Startup Saturday: Successfully converting ideas into reality
Venture Centre has played a vital role in the business of incubating technology entrepreneurspune Updated: Aug 04, 2018 16:44 IST
A spin-off designed to create a technology incubator for National chemical laboratory (NCL) members as well as outsiders, Venture Centre (VC) has grown into a leader in the field, being awarded the Incubator of the Year Award 2018 by the Asian Association of Business Incubation (AABI). AABI, a pan-Asian association of incubators from 19 nations and regions, selected Venture Centre along with Shanghai Yangpu Technology Business Incubator for the award.
In a freewheeling chat with Dr V Premnath, director, Venture Centre, we learn about the vital role it plays in the business of incubating technology entrepreneurs.
Technology needs to be market oriented to become a successful business venture? What does VC do to orient their incubatees in this?
Venture Centre was set up to be a vehicle for translating technology developed at NCL, but the way it has been structured is that it is open to all and is richer because of it. One route for the scientists to market their technology is through startups, though of course they tie up with the government and large companies as well. Though NCL is more of an applied science set up and VC is about entrepreneurship, both perspectives have their own importance. Pure science is exploratory and you will never know what uses it may find in the future. For example, who would know that Einstein’s theory of relativity would come in use for the GPS that we use now? When you have to triangulate such large distances using electromagnetic waves, you use the theory of relativity. When we work with applied sciences we are looking at long-term prospects. In our Indian context we have to look for applications rather than pure sciences because we don’t have deep, large pockets. We have to look at the technology of tomorrow otherwise the markets will shut the door on us. It is the scientists who file patents and help entrepreneurs find solutions in the real world. If everyone files patents then the doors would be shut on us wouldn’t it? It is the Indian institutes of technology (IITs) and Indian institutes of science (IIScs) that do this for us.
Entrepreneurs need to know what will work in the marketplace.
So, we do many things. We have mentoring sessions that help bring clarity on what market one is tapping. What is the value of their product or service in such a market? Then people have gaps in their story; say one cannot understand a few aspects of the ecosystem. If say a guy is working on a medical device he needs to talk to clinicians to understand what the solution should be. He can’t have a secondary or superficial solution. We provide them with such networks, with clinicians and hospitals. We have tie-ups with Deenanath Mangeshkar hospital and several doctors in the city. We give our entrepreneurs the opportunity to understand the problem first hand and then find out a solution.
Or let’s say our member wants to figure out a technical solution to his problem. If say a person is working to solve the problem of disposable plastic. Where will that technology come from? We have scientists at NCL and even tie-ups with Indian Institutes of Science Education and Research (IISER) and Agarkar Institute to help our entrepreneurs. So, whether it’s understanding the problem or finding a solution we are in a position to help. At any given time 20% to 30% startups have an NCL connection. And, so far, 10 companies have spun off out of the NCL stable. Such is this rich connection between NCL and Venture Centre.
How do you manage funding?
I think when we talk about technologies that will find a place in the markets of the future, the government plays a very important role. There is always a higher risk involved with technologies of tomorrow. A businessman would be less inclined say to fund a novel drug discovery solution which is long drawn and tedious. But the government does that though it is very selective. They invest in such novel opportunities which may take time to turn profitable.
How many companies that VC has supported have become successful?
It depends on what you call success. If it is profitability then let me tell you that technology-based startups take a long time before they become successful. What we use to gauge success is how big the company has grown in terms of market space, even though it may not be profitable. Walmart bought over Flipkart not because it was profitable (it was making losses) but because of the market space it had captured. So, if we are to gauge by that yardstick, Biotechnology Industry Research Assistance Council (BIRAC) started in 2012 and six years is too small a yardstick to measure this. It takes about five years for a biotech company just to get all its approvals in place. But many companies have gained from government support. Shanta Biotech, Biocon and Praj all have at some point or other have been supported by the government.
So, to give you an idea, when Biotech Ignition Grant (BIG) was started, we saw that roughly 30% applicants were startups and 67% were people who were planning to set up something. By the time we closed the programme, half of the 67% had converted to entrepreneurs. By the time they completed their BIG programme, 80% had created their own companies. An incubator is judged worldwide by the failure rate of companies started five years ago. If a company has stayed alive for five years it is considered good, generally they fall by the wayside in five years. In our case more than 90% of our companies are alive after five years. In the last financial year, our current residents (60) raised up to Rs 25 crores and had almost 15 crores in revenues.
What is it that VC is doing right?
Technology development has no recipe because every project is unique and its incubation depends on multiple factors. We are fortunate to be based out of Pune, a city where scholarships are valued very highly. It has an environment that supports science. The same cannot be said of say Delhi or Hyderabad that values IT, for example. What are we doing right? I think we understand what is needed to translate technology to the next stage. How do you build an ecosystem that helps entrepreneurs? They need to have many stepping stones in this pond of the market place and technology. Boston and Silicon Valley have that. We believe we provide those stepping stones in the form of mentoring, with our equipment like say our Mass Spectrum (which by the way is 100% utilised) our networks and connections to academia and industry, we have a library, IP facilitation centre, an in-house patent agent as well as people who can do your accounting work, compliances, company secretarial work. In addition to that, we do over 150 events at various centres across the country. All this helps entrepreneurs immensely. In fact, we reach out to entrepreneurs in 11 cities providing mentoring services over Skype or phone.
How Venture Centre Helped Them:
Sachin Dubey, founder, Module Innovations
Module Innovations makes U Sense — a card with chips that detects four major pathogens that are responsible for 96% of urinary tract infections (UTIs). This it does in 30- 60 minutes not requiring a lab or people to do so. Labs generally take three days to detect the pathogens causing UTI.
“It has been the advice and guidance of Dr Premnath that has been most invaluable to us. My co- founder Usman Khan and I were doing our engineering internship at NCL and it was Dr Premnath’s guidance that steered us towards this company. He showed us how to write a business plan, what sources of funding were available. This space also has a lot of facilities that have been of great help.”
Chaitanya Saxena, founder, Shantani Proteam Analytics P Ltd
“We are a drug discovery and biopharma company. We devise methods to analyse biomolecules for biopharma companies. The biggest help that VC has extended to us is the facilities and high-end instruments that we use. As a startup it would been impossible for us to buy such instruments but here we can just rent them. This puts the capex on them not us. It helps us get ahead with our technology without having to worry about purchase of high-end instruments.”
Renuka Diwan, founder, Bioprime Agri Solutions
“We have developed a solution based on signalling that happens in plants. Our organic solution mimics the adaptive response that the plants have developed over millions of years. We are all technology people and it was VC that helped us with writing a business plan, pricing, creating deals with strategic partners along with mentoring.
Anuya Nisal, BiolMed Innovations P Ltd
“We make bio absorbable implants out of silk. A lot of surgeons use bone from the hip to make up for bone that is lost on account of accidents and so on. But our solution which is organic helps regeneration of bone cells from the neighbouring tissue. This new bone thus regenerated takes six months to form and the protein that we have developed gets ejected by the body in two years.
“VC helped us in every aspect of our business. We were scientists at NCL. They helped in setting up a lab-to-market agreement for us. Helped us file early patent, took it forward with the VCs, and showed us how to pitch to investors. In fact, their shared lab system helped us with all the facilities we needed for our testing.
Funding Round Up:
Pune-based fintech startup EarlySalary has raised $15.7 mn (INR 100 Cr) in Series B funding led by Eight Roads Ventures India. Existing investors IDG Ventures India, Dewan Housing Finance Corp Ltd (DHFL) and early backer Ashok Agarwal also participated in the round.
Pune-based healthtech startup LiveHealth, working on digitising diagnostic lab workflows, has raised a seed round of $1.1 mn from Nexus Venture Partners.
Inputs from Amit Rawat, startup mentor and angel investor
August 3 & 4: Venture Centre is organising a two-day intensive workshop on advanced thermal analysis, DSC, TGA and DMA (emphasis on poymeric materials) at Venture Centre, Pashan
August 10, Friday 8.30 to 10.30 am: TiE Pune interactive breakfast session on taxation for startups & valuation of your startup at ICC Towers, SB Rd
August 3, MCCIA is organising a company performance enhancement programme at MCCIA Hadapsar branch
August 4, MCCIA is organizing mantras for workplace improvement (5S and Kauzen at MCCIA, SB Rd
August 8, MCCIA’s Be The Gamechanger at MCCIA Hadapsar
August 10: Professional relationships and networking skills by MCCIA at MCCIA , Hadapsar Branch
First Published: Aug 04, 2018 16:41 IST