The first disbursement of funds under the new schemes announced in the latest Kerala budget for hardware startups will be done in April, according to M Sivasankar IAS, Principal Secretary, Electronics and IT, Govt. of Kerala.Delineating the problems being faced by hardware startups in the State, Sivasankar said, “One of the basic things is their
The first disbursement of funds under the new schemes announced in the latest Kerala budget for hardware startups will be done in April, according to M Sivasankar IAS, Principal Secretary, Electronics and IT, Govt. of Kerala.
Delineating the problems being faced by hardware startups in the State, Sivasankar said, “One of the basic things is their need to have a huge working capital, which is traditionally not funded by Angels, VCs or High Networth Individuals (HNWIs). The banks have certain financial norms like collateral security for giving credit”.
He was speaking on the concluding day of the Seeding Kerala investment summit. “We have a very large number of hardware startups in Kerala. They face challenges ranging from running companies smoothly to taking prototypes to the next level. So we had to suggest to the government to evolve a framework by which the hardware startup requirements could be funded at least to a certain extent,” he pointed out.
Sivasankar said the state budget has included a scheme under which a committee can approve a certain level of funding to a startup if it was found to have received ‘genuine’ orders for its product or service. With that recommendation, the startup can go and secure financial assistance from State financial institutions like Kerala State Industrial Development Corporation Limited (KSIDC) and Kerala Financial Corporation (KFC).
“The first disbursement will be made in April. I hope banks will also join in this endeavour in a short period of time. When we put this framework into practice, it will help solve a very big challenge being faced by these companies,” he added.
“Another interesting announcement made by the government is the ‘impact funding’. One thing which Kerala has learned in the aftermath of the last two floods is that we need to put a premium on sustainability. As per the impact funding scheme, any startup that is going to work on any of the Social Development Goals (SDGs)-related themes, will get special financial support for investing some money into kick-starting the process,” he said.
“The third thing we are planning is the introduction of a very transparent system to channelize the Corporate Social Responsibility (CSR) funding into the startup ecosystem. We have already created a set of incubators across colleges. Putting CSR money into incubators is one aspect. But more importantly, it’s about channelizing CSR funds through the incubators to the startups,” the official added.
On the impact of the event, he said: “This edition of Seeding Kerala actually created the situation wherein the participants could go back with confidence as the ambassadors of the startup ecosystem of Kerala.”
Virginia Tan, Co-founder & CEO, She Loves Tech, was the Chief Guest at the concluding session of the event. Dr. Saji Gopinath, CEO, KSUM, was also present.
The investment summit brought together leading figures in the country’s startup ecosystem besides senior government officials.