The number of student start-ups at the Indian Institute of Technology (IIT), Bombay, has increased by 58 per cent over the last three years. This is despite the funding trend for start-ups on campus reflecting a slump in the past year.
While only 31 start-ups existed at IIT-B in 2015, this year the campus’ entrepreneurial ecosystem is thriving with 49 student-founded start-ups — excluding those founded by students who have graduated in 2016 and 2017. However, funding that increased from 2015 in 2016 dropped again this year, according to a survey released by the Entrepreneurship Cell (e-cell) of IIT-B. The survey found that while only 16 per cent of the start-ups had raised funds in 2015, the figure spiked to 29 per cent in 2016 only to drop again in 2017 to 25 per cent.
While the figures are slightly higher, the funding scenario has relatively remained the same over the years taking into account the rise in the number of start-ups. The survey also took into account the problems faced by the start-ups on campus, which shows while the start-ups faced a dearth of funding earlier, the situation has eased slightly.
In 2015, most start-ups had difficulty with funding, finances, legal help and networking, which were reported as the biggest problems by entrepreneurs. While the trend has now slightly changed with more start-ups facing technical difficulties in 2017, the dearth of funding is still a reality. “Investors are reluctant to invest in high risk ideas and a lot of regulatory hurdles are involved,” said Shubhadeep Das, a research scholar and the founder of Convalesce, a start-up that develops a medical gel preventing migration of stem cells to unnecessary body parts.
Yet another trend established by the survey is the shift from service providing to technological solutions. In 2015, most start-ups (39 percent) were founded around services but today half of them provide solutions leveraging technology. Agriculture and product and graphic designing form the second biggest chunk this year. Most of the start-ups — 39 percent — today are operating as full-fledged start-ups with only 28 per cent of them running on beta versions. The rest are still prototypes. The second big problem to emerge over the past two years is the lack of a ‘good team’ to work with. IIT-B boasts of a booming start-up ecosystem thanks to its e-cell and Society for Innovation and Entrepreneurship (SINE), the institute’s own incubation centre providing a host of programmes to promote entrepreneurship.
The recent study found that 11 out of 20 campus start-ups of IIT-B have won some competition, of which three managed to reach the final round of Eureka — the institute’s International Business Model Competition. Some of the start-ups surveyed felt that more such surveys were needed to understand the ecosystem better. “Most start-ups we surveyed asked for more mentoring sessions with industry professionals,” said a member of the e-cell.