Overview and Objectives
The SAMRIDH Scheme of MeitY provide the startups which already have brilliant solutions and proof of concept for their product the more facilities to enhance their product using innovative technologies for the market with a solid business plan and enable them to obtain investments from venture capitalists and angel investors easily.
An urgent need to conceptualize and run an accelerator program to help these start-ups and other start-ups with Social Impact and to solve India’s problems at scale has been strongly felt at the MeitY. The Startups from various programs will act as a feeder for the SAMRIDH program. The SAMRIDH Scheme provides startups with a platform to enhance their products and secure investments for scaling their business.
Accelerators start with an application process typically called a cohort, but the top programs are typically very selective and may be sectoral-specific. Incubators operate on an open-ended framework including a timeline focusing on product maturity. They focus more on the longevity of a startup and are less concerned with how quickly the company grows.
The SAMRIDH scheme will support existing and upcoming Accelerators to select and accelerate potential product-based startups to scale. The program will focus on accelerating the startups by providing customer connect, investor connect and internationalization connect services.
- Based on the growth stage of the Start-Up, an average of ₹ 30 Lakh per startup per cohort shall be invested. In exceptional cases, the investment may go up to ₹ 40 lakh to the startup
- Equal matching investment by the accelerator/investor of up to ₹ 40 lakhs (with an average of ₹ 30 Lakh per startup per cohort) to the start-up based on the current valuation and growth stage of the start-up.
- Accelerators shall take equity from the start-ups from such investments in the selected start-up based on a SAFE / Promissory Note.
- SAFE notes shall take the legal form of Compulsorily Convertible Preference Shares (“CCPS”) as governed by sections 42, 62 and 55 of the Companies Act, 2013 (“the Act”) read with Companies (Share Capital and Debentures) Rules, 2014 and Companies (Prospectus and Allotment of Securities) Rules, 2014.
- The startup will have the option to utilize the appropriate investment vehicle including participation in equity, debt, and other financing mixes as deemed appropriate by a startup, investor, and accelerator
- For the Government funding in the start-up, MeitY Startup Hub, the proposed implementing agency of SAMRIDH will utilize the same investment vehicle as the accelerator/investor which will be utilized for self-sustainability of the program.
Accelerator Services and Activities
In each of the cohorts organized by the shortlisted accelerator, a maximum of 10 startups and a minimum of 5 startups can be supported under the scheme working in the domain area of software products.
The Accelerators have to provide services to the Start-Ups which include the following:
- Expert diagnostic for market research and product positioning.
- Mentoring Startups through experts based on tech vertical
- Legal Assistance for all matters: IP, Incorporation, and other matters
- Connected learning, and networking through shared platform
- Weekly meets between founders of all startups
- Demo Day: Presentation with VCs and angel investors
- Assistance to startups in negotiating and closing investment deals with VCs and angel investors