Magazine Advertising Expense

Newspaper Advertising

Expense

Government of Gujarat provides marketing assistance upto INR 10 lakhs to Startups for attending national and International events. Also, if a startup participates in an International event, it can avail benefits under existing schemes of Industrial Policy, subject to fulfilling the required criteria.The guidelines for Marketing assistance are available on Startup Gujarat’s website. Following is a list of components covered under marketing assistance:


Other Promotional

Item

Celebrity marketing — use of celebrities as spokespeople,

for endorsements or testimonials

Long Tail marketing — marketing to many niche segments that aggregate

to a huge audience

Sports marketing — use of sporting events, teams, and athletes to

promote products

Video marketing — incorporating videos in online marketing, leveraging YouTube

Trade show marketing —exhibiting and promoting

at trade shows

Youth marketing — targeting young

audiences, often using emerging channels

Self-marketing — marketing yourself,

also known as personal branding

Search (engine) marketing — organic

and paid promotion via Google, Bing, etc.

Niche marketing — targeting very specific

audience segments

Catalog marketing — marketing through

printed catalogs delivered in the mail

Campus marketing - marketing to (and often

by) college students, campus ambassadors

Informational marketing - providing useful/

educational material to nurture audience

Telemarketing - calling people on the phone with a pitch, usually

uninvited

In-store marketing — promotions based at a

retailer’s location

Data (web) marketing - using data as a

marketing channel


WAY FORWARD



SHORT TERM ACTIVITIES (1-3 MONTHS)The activities suggested in this category are important and will take relatively less time for implementation. Through dedicated efforts, results can be achieved within one to three months. Activities suggested under this category are: :

Enhancing Scope of National and International Events

Students or aspiring entrepreneurs require basic understanding of ideation, business planning, finance, legal and pitching before they venture out to run a Startup. Going forward the state could conduct such trainings and events in more educational institutes of the state to ensure coverage of all districts


Notes

CONTACT US

www.startupindia.gov.in

[email protected]

1800-115-565

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