Twitter / Balaji Sowmyanarayan

Monday, May 01, 2006

Seed funding in India; Prove your idea with a prototype

One of the biggest myth amids wannabe innovators is the lack of seed funding in India. I was a true follower of this myth untill I got funding from TIFAC for my idea. The (funding)program is running for several years now from mid 1990s. It is successfully reviewed by the (National)planning commision, and the program is now extended/expanded. Now the funding quantum(per innovation) is expanded and the total allocation(whole program) is also enlarged. So there is more funding available. Unlike private seed financing this goes though a government evolved process. It is all done by an expert committee, there is a bit of process and steps involved due to it, yet it is faster.

The particular program I am talking about is for barefoot individual innovators/inventors. It is called Technology Entrepreuner Promotion Program - called TePP for short. It is administred by Department of Scientific and Industrial Research(DSIR) jointly with Technology Information Forecasting and Assessment Council(TIFAC) of Department of Science and Technology(DST). In the expanded regime, funding up to Rs 10 lakhs is available to seed innovations. For that the idea must be new, innovative and useful. The scope of the funding is limited to proving the concept- possibly through a working prototype.

If you have an idea, and you want to develop a prototype to prove its viablity, here is your chance. Just apply for the funding. And rock on. It might take up to 6-8 months to go thoough the clarification, proposal refinement process. So be ready for that.

The funding program is going through a rapid growth. Proposals are sought from NGO and other frontal organizations involved in the innovation ecosystem to give a helping hand. Watch out for such announcements and make your proposals.

More than the funding, it takes you thoough a process. And in the end it offers a lot of credibility to your innovation.

Rock on.

Bonus Links:
Example of a funded Idea: Devesh's Car Jack on the Go Soon Mahindra & Mahindras vehicles will come with these factory fitted!
Atta boy RajAT GupTA has a post on TePP
DSIR's page on TePP Program.

1 comment:

  1. Karthikeyan of Venture Intelligence writes:

    Many people wanted a list of VCs doing early stage investments in India and I guess some capital infusion might go a long way in transforming these ideas to successful businesses.

    Anyways, as indicated in the talks there is a dearth of early stage financing in the country, here are some options for companies who are planning to raise 100k -2M $
    ( I have ranked the funds in ascending order of their typical investment size)

    i) TIE -EAP : this is a new initiative from TIE to promote early stage investment in the country. They have invested around 100k into a web based early stage startup.

    ii) Mentor Partners: As the name suggests, they do mentoring apart from funding. Really good team of ex-entrepreneurs who have been there, done that.

    iii) Nadathur Holdings: It is a fund established by Mr.N.S.Raghavan, co-founder Infosys, and is managed by his son Anand.

    iv) Erasmic incubation fund: They started out being incubators but have done funding in recent times,

    v) Seed Fund: A fund specifically created to tap into the market opportunity in early stage investing (or the lack of it)

    vi) SIDBI Vetures:

    vii) Helion VC: A recently launched fund, would be scouting for deals pretty soon

    viii) Sequoia India (formerly Westbridge capital partners) :

    They invested 2 M $ in TutorVista a couple of days ago:

    Hope this helps. This could be a starting point for folks who are looking at funding. But as always, I would strongly suggest you to figure out if you could do without it. Fund raising is a time consuming and painful process, better to avoid it (but sometimes this might not be possible!)

    It is pretty disheartening to note that, there are no networking events after the barcamp. So instead of merely complaining about this, I plan to take this up for discussions with the local TIE chapter. At an informal level, I think we could do something ourselves (similar to barcamp). Do let me know your views on this,especially the kind of people you would like to meet (VCs, successful entrepreneurs, technologists etc.). Let me see if I can get them here, if you guys think that would be a good idea. Also with enterprising people like Kiruba, Ganesh, Narain et al, I guess it won't be that tough!

    Lets keep the momentum going,

    Best Regards,
    Karthikeyan S
    Venture Intelligence India
    (TSJ Media Pvt. Ltd.)
    Tel: +91-44-45534303