Policy and Procedures

NITJ Technology Business Incubator

Dr B R Ambedkar National Institute of Technology

Jalandhar – 144011

Technology Business Incubators (TBIs) are considered to be promising policy tools that support innovation and technology oriented entrepreneurial
growth. They have emerged as sound platforms to bring about economic development in any economy. They help mitigate several avoidable risks in an early stage start-up thereby increasing the rate of success of start-ups as well the time taken to gain traction. During the past decade as in several parts of the developed and developing world, the concept of business incubator has taken root in India. Significant support in initiating Business Incubation and its evolution has come from the Government of India through the Department of Science and Technology (DST).

 

With the recommendations of the National Expert Advisory Committee, TBI has been established at Dr B R Ambedkar National Institute of Technology Jalandhar (hereafter referred to as the Host Institution) with the support of DST. TBI has been registered as a Society under the Societies Registration Act, 1860 with the name ‘NITJ Technology Business Incubator’ and the following defined objectives:

i) To setup a vibrant startup ecosystem so as to align itself with our country’s major policy initiatives of Make in India and Start-up India; Stand-up India.
ii) to set up incubator facilities and provide cost-effective infrastructural support and value-added services to startups like mentoring, legal, financial, technical, and intellectual property related.
iii) To support NITJ in creating a platform to nurture the creativity, innovation, and entrepreneurial skills of faculty and students.
iv) To provide a platform for speedy commercialization of technologies developed by NITJ or by any other academic/technical/R&D institution or by an individual.
v) To build a close and pragmatic collaboration between the educational institutions, research institutions, and management institutions on the one hand, and industry and other user organizations on the other.
vi) To facilitate the dissemination of information by organizing conferences, seminars, lecture series, workshops and boot camps, hackathons, etc.
vii) To generally do and perform all the above acts and such other things as may be deemed incidental or conducive to the attainment of the above objects or of any of them or any allied objects or which may advantageously or conveniently be combined with the programme of the Society in a profitable way. This document contains policy and procedures for operational matters related to NITJ Technology Business Incubator’ and covers the following processes:

 

Eligibility
Admission to NITJ TBI will be open to:  i) Faculty/Staff of the Host Institution (Current and Retired) ii) Students, research scholars and current project staff of Host  Institution  iii) Alumni of Host Institution  iv) Universities/Institutions having R&D collaboration with the Host  Institution  v) Others  The proposals for business incubation must meet with one or more of the  following parameters:  i) Proposals with Intellectual Properties (IP) generated within NITJ  and transferred to the company for a consideration  ii) Proposals with IP belonging to faculty, staff, student or alumni  (created outside NITJ)  iii) Proposals with potentials for strong identifiable involvement or  interaction with NITJ faculty with/without usage of NITJ facilities iv) Proposals which will have social and strategic impacts  v) Proposals with potential for large resource generation and/or  impact value  Applications for admission to NITJ TBI 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 NITJ TBI.
Admission Process
At the opening level, the potential incubatees for admission in NITJ TBI  will be required to submit an application. After initial screening and  eligibility check, applicants will be invited for an initial meeting with the  NITJ TBI management. Upon affirmative preliminary assessment,  applicants will have to submit a detailed proposal consisting of:  i) Business Plan  ii) Details of IP/ technology based on which a company is proposed  to be promoted/ founded. In case the IP/ technology is developed  at NITJ, a copy of letter of approval from NITJ for transfer of /  licensing of/ permission to use IP in favour of prospective 
incubatee companies.  The business plan must cover all aspects including: company description,  value proposition, products and services, market and competition analysis,  revenue model, milestones and timelines, development and marketing plan,  organizational structure, core team, risk analysis, funding requirements and  projected financials. Applicants may give such additional information as  they think would help in the assessment of their proposal.  Based on the documents submitted, the Business Plan will be screened by  the NITJ TBI 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. The expert members would be invited/ identified depending  on the nature of the proposal. 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.  Submissions to NITJ TBI will be treated with utmost confidentiality.  Some representative criteria to be applied for evaluation (but not limited to  these):  i) Strength of the product idea in terms of its technology content,  innovation, timeliness and market potential  ii) IP already generated and the potential of the idea for IP creation iii) Strength of the core team  iv) Funds requirement and viability of raising finance  v) Time to market  vi) Break-even period  NITJ TBI will have a sole discretion whether to admit or reject a proposal  for incubation and the decision of NITJ TBI in this regard shall be final.  NITJ TBI is not bound to give any reason in case a proposal is rejected.
Infrastructure
Upon admission to TBI, the following infrastructural facilities will be  offered to the incubatee companies on an individual basis, apart from a set  of shared/ common infrastructure mentioned hereinafter:  i) Office space  ii) Internet connection  iii) Personal Computers (as per availability)  Besides, NITJ TBI will facilitate the incubatee companies to access 
departmental laboratories and other resources of Host Institution for their  products development purposes. Access to departmental resources is  possible through Dean (Research and Consultancy) of NITJ and usage of  such resources should be with permission of the concerned department to  avoid conflict with departmental activities and objectives. Further usage of  such resources shall be on commercial basis and in conformity with the  policies of Host Institution.  Apart from company specific infrastructure as stated above, NITJ TBI will  provide certain facilities be shared by all incubatee companies which would  include:  i) Laser Printing  ii) 3D Printing  iii) Photocopier  iv) Scanner   v) Teleconferencing facilities   vi) Meeting/Conference room with projection equipment vii) NITJ TBI Library facilities  viii) Pantry facilities  ix) Recreational facilities  x) Common secretarial pool/staff depending on availability of such  staff with NITJ TBI
Services
In addition to physical infrastructure, NITJ TBI intends to provide other  support and services including:  i) Company registration and filings  ii) Accounting services  iii) HR services  iv) Legal  v) Intellectual Property (Copyrights, Trade Marks, Patent) filings vi) Training/Conferences/Workshops  vii) Seed Funding support  viii) Governmental Agency funding  ix) Networking and linkages with NITJ Alumni for mentorship,  funding, technical expertise and market access  x) Venture capitalists / Angels / Investors Introductions xi) Meetings with visitors of NITJ (such as alumni, VCs, industry  professionals)  xii) Showcasing NITJ incubated companies through networking and  events  xiii) Entrepreneurship meets
Periodic Assessment
NITJ TBI will evaluate the performance of incubatee companies, who will  be required to submit information on a quarterly basis in a prescribed  format. Additionally, incubatee companies may also be subject to annual  assessments.
Information Submission
Incubatee companies will submit information to NITJ TBI about all  material changes or developments taking place in their companies from  time to time. Such information could be (but not limited to) change in name  of the company, change in business or product profile, change in directors,  promoters or shareholders, acquisition of a new office, additional equity or  debt investments. NITJ TBI may require incubatee companies to submit  other information as it deems fit. Prior concurrence of NITJ TBI should be  obtained for effecting such changes.
Tenure in NITJ TBI
Companies will be permitted to stay in NITJ TBI, to begin with, for a  period of 18 months that may be extended to another 12 (6+6) months after  review at each stage. A nominal monthly charge will be levied to a  company for this period of 30 months. NIT TBI may, at its own discretion,  permit companies to extend their stay further for a maximum period of  another 12 months, for which they will have to pay the charges at the  prevailing market rate to be decided by NITJ TBI.
Rent
Rent for the incubatee companies will be guided by the following norms: i) Office space with 2 workstations – ₹1000/- pm  ii) Office space with 3 workstations – ₹1200/- pm  iii) Additional workstation space – ₹300/- pm
Exit (Graduation)
Incubatee companies will leave the incubator under the following  circumstances:  i) Completion of stay for 30 months, unless the stay is extended by  NITJ TBI.  ii) Underperformance or unviability of the business proposition:  criteria for the same will be decided and applied by NITJ TBI on  the case to case basis.  iii) Irresolvable disputes between promoters/ founders. NITJ TBI  will decide the position or point when disputes are deemed to be  irresolvable.
iv) When the company enters in an acquisition, merger or  amalgamation deal or reorganisation deal resulting substantially a  change in the profile of the company, its promoters, directors,  shareholders, products or business plans, or when a company  plans for a public issue.  v) Change in promoters’/ founders’ team without concurrence of  NITJ TBI.  vi) Any other reasons which NITJ TBI may find it necessary for an  incubatee company to leave.  Notwithstanding anything written elsewhere, NITJ TBI decision in  connection with the exit of an incubatee company shall be final and shall  not be disputed by any incubatee company. 
Equity
In lieu of support and services to be provided by NITJ TBI/ NITJ, the  incubatee companies will be subject to consideration in the form of equity  and/or revenue sharing of the respective companies. The percentage of  equity and revenue sharing will be decided by NITJ TBI and is to be given  in favour of NITJ TBI. The indicative range of the equity holding by NITJ  TBI will be 3-6%.
Virtual Incubation
Virtual Incubation is a concept of incubation that allows an incubatee to be  part of an incubator without being physically located at incubator’s  premises. NITJ TBI is open to virtual incubation and will extend all support  as made available to other incubatees that would be physically located.  Virtual incubators will have to pay ₹6000/year as the registration fee.
Conflicts of Interest and Confidentiality of Information
When a person plays two separate roles in two different positions and  he/she uses one position for his/ her personal benefit in the other role, a  situation leading to conflict of interest arises. NITJ TBI endeavours to draw  a line between appropriate and inappropriate interactions among its board  members, employees, mentors, consultants, affiliates, incubatee companies,  their employees, persons connected to them or their promoters, employees  and staff, various service providers and suppliers.  Conflicts between private interests and official responsibilities of all  stakeholders must be handled in a transparent manner, and NITJ TBI  considers full voluntary disclosure as the best mechanism for managing  conflicts of interest. Since situations leading to conflict of interests are  inevitable, it is expected that the interested persons follow transparency in 
their actions based on full disclosure of relevant information by them.  Following guidelines are suggested for management of actual or potential  conflict of interests and to address disputes arising out of conflict of  interests and maintenance of confidentiality:  i) Appropriate disclosure of the conflicting situations involved in  a decision or transaction  ii) Abstaining from participating in decision making process or  transactions involving such situations  iii) Obtaining appropriate approvals to avoid conflicts  iv) Reporting of the breach of the policy without deliberate  intention or knowledge.  A committee may be set up by NITJ TBI to resolve any dispute over such  situation causing conflicts of interests.  Further during the process of incubation, certain proprietary information  may also be exchanged between various parties which are of confidential  or sensitive nature. The confidentiality of such information needs to be  maintained.
Agreements
The following agreements are required to be signed by the companies to the  extent applicable:  i) Service Agreement  Between NITJ TBI and Incubatee company for admission of the  company to NITJ TBI  ii) Equity Agreement  Between NITJ TBI and Incubatee company for NITJ TBI equity  holding in the Incubatee company  iii) Transfer of Technology/Technology License Agreement Between NITJ & an incubatee company for transfer of  technology from NITJ in favour of incubatee companies  iv) Usage of Host Institution Lab Resources  Between NITJ & an incubatee company for usage of  departmental resources of NITJ by the incubatee company as per  the prevailing policy of NITJ
Campus Accommodation
Subject to availability, an incubatee may be provided with campus  accommodation, on a payment basis. Incubatee will have to pay the monthly rent as per the norms of the host institution.
Disclaimer
The incubatee company will understand and acknowledge that NITJ TBI  intends to provide supports and services to the Company in good faith to  pursue its objective to promote entrepreneurship by converting innovative  technologies developed in the Institute to commercialization by incubating  and supporting new enterprises. It is understood that by agreeing to provide  various supports and services, NITJ TBI does not undertake responsibility  for:  i) Ensuring success of an incubatee company, its products/ process/  services or marketability  ii) Ensuring quality of support and services provided by NITJ TBI to  the complete satisfaction of the incubatee companies or their  promoters/ founders  iii) Ensuring quality of services of the consultants engaged by the  incubatee companies through NITJ TBI/ NITJ network. Incubatee  companies will have to apply their judgements before getting in  to a relationship with them  iv) The incubatee companies agree that NITJ TBI/ NITJ or their  employees shall not be held liable for any reason on account of  the above
The policy is subject to periodical review and amendment. NITJ TBI reserves  the right to make exceptions to the terms of the policy where justified for a  particular company or promoter on a case by case basis.