The programme intends to pick 100 companies with innovative ideas and potential to grow fast.
Continuing with the state’s efforts to be home to one of the top startup ecosystems in the world, Karnataka’s infotech department is launching Elevate, a programme to identify top 100 innovative companies.
Planned as a precursor to the flagship BengaluruITE.biz, India’s largest IT conference, Elevate will identify, fund and mentor these companies.
State IT and BT minister Priyank Kharge told YourStory that with Elevate, the state, already a leading innovative and disruptive tech hub, intends to leapfrog to the next level. Priyank said,
“Bengaluru is among the top five most favourable ecosystems for startups in the world and the World Economic Forum has given it the ‘most dynamic city in the world’ tag. We understand that this sense of technology innovation is spreading all over Karnataka and we want to look for innovative ideas in Tier-II cities such as Mysuru, Mangaluru, Hubbali and Kalaburgi.”
A hundred startups can aspire to be funded, mentored, incubated and even get their ideas validated.
The extensive process will start soon and the department is hoping to receive at least a thousand pitches. As a precursor to the event scheduled for end of August, events will be held in the four secondary cities and finally in Bengaluru. As many as 250 companies will be able to make direct pitches.
The selected startups will be eligible to get guidance, consultancy, patent filing facilitation, legal assistance, and funding.
India ranks third among global startup ecosystems, with more than 4,200 startups that employ close to 85,000 employees. With over $5 billion worth of investment in 2015 and $4 billion in 2016, on an average there are three-four startups emerging every day. It is projected that the number of startups in India will reach 11,500 by 2020.
“Karnataka is already leading in IT and BT and we are trying to leap ahead and march forward. The selected companies can tap into Rs 200 crore worth of funds–in the form of both grants and venture funds,” Kharge said.
The conference is designed to bring together leading investors, successful entrepreneurs, academics, policymakers and mentors from India and abroad. The whole idea is to boost the startup ecosystem and provide support to innovative ideas.
“We understand that not all companies require funding. Some may need validation, others technical help and many others a clear direction. This is a great opportunity as we have not just Nasscom, the Deshpande Foundation and TiE, which will curate and validate ideas, but we are seeking help from HNIs, seed funding companies and venture capitalists,” the minister added.
Karnataka has been the first government, which includes the Centre’s Startup India programme, to provide grants to ideas without any equity. In biotech, 26 startups received Rs 10.70 crore, and earlier eight tourism-based startups received Rs 1.80 crore. The state has already set aside Rs 17 crore for nearly 50 chosen startups and challenges that it has conducted.
In addition, it has announced Rs 10 crore for agri-tech funds and a Rs 2.5 crore fund aimed at generating original IP-based content in animation, video effects, gaming and comics. The state government has also set aside Rs 8-10 crore for promoting women entrepreneurs. “Women entrepreneurs can also pitch for funds through the Elevate programme,” the minister added.
At Elevate, a mixture of funds worth Rs 200 crore will be available from Karnataka IT Venture Fund (KITVEN), Biotech Venture fund, AVGC venture fund, Karasevam fund and the idea2POC funds for tourism, women entrepreneurs and agri startups.
While idea to proof of concept is a grant, companies funded through other routes will have to part with equity for the state government. There will also be grand challenges announced soon to tackle malnutrition and sewage problems, which were announced earlier.
A KBITS officer said Elevate is a huge opportunity for companies that apply as their startup ideas will get validated. “Are they early or late is a vexed question many startups face. Elevate will save a lot of time for them to figure out whether their idea is scalable or not. Another crucial aspect is funding,” he said.
Venture capitalists in India generally invest in firms that are already generating revenues, therefore investing relatively late in the startup cycle. Startups looking for funding of less than Rs 50 lakh therefore often struggle to access investors.
This is where government intervention is required through the provision of alternative sources of funding, grants etc., and through partnerships between industry and academia.
The government hopes to creatively disrupt the startup ecosystem into which it is putting so much faith. It hopes Elevate will be a perfect take-off for startups.
“Our intention is to spread innovation all across Karnataka and not limit it to Bengaluru. For example, not many know that there is a blockchain startup in Tumkur,” Kharge added.