Incubation models help building ecosystems

Jessu John | Updated on December 29, 2014 Published on December 29, 2014

RISHI KHIANI, Managing Director and CEO, AntFarm

AntFarm focuses on making digital businesses future ready

Enablers contributing to innovation are, arguably, helping strengthen the ecosystem for entrepreneurship. Beefing up the enabler quotient of India’s start-up ecosystem is vital, so that new businesses have access to the right advice and guidance as they take a venture to profitability even in challenging times. Over the course of a year, it was interesting to look at how investors have become partners in new businesses rather than just agents providing capital.

One of the more helpful things to have happened is that among some investors and early-stage funding partners, a variety of models have emerged. Incubation is taking more of a centre-stage. And increasingly, ‘digital’ is getting the attention it deserves in India as anywhere else.

Precedents and possibility

Earlier this year, BusinessLine carried a story on FutureIP’s collaborative early-stage model of incubation. FutureIP is focused on intellectual property development through each of the start-ups. Though largely concentrated on technology products and services, FutureIP did not leave out opportunities in sectors like energy.

Founder and CEO Sudhir Sarma’s observations are that among conventional venture capital firms, the success rate is about 10 per cent. As a testament to how the FutureIP-style incubation model can be efficient, each of its incubatee firms is now consistently cash positive.

In the case of TO THE NEW, featured here earlier, the founders were set on building digital businesses across Asia. But as Co-founder and CEO Puneet Johar said then it is also imperative to build the right talent for these businesses. Its ‘Entrepreneurs at Work’ programme seeks to do just that.

AntFarm, a younger venture, takes the spotlight in this edition for not only creating and incubating businesses but also putting professionals in charge of them.

Managing Director and CEO Rishi Khiani makes a statement concurrent with Sarma’s view: “A normal incubator and accelerator will take a few people on and it’s like entrepreneur tourism, a whirlwind tour for them. But we own a majority of our businesses and not a minority stake – it’s a 5/5 strike because we give our start-ups sweat equity, bring in the right people to lead the businesses and we’re involved investors.”

So while making businesses future ready, there has to be sufficient human capital for these business environments. It’s about business owners and investors taking on a range of sectors.

Variety the spice

Moreover, with consumer experience now being delivered and managed through digital platforms, consumption is fuelled across sectors. So the case for ‘digital’ in India only grows and AntFarm does well to focus its incubation efforts on digital businesses. The firm “identifies ideas with the potential to disrupt markets, leveraging years of expertise, resources, and experience to grow successful companies through collaboration and knowledge sharing.” Khiani has led the internet divisions for media companies and successfully exited his first company UrbanEye Media.

With AntFarm, Khiani has chosen to foray into a range of spaces with properties like Fork Media, Impulse, and Revolutionary Fitness. Under his leadership, AntFarm’s current valuation, captured through its individual businesses, stands at over 400 per cent since last fiscal.

“We look at different verticals, what’s going to be a longer-term sustainable business idea, identify people to start the business and lead it. We offer co-working space and spend the time to build technology backbones of each property we take on. In most cases, we’re able to do this in 21 days, putting an entire comprehensive brand-focused platform together,” Khiani explains.

Stronger ecosystems are made by diverse models flourishing across sectors. Forward thinking investors can now enable this. More in a fortnight.

“We own a majority of our businesses and not a minority stake – it’s a 5/5 strike because we give our start-ups sweat equity, bring in the right people to lead the businesses and we’re involved investors.”

Published on December 29, 2014
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