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The Society for Innovation and Entrepreneurship (SINE) at the Indian Institute of Technology – Bombay incubates technology start-ups with a strong IIT-B linkage.
According to Poyni Bhatt, Chief Operating Officer, SINE, the incubator looks at companies from three aspects – high risk, high growth; strategic value; and, social impact. Selection is subject to certain processes.
The SINE, started in 2004, is spread over 10,000 sq ft and can accommodate about 18 start-ups at a time. It incubates the ventures for three years, helping them with seed capital, either in the form of debt at highly subsidised rates of interest, or equity. The SINE invests up to ₹25 lakh as equity in the start-ups and picks up to seven per cent stake in them. The idea, according to Bhatt, is to provide the much-needed risk capital for the entrepreneurs. The SINE gets grants from the government, which it uses to invest in the start-ups. It will look to the entrepreneurs to give it an exit and liquidate its investment at each stage of fund-raise.
As per SINE’s policy, the indicative range of its equity holding for infrastructure and IP will be 6-8 per cent. In case the venture does not raise investment from an angel investor or venture capital fund for five years from the date it issued shares to SINE, SINE will have a right to sell its holding to the promoters at a value that will be higher of book value and fair value, according to information available on SINE’s web site.
Every year, about half a dozen companies get admitted to the incubator. She says that the SINE is a broad technology incubator and the incubatee companies should have a strong IIT-B linkage – either started by its students or alumni, or use technology from IIT-B. Some of the start-ups incubated at SINE are Seclore, Ideaforge and Sedemac.
A large number of venture capital and private equity funds are based out of Mumbai and start-ups at the SINE benefit from their presence. Also, the Mumbai Angels, a network of wealthy individuals who invest in and mentor start-ups, is a leading angel network group in the country and is active in the city. There has also been an effort to highlight Powai Valley – Powai is where the IIT-B is located – as a unique ecosystem that fosters entrepreneurship. All these will help the ventures being incubated at SINE.
Tangible supportAccording to her, the tangible support that SINE provides to companies admitted to the incubator include office, shared space, common facilities, easy access to labs at IIT-B, prototyping facilities. The biggest advantage is the access to faculty expertise and service providers, industries that partner with IIT-B and participation in various Government programmes.
On the start-up scene, Bhatt says a whole lot of things have changed in favour of entrepreneurs and start-ups: funding is much more easily available, there are mentors to help the start-ups and the government too is encouraging entrepreneurship. Still, she would like to see more technology-based product companies rather than services companies coming up. This will help in creating product intellectual property rights.
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