A brainchild of the Software Technology Parks of India (STPI), Electropreneur Park helps electronics startups through the processes of incubation, acceleration and pitching to VCs. This initiative is supported by the Ministry of Electronics and Information Technology (MeitY). The STPI, the University of Delhi and India Electronics & Semiconductor Association (IESA) are also stakeholders in this venture.
Sanjeev Chopra, CEO, Electropreneur Park, in an exclusive conversation with EFY’s Mukul Yudhveer Singh, sheds light on how the organisation is helping India based startups incubate, accelerate and pitch ideas to VCs. Located in the Delhi University, Electropreneur Park has mentored more than 40 electronics startups till now.
Q. What do you offer startups, in terms of support?
A. We offer every incubated startup a dedicated office space at our center, with the primary objective of giving full-time access to the state of the art electronic lab facilities, and product development assistance. Typically, an electronics startup needs to invest about Rs 2 million to 3 million in necessary test and development equipment. We have advanced testing equipment like spectrum analysers, variable DC loads, 3D printing, PCB prototyping machines, EDA/software tools and embedded tools for creating embedded designs, and more.
Then, as a part of the programme, we offer each startup an anchor mentor, who could be a leader/expert in a company or a successful entrepreneur.
We also facilitate interactive sessions with technical experts from the industry, such as chip manufacturers /distributors like Infineon Technologies, STM, Arrow Electronics etc. We arrange visits by technical engineers from leading organisations to visit Electropreneur Park and sit down with startup team members to understand the application and help startups choose the right set of components for the product or solution they are building.
While all the facilities are extended to a startup without any outright fee or charges, we expect each startup to share a small percentage of equity for sustainability of Electropreneur Park project.
Q. Do you also help startups when it comes to pitching to VCs?
A. We help startups in every way possible during the incubation period. Electropreneur Park helps them connect to industry leaders, vendors and others. We invite various investors and VC to Electropreneur Park from time to time for providing startups ample opportunities to make a business pitch and seek investment. We also engage experts to help startups create a professional pitch for the investors.
Q. How are startups paired with mentors? Can mentors invest in these startups?
A. Both, the startup as well as the mentor, should be comfortable with each other. It is not a simple process of pairing a mentor with the startups. We want both the startup and the mentor to be excited about being coached, and mentoring, respectively. We arrange maybe two or three sessions between the mentors and the startup.
After that, we check how the startups and mentors are feeling. The initial three to four months is about interacting with the various potential mentors before formally assigning a specific mentor to a startup.
A startup can have more than one mentor. One could be on the strategic side and the second could be with a very specific domain expertise.
Q. How long does a season usually run for? How many startups have you helped so far?
A. A formal call for proposals and outreach activities are conducted every eight to nine months depending on the availability of incubation space. We have already conducted six seasons. We started operations in April 2016 and are in our fourth year of operation.
Till now, we have been able to support 40 startups in various programmes. Out of these 40, we are expecting that by the end of this year, we will have exit from one or two startups, though many of the startups have completed the incubation period and graduated. Our programme typically runs for one-and-a-half to two years, as far as the incubation is concerned.
Q. What does the term ‘exit’ signify?
A. By ‘exit’ we mean that we completely let go of whatever equity we hold in the startup that is exiting. The money that comes in can be used to sustain this project. Exits generally happen when venture capital (VC) comes in and there is a VC level of funding involved. We expect our startups to achieve a consolidated valuation of more than Rs 3 Billion by end of this year and a possible exit from 1 or 2 startups.
Q. How many types of programmes do you run?
A. We have two types, mainly – the pre-incubation programme and the incubation programme. There is also a third category, which is the virtual acceleration. It is offered to startups that are not located at Electropreneur Park premises.
For example, we have one startup under virtual acceleration in Bengaluru. That programme involves more mentoring and other support services.
Q. What if a startup is not ready to make an exit two to three years after the incubation?
A. We understand that every startup may not be able to offer us an exit upon graduation (two years) as electronics startups need time to develop the product and scale it to the desired level to attract institutional investors.
Apart from the physical space, all the other support is available to startups that have graduated. If a startup graduates after two years but still wants mentoring or access to our lab facilities, we extend these facilities without any charges from the startup. We also continue to extend our support in market access to these startups.
Q. What happens if a startup makes an exit and another reaches out to you with the same idea?
A. We don’t incubate at any given time two directly competing startups unless we see a synergy among them. So far, we have also not taken on any startup working exactly on the same idea of an already graduated startup. However, if a startup is working on an idea with a new value proposition, though addressing maybe the same problem as an earlier startup, then we may consider taking it on board.
Q. From all the applications you receive, how do you select the startups?
A. We have a two-stage process. We receive close to 100 proposals every season, Out of those, we do the first-level screening to shortlist 20 complete and most promising proposals. These teams are then called for making a detailed presentation and pitch to a panel of industry leaders and experts.
This panel consists of highly experience industry veterans like Dr Ajai Chowdhry, co-founders of HCL, Jaswinder Ahuja, MD of Cadence; Ajit Manocha, ex-vice chairman of Global Foundries; Pradeep Gupta, MD of Cyber Media; the director of STPI, Delhi University representatives and other industry leaders.
After making presentations, a lot of cross-questioning and discussion takes place. We typically coach about six to eight startups every season.
Q. What if the panel sees potential in a startup but is still not sure?
A. We have started a pre-incubation programme. For the first two seasons, we were only taking startups that had a validated proof-of-concept (POC) for Incubation. But then we realised that few of the startups had a good business idea and we started a pre-incubation programme, which typically lasts for three to six months.
If a startup has a very good business idea, and we see potential in the team, then we give them free access to the lab and the office for a period of three months along with the required technical and business mentorship.
Once the startup is able to demonstrate a POC , the startup gets an opportunity to pitch again to the panel for Incubation programme.
Q. Are POCs mandatory for applying to the incubation programme directly?
A. Yes, for incubation programmes POCs are required. This is accessed at the time of startup making the required pitch to the panel of Industry experts. Either we completely reject a startup, or in case we are satisfied with the current progress by a startup, we may offer it pre-incubation on the condition that the team demonstrates the POC. This is reviewed and the result is declared after three months.
Q. Are you focusing on startups working around some specific technologies?
A. We are open to startups working around any technology. While selecting a startup, we look for innovation, uniqueness of idea, business potential, team capabilities and feasibility of the project to create a sustainable business venture within 1 to 2 years.
We also ensure that we are able to offer the required mentor-ship and facilities in the technology area of the startup we Incubate. For example, we took on a startup from Bengaluru, which was creating an electric helicopter.
Now, we don’t have the technology to create an electric helicopter in-house, but we took startup on-board as we could facilitate the access to LAB facility at ITI complex in Bengaluru and expertise from HAL Laboratories in Bengaluru.
Q. How do you reach out to potential startups?
A. We use all possible forums – through the online and print media, We reach out to various engineering colleges for roadshows and sharing programs on college social media pages for students. This season we also used Google adwords, organic and non-organic promotion on other channels like Facebook and Instagram.
We are also getting a good number of prospects from Startup India portal and Meity startup hub portals. Initially we were doing roadshows on a pan-India basis by visiting various cities. But last season, we did a live webcast for those who were out of town to address all questions of potential Incubatees.
Q. Where is the Entrepreneur Park facility located?
A. We are in the South Campus of Delhi University. We are on the third floor of the library building. It is a 10,000 square feet space, where we have set up an RF and a power lab. Around 72 people can be accommodated. We have different cubicles since electronics startups working on a product need to protect their patents.
Every startup that comes on board is given a cubicle, which is either a five-seater or an eight-seater. They can use the lab facilities as and when required.