Assam is on the right track to see a unicorn happening soon

This is a golden period of startups and not a single day goes without news of startups coming up new innovations with huge funding. Assam though it started late has picked up phenomenally and startups incubated at The Nest have already raised Rs 54 crore till date and are innovating products/services that can meet global demands.

Pranjal Konwar Chief Operating Officer at The Assam StartUp who has 24 years of national/international corporate experience across diverse domains says they believe in encouraging the startups to create their own niche and play to the strength of the region. “Every region has its typical challenges and uniqueness and it’s better to harness this uniqueness. We might not be the best tech innovators like Karnataka, Kerala, or Telangana. But our uniqueness lies in our unique challenges and the unique society-centric innovations to deal with the challenges” Konwar told BusinessNortheast on startup culture picking up in Assam.

1. Entrepreneurship has always been there. But of late, a new concept called startup has come about. Can you explain how did startups happen?

The term ‘startup’ became internationally popular during the dot-com bubble in the late 1990s when a phenomenal number of internet-based companies rose to prominence. The booming internet business, with rapidly increasing stock prices, saw venture capitalists willing to invest in favour of technological advancements at the cost of overlooking the traditional valuation metrics. This was the phase when some of the biggest startups like Amazon and eBay were founded. Following the modus operandi followed by most of the companies during this period, the term ‘startup’ became synonymous with an entrepreneurial venture that has emerged newly and is scaling up fast to meet the needs of a marketplace by innovating a unique product, process, or service.

2. Assam is not the ideal place for being an entrepreneur due to many reasons. How is Nest helping to change that?

When we talk of the hindrances to entrepreneurial pursuits, they are affected by both internal and external factors. External factors may include the dearth of exposure, inadequate industrialization and lack of confidence of the corporate and investors in the entrepreneurial potential of the region. The internal factors primarily revolve around the job-seeking mindset of the people and a lack of social acknowledgment of the potential of entrepreneurship as a career option.

The biggest challenge that we faced while starting the initiative was that we had to start from scratch to build a startup ecosystem. We had to generate excitement around entrepreneurship and create the buzzword. There was a task in hand to awaken the problem-solving mindset and motivate them to innovate solutions. To this end, we designed a 4I Model viz., Inspire, Ignite, Incubate and Invest.

The task to acquaint and inspire started with outreach programs in different districts of the state. We also leveraged social media and mass media to spread awareness about startups. The next task was to ignite the drive among the youth to innovate solutions to local problems. To this end, we organized Hackathons, B-Plan contests and Idea Validation programs. Further, we onboarded 45 academic institutions in Assam as academic partners, activating their EDCs and facilitated the launch of 10 Spoke Incubators in academic institutions. We also trained the trainers in these incubators to enable them to provide the initial hand-holding to the startups. Startups selected for incubation at Assam Startup attend monthly bootcamps and are provided dedicated mentoring, corporate connects, market access and branding and visibility support. Further, the incubated startups are connected to investors to learn the nitty gritty of fundraising and subsequently pitch for funding.

Four years down the line, we can see the 4I model bearing fruits. Our efforts to reach out to over 18,000 youth in Assam through 450+ outreach and awareness programs have certainly borne results. The fact that 625 startups from Assam have been awarded DPIIT recognition till now reflects the progression of the startup culture in Assam.

3. What do you look for in an entrepreneur before taking him for incubation?

Startups applying for incubation are evaluated based on five key parameters, viz., Innovation, Market Potential, Revenue Model/Traction, Social Impact and Team Capability.

4. There are a lot of funding organisations which provide equity and other investments to startup entrepreneurs. How should an entrepreneur choose which is the best for him?

Startups must look for funding from different sources depending on the stage they are in. For a startup still in the idea or prototype stage, it’s advisable to target family and friends or angel investors to invest in the venture. They may also apply to various funding schemes by central and state governments and participate in B-Plan challenges. NRL Ideation is an apt instance to mention. Getting into an incubator can also give access to various funding schemes. The Central government has introduced various schemes to bolster entrepreneurship and support startups financially. Startup India Seed Fund, Stand-Up India, Pradhan Mantri Mudra Yojana, Atal Innovation Mission, Samridh, MeitY TIDE 2.0 and NIDHI Entrepreneur-in-Residence are only a few programs to mention, which are typically channelized through the incubators.

For startups that have gained decent traction and are eyeing at expansion, they may try for seed funding from local VCs like NEDFi Venture Capital Limited (NVCL) to begin with and subsequently target the pan-India VCs. While targeting these VCs, a startup must do the homework in terms of understanding the industries and business stages preferred by the given investment entities and their previous track records. Crunchbase and LinkedIn could be good tools to cull out such information.

5. In the last three years since its inception, how many entrepreneurs have been incubated and how much money have they raised?

To give you the latest figures, 66 of our incubated startups have together raised Rs. 54 Crore to date.

6. How many of these startups are making profits?

Out of the 179 startups that we have incubated, 50 of them are currently generating revenue while a majority of the rest are either developing their products or gearing up for launch.

7. How do you judge the startups incubated at the Nest? Are they comparable to the rest in their country?

Rather than comparing our startups with that from other parts of the country, we believe in encouraging the startups to create their own niche and play to the strength of the region. Every region has its typical challenges and uniqueness and it’s better to harness this uniqueness. We might not be the best tech innovators like Karnataka, Kerala, or Telangana. But our uniqueness lies in our unique challenges and the unique society-centric innovations to deal with the challenges. So, when Esah Tea offers tea packs from the small tea gardens of Assam, the venture is predominantly fueled by the intention to give the small tea growers of Assam their due. When Brahmaputra Fables creates an e-commerce site for North Eastern handloom and handicraft, he encourages thousands of weavers and artisans from the region to continue the legacy by helping them make a continuous earning from it. While addressing the core local issues, these entrepreneurs are innovating products/services that can meet global demands.

On the other hand, there are startups whose innovations are potentially positioned to provide national and even global solutions. For instance, the 3D figurines created by My3DSelfie find a lion’s share of consumption in the US and Europe. The plastic-embedded brick innovation by Zerund Manufacturing is finding acceptance nationally. Defence and Space Robotics Laboratory’s innovation of a ground penetrating radar system that can scan underground activities and tunnels, has won prize money of Rs. 10 Lakhs in the BHUMI-BSF Grand Challenge by MeitY, in partnership with the Border Security Force. The startup is currently testing the product on the ground in Kashmir. If everything goes well, the startup will be recognized for innovating a solution of paramount national importance.

While I am reluctant to judge our startups, I can say with absolute confidence that our startups are no less in terms of building innovative solutions that can forge tremendous impact nationally.

8. There is a lot of talk about unicorns in the country. Is there a possibility of any startup from Assam that can reach the unicorn league?

Had you asked me this question five years back, I might have said that it’s just a dream. But Assam Startup was instituted to make big dreams possible. A startup becomes a unicorn when it reaches an investor valuation of $1 billion or more. Given that the startup movement in the region started only recently, it might take a few more years for the startups to reach the level of maturity where they can target massive fundraising. As per a finding, the average time taken from founding to becoming a unicorn in India is seven years, six months and twenty-five days. This, coupled with the relatively young startup ecosystem in the state, brings us to the conclusion that we might have to wait for some more years to see a unicorn emerging from this part of the world. Nevertheless, given the growth trajectory that startups like Zerund Manufacturing and My3DSelfie have carved in the last 3 years, combined with the fact that one startup, Gobillion has raised $2.9 million in a seed round led by YCombinator, Tinder founder Justin Mateen, Pioneer Fund and others, we are definitely on the right track to realizing the dream sooner than we might expect.

9. Should a startup reach out to outside investors for funding or should he/she first tap the local investors?

Assam has an evolving startup ecosystem where most of the startups are in a relatively early stage of business. The big, pan-India VC companies would usually look for startups that have generated good traction and are gearing up to scale up. For these early-stage startups, it’s advisable to look for local angel investors to invest in them. Having said that, there are more matured startups like Automovill and Zerund Manufacturing that have raised funding from outside organizations like the Mumbai Angels Network and Gruhas ASPIRE respectively. However, the fact that these startups raised outside funding only after the local organization, NEDFi Venture Capital Limited (NVCL) had invested in them tells a lot about the importance of tapping the local investors before trying to pitch to a national-level funding organization. Prior funding or co-investment by a local investor gives an outside funding source confidence and validation about the low-risk level of investing in the given startup.

10. What would be those three commandments/ messages to the upcoming entrepreneurs who want to make it big?

Firstly, it’s good to believe in your innovation, but do not obsess over it. The common mistake made by startups is to focus more on the innovation than trying to align it with the market need. Successful startup founders have a keen understanding of the pain points and are smart enough to tailor their innovation according to the need.

Secondly, do not shift to entrepreneurship if your goal is to get rid of the 10-5 job grind. Entrepreneurship is a 24x7 calling. Be ready to be displaced from your comfort zone. Stay open to new learnings every day and be flexible enough to drop your attachment to your previous experience and learnings. At the end of the day, your perseverance, adaptability and passion to solve a problem will open the success door for you and for your startup.

Thirdly, while funding is important for a startup, don’t assume that funds can steamroll all your challenges. Before attempting to raise funds, chalk out a detailed plan for utilization of the fund. If you are in the idea stage, do not expect an investment entity to give you money. Rather target family, friends and acquaintances to invest in your startup.

Finally, this is a golden period for startups in the region. 10 years back, if someone wanted to start up, he had to do it all alone without any support. There were no ecosystem players and enablers to show him the way. Compare to the current state, Assam’s startup ecosystem has evolved phenomenally. You are not alone in your entrepreneurial journey today.

Most importantly, even if you fail in your startup venture, remember that a failed entrepreneur has better value in the job market than a fresher.

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