BITS Spark

Prospectus

Ver. 8, Dec 30th, 2011

Background

BITSian entrepreneurs have been tremendously successful. BITS was ranked as a top school to produce entrepreneurs1.

The new India presents today’s youth with many entrepreneurial opportunities. VC funding is robust at $750m in the last 9 months.

There are many young BITSians aspiring to start innovative companies (e.g. RedBus, GharPay, Exotel, SuperAngels)

In the last 5 years BITS-Pilani has created more than a dozen startup initiatives most notably CEL and on-campus activities

However, there is a dearth of early stage funding and mentoring

BITSAA has set a long-term goal to make BITS-Pilani a top-3 institute for entrepreneurship in Asia

1. http://www.slideshare.net/mrogati/sequencing-the-startup-dna-mrogatis-talk (Slide 10)2. http://smehorizon.sulekha.com/vc-firms-invest-217-million-in-india-in-q3-11_sme-viewsitem_5554

What is BITS Spark

§In July 2011, BITSAA International set a high-level objective: Create an eco-system of partners in industry, government and academia to enhance research and entrepreneurship at BITS Pilani.

§BITS Spark's objective:

§ENTREPRENEURSHIP

§BITS Spark’s vision:

§“Make BITS Pilani a top 3 institute for entrepreneurship in Asia”

What does a BITSian need to do a startup

Inspiration & Passion: "its unbelievably important" Entrepreneurs who share, connect, meet with BITSians are most inspiring

Recent success stories help build confidence to take the plunge

Accessibility: Approachability of this program and people backing should be easy

Any BITSian should be able to access

Community A well-knit BITSian mentor network will increase student confidence

Need the ability to know whom to reach and ask any startup questions

Resources Information on startup basics e.g. legal, funding, web hosting

Access to contacts who can provide these resources

Funding to help with the initial stages

Spark has 3 pillars

Spark ConnectOn-campus and post-

campus activities to ramp up startups

Spark MentorsMentoring network for formal mentoring of

entrepreneurs & startups

Spark AngelsAngel network to fund

high potential startups at seed stage

Spark ConnectOn-campus and post-

campus activities to ramp up startups

On-Campus Activities – Immediate Priority

§On-campus Faculty ChairDedicated faculty member to support and drive new initiativesWorks closely with BITSAA Spark Board member

§New Venture CreationMake it a formalized course on all campusesAssign dedicated faculty and student CEL members

§PS I, II and Summer (after 1st/3rd year) InternshipsCreate an insti-led program for startups to hire summer interns in all summer termsCreate executive assistant opportunities at startups

Spark Connect

On-Campus Activities – Ongoing

§Entrepreneurship coursesMandatory activity based course in year 2Industry-led courses (e.g. mobile Internet startup courses)

§RecognitionCreate annual entrepreneurship awardAwarded to someone who best exemplifies entrepreneurial traits

§Online resourcesDetailed and curated resources to start a company in IndiaList of contacts (lawyers, mentors, entrepreneurs, investors, etc.)

§On-Campus CELExpand CEL to encourage more participationImprove structure, awareness, stature of Goa and Hyd CEL Create on-campus and post-campus hackathon

Spark Connect

Post-Campus Activities

§Current BITSAA CEL activitiesContinue on-going BITSAA CEL activities Abandon BITSAA CEL structure

§Access to funding (more in Spark Angels)1

Setup non-bureaucratic fund to give "confidence money” to pre-seed startups

Includes Manoj Saxena fund, BITS 75 trust etc.

Raise small pre-seed amounts from several investors

§Startup Workshops (more in Spark Mentors)In-depth weekend workshops to match startups with dedicated mentorsConducted once a quarter and sequenced before Spark Angels review meeting

Spark Connect

1. Seed stage startups will be served by Spark Angels

Post-Campus Activities

§Bits2startup

Well managed email group (similar to bits2bschool), identify key entrepreneur contributors

Help to find talent, one-off startup questions, advice

§Startup MeetupsInformal meetings for startupsStart in Bangalore, Delhi, Mumbai, Hyderabad; solicit BITSian entrepreneursAssist in discovering co-workers/founders/customers

Spark Connect

1. Seed stage startups will be served by Spark Angels

Spark MentorsMentoring network for formal mentoring of

entrepreneurs & startups

Objective

Create a BITSAA mentoring network

Create formal mentor-mentee matching program

Provide mentoring to BITSian startups1

1. Startups in pre-seed, seed, early stages are eligible

Spark Mentors

Criteria for Mentors

Interested in promoting BITSian entrepreneurs

Should be a BITSian

Willing to commit minimum of x hours per month

Engages deeply with the entrepreneur for a min period of

6 (?) months

Brings unique industry or operational expertise

Able/willing to coach the entrepreneur

Spark Mentors

Criteria for Startups

Includes at least one current or graduated BITSian

Startup should be based in India

Can be in pre-seed, seed or early stage

Is already funded or seeking funding in next 6 months

Willing to give nominal (0.5 – 3%) equity to mentor

Entrepreneurs should be pursuing startup full-time or will

become full-time in next 6 months

Spark Mentors

BITSAA Spark Workshop

Spark Mentors

Objective: Match startups with mentors with a formal relationship

Application proces: 7-8 slides for application

Quarterly 2-day event to match startups with mentors

1st event: Mar 3rd - 4th

Day 1 (6 hours):

1 hour: Selected teams pitch in 8 minutes

1 hour: Mentor-mentee speed dating

1 hour: Each startup matched assigned to 3 mentors

1 hour: Market review: 1-1 mentoring session

1 hour: Product review: 1-1 mentoring session

1 hour: Business review: 1-1 mentoring session

Day 2 (6 hours): TBD

Spark AngelsAngel network to fund

high potential startups at seed stage

Objective

Create a BITSAA angel group of investors

Invest in BITSian startups1 based in India

Provide mentoring to funded startups

1. Applies to both on-campus and graduated BITSians

Spark Angels

Criteria for Angels

Interested in promoting BITSian entrepreneurs

Should be a BITSian; non-BITSians only by invitation

Willing to take risk

Expected to make 1-2 investments a year

Typical investments upwards of INR 5 lakh

Should be accredited as per Indian laws

Pay small annual membership (waived first 6 months)

Spark Angels

Criteria for Startups

Includes at least one current or graduated BITSian

Startup should be based in India

Demonstrate potential for substantial high growth

Should be in seed & angel stage (INR 25 lakh – 2 crore)

Selection rate will be about 3-5%

Entrepreneurs should be pursuing the startup full-time at

the time of application

Spark Angels

Funding Process

Stage Activity Timeline People Modality

1Application cut-off date;

Online screening1 week before Step 2

All angels & managed by moderator

Gust

2Screening meetingSteering Committee

1 week before Step 38 angels; up to

6 startupsSkype & Dial-in

3 Spark Angel meeting Once every 3 monthsAll angels; up to 3 startups

Skype & Dial-in

4 Due diligence & fundingCompletes 1 month after

step 3

Investing angels & 1 SC

member

As necessary including f2f

Proposed date to complete first cycle: Apr 18th, 2012

Spark Angels

Logistics

Step 1: Online applications are submitted to Gust or equivalent software.

Video pitch of 5 min to be submitted online (YouTube or equivalent).

Step 2: 10 min per team Steering committee to conduct screening over Skype & phone call

5 min: View video pitch on individual computers

5 min: Q&A with startups

Collect feedback; create shortlist for Step 3

Step 3: 20 min per team All angels to conduct screening over Skype & phone call

5 min: View video pitch on individual computers

10 min: Startup is allowed to add further info; Q&A

Collect interest level using online survey

Spark Angels

Due diligence process

Team:

1 lead angel – drives the due diligence process

Other interested angels – participate in due diligence

1 steering committee member

If no steering committee is investing, a neutral member joins the team

Due diligence duration: 1 month

Submit Diligence Report (approx. 3 weeks)

Include team, market, technology, legal, funding etc.

Transfer of funds and legal (approx. 1 week)

Spark Angels

Transparent Process

Investment terms to be determined directly between angels

and startup (amount to be shared, terms remain undisclosed)

Membership fees will cover admin costs (waived initially)

Transparency

All startup applicants will be made available online

Results of each evaluation stage will be made public

All angels should disclose prior relationships with startup

Any other aspect will be made transparent

BITSAA team (non-angels) to drive administration

Spark Angels