Accelerators & incubators are supporting pillars of all startup ecosystems and India is no exception. Till 2005 in India, incubators were based in educational institutes with a purpose of building a culture of innovation and experiment within the institute. Come 2005; this changed. The startup ecosystem in India started seeing a rise of accelerators & incubators. After 9 years, we have more than 60 accelerators & incubators present in India out of which 20+ are active. It is claimed by the active accelerators that 60% of all the startups which are part of accelerators and incubators go on to raise funding.
The Accelerator Program of Microsoft Ventures in India has been active for the last 3 years and 82% of the accelerated startups have raised funding within a year of being in the Program, with 27% raising Series A funding. I believe that some of the reasons that made this possible are:
- The rigorous selection process to get into the Accelerator Program is a validation in itself for the idea, the quality of the company and the entrepreneurs.
- Startups go through an intense process of re-evaluating their assumptions about their business models. The entire startup idea gets re-validated not only in terms of the purpose it serves but also in terms of the target markets that it will serve. Startups get the clarity on whether they are building a product for a global market or for a localized market.
- A focused strategy on how to take the company forward is decided, an operating plan to help build the company to the next level becomes clear, which in turn leads to faster execution.
- Being associated with Microsoft Ventures adds to the credibility of startups. The alumni startups of the Accelerator Program always have the access to Microsoft Ventures resources. It gives investors a little bit of comfort and confidence. The ability of startups to try out new things in new markets and geographies increases because of Microsoft’s network around the world.
Apart from these, mentorship plays a big role in making the fund raising process easy for startups. I have always believed that role of mentors in nurturing and scaling startups is very important. In the past, I co-founded Mentor Partners, an organization to help entrepreneurs in India build global companies. Mentor Partners helps entrepreneurs by bringing together customers, ideas, entrepreneurs, venture capitalists, and expertise. Having a good mentor can do wonders for your business. Three of our alumni startups from the Accelerator Program at Microsoft Ventures, share their views on the same.
David Back, Co-founder, ZoomCar
When we joined the Accelerator Program in January 2014, we had 50 vehicles. Today, we have over 150 vehicles. And this is a minor example of the scale we achieved over the course of 4 months at the program. On the technology front we have scaled up tremendously. Our technology platform has improved both in terms of customer experience and in terms of our backend operational efficiencies.
We had raised close to $1.5 million dollars when we joined the Accelerator Program. Since then, we have raised a significant amount again. We hired a number of extraordinary people in crucial roles. The program was helpful to us in terms of technology, design, product road mapping and hiring. Microsoft Ventures’ excellent mentor network comprising of experienced entrepreneurs and venture capitalists was of crucial help.
Raising capital is not just about closing the deal, it is a strategic decision for entrepreneurs – who do you want to raise capital from, how much do you want to raise in a certain time period, what to consider in the long term for your current investment and for future investments. The mentors were excellent help in this.
Kunal Lagwankar, Co-founder, AdSparx
Startups are fighting a plethora of problems everyday with limited resources and limited team strength. Sometimes you tend to loose focus because of the chaos around. The Accelerator Program at Microsoft Ventures helped us set our focus on immediate and important tasks at hand.
When we joined the program, we were facing some issues with respect to product, customer support, strategy etc. We got a chance to discuss all these aspects with the mentors at the program. We had an informative session covering all dimensions of building a business and clear, measurable goals were listed. Things started becoming easier; with a clear action plan and a clearer review process. In a very short span of time, we were able to break our big goals into measurable activities and we strived to achieve them. We worked on the product side with an easily accessible and experienced technology team at Accelerator Program.
The Accelerator Program gave us an access-way to great mentors. We got ample opportunities to interact with potential mentors to figure out whom we want to work with and who will be the right mentors for us.
With the right set of mentors, we laid out our major goals, got to know the major areas where we were lacking and the problems that could be solved with financial investors coming in. Our mentors helped us in identifying the barriers that we needed to cross before we go to an investor and pitch. Our fund raising process was smoothened considerably.
Jasminder Gulati, CEO, NowFloats
The whole ecosystem connect at the Accelerator Program of Microsoft Ventures was great; the founder community, investors, access to customers, mentors and partners was very critical for us at early stage. To have this ecosystem made available by Microsoft Ventures from day one is a no trivial thing.
We were in the first batch of the Accelerator Program and that time this ecosystem was being built; now it is a well-oiled machine. We had the opportunity to build it along with Microsoft Ventures. We could go ahead and tell them that we wanted to connect with someone and they would help us do that. It was a very powerful thing.
The peer group that you get exposed to is very critical too. The fact that 11 startups co-exist at a facility is very exciting. There is a lot of energy in the room. You see other people working very hard and the energy gets to you too. You question yourself after a week – those guys have done some amazing stuff in the past week, are you doing something too and are you doing it fast enough? This atmosphere helped us a lot.
You can talk pretty openly to the Microsoft Ventures team, what the market is looking for, are you on the right business model, do you have the kind of traction, are you talking to the right people, for us it helped to get validation on some of these areas.
We continue to maintain very healthy relationship with the people and the mentors we met there. We are still in touch with mentors and they help us even now. They are deeply involved in our progress till date. Even today we can get back to them and ask for anything that we need. We remain connected through a Whatsapp group, and that’s the comfort level and the kind of relationship we have built. The mentors have given their time unconditionally and that’s really wonderful.
Fund raising process can be challenging for entrepreneurs and having a right set of mentors can really smoothen the process.
About the author:
Ravi Narayan is the Director of Microsoft Ventures in India and responsible for the Accelerator program in Bangalore. He joined Microsoft recently from Mentor Partners, a Seed Fund based in Bangalore. Ravi has been an entrepreneur, mentor and investor most of his career. An alumnus of the Indian Institute of Technology (IIT) Madras, and an MBA from the University of Southern California. Following his return to India from the United States, Ravi lives with his family in Bangalore. A black-belt in martial arts, Ravi enjoys meditating and Tai Chi.