[Startup Bharat] How Chandigarh is carving its own success story as an innovation hub

Last July, when a two-year-old Chandigarh-based startup — PrepLadder — was acquired by Facebook-backed edtech giant Unacademy for $50 million, the spotlight was turned on this small town in North India. The deal indicated that a startup need not be in India’s metros to write their success story anymore.

In the past few years, several startups have emerged out of Chandigarh including Jugnoo, LetsShave, Pumpkart, EduRev, Trideal, PayMart, among others that have been backed by the likes of Kalaari Capital, Omnivore, Wipro Consumer Care Ventures, Y Combinator, Indian Angel Network, etc. 

Now, the startup success story of the tricity (Chandigarh, Panchkula, Mohali) is progressing beyond a handful of VC-backed names and carving its own narrative.

Grassroot buzz 

According to Tracxn, there are about 558 tech startups in Chandigarh as of July 20. And experts suggest that there is a significant amount of progress taking place at the grassroots.

Vineet Khurana, Strategic Advisor at Startup Accelerator Chamber of Commerce (SACC), adds that this groundwork is often not spoken about or marketed well. 

“There are hundreds of run-of-the-mill business growth stories in the tricity that are not marketed well. The spotlight continues to remain on who got how much funding or got acquired by a big name,” says Vineet Khurana, Strategic Advisor at SACC.

“We get applications from Himachal, Patiala, Ludhiana and other states as well. There is a need to handhold these entrepreneurs and make their business propositions viable for scaling up. Smaller startups will soon find their feet in the region. In the stage of ideation — pre-prototype — MVP, and revenue, a majority of the incubated startups are in between the last two stages,” says Vineet Khurana, Strategic Advisor at SACC.

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The wrong measure of success

External funding might be the wrong yardstick to measure the success of a startup ecosystem, says Alok Ramsisaria, CEO, Grazitti Interactive, and Board Member and Co-founder at Chandigarh Angels Network. 

“It is important to have superstar stories to motivate young blood to take the entrepreneurial plunge and show confidence in the ecosystem. Having said that, the strength of a startup is measured by its product, sustainability, and revenue building potential,” says Alok Ramsisaria, CEO, Grazitti Interactive. 

About 100 active startups are enrolled by SACC, a not-for-profit organisation that is working in partnership with the Department of Higher Education (DOHE), Haryana, in the past 3-4 years across its five incubators.

Another 40-odd entrepreneurial stories across health, waste management, content, data analytics, education, and agriculture, are brewing in the Software Technology Parks of India (STPI) Neuron, a Centre of Excellence in AI/data analytics, IoT, and AVG. 

Then, Mohali-based Chitkara University’s Centre for Entrepreneurship and Education Development (CEED) has incubated around 115 startups. Its success stories include Shotlo, Itmatic, SchoolPad, RidezNow, YourMaali, Youcare, and Anukai, among others. 

“The aim is to build a strong product and high customer acquisition, which brings in revenue. Fundraising will only speed up the process but doesn’t ensure the sustainability of a startup. Majority of them end up burning cash,” says Piyush Garg, CEO of Neuron, STPI NEXT.  

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Play on strengths: tech, pharma, and agriculture 

Every startup ecosystem is built on its market. While Chandigarh’s core sector — IT services — has been strengthening over the years with SaaS startups like authorSTREAM, SchoolPad, Uengage, and Click Labs building up, other areas like pharma and agriculture have not been able to make their innovations commercial. 

There is major potential in the business-to-government (B2G) sector and institution-level collaboration as well. But, the transition is steadily taking place. 

In 2020, the incubator cell of Post Graduate Institute of Medical Education & Research (PGIMER), ICMR-CIBioD, co-created around 20 medical innovations like e-stethoscope, ArogyaSahayak, Rakshak CT, E-OPD (Smart paperless OPD system) for hospitals, portable currency sanitising wallet device Censy, and Intelligent Patient Care System (i BED). Seven other patents are under development. 

The cell was set up last year to bring together institution experts, experts, clinicians, and new-age startups to co-create medical devices.

Around 10 projects were incubated and patented by PGIMER-based platform Biomedical Instruments and Devices Hub (BID Hub). 

The government-backed platform has started an “Innovation Marketplace”, which allows innovators to list their inventions for crowd-selling to interested industries or investors. 

“We need to play on our strength and build a market. There is a huge potential for smart talent to co-create products and services with experienced experts in the domain. We already have state-of-the-art infrastructure at place. In the past, everything used to stop at innovation and a business case was not created. Startups are stepping up in this game,” says Alok. 

Bio-Innovation Centre at CSIR-Institute of Microbial Technology (IMTECH) is incubating life-sciences and biotechnology startups under a plug-and-play model coupled with access to seed capital, mentoring and training. 

As per the ministry data, Chandigarh led the startup innovation in North India with 89 patent requests in 2019-2020.  

Another major potential sector — agriculture — is being harnessed by agritech startups like Agnext, Pindfresh, Osaw Industrial Products, and Fare Labs Pvt Ltd, A2P Energy, and Mooo Farm that are working in new-age farming technology.

“The region has been an experimenting ground for agritech startups. The state will soon get its own dedicated agri incubator to speed up things as the sector catches attention,” says Nitika Khurana, Head of Operations, Chandigarh Angels Network (CAN).  

The collaborative efforts have not been harnessed to their full potential, but some work has started. 

In the past five years, companies and research organisations have published over 200 patents in the smart agriculture and crop sciences space. Punjab Agricultural University (PAU), National Agri-Food Biotechnology Institute (NABI), Centre of Innovative and Applied Bioprocessing (CIAB), Chitkara University, and Chandigarh Group of Colleges hold Intellectual Property Rights (IPR) over a diverse range of latest agriculture technology. 

Recently, Black Eye Technologies Private Limited, a startup incubated under Punjab Agri Business Incubator (PABI), was honoured with the Greenpreneur Award 2021.

“Chandigarh needs to carve its own success story and not replicate other models. We need to play on our strengths, especially pharma, SaaS, and agriculture. Institutions need to aggressively incubate startups and collaborate,” says Alok. 

Remote working 

Hiring senior tech talent has been a major issue for maturing startups. Usually, after scaling up to a certain stage, startups have to shift base to bigger metros to hire the right people. 

However, with remote working becoming the new normal, the barrier of working from a physical office is fading and everyday tasks are being performed online from our dining tables. 

According to Deepanshu Goyal of Prepladder, which operates from Chandigarh and Delhi, people are also showing interest to move to Chandigarh, either looking for a job or starting new ventures. 

“Chandigarh has been a net exporter of tech talent. With remote working, the dynamics are shifting in three ways. One, homegrown startups are not finding a need to move base with work from home opportunities. Second, founders outside the region are looking to relocate to Chandigarh with online teams all pan-India. Third, is homegrown senior talent longing to move back and looking for opportunities,” says Alok. 

Chicago-based Jorie Healthcare Partners has set up its Indian arm in Mohali with an investment of over $7 million. Even Canada-based fintech startup Finvasia shifted operations to Mohali last year.

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Stepping up the game: No dearth of infrastructure 

Besides the institutional E-cells, the tricity has around 11 incubators and four to five big co-working spaces. 

In order to promote SaaS-based startups, SACC is planning to build one of the largest dedicated incubators in the region, which will also get a new IT park in Mohali to further strengthen the ecosystem. 

There has been an increase in startup sensitisation across the region. Regular bootcamps are conducted by private and public institutions along with mentoring sessions and discussions by private incubators and organisations like The Indus Entrepreneurs (TiE).

“The aim is to nurture new ideas and create a strong revenue-backed business more than raising investments. There is no dearth of talent and skilled labour. Getting the right incubation is important and the tricity has managed to build the same for entrepreneurs pan-India. We get requests from startups outside the region to start operations in Chandigarh,” says Piyush. 

In a recent open startup challenge, as many as 13 local startups, out of 300 applications, were on-boarded by STPI Neuron, which has built a 500-seating capacity, stack labs, Integrated development environment (IDE) in its Mohali facility. 

The fund has a corpus of Rs 10 crore with 40 angel investors and a special focus on women entrepreneurs. A similar initiative was taken by CEED, with an angel investors fund and state grants worth Rs 4.5 crores. 

As far as external funding is concerned, experts bust the “vicinity myth”, saying the investors are agnostic and look to place their bets on the business potential. If you can show traction beyond MVP, you will get funded — without bias.

One of the largest funds in the region, CAN, has invested about Rs 10 crore in the past few years with good exits. It has funded local startups like PayMart, Leegality, JumboBasket, and others with many more in the pipeline. 

“We are definitely picking up steam and within six months, we will see a major transition as pandemic has pumped up online businesses, demand for tech solutions, and resolved the talent issue. This is coupled with active enablers and strong infrastructure. The story is building up. Leave it to the time,” says Nitika.