These start-ups are different from the ones that have made it big in India.
Subhayan Chakraborty reports.
Aum Project Engineers, Biomatiques Identification Solutions and Biomed Innovation are among 88 young companies, most of whom have names ending with 'solutions' or 'innovations', that have made it to the government's first list of firms to benefit from the Rs 10,000 crore (Rs 100 billion) 'fund of funds' for start-ups.
The Small Industries Development Bank of India-backed corpus was announced in the Union Budget and was recently cleared by the Cabinet.
These start-ups, however, seem to be different from the ones that have made it big in India. In fact, it's hard to find anyone following the Flipkart or the Ola model.
With their origin anywhere between Bathinda, one of the oldest cities in Punjab, and Bengaluru, the country's IT capital, these firms are working in areas like manufacturing of agricultural vehicles to providing solar solutions, from making beverages to offering consultation for agro plants.
The only link to the likes of Flipkart and Ola is perhaps the Indian Institute of Technology (IITs). If Flipkart founders Sachin Bansal and Binny Bansal (not related to each other) and Ola's Bhavish Aggarwal studied at IIT, Cygni Energy, one of the fortunate 88, was incubated at IIT-Madras.
'Solar energy is the fuel of 21st century... Cygni is on a mission to power a billion dreams by venturing into new solar solutions,' the company says on its website.
While these companies will get investments from the Sidbi-monitored fund, beginning with a total of Rs 500 crore (Rs 5 billion) in the first year, the government will also help them with faster approval of patents, an official at the Department of Industrial Policy and Promotion said.
None of the start-ups would get an income tax break for three years, a key incentive announced earlier, it is learnt.
The flipside is that the government has not performed a detailed background check before selecting the 88 firms.
Even the date of incorporation or total annual turnover -- two key factors defining a start-up -- were not checked, according to the DIPP official.
"While the government has focused on the innovation quotient, it has not probed into other aspects," he said.
The start-ups have submitted a 'letter of incorporation', but the government has not looked beyond that. No document proof was sought on date of incorporation or turnover.
The government has defined a start-up as an entity, incorporated in India not prior to five years before, with annual turnover not exceeding Rs 25 crore (Rs 250 million) in any preceding financial year, which is working towards innovation.
Even as these start-ups prove themselves and wait for funds from marquee investors, the government is planning another start-up conference in August. Already upbeat on the sector, the government will showcase the DIPP's initiatives at the event.
Around 10,000 participants as well as incubators are expected to participate in the event. The last big start-up conference 'Startup India' was in January where global and Indian entrepreneurs and investors had queued up and Prime Minister Narendra Modi had addressed the gathering.
There are plans to invite prominent international start-ups at a similar conference next year too, coinciding with the first anniversary of Startup India.
