The alumni network of Indian Institute of Technology (IIT) Madras is planning to raise Rs 100 crore this year for various purposes, including funding innovations and start-ups of IITians. It is evaluating a business plan to set up a development office in the US for the proposed fund raising. The network formally launched an innovation fund of $600,000 last year, one-fifth of which has been invested in seven-to-eight start-up firms as seed funding. This year, the fund is expected to have about $1 million to expend. "We are planning to raise Rs 100 crore this year - Rs 70 crore from the US and the rest from India. Part of this would go to the innovation fund, while the rest would go to various other projects including research, entrepreneurship development, sustainability initiatives etc," said R Nagarajan, dean of international and alumni relations and professor, department of chemical engineering. IIT-Madras alumni network, which has about 40,000 members, is looking at raising funds from various sources including big companies, foundations, high networth individuals, among others, to reach the target. The institute also has an Alumni Entrepreneurship Forum, which allocates funds and acts as a mentor to the start-ups of the students and young alumni members. IIT-Madras also has platforms such as Centre for Innovation to support prototype development and Centre for Social Innovation and Entrepreneurship to support social entrepreneurship. Nagarajan said the institute's incubation centre currently has about 20 start-ups.
The centre is the single window for the students as well as alumni to get support for their business idea. Two months ago, the centre was allowed to take an equity between two and five per cent in start-ups. The equity holding of the centre would depend on the role it has taken in developing the business, he added. Even if one out of many start-ups becomes a success, that would bring in value to the share-holding of the centre, Nagarajan pointed out. Going forward, the fund would look to invest Rs 10-50 lakh in a venture depending on the potential, viability and profitability of the model. The network has been raising funds under the name of IIT-Madras. So far, money from the US has been raised by the IIT-Madras Alumni Association of North America and sent to the alumni network's office in IIT-Madras. The money has not been raised as returnable investment, but as donation. Now, the alumni network is looking at raising money from non-alumni as well. This will also be by way of donation, where the investors will get tax benefits in return, Nagarajan said. While the innovation fund was formally launched only last year, the pooling of money had started as early as three years ago.