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Karnataka has emerged as a pioneering force in startup development, driven by strategic government initiatives, collaborative partnerships, and a robust innovation ecosystem. The state’s comprehensive approach transforms aspirational entrepreneurs into successful business leaders while fostering a culture of innovation across educational institutions. The Karnataka Startup Policy 2022-27, in particular, is a roadmap to make it the most promising place for entrepreneurs to flourish.

Building a Strong Base With The Karnataka Startup Policy

The Karnataka Startup Policy 2022-27 was introduced in December 2022, by the Karnataka Innovation and Technology Society (KITS), Department of Electronics, IT, Bt, and S&T, Government of Karnataka, to make the state a top place for startups. This five-year plan focuses on providing all the essentials that startups need, such as funding, spaces for working, mentorship, research opportunities, and connections to the industry.

Some of the major initiatives under the policy include:

• Establishment of New-Age Innovation Network (NAIN) Centres: The policy proposes setting up 50 NAIN centres in higher education institutions outside the Bengaluru Urban district to promote innovation and entrepreneurship among students.
• Launch of a ₹100 Crore Venture Capital Fund: This fund is designed to support emerging startups in sectors such as artificial intelligence, machine learning, electric vehicles, medtech, robotics, and drones.
• Elevate Idea2PoC Scheme: Under this scheme, startups can receive a one-time grant of up to ₹50 lakh to develop proof of concept and early-stage prototypes.
• Support for Women Entrepreneurs: The policy includes provisions for direct loans of ₹10 lakh for female entrepreneurs and reserves 25% of the venture capital fund for women-led startups.
• Beyond Bengaluru Initiative: To promote regional development, the policy offers incentives for startups operating outside Bengaluru, including the establishment of Rural Innovation Centres and dedicated seed funds for emerging technology hubs in cities like Mysuru, Hubballi, and Mangaluru.

KITS serves as the nodal agency for implementing the policy, providing facilitation through the Karnataka Startup Cell. The policy is designed to make sure startups have a clear path to follow. From registration to securing government support, the guidelines offer a structured process that helps startups at every stage.

NAIN Centres, The Small Hubs of Innovation

The New Age Innovation Network (NAIN) is one of Karnataka’s standout initiatives to help the state transform its startup landscape. It focuses on student-led projects and small businesses by supporting innovation-driven projects and nurturing talent at the grassroots level. By 2027, Karnataka plans to open 50 new NAIN centres at universities and colleges across the state, especially in places outside Bengaluru. These centres are designed to help students and local entrepreneurs develop solutions for real-life problems.

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Each NAIN centre receives support from a Project Monitoring Unit (PMU), which provides mentorship, expertise, and industry links, and ensures projects meet industry standards. Each NAIN centre receives ₹12 lakhs annually for operational expenses, supporting up to 30 projects over three years. Additionally, selected student-led projects receive up to ₹5 lakhs in funding to develop prototypes and working models.

The initiative promotes inclusivity, requiring at least four of every 10 funded projects to be led by women. It also encourages projects in deep tech, assistive technology, and Sustainable Development Goals (SDGs), such as renewable energy and climate solutions. Its objective to focus on underrepresented areas helps the startup ecosystem of Karnataka as it reaches all regions, promotes local talent, creates jobs and builds an inclusive innovation culture.

The Elevate Karnataka Programme Financial Help for New Startups

To help startups with funding in their early stages, Karnataka’s Department of Electronics, IT, Biotechnology, and Science & Technology introduced the Elevate Karnataka programme. It is a flagship initiative by the Government of Karnataka that provides funding, mentoring and incubation facilities to startups. This programme provides one-time grants of up to ₹50 lakh, helping startups move from just an idea to a working product.

The selection process involves multiple stages, including data sufficiency checks, offline pitching, multi-city pitching sessions, and a grand finale where winners are chosen. The programme focuses on startups led by women and entrepreneurs from SC/ST communities, resulting in diverse participation in the state’s startup ecosystem. It also encourages startups from Tier II and III cities, providing them with platforms to pitch their ideas regionally. Elevate is especially helpful for new businesses because it provides funding without taking away any ownership, which is a big advantage for small companies.

Special Access to Government Projects

The government recognises that it’s often hard for new startups to get their first customers. To help with this, Karnataka has a policy called Preferential Market Access (PMA), which gives startups priority in government projects. This policy reserves a portion of government contracts for local startups, allowing them to gain real project experience while serving the public.

Startups get the chance to work in areas like healthcare, agriculture, and smart city development, giving them exposure and credibility. By opening up these opportunities, Karnataka gives startups an entry point into larger markets.

Support for Incubation and Acceleration

Incubation and acceleration programmes are essential parts of Karnataka’s startup ecosystem. The state has over 20 Technology Business Incubators (TBIs) that support new businesses. This includes workspace, mentorship, legal help, and guidance on finances and intellectual property. Karnataka plans to expand these incubators by adding six new TBIs for IT/Electronics and three for Biotechnology, with each receiving up to ₹10 crore in funding.

These incubators focus on emerging technologies like artificial intelligence, the Internet of Things (IoT), blockchain, and quantum computing. By concentrating on these fields, Karnataka is ensuring that it will have the talent needed to meet the demands of tomorrow’s industries.

Policies for Women-Led Startups

Karnataka is also committed to supporting women entrepreneurs. The state defines a women-led startup as one where women hold at least 51% of the company’s ownership. Karnataka’s policy provides special funding, mentorship, and networking events to support these women-led businesses.

Under the NAIN programme, for example, each centre must support at least four projects led by women. This ensures that women have equal opportunities and that the ecosystem includes a variety of perspectives and ideas.

Strong Infrastructure and Digital Connectivity

Karnataka’s success as a startup hub is also due to its advanced infrastructure. The Karnataka Innovation and Technology Society (KITS) makes sure that innovation hubs have high-speed internet, workspaces, and access to essential tools. Karnataka has also invested in major projects like the Bengaluru Tech Corridor, which connects key technology hubs in the city, allowing startups to grow and reach new customers.

Collaborations Between Universities and Industry

Karnataka’s approach to fostering startups also includes collaboration between universities and industries. NAIN centres, for example, are based in colleges where students can work on real-world problems with guidance from professionals. This gives students valuable experience while bringing fresh ideas into the industry.

This model of collaboration also applies to TBIs, which are hosted by institutions with a strong focus on research. Startups benefit from access to new technologies and testing spaces, while universities and industries benefit from the students’ innovative projects.

Monitoring and Continuous Improvement

To keep improving its startup ecosystem, Karnataka has a strong monitoring system. KITS conducts regular reviews to ensure that funded projects are on track. Committees like the State Expert Advisory Committee (SEAC) meet twice a year to review progress and make adjustments to the programme if necessary.

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The performance of startups and incubators is measured by milestones such as the number of products launched, patents filed, and jobs created. This way, Karnataka can ensure that its programmes are achieving real results and evolving with the ecosystem’s needs.

Karnataka’s Growing Influence as a Startup Hub

Karnataka’s efforts are showing impressive results. The state is one of the top destinations for startups in India, accounting for over 13% of the country’s recognised startups. Bengaluru alone has more than 10,000 startups, covering various fields from finance to healthcare, and supporting projects in fields like renewable energy and climate change. Karnataka is a prime example of how governments can drive growth through innovation.

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