Entrepreneurial risk-taking is essential to take assistive technologies-led innovations from the lab to market
By Pulkit Aggarwal & Rishabh Nayyar
Disabled Lives Matter’ should have long back become a rallying cry in a world that is indifferent to their needs. The pandemic has brought in its wake unprecedented challenges in the lives of People with Disabilities (PwD). Large numbers of children with disabilities stay out of school, disabled adults are likely to be unemployed, and families with a disabled member tend to be economically weaker because of high out-of-pocket expenditure to maintain a sustainable lifestyle.
To come out of this vicious cycle of poverty and illiteracy, an aspiring disabled population needs efficient assistive technology products. However, most such products are either out of the reach of PwDs or suffer from poor quality.
Historically, assistive technology solutions have been promoted and executed by the government and philanthropic institutions like foundations, charities, and non-governmental organisations. One of the organisations empowered by the government to distribute assistive technology products is Artificial Limbs Manufacturing Corporation of India (ALIMCO). Camps, which are organised at the behest of ministry, local representatives, or district authorities, are the only way to access these products. Even, giants like ALIMCO, are hugely dependant on government grant-in-aid programmes as more than 60% of the sales happen due to the support from various government schemes and grants from CSRs.
Philanthropy reached those underserved sections, which had traditionally been deprived of effective disability solutions. But India is now seeing a spike in entrepreneurial activity in the assistive technology sector, which can drive innovation and efficiency. Solutions like Braille computers, smart canes, bionic arms, and mechanised wheelchairs have been taken up by startups. Over 200-plus startups, in India alone, are working on high-quality innovative solutions across multiple disability areas to create access to education, livelihoods, and employment for over 200 million people.
Blended financing can be an instrument to improve both the quality and accessibility of newer assistive technology products trying to enter the market by subsidising the product to bring it within the reach of the common man while freeing up welfare funds for R&D. It will pave the way for commercial and philanthropic capital to work together, encouraging the customers to pay at least a portion of the product cost, while the rest is either taken care of by philanthropy and/or banks.
This financial model will create and reinforce private markets by reducing investment risk, enhancing returns on investment, and increasing financial flows to the ecosystem by ensuring the commercial viability of start-ups. Consequently, better products at reasonable prices will draw in paying customers while reviving and expanding the size of the assistive technology markets. Eventually, philanthropy can shift to supporting research and development, while the risk capital can scale up high-quality solutions.
The innovation pipeline in assistive technologies is now becoming visible. Entrepreneurial risk-taking is important in order to take these innovations from the lab to market. And, while entrepreneurs busy themselves with the next innovation, the blended financing model is daring to dream of creating a market-access funding mechanism to accelerate user-adoption without challenging the financial sustainability and survival of these nascent startups. This is a call for the private sector to step in, identify the aggregator platforms and help in creating an entirely new market.
Aggarwal is investment director Assistive Technology. Nayyar is portfolio and investment executive at Social Alpha, a Tata Trusts supported multistage venture development platform for S&T startups