Kochi: In start-up business, in which Kerala showed the way for India through Keltron and Technopark, other states have overtaken it and are racing ahead. In the past five months, when more than 10,000 crore rupees was invested in start-ups, most of it was taken away by Delhi, Bengaluru and Mumbai. Kerala did not get even Rs. 50 crore.
Kerala is the first state in which the government started an incubation centre and a Startup Village and framed a policy for young entrepreneurs. Still, when huge investments were made by venture capitalists in more than 200 start-ups in Delhi and Bengaluru in the past five months, only one company in Startup Village, Kochi, got funds. In the number of start-ups too big cities have left Kochi and Thiruvananthapuram far behind. Observers believe that what is happening in the case of start-ups in Kerala is similar to what happened in the case of IT parks.
Jugnoo, Porter, UrbanClap and PepperTap are among the start-ups that have received funding. Among the investors were foreign giants such as Softbank and DST Global. In the number of financing deals, the first five spots are held by major cities in IT: Bengaluru, Delhi, Mumbai, Hyderabad and Chennai. After them, even cities such as Udupi and Udaipur are ahead of Kochi and Thiruvananthapuram.
This year, Rs. 20,000 crore could be invested in Indian start-ups. If that trend continues for five years, the total investment will be Rs. 1,00,000 crore. At the current rate, Kerala is unlikely to get even 500 crore rupees out of that. In short, the start-up bus too is bypassing Kerala.
Not only in information technology, even ventures such as Oyo Rooms, a market for hotel rooms, have received funds in a big way. Last month, Ritesh Agarwal, a 21-year-old in Delhi, got 600 crore rupees for this venture.
Experts point out that there is only initial enthusiasm and no finishing in Kerala. Even startups that sprout in the state move to cities such as Bengaluru for more growth opportunities. The main reason for it is that there is no ecosystem for growth in the state. Even in Start-up India, announced by Narendra Modi, Kerala will be left behind.
Start-up policy for students
Kerala Technological University’s start-up policy for students came out just before Onam. Selecting entrepreneurs from each engineering college and helping them is part of the policy, and this task has been entrusted with the faculty and the Startup Village. Selected entrepreneurs will be given 1 lakh rupees. It also envisages a small course on entrepreneurship that is worth two credits. But, for the time being, all these initiatives are on paper only; they have not been implemented in colleges. Gujarat Technological University has signed a memorandum of understanding with the Startup Village in Kochi to identify the best ventures. Kerala Technological University included Startup Village as its partner in the policy only after that.
In Gujarat, any engineering student can do a minor course in entrepreneurship. In an engineering course with 180 credits, this course will provide 12 credits. Instead of passing a theory exam, credits can be earned by successfully managing a start-up. If the venture gets 5 lakh rupees as investment or if it generates 2.5 lakh rupees in revenue or 1 lakh rupees in profit, the student will pass the course. Thus practical application of theory is rewarded.
Kerala-Silicon Valley connection
Since Kerala cannot compete with major Indian cities in IT, Startup Village CEO Sanjay Vijayakumar says the state must establish a link with Silicon Valley. The state’s IT department has already set the ball in motion. It has sent some entrepreneurs to tour Silicon Valley, and a team of representatives from there have come to Kerala.
Annual investment in startups in Silicon Valley is 10 times the money pumped into Indian ventures. Observers point out that if Kerala can establish a link with Silicon Valley, like Malayalis’ Gulf connection, then it will get a not-so-small piece of that investment pie.