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Entrepreneurial Initiatives in India

Institutes of national importance that have been setup

through an act of parliament (IITs, IIMs, NITs, AIIMS, IISc etc.) are the main leaders in the field of knowledge transfer. Examples:

Organizing Competitions like Great Idea, helping and incubating ideas.

IIT Kharagpur: Nina Saxena Excellence in Technical award (Yearly).

Revenue Streams for Incubators A fixed rental to cover the cost of basic
infrastructure A usage based charge for services like conference room, copier, etc. A success fee which can be in the form of an equity stake in the new venture.

Exiting an Incubator The entrepreneur should exit:

After a fixed period
When the start up receives substantial funding When it achieves a certain level of profitability

In case of irresolvable disputes

Top Incubation Center

1. Centre for Innovation, Incubation& (CIIE) - IIM Ahmedabad
Set up in 2001 Since inception CIIE has 80-odd innovations grow out of the


incubation centre in varied technologies 2. Society for Innovation and Entrepreneurship (SINE)- IIT Bombay
Set up in 2004

3. Technology Business Incubator (TBI) - BITS Pilani

In association with DST, BITS has established Technology

Business Incubator in the area of embedded systems and VLSI design back in 2004
So far, TBI has helped spawn ten companies.

Top Incubation Center

4. Cell for Tech Innovation, Development & entrepreneurship support- IIT Chennai Set up in 2000 Organises national level competitions, Breakthrough (general business plan competition) and Genesis (social entrepreneurship plan competition) 5. Society for Innovation and Development (SID) - IISc, Bangalore Set up in 2006 The investigator is given a seed capital for Rs 20 lakh a year for two years as soft loan for the approved plan 6. The SP Jain Centre for Entrepreneurship DevelopmentSPJIMR
16-week 'Start Your Own Business' programme-a public

Top Incubation Center

7. Technology Incubation and Entrepreneurial Training Society (TIETS) IIT Kharagpur
Set up in 2005, So far, the institute has been able to

incubate two companies through Concipio over the last three years. Besides, an in house panel has helped 11-12 ventures take wing

Assistance in converting your ideas into an actual B-Plan. Funding for the enterprise through TIETS (Technology

Incubation and Entrepreneurial training Society)

Some of the successfully incubated companies from SINE, the incubator at IIT, Bombay Herald Logic Pvt. Ltd. Voyager2 Infotech Myzus Technologies eInfinitus Powai Labs Pvt. Ltd. Seclore Technology Pvt. Ltd Eisodus Networks Pvt. Ltd. Quantum Phynance Pvt. Ltd.

Form of business ownership created by contract whereby

a company grants a buyer the rights to engage in selling or disturbing its products or services in exchange for royalties or share of profits. Buyer is franchisee
Franchisee enters into an agreement with a franchisor to

sell the goods or services for a specified fee.

What is a franchise?
License to use an established brand
Use is very restrictive many rules to be followed. Provide a proven successful business format Entrepreneurship for people that are not particularly


Advantages of Franchising
Buying a name/reputation
Established markets Technical/management assistance

Standardized procedures
Quality standards Selection of location

Facility design
Quicker cash flow

Disadvantages of franchising
Loss of independence High initial fees High royalties and advertising allowances Contractual restrictions Inapplicable advertising Termination clauses Not receiving promised help Lack of competitive advantage

The Franchisees Perspective Things to Look For

Proven operating location Credible top management Skilled field support staff A trade identity Effective training programs Plans for advertising, marketing, PR and promotion A communications system Sufficient capital

1999 by Prentice Hall


Franchising Agreements
Franchise fee Royalties

Questions to Resolve
Amount? One time? Per unit? Amount? Percentage of net or gross? Sliding scale?

Quality control Quality specs? Monitoring practices? Rewards? Sanctions?

Offerings Equipment Location Operations Reporting Disputes Termination

Fee? Local budget? National? Intensity? Messages?

Product line? Product mix? Requirements? Alternatives? Required? Additional? Financing? Site selection requirements? Franchisor aid? Financing? Signs? Hours? Maintenance? Dcor? Personnel policies? Types? Frequency? Auditing? Sanctions? Resolution methods? Equity of resolution process? Timing? Causes? Sanctions? Recourse?

1999 by Prentice Hall


Franchisee Guidelines
Perform a self-evaluation Investigate the franchisor Study the industry and competition Study the Uniform Franchise Offering Circular Investigate the franchisors disclosure Know your legal rights and retain counsel

1999 by Prentice Hall


The Franchisors Perspective Advantages

Faster growth
Lower capital requirements Motivation franchisors are owners of the franchise Control of locations Revenue stream franchise fees/royalties

The Franchisors Perspective Disadvantages

Reduced control
Profit sharing Greater commitment to operating support

Recent Type
Business format franchising

Franchisor offers a wide range of services to the franchisee Includes::: Marketing, advertising, training, strategic planning, quality control guidance.