Nasscom helps tech start-ups find their mojo

Sonali Chowdhury

It’s an initiative for tech start-ups to find their mojo and the race is well and truly on! Christened simply ’10,000 Start-Ups’, the initiative has been launched by Nasscom (National Association of Software and Services Companies) and, not surprisingly, applications are pouring in. The programme, launched in March, aims to provide support to early-stage technology start-ups by offering them accelerator support, angel funding, warehouse facilities and an opportunity to form key connections and alliances in the domain. But nothing comes easy and to qualify, start-ups must be innovative, scalable and able to create intellectual property. Applications started coming in on April 11 and Nasscom will begin interfacing with a selected few in July. The trade body hopes to build up to the magic figure of 10,000 start-ups over the next 10 years. “In the last 5 years, India has witnessed the launch of over 1,100 start-ups with a focus on mobility, SMBs, e-commerce, education etc, and the market is expected to grow over the next few years. We believe more needs to be done to evangelise and support start-ups in the country. Hence we have initiated the 10,000 Start-Ups programme,” says Nasscom President Som Mittal.
Let’s take a look at the key challenge faced by small businesses and how Nasscom’s initiative will help overcome them. Funding: Money Matters The Challenge: The primary challenge for any start-up is always money. Even though tech set-ups are perceived to be leaner and thus less afflicted by monetary constraints, the truth cannot be farther than this. Openlabs Technologies Founder and COO, Varun Kumar, explains why. “The major obstacle is shortage of capital required in the initial phases of a start-up. Mobilising funds for operations, payroll and setting up office is quite a challenge.” Money is required not only for the mundane demands of running an office but also critical areas such as marketing, technical equipment and attracting the right workforce. “Recruitment was a challenge as multinational companies were ready to pay our members fat pay cheques along with a secured career,” says Cloud telephony-based solutions firm Knowlarity’s Founder and CEO Ambarish Gupta. The Solution: Nasscom’s programme addresses this by tying up with angel investors. The business model of every applicant, which has already been bootstrapped to a working prototype, is open to scrutiny by all the partner angel investing groups of Nasscom’s programme. If selected, the start-up could receive funding from Rs 25 lakh to Rs 2 crore from investors such as Indian Angel Network, Mumbai Angels, Bangalore Angels and Hyderabad Angels, to build a stable financial bedrock for its business. Warehousing: Space for Growth The Challenge: Aiming to be a cutting-edge tech firm in a developing nation with abysmal infrastructural problems can daunt the strongest of entrepreneurs. “Acquiring a secure office area in urban areas is very expensive, especially for a start-up company. Even setting up an office can be quite a challenge,” says Kumar. The Solution: 10,000 Start-Ups is bridging this gap by opening start-up warehouses in key cities, where the selected firms can find office space on a co-working basis at subsidised rates. With the first such warehouse scheduled to open in Bangalore and four more to come up soon in major tech hubs across the country, the programme not only gives space to fledgling firms but also places them in an entrepreneurial ecosystem of mentors, other start-ups and tech experts. Accelerators: Building the Basics The Challenge: The tech business is a fiercely competitive field, where a good idea needs to be backed by solid business basics. With the bulk of effort obviously directed towards the technical aspects of running such start-ups, core business admin can stealthily hurt its growth. “In a start-up, you are always trying to manage a crisis situation. It could be a marketing campaign, a product bug or a customer complaint. While doing this, basic administration in a business takes a hit. It could be processes, using the correct tools to measure performance of the product, employee training or any activity which could build your company’s culture,” explains Harsh Gadia, co-founder of Klip.in. Getting help in these areas is not easy to find if one does not already possess strong business networks. “Every start-up needs the right guidance and direction at its nascent stages. It is sometimes a challenge to approach the right kind of advisors due to lack of funds and low awareness of these institutions and organisations,” points out Gupta. The Solution: Nasscom has partnered with a host of incubators and accelerators to address this problem.  With names like Microsoft and Venture Nursery providing assistance in areas like business concept validation, seed capital, shared services and resources, peer learning and go-to-market guidance, start-ups can overcome numerous challenges including access to veterans in the industry who are otherwise not accessible to a small business. The 10,000 Start-Up initiative has already received over 4,000 applications. That’s a huge leap in a country that has been producing only 150 tech-enabled start-ups a year. To put some punch into the initiative, Nasscom has several events lined up, a Megathon or India’s largest hackathon and a Silicon Valley Roadshow. At the recently concluded StartupRooots event in Bangalore, Nasscom selected four early-stage ventures for on-the-spot for funding and is well on its way to living up to its motto ‘Dream up, Start up, Scale up’. You can send your feedback on smementor@moneycontrol.com or simply post comments below