SETHU RESEARCH AND INNOVATION CENTRE (SRIC)

Incubation Policy

Introduction

Sethu Research and Innovation Centre (SRIC) is created for fostering innovation by supporting & promoting technology-based startups and providing an ecosystem for their growth by Incubating them in the Center was established in 2019 by Sethu Institute of Technology. The Center was established in 2019. The SRIC is actively involved in developing the paradigm of entrepreneurial mindset & environment of ideating, creating and commercializing the ventures at the institute or any other startups aligned to the core theme of center.

The main aim of the incubator goes hand in hand with MSME and EDII, objectives. The main goal is to nurture ideas from professionals / students/ local community and foster such entrepreneurial ideas in a supportive environment before they become attractive for venture capital.

The SRIC aims to promote and support untapped creativity of individual innovators and to assist them to become technology based entrepreneurs. It also seeks to promote networking and forging of linkages with other constituents of the innovation chain for commercialization of their developments, provide support and training for students and innovators who are interested in converting their social ideas into social startup.

SRIC will provide necessary infrastructure, prototype development support, research assistance, help in getting funding, business consulting assistance, mentoring and guidance to make their idea into a successful venture. SRIC will be adopting the proposed Incubation Policy to provide guidance and management structure to facilitate development of entrepreneurship and Innovation.

The vision and objectives of the Incubation Centre, SRIC is as follows: VISION

SRIC aim to empower the aspiring entrepreneurs to start and effectively scale their technological ventures, by providing a comprehensive incubation eco system for entrepreneurship and incubating research mindset leading to societal impact.

                                               Invent, Incubate, Impact

Our vision is to create a vibrant and sustainable ecosystem to help young entrepreneurs for nurturing and enriching Creativity, Innovation, Entrepreneurship and IPR that creates a colossal impact.

MISSION

To incubate and support innovative startup ideas for transformation into successful business entities.

To be a Launchpad for impact innovators with resources, network and to provide Business Development Assistance, inculcate sound entrepreneurial and start up culture among students.

Objectives

1. To assist the incubatees in creating a sustainable, scalable & profitable business model
2. To provide physical infrastructure and value-added support services
3. To conduct events and inspirational programs
4. To provide trainings and mentorship to entrepreneurs
5. To forge partnerships and networks with academia, industry, funding sources, existing incubators and others for the start-ups to leverage.
6. To build a strong team with adequate knowledge and experience in guiding start-ups, building business plans, facilitating investments, building networks etc.

The scope of this document is to define the policies and procedures for the operational matters related to the SRIC, Sethu Institute of Technology. It covers the following processes: 

1. Eligibility
2. Admission procedure
3. Infrastructure and Services provided to incubates
4. Mandatory Mentorship
5. Period of Incubation/ Exit
6. Intellectual Property evaluation
7. Seed funding
8. Periodic assessment
9. Consideration
10. Conflicts of interest
11. Disclaimer
12. Agreements

The policy is subject to periodical review and amendments. It will be the responsibility of the companies admitted to SRIC to update themselves from time to time on amendments in Incubation policy and procedures. SIT reserves the rights to make an exception of all or any of the terms of policy for a particular company or a promoter on a case to case basis.

Eligibility for Pre-Incubation:

1. A pre-incubatee can be from SIT or outside of SIT.
2. The period of pre-incubation is 3 It can be extended by another 3 months. The maximum period for pre-incubation is 6 months.
3. A pre-Incubatee can apply for incubation or virtual incubation during the pre- incubation period or after graduating from SIT.
4. Incubation service fees details can be referred from Annexure I.
5. A pre-Incubatee may or may not be a registered entity.
6. Acceptance of the application for the Incubation is subject to discretion of SRIC board members.

Admission to Sethu Research and Innovation Centre is open to:

1. Registered Student of SIT
2. Current Faculty members of SIT
3. Alumni of SIT
4. Local Community

Applicants must provide the required details and proposal for making an admission in the SRIC Centre. Applications for admission to SRIC Centre will be made in the name of registered (unlisted) companies within the meaning of the Companies Act, 1956. If a company has not been registered, an application may be made in the names of all promoters/ founders; however, the promoters/ founders must ensure that the company is registered within a period of three months from the date of approval of the application for admission in SRIC Centre.

Admission Process:

The applicants will be required to submit business plan for admission in Sethu Research and Innovation Centre, which can be downloaded from its website www.sethu.ac.in/sric.

Based on the documents submitted, the Business Plan will be screened by the pre-selection team for assessing the suitability of the proposal for further evaluation by expert members regarding its potential for incubation. Detailed scrutiny including financial and technical due diligence of the proposal shall then be carried out by the expert members for evaluation of the proposal. Business Plan will be reviewed by experts having technical, business and financial expertise.

Applicants may be invited with their teams to make a presentation on their proposal. In order to enable the expert members to take an appropriate decision, members may ask for any additional information from the applicants and/or revision in the proposal. SRIC will have a sole discretion whether to admit or reject a proposal for incubation and the decision of SRIC in this regard shall be final.

Infrastructure and Services of SRIC:

Upon admission to SRIC, the following facilities will be offered to the incubate companies on an individual basis:

• Office space
• Computers – up to two on rental More than two can be availed at market rates.
• Printer
• Internet connection
• Phone connection– Each company will pay the rentals and bills
• Standard Furniture as decided by
• One Accommodation to Director/Promoter depending upon the availability (One room in hostel).Fare shall be approved by the Management/Committee

Common infrastructure

SRIC provides a common pool of hard and soft infrastructure to be shared by all incubate companies. Following resources are provided:

• Fax machine
• Photocopying machine
• CD-cutting machine
• Document Scanner
• Library: Management Books, Subscription to IT, Business, Management and Trade journals and newspapers
• Meeting/Conference room with projection equipment
• Tele or Video conferencing facilities

Mentoring and Advisory Services

• Strategic Checkups: The SRIC Head will meet with company CEOs at least once in a month for strategy reviews and discussion of operational
• A incubate company has to take a faculty advisor as a mentor on technology
• Specialized mentors are also available to the companies to assist with particular strategic areas or to provide project-oriented consultation. These arrangements maybegin as a pro bono arrangement with an option for both parties to graduate to a
• A incubate company may avail of consulting services by empanelled professionals of SRIC.

Mandatory Mentorship

One of the objectives of Incubation is to utilize the technical expertise and lab infrastructure of SRIC, thus every company that is offered incubation at SRIC has to select one faculty from SIT who shall act as mentor of the Incubate and guide the company on product develop. The incubate has to offer minimum 1% of share equity to the mentor as a consideration of mentorship.

Industry Mentor

SRIC has created a database of Industry mentors. Every incubate company incubated at SRIC may select one Industry mentor within six months from the date of joining incubation centre. In case the incubate opts for an industry mentor the incubate company has to offer minimum 1% of equity to the mentor as a consideration of mentorship.

Tenure of Incubation

Companies will be permitted to stay in the incubator for a period of two years. Maximum two extensions may be granted for 6 months each at a time at the sole discretion of the Institute.

Exit

An   Incubate  company  will   leave   the  incubator  under  the  following circumstances:

• Completion of two years stay (if no extension granted)
• Underperformance or non-viability of business proposition as decided by SRIC on case to case basis
• Irresolvable promoters disputes as decided by SRIC on a case to case basis
• Violation of any SRIC policy
• When the company enters in an acquisition, merger or amalgamation deal or reorganization deal resulting in a substantial change in the profile of the company, its promoters, directors, shareholders, products or business
• Change in promoters’/ founders’ team without concurrence of
• Any change of more than 50% of equity ownership would require a prior approval of SRIC.
• Any other reason for which SRIC may find it necessary for an incubate company to

Not with standing anything written elsewhere, SRIC’s decision in connection with the exit of an incubate company shall be final and shall not be disputed by any incubate company.

Periodic assessment

The incubate company has to submit an yearly audited statement of profit and loss account and unaudited quarterly statement about the activities. However, incubate may be asked to provide more frequent updates to SRIC.

Intellectual Property

Promoters should fill an IP declaration worksheet at the time of admission and declare the Intellectual Property developed and owned by the incubate company.

A company desirous of getting seed loan/ fund may submit an application for seed fund after three months from the date of admission in SRIC. Sanction of seed loan will be decided based on the eligibility criteria as decided by SRIC.

One of the criteria for approval of the seed loan will be the contribution brought in by the promoters to the capital of their companies. Preference will be given to companies who already have some sources of revenue or some customer order booking. SRIC will have sole discretion to sanction or reject an application for

seed loan and the decision of SRIC in this regard shall be final. SRIC is not bound to give any reason in case an application for seed loan is rejected.

Though seed loan may be sanctioned at the time of approval of the proposal for admission, disbursement shall be subject to satisfaction of SRIC Head that suitable progress has been made. Notwithstanding anything contrary contained herein the Seed fund sanction and disbursal shall be governed by Seed Fund Guidelines of SRIC.

Consideration

SRIC will charge the incubatees for infrastructure and services, seed loan and SRIC’s Intellectual Property. This payment would be in the form of service charges and equity share as per following details. Liability free (paid-up) Equity of 3% equity would be assigned to SRIC for providing incubation facility, infrastructure services in all cases.

The Equity held the incubate companies shall be Disposed by SIT shall be as per the approval given by the Institute based on recommendations of Management Advisory Committee (MAC) created by the Institute.

Consideration for infrastructure and services:

For a company with office space of 250 sq. feet and 2 PCs, the service charge comesto minimum of Rs 5000/- per month as per the following calculation:*

However, SRIC may at its discretion revise the rates from time to time.

The incubates would have option of deferring 50% of the rent till the time they exit from SRIC. For the deferred amount an interest rate of 5% would be charged to incubate. This amount would have to be paid back at the time of exit or converted to equity. The price for conversion would be as per the guidelines for seed fund.

Conflicts of interest

In case of conflict of interests the decision of Institute shall be final and binding upon the parties.

Disclaimer

SRIC does not guarantee to company incubated about success and/or feasibility and warrantee technology transferred from SIT. Any person representing SIT or SRIC shall not be liable for any acts or omissions of the incubate company, however, in case of any such event the incubate company shall do all that is required to hold any person representing SRIC harmless from any loss including damage, penalty.

Agreements: 

All incubate shall to enter into following agreements with the Institute:

1. Incubation Agreement:   Containing  rules   and   other   incubation  norms, consideration, equity holding, (Applicable to all)
2. Seed-Fund Agreement: Containing rules of disbursement and repayment. (Applicable to incubates availing seed-fund)
3. Technology Commercialization Agreement: Applicable to Incubatee using Technology or IP developed by SRIC.

Internship 

  Explore possibilities of hiring interns and team members from a rich ecosystem of highly trained graduates and post-graduates from SRIC and associated academic institution.