Hyderabad to ride next wave of start-ups in India with t-hub launch

Hyderabad is scripting a new chapter in the start-up ecosystem with the Telangana Hub (t-hub) , the incubation capital, which is ready for inauguration by Ratan Tata on Thursday (November 5, 2015) in sync with the ‘Make-in India’ campaign and the big push being given for start-ups by the Narendra Modi Government.

The t-hub addresses the gaps in the existing ecosystem in a way it makes this city the best for the business for start-ups. “We are mapping and connecting the ecosystem together by joining the entire start-up community together. And helping them connect with one another,” says Srinivas Kollipara Chief Operating Officer of t-hub, Srinivas Kollipara

The key challenges are the ideation, seed funding/bootstrapping, creating market, facilitating the scalability of the idea and connecting with Angel investors and Venture Capital Funds.

Creating clusters of innovation around a vertical – Healthcare, IoT (internet of things), Smart cities, Agro-tech and Fintech (financial technologies) and the likes – is the in thing.

The t-hub, for instance, finds right resources, funders for the domain, incubators and accelerators in respective domain and connect the peers in the community. The t-hub also helps the start-ups with the marketing facility. If a start-up abroad is looking for a market in India or vice-versa, t-hub facilitates the same.

He “We are creating a start-up ecosystem.” While the t-hub building is set for an inauguration on the sprawling premises of IIIIT-Hyderabad, the Government of Telangana has already embarked on another facility which is five times bugger in size compared to the current one. The three-lakh sq. ft structure would come up near Rayadurgam, closer to the HITEC City in Hyderabad.

The t-hub is a PPP (public-private partnership) between the Government of Telangana, IIIT-Hyderabad, ISB and NALSAR and key private sector leaders.

Six corporate leaders, including NASSCOM Chairman BVR Mohan Reddy (Cyient Technologies) have all invested Rs 1 crore each. The Rs 50-crore project has been taken up with the State Government pitching in with Rs 40 crore and other directors with Rs 10 crore.

While envisioning the phase-II facility, the start-up ecosystem in Hyderabad is creating a Rs 100 crore innovation fund, of which Rs 20 crore would be the contribution from the Government of Telangana, which dons the role of anchor. The rest would be from several other stakeholders.

As many as four angel networks, 30 seed funds and 20 venture capital funds have been roped in to participate in accelerating the start-up activity. Apart from creating infrastructure, and policy-making. There are several incubators in Hyderabad, including the ones at IIIT-H, ISB, BITS (Pilani)-Hyderabad campus, etc.

He foresees at least 25-30 start-ups would be mature enough to have their own set-ups in a year’s time. This will be a continuous activity, though no specific investments can be expected to committed. But over 300 start-ups have already enrolled themselves to make use of the offerings of the t-hub.

“T Hub is going to define the next phase of the start-ups story in our country. It will demonstrate how a comprehensive ecosystem can be fostered with government’s facilitation to assist start-ups not just to do well within the country, but also make waves in the global marketplace. It is an 800-seat facility built in 60,000 sq. ft,” says Jayesh Ranjan, Secretary IT, Government of Telangana.

“What Hyderabad always lacked is access to mentors who can add real value and aggressive investors. Now with the world class facilities like T-Hub, we are sure to attract more attention to the Hyderabad start-up ecosystem, “ says Adi Vemuru, core team member of AugustFest.

Modi regime’s fillip to start-ups

It may be recalled that the Government of India announced a policy of corpus fund for giving big push to the start-ups in the country.

Finance Minister Arun Jaitley, in his first Budget speech of the Narendra Modi-led NDA Government’s regime, had announced a start-up fund of Rs. 10,000 crore to give a fillip to the start-up ecosystem in the country.

However, there has been a lull on the fund and its channelization. Confusion reigned supreme as activity on this front remained a non-starter, though the Ministry of Skill Development and Entrepreneurship was supposed to have anchored the program.

The fund eventually saw the light of the day on April 19 with Jaitley launching it through Small Industries Development Bank of India (SIDBI) as the nodal agency to coordinate and release the funds. The initial corpus created was Rs. 2,000 crore under the name India Aspiration Fund for promotion, financing and development of micro and small and medium enterprises.

Jaitley had launched at that time the SIDBI’s Make in India Loan for Small Enterprises (SMILE) scheme which would have an allocation of Rs. 10,000 crore with a special emphasis on 25 sectors as part of Make in India program.

Of the Rs. 2,000 crore , rs. 753 crore had been sanctioned towards seed capital and the activity is gaining momentum.

In fact, Prime Minister Narendra Modi has been campaigning about the start-ups and his recent assertions at the Indo-US Start-up connect, launch of “Bharat Fund” and he said in September in the US: “The course of human history and progress has been shaped by imagination, inspiration, invention and innovation."