-M. Sivasankar IAS
The evolution of the startup ecosystem in Kerala needs to be viewed from the context of how Innovation and technology can be fostered in geographies other than a few tier 1 cities, which have a high concentration of new generation Multinational companies. Tier-one cities provide ready access to high-risk startup venture capitalists, mentors, financial markets and industrial connections, some of which are vital lifelines for startups at various stages of their growth and evolution. Fully realizing this limitation, we approached the startup ecosystem development process, systematically, improvising and innovating as we went along. Kerala thus developed a “ground up” model of innovation and entrepreneurship, providing a comprehensive model extending from schools to enterprises
The very first thing we decided was that we will limit our focus to product companies and companies working in deep tech. While, the entire host of service companies, quite a few of them are there, would be eligible for benefits from DPIIT and state schemes, our engagement would be limited to startups working in the data stack( AI, ML, Data Analytics) content enrichment stack( AR/VR, gaming, animation, etc), Blockchain and Fintech, Cyber Security and Hardware/ RPA, etc., leveraging on innovation. To enable this, multiple interventions are being rolled out. This could Future Spark program in Schools, Idea fest in Colleges, Idea day for communities, etc. All of these provide platforms to kindle the spirit of innovation among potential entrepreneurs and professionals. To support the development of knowledge and skills and emerging technologies, we set up a Skill Delivery Platform, Kerala with a telepresence network connecting more than 100 educational institutions State agencies like ICT Academy, Kerala and IIITMK are commissioned to develop skill up-gradation courses to be run through this. This ensured that innovators earn the right skill sets to convert their ideas into reality. It also ensures talent availability for startup companies.
Secondly, we created a vibrant network of Innovation and Entrepreneur Development Cells in all colleges to act as first level touchpoints for youngsters with project/ business ideas. IEDCs were trained to evaluate ideas and propositions and provide initial level mentoring. Once IEDCs found an idea worth taking forward, they will get evaluated by a committee consisting of industry experts who would recommend an idea grant. These recommended ideas will be supported by the incubators set up in every district to be structured as corporate entities. The incubators will also organize an Idea day and a Demand day where Industries/ Government Departments would evaluate the ideas or pose their business problems and act as rudimentary early channels of market connect.
Thirdly we established incubators in almost every district, where coworking spaces were made available to early-stage startups along with common infrastructure like mini Fablabs, common software, software banks, high-quality bandwidth, etc. The incubators also organize meet up cafes, seeding Kerala events where they link up investors to startups and technology talks.
Fourthly we set up a state-specific Fund of Funds where a SEBI accredited Fund was identified who would put in an equal amount of funds as what the state would earmark and using this corpus, run a program of investing in startups at the scale-up level. This intervention was a big success.
To enable mature startups to provide innovative solutions to Govt., Kerala formed one of the most favourable procurement policies in the country. As per this every purchasing officer in the Government department could buy products from startups up to 20 Lakhs without a tender process and up to 100 Lakhs through a limited tender, opening up Government as a market place. Innovation hubs are also being set up in select departments to co-create products of large social relevance useful to Govt.
The strategy of the state was thus to focus on dissemination/ evangelisation among the youth, provide pre-incubation / incubation facilities, extend financially and market connects and invests in Human Resources particularly in emerging technologies. These efforts put together have resulted in sustained growth in numbers as well as the quality of startups in the state.
(The author is the Principal Secretary, Department of Electronics and Information Technology, with the Government of Kerala. The views are his own)
