Our belief in academic spaces
Many ask us what our vision is with gradCapital. And yes, to an extent, we are investing in student start-ups. But there’s something even more fundamental than that.
A first-year hacked into our course system to play a music video on the portal. A team developed the first humanoid robot. People used automated delivery vehicles to deliver across campus. A PhD student developed a face recognition algorithm for attendance. Students protested against fee-hikes at BITS. The CAA/NRC movement was centred at JNU. Students in China started a democracy movement (Tiananmen square). Two technologies that will genuinely change the upcoming world, CRISPR & quantum computing, have its root in another college. CRISPR will truly revolutionise medicine and how we think about healthcare. Quantum computing is likely to change everything.
From building new machines, banks, governments to robots & new nano-material, it’s hard to deny the role of academic spaces in future building.
Many of these projects are new, radical, fresh and even world-changing. But not all are positive. In the 1940s, a team at UC Berkeley came up with the flu vaccine – truly world-changing and saving millions of lives. In the same decade, Dr Oppenheimer directed the operations of the Los Alamos lab that built the atomic bomb. The tools of academic spaces are powerful and can be misused as well.
Unfortunately, we can’t invest in all kinds of projects at the moment. Start-ups are just one small piece of the large picture.
What this means is, there are numerous ways to organise a project. It could be a non-profit, start-up, a traditional business or even a think tank. Whenever I speak with potential new students, I first try to figure out what kind of organising principle suits them. This depends on their aspirations and project outcomes. If they want to grow it sustainably and use their profits to fund their growth, VC may not be the best idea. If they genuinely care about building for the public without charging them money, then non-profit could be more appropriate. But if we see someone with a high-risk & high-reward project, that catches our attention. There is risk in terms of their underlying technology and assumptions. They would need capital to test these assumptions. And the return on capital is generated by monetising it. The scale of this determines reward. In contrast, the assumptions determine the risks.
A project with a professor to understand the genetic behaviour of humans to then potentially develop therapies for humans - is an inherently risky project. The reward is not clear in terms of immediate revenue. The timeline of reward is a vital criterion for capital owners to invest. VCs look at a particular time period that may not fit with all kinds of growth stories.
Not every project has to be heavy tech-driven. I am also meeting with teams that want to help build a more sustainable future, which means new kinds of clothes, chocolates, soaps or even soft drink packaging. The inherent risk here is not a technological one but a socio-technical one. Will people become more conscious in future? What will drive it, and how to get there? These are again uncertain questions and fit the VC bill, if the founders can establish a high-reward roadmap after validating assumptions.
But what makes a college environment so different & innovative?
There’s something tricky that happens when people graduate and transition to the “real” world. In every new place, like a corporate, master’s degree, or a fellowship, one is exposed to new norms—these new norms set in new types of thinking that create a new world map. The world remains the same when you transition from college to the real world, but the construction of the world by us now changes. Ask a first-year student what some significant problems in the world and their lives are. And repeat that and ask them five years later. Of course, that person evolved and learned new perspectives. But the scope of how these two groups will think would be limited in scope by individuals and differ in groups. A college student is more likely to care about the environment or sexual rights than a middle manager in a corporation. And to have a free culture to think and converse is not easy to have. There’s more to it than just having Free Speech laws. The environment can’t punish but has to reward new ideas. If someone wants to work on truly new ideas despite them appearing as a threat to power structures, they must be relieved from social constraints. Expectations are set by parents, friends, professors and even by unfriendly neighbours. And if someone deviates from those expectations, they are questioned or forced to go back to the status quo. This set of expectations may not have any analytical basis. Meaning, norms can support the most significant atrocities and crimes, and any deviation would still be punished. A college environment ensures limited social punishments because the expectations are little. And that’s what primarily drives innovation, free-thinking, and start-ups.
Lastly, college can be an equaliser. People from various socio-economic backgrounds sit in the same classes, get access to the same conversations and similar opportunities. For a moment, it neutralises the historical power relations amongst many social & economic groups. It enables the flow of new ideas, more room for empathy, and even more diverse teams. College, hence, also by its existence, carries the power to neutralise historic disadvantages as well.
At gradCapital, we look at student entrepreneurs as student’s first. And that belief is taught in any activity we do.