‘We have barely scratched the surface…We have a lot more to do.’

I hope you and your family are taking care and keeping safe. COVID-19 outbreak has wreaked havoc across the world. With a raging second wave in India and ramifications poised to surpass any catastrophe in our living memory, we believe our collective and coordinated efforts will change the course of this pandemic. In order to better prepare ourselves for future catastrophes, we must focus on accelerating innovations with the potential to support and strengthen the health systems. Pandemics have been central to global history as highly contagious diseases like the bubonic plague, leprosy, smallpox ravaged countries across continents down the ages, taking millions of lives in their wake. Back then, people had virtually no scientific understanding of what caused the infections. Now Covid-19 has brought us to the juncture of history that calls for a course correction. There is a need for a deeper engagement with science, technology and innovation in our collective approach to responding to a crisis of this magnitude.

Innovators and entrepreneurs, particularly those harnessing science and technology to create high impact solutions, have historically been underfunded leading to a series of “valley of death” exposures as they make efforts to chug along with their lab to market journey.  This experience leaves many breakthrough innovations stuck inside R&D labs, journal articles and patent offices and discourages entrepreneurial risk-taking. Solutioning and commercialising high-impact innovations is where the risk capital is most needed but least available due to several reasons including the absence of impact-market thesis, poor innovation curation and suboptimal venture development efforts by the ecosystem enablers. Lack of empathy, unrealistic expectations and a widespread misunderstanding of risk-return trade-offs further exacerbate this gap between the capital providers and product start-ups. The private capital markets have been evolving with an increasing appetite to underwrite early-stage start-up risks, especially chasing the business models built on consumer internet and digital platforms. Unfortunately, they are not yet ready to support entrepreneurial risk-taking in science and technology innovations where the intent is to solve deep-rooted problems facing the communities and the planet. High product development risk, longer gestation period, inability to foresee an exit horizon, and poor assessment and pricing of risk keep most investors away from such early-stage investments, leaving the state and philanthropy as the two sole providers of capital to this sector.

However, the number of S&T start-ups in the country is growing faster than the funding ecosystem and existing capital pools are getting very thinly distributed across multiple start-ups, leading to a significantly sub-optimal capital allocation for some of the most promising impact creators and potential winners.

At Social Alpha, we are striving to create aggregated pools of capital (both dilutive and non-dilutive) with an empathetic yet efficient resource-allocation model, which aligns with our multi-stage innovation curation and venture-development thesis. The idea is to identify, nurture and support start-ups who have a genuine intent and ability to transform the lives of people and communities by creating positive outcomes across various sustainable development goals.

I want to take a moment to share that Social Alpha has completed five years of being in existence. During this journey, we have come across thousands of ideas and innovations, screened and evaluated hundreds of them and have also made a few investments. It has been a great learning experience for all of us, as we supported a portfolio of 150+ start-ups with 56+ cr in non-dilutive grants, 24+ cr in seed equity.  We have built and operated 9 innovation and incubation platforms, 11 venture accelerators, 8 grand challenges to enable and support various innovation programmes. This couldn’t have happened without the unprecedented support and collaboration with our 100+ partners across government, industry, civil society and academia.

I am deeply grateful to our entrepreneurs, donors and execution partners who believed in us through this journey. The real challenge now is to scale what we have built as we continue to experiment with new ideas and replicate the successful models.

The next five years for Social Alpha would demand extensive work in curating and supporting innovations in challenging areas like Climate, Health and Livelihoods.  The ongoing pandemic and climate change have both highlighted a critical gap: the lack of resilient systems. And, perhaps, both require a similar set of actions to inspire people to drive systemic changes. To prevent the worst effects of climate change, we need to get to “zero net greenhouse gas emissions” in every sector of the economy and focus on reducing emissions and increasing carbon sinks. Innovation will play a critical role in driving climate action. This means nurturing deeply committed start-ups, entrepreneurs and innovators working across clean energy systems, climate-resilient and regenerative agriculture, sustainable consumption and production, new materials and manufacturing, circular economy models and much more. Beyond creating a conducive technical environment for these start-ups to be able to develop relevant solutions, systemic change is necessary for these technologies to create the desired impact.

Our entrepreneurs are solving humanity’s most pressing problems and creating real-world impact. India’s deep tech ecosystem is breaking out with ambitions. I am hopeful that startups of the future can play a multi-faceted role in our tryst with public health, climate change and create mass prosperity and improve the quality of life for billions. What we need to do is to continuously enhance the enabling infrastructure and value-addition capability of our innovation and entrepreneurial ecosystem that can accelerate their progress towards creating a more prosperous and resilient world. At Social Alpha, our mission continues – to drive social justice, economic growth and climate action through the power of entrepreneurship and market-creating innovations…and with your support, we will continue to help India’s S&T innovators and entrepreneurs to remain focussed on their mission to create impact.

We have barely scratched the surface. We have a lot more to do.

Stay safe. Take care.