cibi executive presentation jan2014
TRANSCRIPT
A potential TBI under NSTEDB scheme of DST
Promoted by KCT, Coimbatore
CIBI
Coimbatore Innovation & Business Incubator
Journey of Coimbatore
2
Coimbatore 1.0
• Pre-Independence
• Agrarian Economy
• Rural Society
Coimbatore 2.0
• Last 50 years
• Indigenous SME Industry
• Entrepreneurial Roots
• High Growth Urbanizing Society
Coimbatore 3.0
• Next 20 years
• Technology Powered
• Knowledge Economy
• Global Connect
Innovation &
Entrepreneurship
3
KCT Who we are …
Key Objectives
4
Seeding a grassroots entrepreneurial revolution
Seed, build and evolve a grassroots and youth centered technology intensive innovation and entrepreneurial
revolution creating enterprises, jobs, and wealth, contributing to the overall economic and social progress of the
greater Coimbatore region;
Entrepreneurship HUB to transform IDEAS to ENTERPRISES
Create a dynamic entrepreneurship hub connected to a large global ecosystem of mentors, investors, and business
leaders, where aspiring innovators, first-time entrepreneurs, ambitious small businesses, passionate graduates with
a million dollar idea, and innovative academics exploring commercial success go to … to transform their Ideas into
Enterprises;
Innovative, Impactful, Profitable, Growth Businesses
Generate robust demand from among students, professionals, small & family businesses, women entrepreneurs,
social enterprises, and academics to create a large number of profitable and scalable businesses, achieving global
benchmarks in technology impact, market potential, industry value creation, and investment returns;
CIBI First 5 Years Vision
5
on People
• Make Entrepreneurship a Primary Career Choice
• Impact across Socio-Economic segments
I
on Innovation & Business
• Meaningful, Impactful, Technology intensive Innovations
• Coimbatore a Hot Spot - World-Class Products & Scalable Businesses
II
on Institutions
• Entrepreneurship focus as a DIFFERENTIATOR
• Outcome based Technology Education - Role Model status
III
on Ecosystem
• Role model INCUBATOR - Our Practices become Templates
• Ecosystem Keystone - Investors, Mentors, Global Partners
IV
on City (Region)
• From S&T Education Hub to S&T Innovation & Business Hub
• National and Global Visibility
V
CIBI
IMPACT
6
Opportunity & Potential
7
CIBI - Technology Thrust Areas - Innovation & Business
CIBI
Thrust Areas
Electronics
Embedded Systems
Industrial Automation
Technology Services
Engineering & Industrial Design
Technology Enabled Services
CIBI - 5 Year Vision
8
CIBI - 5 Year Goals
9
Incubator Strategy & Business Model
10
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Marketing CIBI - Ecosystem Building
Leadership & Governance
12
Section-25 Company; Limited by Guarantee
Company Name confirmation recd. from ROC
Management Team
13
Location of CIBI
KCT Tech Park
IT Park & Business/Commercial Center › Owned by the same Trust as KCT (RAF)
› Total 100,000 sq.ft space
› >2000 Employees
› Tenants: Cognizant, Ford, Firstsource (+10) IT/Business
Services
› CBE City Limits location on Highway
› Rs. 20 per sq. ft current rental income for KCT
10,000 sq.ft dedicated space (Phase-I) › Additional 9000 sq.ft (Phase-II)
› STPI Incubator (4,000 sq.ft)
› Entrepreneurship Education, Training, Development
Center (5,000 sq.ft)
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Incubation Process & Policies
Project Budget & Funding Plan
CIBI Project Funds Summary for 5 years in Rs. Lacs
Year 1 Year 2 Year 3 Year 4 Year 5 Total %
Capital Cost
DST contribution 385 160 58 12 0 615 77.4%
HI contribution 180 0 0 0 0 180 22.6%
Total Capital Cost 565 160 58 12 0 795 100.0%
Recurring Cost
DST contribution1 53 50 42 25 0 170 23.7%
HI contribution2 15 21 26 29 31 122 17.0%
CIBI self-contribution3 23 40 71 127 165 426 59.3%
Total Recurring Cost 91 111 139 181 196 718 100.0%
Total Project Cost4
DST contribution 438 210 100 37 0 785 51.9%
HI contribution 195 21 26 29 31 302 20.0%
CIBI self-contribution 23 40 71 127 165 426 28.2%
Total Project Cost 656 271 197 193 196 1513 100.0%
1 DST Contribution towards Recurring Costs is deficit support for Operational Losses; 2 HI Contribution towards Recurring Costs is up to 50% subsidy on Power, Utilities, Repairs & Maintenance costs; 3 CIBI self-contribution is Revenues from CIBI Operations; 4 Operational self-sufficiency in the 5th year;
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CIBI - 5 Yr Operations P&L
Recurring Expenditure & Income Statement (in Rs. Lacs)
Recurring Cost Items Year 1 Year 2 Year 3 Year 4 Year 5 Total
1.Manpower cost 34.50 39.00 51.50 85.00 96.00 306.00
2.Travel 6.50 6.50 7.00 8.00 8.00 36.00
3.Utility and Maintenance 30.00 42.00 52.00 58.00 62.00 244.00
4.Marketing Promotion and advertisement 15.00 17.00 21.00 21.00 21.00 95.00
5.Networking and training 2.50 3.00 3.00 4.00 4.00 16.50
6.Consumable 0.50 0.50 0.50 1.00 1.00 3.50
7.Other expenses (if any)* 1.00 2.00 2.00 2.00 2.00 9.00
8.Miscellaneous and contingencies 1.00 1.00 2.00 2.00 2.00 8.00
A. Total Expenditure 91.00 111.00 139.00 181.00 196.00 718.00
Revenue
1. Revenue from operations 23.00 40.00 71.00 127.00 165.00 426.00
2. Support from HI towards 50% of Power,
Utility & Maintenance costs 15.00 21.00 26.00 29.00 31.00 122.00
B. Total Revenue 38.00 61.00 97.00 156.00 196.00 548.00
Net income [B-A] (surplus+ / deficit-) -53.00 -50.00 -42.00 -25.00 0.00 -170.00
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CIBI - 5 Yr Revenue Plan
Self-sustenance beyond 5 Years • Increased Debt/Equity investments into Ventures sourced from Private Venture Fund (Angel/VC partners)
• Higher equity payouts & interest income
• Continued HI subsidy towards Power, Utilities & Maintenance costs
• Strategic Incubation: Sector focused, Global market access, India specific R&D for MNCs
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CIBI Revenue Plan for 5 years (in Rs. Lacs)
S. No Revenue Source Year 1 Year 2 Year 3 Year 4 Year 5 Total % Share
1 Rental Income 1.80 4.50 6.30 8.20 9.20 30.00 7.04
2 Training & Mentoring Fees 5.00 13.00 29.00 54.00 64.00 165.00 38.73
3 Advertisement Revenues 5.00 6.00 8.00 9.00 15.00 43.00 10.09
4 Sponsorships 11.00 11.00 12.00 15.00 16.00 65.00 15.26
5 Interest Income 0.20 0.50 0.70 0.80 0.80 3.00 0.70
6 Equity Buyout 0.00 5.00 15.00 40.00 60.00 120.00 28.17
Total Revenue 23.00 40.00 71.00 127.00 165.00 426.00 100.00
Location of CIBI
KCT Tech Park
IT Park & Business/Commercial Center › Owned by the same Trust as KCT (RAF)
› Total 100,000 sq.ft space
› >2000 Employees
› Tenants: Cognizant, Ford, Firstsource (+10) IT/Business Services
› CBE City Limits location on Highway
› Rs. 20 per sq. ft. current rental income for KCT
10,000 sq.ft dedicated space (Phase-I) › Additional 9000 sq.ft (Phase-II)
› STPI Incubator (4,000 sq.ft)
› Entrepreneurship Education, Training, Development Center (5,000 sq.ft)
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Space Utilization Size (L x B, ft) Area
(sq. ft)
CIBI Office 20x40 800
Conference Room 20x20 400
Equipments Room - E & A 20x30 600
Equipments Room – TS 20x30 600
Cafeteria 20x30 600
Dormitory with Change Room &
Shower Room 20x20 400
Common Facilities – Toilet 24x30 720
Common Facilities -
AHU/AC/ELECTRICAL 18x18, 20x10 580
Common Area - Lobby/Passage 30x20,
100X5,60X10 1700
Incubatee space 40x90 3600
Total Area - CIBI 10000
Phase - II
STPI Incubator 4,000
Entrepreneurship Education,
Training & Development Center 5,000
FLOOR PLAN FOR KCT-TBI AT TECH PARK GROUND FLOOR
FREE SPACE
4000 SFT
CAFETERIA
900 SFT
CONF ROOM
900 SFT
AHU
STAIRS
FIRE
EXITOFFICE ROOM
600 SFT
INNOVATION & ENTREPRENEURSHIP
TRAINING CENTRE
5000 SFT
EQUIPMENT ROOM
600 SFT
EQUIPMENT ROOM
600 SFT
LOBBY
900 SFT
DORM &
CHANGE
ROOMS
900 SFT
LIFTS
INCUBATEE SPACE
3600 SFT
STAIRS
TOILETS ELECTRIC
SWITCH ROOM
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CIBI Core Team
Investment Policy Criteria
Entrepreneur (Founders & Management) Assessment:
Background, experience, references and credentials of the entrepreneur(s) & management team
History of professional/business association of Founders/Management Team
Financial, Time commitment; Passion for Entrepreneurship
Strong domain expertise, sector/market knowledge with practical business experience
Technology Assessment:
Innovation potential or Degree of Technology involved in the Business
Relevance to the Technology Thrust Areas broadly but specific relevance to any sub-areas
Business Assessment:
Financial viability with the capacity to service Incubator debt within the defined milestones
Growth potential based on market expansion, region/geo expansion, product line/portfolio extension etc.
Extent of Innovation in the core Technology and potential impact of its applications
Innovations in Business Model or Business Process leveraged to build higher Enterprise Value-Added (EVA)
Potential for IP Generation and scope for exits through Technology Licensing or M&A
Portfolio management imperatives and mandates
Incubator Needs Assessment:
Clear understanding of the role of the Incubator in supporting the venture at this stage
Office space, technology requirements and openness to opt-in for hybrid Incubation taking minimal space in
the Incubator
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Graduation Policy Criteria
Guideline Tenure Period:
Products Business - Min 18 months - Max 36 months
Services Business - Min 12 year - Max 24 months
Student Business - Min 24 months - Max 36 months
Graduation - Pre-Tenure
Achievement of stated goals as per defined milestones
Readiness to sustain independently (No Dues clearance)
Equity dilution or Debt repayment demands during pre funding due diligence
Graduation - On-Extended Tenure
Review and Approval by Investment Committee
Redefined goals, milestones, strategies, investments
Termination
Violation of agreed terms & conditions, conflict of interests
Legal/ethical issues from malpractices
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CIBI - 5 Yr Funding Plan
CIBI Project 5 Year Funding Plan (in Rs. Lacs)
1. HI contribution toward existing/new land & building1 (10,000 sq.ft)** 130
** 10,000 sq.ft of dedicated floor space in KCT Tech Park (Software/IT SEZ) for Incubator space
** Additional 4,000 sq.ft in KCT Tech Park planned as Center for Entrepreneurship development, training and related
events ** Additional 4,000 sq.ft in KCT Tech Park planned for STPI Incubator
2. Contribution of HI toward Capital Costs2 50
Capital costs towards dedicated technology infrastructure including furniture, Lab Equipment, Software, Utilities,
Toolkits etc.
3. Capital Grant (Capital Costs) from DST for 5 years 615
4. Recurring Grant (support for Operating deficit) from DST for 5 years 170
5. Revenue Generated by Incubator in 5 years 426
6. Contribution of HI towards Recurring Costs for 5 years 122
Up to 50% on Power, Utilities, Repairs & Maintenance Expenditure
TOTAL PROJECT COST 1513 Private Venture Investment Fund3 200
1 Excludes the Opportunity Cost of Rs. 200 Lacs of foregone rental income in 5 years for 19000 sq.ft of
commercial space; 2 Excludes the Cost of shared lab/technology equipment amounting to Rs. 110 Lacs available for incubatees to
use; 3 CIBI (backed by KCT) taking the support of Sakthi Finance (a Sakthi Group NBFC business) to raise capital
from VCs/HNIs shall create a private venture fund to infuse debt/equity capital into the Incubated ventures;
Revenue from Interest Income and Equity Buyouts generated from such capital infusion is not considered in
this funds and budget planning exercise - Indicated to highlight the expression of intent of the HI (KCT) with the
support of Sakthi Finance to bring venture funding to the CIBI; 23
“If I have the belief that I can do it, I shall surely acquire the capacity to do it even if I may not have it at the beginning” “An ounce of practice is worth more than tons of preaching”
“Be the change that you want to see in the world”
Thank you