Karnataka plans to set up a technology incubator to help start-ups

The model, which will need an investment of about Rs15 crore, will help companies access global market and capital

Bengaluru: The Karnataka government is working on a new initiative to set up a technology incubator near Bengaluru to serve as an international platform to support technology development of start-ups and that of existing enterprises in the electronics and energy sector. The model, which will need an investment of about 15 crore, will help these companies access global market and capital.

The government is considering a proposal for the incubator model, dubbed as ‘Karnataka Regional Incubation Center’, prepared by electronics industry association CLIK (Consortium of Electronic Industries of Karnataka). As per the proposal, the government is in talks with Austin-based University of Texas to seek technical know-how for the center.

R.V. Deshpande, the state’s new industries minister, said the officials of the state government held the first round of talks with professors from Austin earlier this month.

The proposal, reviewed by Mint, suggests that the state government should invest in a world-class incubation model that is globally competitive, managed by a professional team trained in incubator management based on the Austin Technology Incubator (ATI) model.

ATI is the incubator run by University of Texas’s IC2 Institute that has a 25-year track record of helping technology enterprises across the world. The institute has been in India since 2006, training the Department of Science and Technology’s incubation centers and working with other Indian organisations.

The state government would finalise the project after going through a detailed project report to be prepared by IL&FS (Infrastructure Leasing and Financial Services Ltd), said Ratna Prabha, Karnataka’s additional chief secretary for industries.

“The model is to house the incubator in the KIDB (Karnataka Industrial Development Board) industrial area where CLIK would be developing a facility for electronic hardware companies," said Prabha.

The state government would have to invest about 15 crore to set up the incubator in the industrial area in Doddaballapuram near Bengaluru. The center, after training its managers in Austin for six months before opening, would incubate up to 15 technology ventures in the first phase, she said.

Mohandas U, vice-president of CLIK, said he expects the project to be finalised within the next two to three months.

Other state governments have also been trying to tap into the vibrant start-up ecosystem of the country. The Telangana government has started the construction of a 35 crore technology incubator in Hyderabad to reposition the city as a technology destination, a January report in Mint said. Tamil Nadu has decided to set aside areas for start-up warehouses in all information technology parks developed by the government, reported Times of India in January.

However, experts doubt the success of the Bengaluru project unless it is intelligently executed.

“The government is never short of ideas. But its success would depend upon how it is structured and executed. The devil will be in the details," said a high-profile start-up investor and technology veteran, who was part of the meeting called by Deshpande, on conditions of anonymity.

The good thing is that the government is getting involved with the startup industry, although Bangalore has developed without government intervention, the investor said.

Karnataka’s new initiative comes two years after it built the first state-level start-up warehouse, which had attracted about $1 million investment. It also launched a series of projects last year to bolster Bengaluru’s reputation as one of the world’s premier startup ecosystems. Both these were launched in association with information technology industry lobby group Nasscom.