PUNE: There were times when the word startup itself was risky and very few people chose it. Young people choose Indian Institutes of Technology (IITs) to get great jobs. But things have changed. Startups are rapidly gaining people’s attention. It is no longer seen as a hassle or a big risk that most people were scared away from a generation ago. Now more and more students are stepping into the startup field, from IITs, IIMs (Indian Institute of Management) and doctors of course.
In fact, India’s startup ecosystem is the third largest in the world with nearly 100,000 startups, of which 107 are unicorns. And the government has chosen to support it in a big way by providing early stage funding. In fact, the government also supports startups by providing funding. And like most things that come out of bureaucratic nests, finding the best fit is very difficult.
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So how do you know which types of government funding plans available can cover your requirements?
Startup mentor, investor and former CEO of Bow Institute of Innovation, Entrepreneurship and Leadership, Pune Engineering College (COEP), Mr. Vijay Talere helps you choose the right fund to purify the air.
“Despite the funding winter that lasted until the first quarter of 2024, India remains the fourth largest in terms of startup funding during the same period. Overall procurement has increased by 25%, and the government’s efforts to support startups and angel investors are greatly appreciated.
“These funding schemes are mainly TBI (Technology Business Incubator) established by DST (Department of Science and Technology), AIC (Atal Incubation Center) under the initiative of Atal Innovation Mission, and TIDE (Technology Business Incubator). Incubator under the Ministry of Electronics and Information Technology (MEITy).
“Similarly, BIRAC (Biotechnology Industry Research Assistance Council) set up by the Department of Biotechnology (DBT) has set up bioincubators in India to promote innovation in biotechnology. All these government agencies Collectively, there are over 425 incubators across India. It is important to note that these incubators are the primary vehicle for state and central governments to implement various early stage government schemes. ” he said.
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“Government funding schemes for early-stage startups fall into three main categories. These include fellowships, grants, and seed support. These schemes primarily support the startup journey. It bridges the funding gap from the initial idea stage to the early revenue traction stage. After that, angel investors are usually interested in funding startups. Startups that receive government funding are eligible for angel investors. It also functions as a filter for
“If an entrepreneur has an innovative idea and needs to develop a proof of concept in the lab, a fellowship is the best option. Under this scheme, the government grants fellowships to students who have completed their graduation for almost a year. , entrepreneurs receive monthly fellowships. Notable fellowships include DST NIDHI (National Initiative for Developing and Harnessing Innovations) Fellowship under EIR (Entrepreneur in Residence) scheme, MEITy TIDE EIR, BIRAC SIIP (Social Innovation Immersion) The majority of entrepreneurs who win these fellowships are expected to further develop their ideas and take their startups to the next level.
“Grants are primarily available to startups that develop an idea into a lab-level proof of concept and then develop a prototype to create an MVP (minimum viable product) of that idea and bring it to market. DST NIDHI PRAYAS (Promoting and Accelerating Young and Aspiring Technology Entrepreneurs), MEITY TIDE Grant, BIRAC Schemes (BIG, SPARSH, SBIRI), DSIR PRISM (Promoting Innovation in Individuals, Start-ups and MSMEs), and The recently launched SISFS (Startup India) Startup India Seed Fund Scheme) is part of the government scheme that provides grants. These grants vary in scope: INR800,000 and INR2000000.
“BIRAC BIG is up to INRThe funding is being implemented through eight large centers across India for innovation in agriculture, biomedical devices, diagnostics, industrial biotechnology, drug discovery, drug delivery, and stem cells. These are schemes provided by the central government. The state government also provides grants and funding to help startups develop prototypes, as well as reimbursement for intellectual property (patent) filing, testing and certification costs. Seed support in the form of debt-based products such as OCDs (optional convertible debentures), CCDs (compulsory convertible debentures), loans and equity-based financing. Debt-based funding from DST NIDHI SSS scheme, BIRAC (BIPP, SEED, LEAP) scheme, Startup India Seed Fund Scheme are popular schemes to get seed support for startups.
Seed support typically falls within the following ranges: INR30- INRYou can donate up to $4 million INRBillion. Seed support is typically provided to startups that are at the MVP stage and ready to take their product to market, or that already have early revenue traction.
In addition to the above government schemes through DST, BIRAC, MEITy and Startup India, there are many schemes provided by the government for MSMEs and some of these schemes are also implemented through SIDBI. myScheme (www.myscheme.gov.in) is one of the electronic marketplaces for government schemes and services. myScheme allows you to search for different government schemes, check your eligibility and apply for a scheme. Similarly, (www.msme.gov.in/all-schemes-msme) provides a list and details of all schemes offered by the government for MSMEs, some of which are in early or late stages. Also applicable to startup. A startup journey,” Tarele said.
Funded by Nidhi
Tight The Nut is a SaaS-enabled B2B commerce company founded at Bhau Institute Pune and also led by TiE Pune. These are intelligent CRM and fastest B2B spares delivery platforms that make unorganized auto body shops efficient and profitable.
Azam Shaikh, co-founder of Tight The Nut, used Nidhi (National Initiative for Developing and Harnessing Innovations) SSP to support the company during its growth phase. “The Nidhi scheme is an equity-based scheme that backs start-ups that are at a growth stage. This means you need funds that have some traction but are willing to part with equity.”
How did that go for his company?
Azam said: “We applied for funding last year. To get funding under Nidhi, first and foremost you have to be part of some kind of incubator. We were with Bhau. You applied. After the initial document review, if it is determined that you have potential, you will be invited for an interview. Here you need to prepare a report showing clear financial details and scope of growth. Next, the financial and legal due diligence stage begins. After that, if you are suitable for investment If they think you have, they will agree to fund you. The amount of equity you will get will be based on your company’s calculations. is usually less than that. As a result of negotiations, both sides arrive at a certain percentage. It is important to note that the incubator also gets a portion of this stock.”
How has this helped your company?
“Over the past year, our revenue has tripled and the number of employees directly employed by our company has grown by 10 and indirectly by 30.When we decided to participate in our next round of funding, , Nidhi and Bhau will receive their share,” he said. .
