How women entrepreneurs from Tier II, III cities are driving Bharat

At the recently held Women Startup Summit 4.0 organised by the Kerala Startup Mission (KSUM), several young women entrepreneurs from Tier II and III cities pitched their innovative ideas to an audience that had travelled from across the country to attend the event.

Kochi-based startup Phonologix, founded by Elizabeth Jean Thomas, was selected to present at the She Loves Tech conference in Singapore as one of the 28 finalists from across the globe. She Loves Tech is the world’s largest startup accelerator programme for women in tech and is a partner of KSUM in India.

At the same event, Pallavi M was busy clicking pictures of women attendees and introducing her startup, Gulbonda. She had a creative motive–a week later, the women received a replica doll made from wood and painted with acrylic colours. Her Kozhikode-based startup has been on everyone’s minds ever since.

Pallavi utilises every opportunity she gets to make Gulbonda seen and heard, attending networking events and conferences.

“The difficulty in operating from a Tier II city like Kozhikode is the lack of networking opportunities with other startups and experts in the same industry,” says Pallavi.

Apart from B2C customers, the startup has already partnered with several movies as an official merchandise and gifting partner. These include big names like RRR, KGF Chapter 2, Jalsa, Hridayam, Palthu Janwar, Minnal Murali, and others.

Pallavi says she has benefitted from a ‘vastly online world’ where her location is not a barrier to dreaming big.

According to a statement from the Ministry of Commerce & Industry, Government of India, Tier II and III cities account for nearly 50% of recognised startups in India.

Also, businesses owned by women are likely to grow up to 90% in five years in India, according to a study by Edelgive Foundation. This compares to the US and the UK, where expected growth trends range from 50% and 24%, respectively. The study recommends that states conduct a meta-analysis to identify their specific needs and designs and to implement relevant programmes.

During the pandemic, many returned to their homes in Tier II and III cities and drove the startup ecosystem in Bharat. Entrepreneurial ventures from these cities are creating more job opportunities, and solving unique problems for non-metro audiences.

And women entrepreneurs are not far behind in riding the startup wave.

Incubators and accelerators with a strong focus on women entrepreneurs are also seeing the rise of women entrepreneurs from non-metro cities and smaller towns.

HerStory brings you some success stories from the smaller cities and towns of India while focusing on the benefits and challenges of starting up from these places.

Spokespersons from accelerators like TiE, AIC Banasthali Vidyapith, and WE Hub weigh in on the positive trend.

Building from Bharat for Bharat

That India lives in its towns and villages is no longer a cliché. Located 1,500 metres above sea level and 167 km from Itanagar is Ziro Valley, a beautiful hill station that also houses the Naara Aaba factory that makes wine from kiwi and other fruits. Its founder, Tage Rita, launched Naara Aaaba in 2016, and sources the kiwi fruit from her orchard and the Kiwi Growers Cooperative Society in Arunachal Pradesh. A few years ago, Rita also started making wine from plums, pears, and peaches, fruits that were rotting due to a lack of awareness and buyers.

“The tank at Naara Aaba has a capacity of 60,000 litres per batch. The venture has also received support for plant and machinery from the Ministry of Agriculture through MOVCDNER (Mission Organic Value Chain Development northeastern region) facilitated by NEIDFI (Northeastern Development Finance Corporation),” Rita says. While the ideal turnover is Rs 10-12 crore annually, the pandemic has caused the brand to take a hit.

In August 2020, during the pandemic, Raksha Shenoy started Tapas Foods in Udupi to promote guilt-free, healthy snacking options. The startup has two brands—Tapas and Nummy. The second-generation entrepreneur operates from an industrial area in Miyar village near Udupi, with most of its employees coming from residential colonies in the area.

Noureen Aysha and her husband, Naseef Nazar, who hail from Kozhikode and Kasargod in Kerala, moved to Kochi to launch FemiSafe, a femtech company offering period care and grooming products, in 2020.

“We chose Kochi as the base for our startup due to its cosmopolitan outlook, networking, and logistics accessibility, and of course a forward-thinking crowd in terms of acceptance of a stigmatised topic,” Noureen says.

In Satara, a small town in Maharashtra, Madhavi Jadhav is talking about sex, periods, and other subjects with parents and students addressing questions like ‘Are tampons safe? How do I tell my family I am gay? How do I put on a condom during sex? and more. She is the founder of ThatMate, a platform that aims to raise awareness about sexual well-being among teenagers.

It recently raised $140,000 worth of funding from Rebalance Angel Community and other angels.

Incubated at AIC Banasthali, ThatMate uses a friendly, open, gender-neutral, culturally sensitive approach. It has collaborated with 100 schools in three states and has also partnered with the Jharkhand government and UNICEF to help six lakh students in the state.

Saka Shailaja, one of the incubatees at WE Hub, started Synnove, which offers hair and skin care products at affordable rates.

This village-based industry employs 20 people generating an average revenue of Rs 45 lakh per annum and aspires to hit the one crore revenue mark in the next financial year.

Himalayan Origins founded by Soumya and Neha Parmar in 2020 in Dehradun offers a range of products from face cleansers, facial soaps, shampoo, hair butter, candles and more.

Helping women start up

In 2017, the Banasthali Vidyapith, a university for women in Rajasthan, launched its own Atal Innovation Centre (AIC), with a WOMENpreneur incubation programme exclusively for women-led startups. It has completed four cohorts of women entrepreneurs all over the country.

“Women’s exposure to traveling, affluence, technology, education, and opportunities have grown significantly in Tier II and Tier III cities with various government schemes being a definite advantage,” says Abhishek Pareek, CEO, of AIC Banasthali Vidyapith.

Akansha Singh from Patna, who is an alumna of Banasthali Vidyapith, started Swayambhu in 2015 as a for-profit organisation to generate bio-energy by linking communities to CBPs, which would use domestic/kitchen, livestock, and farm waste on a mass scale to produce biogas. The organisation aims to generate electricity and other by-products like organic manure and bio-pesticides.

Swayambhu received a collaborative grant from the Government of Singapore, which helped kickstart the project. Currently, she runs her project in Sitamarhi and Pusa in Bihar. The latter, she believes, is an example of an ‘empowered’ village in every sense, and has also recently collaborated with the Municipal Corporation of Delhi for her operations in the capital. Swayambhu has raised $71,156 funding from AIC Banasthali, CSR projects, and various government schemes. 

A positive shift in mindset arising from higher education and access to capital has enabled a surge in women opting for entrepreneurship and building their businesses, especially in industries like textiles, food & beverages, retail outlets, beauty, and lifestyle. Ecommerce platforms have enabled a platform for Tier II enterprises to distribute their product nationally,” says Suresh Raju, President, of TiE Hyderabad.

“According to few studies, there are only 10% female founders in India, and this figure is growing by the day. Several successful female entrepreneurs in India have influenced many others. Also, government policies favour women's entrepreneurship and make policies for its growth. Non-Indians are also becoming more mature and accepting of Women Entrepreneurship, and this trend is expected to continue with the success of these female entrepreneurs,” says Deepthi Ravula, CEO of WE Hub, India’s first state-led incubator to foster women’s entrepreneurship from Telangana.

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Benefits and challenges

Noureen believes operating from a non-metro city like Kochi offers a “smaller circle to start with”.

“What FemiSafe does is not quite common, so working with a smaller market initially leads to more penetration and visibility before we scale and move to bigger cities,” she says.

For Rita, it’s the location that made all the difference and helped her to give back.

“With our continued efforts to highlight the plight of farmers and their produce to the world, we have been able to draw the attention of the government and different agencies, which in turn benefits them hugely. Kiwi cultivation is growing at an exponential rate every year. Farmers now even export kiwi saplings to neighbouring states apart from exporting their fruits outside our state,” she says.

Pallavi says it’s easier to communicate and link with service providers for logistics support. Despite the many successes, the challenges of working in small towns and cities cannot be discounted.

Abhishek points out that women in Tier II, III, and IV cities receive limited mentorship and guidance, and it becomes a stumbling block when it comes to scaling their startups.

“To deal with this challenge, we have worked relentlessly to come up with a customised hybrid incubation program to help women entrepreneurs pursue entrepreneurship at ease. AIC Banasthali in partnership with the US Embassy has launched an AWEspiring Program to support small and medium women-led enterprises with constant guidance, support, funding, and mentorship under a three-month capacity-building program. The programme has supported 90+ women entrepreneurs from 7 north Indian states who have achieved significant results after the programme,” he explains.

Rita rues that the erratic distribution network is a major challenge. She reveals that the alcobev industry runs like a mafia-like syndicate, and a more inclusive policy needs to be followed by the government for entrepreneurs to flourish.

Akansha often has had to let her co-founder Ashutosh Kumar do all the talking, especially to people in the villages, because most of the decision-making was left to the men.

For Raksha, mobilising raw materials and other resources has been a huge learning experience as “the startup ecosystem in rural India is not as vibrant as it is in the cities.”

Soumya Parmar explains, “Operating in the mountains presents weather change nightmares along with logistics challenges. We started as a small D2C brand from the mountains of Uttarakhand servicing customers across India and beyond. We launched on Amazon after a few months of setting up our business to better support our logistics and supply chain needs. Now, we receive orders from across the country only and only through Amazon from corners like Andaman & Nicobar. We never imagined shipping our products to such pin codes."

Deepthi believes the challenges are diverse. These include competition from urban areas, lack of family support, difficulty in availing government schemes, and lack of information and other skills.

“Access to funding, particularly working capital, has always been a key challenge for many women-led startups and SMEs. While funding is the primary challenge for any entrepreneur, women from Tier II, III, and IV cities must overcome challenges from the entrepreneurial sector, rural ecosystems, and socio-culture barriers. Another common challenge women entrepreneurs face is mentoring,” she says.

Building to scale

Despite the hurdles in their path, women entrepreneurs in Tier II, III, and IV cities are building to scale.

ThatMate and Swayambhu havereceived significant funding and have paved the way for other startups to think big.

“Support from the government with special Women Entrepreneurs Zones (SWEZ), like SEZs, can catalyse women’s entrepreneurship. Finally, a strong ecosystem of mentors and experts to help women entrepreneurs is critical,” says Suresh.

Deepthi believes that to scale their businesses, women entrepreneurs must alter their mindsets.

“They must want to grow their firm to a greater size rather than limiting it to a specific region. Identifying their company’s unique selling proposition or original uniqueness and using these aspects to market their company is important,” she says.