Despite limited funding, rural innovators find ways to come up with solutions that deal with every day real-world problems.

What startups can learn from cost-effective rural innovations
Atom Startups Saturday, November 24, 2018 - 17:51

There may be biases for innovation in rural and urban startup zones in India. Some founders may claim that “jugaad” is in India’s DNA, while others may reflect upon technology’s role in innovation. There are many examples to support either claim, but few that can compare two distinct journeys in the same industry. Since there are various factors involved, reducing the variables is key. We can compare two stories, industries or journeys but not two results as an outcome of rural v/s urban.

There are many startup success stories in the rural landscape that are tackling local problems. Urban startups are focused more on scaling across the nation. This seems to be the trend that’s permeating the Indian entrepreneurial ecosystem. That’s where funding is being channelled as well.

There are large development gaps in the rural market, where local champions (bio-farming, agri-tech, cotton, etc.) are excelling through innovation. They’re providing cost-effective solutions to real-world challenges. They also serve as examples for urban startups to analyse and implement in their solutions.

Rural innovation comes in the form of individual innovation and organizational-based research. There are individuals that start a new field, a new product line or create a rural breakthrough. There are also organizations (government, private sector, etc.) that are actively designing products that benefit rural India. They are also moving the needle in the space, providing much needed inspiration and support to innovators.

The Rural Innovators Startup Conclave (RISC) hosts rural innovators to present in front of investors and industry players. They attract hundreds of participants to present their innovations, which are typically in the areas of sustainability, local tech and consumer products.  At the conclave, the researchers at National Institute of Rural Development and Panchayat Raj (NIRDPR) are also launching many technological innovations that they’ve developed in conjunction with rural innovators.

 “Startups in the country are mostly IT based and cater to urban services. Innovation and technology diffusion for rural development is the need of the hour. There is a need to develop and nurture mentors, angel investors, faculty, corporates, media so that they play a much more active role in contributing to the ecosystem,” W R Reddy, Director-General of NIRDPR was quoted as saying.

Individual innovators, such as Muruganatham (Padman), have changed the way we view rural innovation. With his less than Rs 1 sanitary napkin, he’s paved the way for rural innovation for generations to come. With 23% of girls dropping out after they start menstruating, he’s provided a new path for girls to receive higher education. He’s now expanding to over 106 countries worldwide, to aid in local employment and rural innovation.

Another shining example comes from Belgaum, where entrepreneur Santosh Kaveri is designing some of the most innovative solutions. From creating a brake system for bullock carts to providing scalable carrot cleaning systems, he’s leading the charge in the local rural space. He’s one of the few innovators in that zone creating new inventions on a regular basis.

The rural innovation movement relies on these pillars to continue. They focus on individual innovators and provide them with the support necessary to excel. While funding may be limited, innovators always find a way to excel. From Karunakara M Reddy’s water ATM, providing 3,000 litres at Rs 0.20 per litre, to Dipak Bharali’s handloom systems, making 1260 knots in 30 seconds instead of 10 hours, rural India is seeing distributed innovation across the country.

Urban startups generally rely on the western model of pre-money funding or scaled revenue generation. Entrepreneurs often emerge from prestigious universities and are taking deeper risks in innovative fields. There is also the support of funding bodies and entrepreneurial cells, that connect innovators to investors from across the country. Startups also look towards China for support, as many investors are entering the Indian market in large waves.

There is also a lot of support being given to innovators in the tier-2 cities and neighbouring zones. The Department of Industrial Policy & Promotion, Startup India and state Skill Development, and Entrepreneurship Department and the Maharashtra State Innovation Society (MSInS) are actively working to create new avenues in Maharashtra’s wide entrepreneurial network.

The challenge for urban innovators comes in the form of scaling up effectively. There are many startups that are vying for customer attention, but few emerge as clear victors in the field. Every sector seems to be increasingly competitive these days, with a lot of focus being given to AI and Big Data. For the B2B side of the picture, there is a dire need for differentiation and innovation in offering.

Owing to the sophistication of the solutions offered, there is also a gap in communicating these innovations. Urban founders need to employ effective communication strategies to create better models. They’re finding it harder to approach new clients and investors, while simultaneously improving upon the core product. They’re unable to work multiple angles, as there are multiple startups vying for any given VC’s attention. That’s where the difference lies for urban startups, that need more capital, more access to customers and better communication models for their innovations.

Views expressed are author’s own

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