ETI Dynamics Collaboration

ETI Smart City FAQ
Smart Cities in India
Team Finland – ETI Dynamics Collaboration
The collaboration has the following components:
1. Technology & Solution Adaptation
Through ETI Dynamics’ global technology & innovation centre, the Finnish smart-city solutions will be
adapted to suit the local market. ETI Dynamics will co-invest with Team Finland to bring ensure that
the solutions port across well to suit the needs of the project site as well as the wider Indian market.
See Annexure I for a detailed technology adaptation process
2. Reference Site Creation
The effectiveness of each of the solution selected will be demonstrated through a reference site. This
is the most significant hurdle that any innovative solution provider faces when entering a new market
particularly emerging markets such as India. In effect the reference site is the first commercial project
for the technology/solutions provider in India.
See Annexure II for reference site funding
3. Commercialisation
The ultimate objective of the collaboration is to provide Finnish companies with access to real
commercial opportunities. The Neemrana-Smart City project will be the first step in the collaboration
but other there are many additional that will be created as a result.
See Annexure III for commercial opportunities
ETI Smart City FAQ
1. Technology & Solutions Adaptation Process
The Centre for Technology & Innovation is ETI Dynamics’ in-house centre of excellence based out of
Bangalore (India) and London (UK). It accelerates technology commercialisation and route to market.
The Centre is connected to a national and international network of subject matter experts that include
but not limited to:
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More than 100 domain specific engineers: Electrical; Electronics; Metallurgy; Software;
Mechanical; Civil; Communications; Environment; Electromechanical; Chemistry; Design; IT;
Database and many others
More than 15 top Indian research & innovation institutions that are currently collaborating on
IP development
More than 20 global innovation partners
Technology Adaptation Process
Technologies and Solutions that already have reference sites and projects available in India can be
invited straight to the project. Whilst those that do not yet have any presence on the ground in India
will be taken through a Technology/Solution Application process. This includes the following:
 Technology Sourcing
 Technology Assessment and Applications
 Technology Unbundling to assess which components can be manufactured locally
 Tie-up with Local Manufacturing/Assembling
 Technology Adaptation
 Pilot project / Demonstration site
 Technology Enhancement
 Compliance and Standards
 Intellectual Property Management
 Licensing and Commercialisation
Frequently Asked Questions (FAQ)
– Technology & solutions adaptation process
1. Why does a company need to go through this process?
A number of companies when entering a new market, such as India, are unaware of market
characteristics and even the solution offered may not necessarily fully port to the local market
conditions. It is therefore very crucial that the solution offering is fully adapted to the local
environment including compliance with standards and norms.
2. How long does this process take?
The process depends on the state of the technology, its application and speed with which the owner’s
technical teams can move. It normally takes a minimum of 3 months to a maximum of 12 months to
go through this process. For instance if the solution is a small household meter then the adaptation
ETI Smart City FAQ
process could be as little as 2-3 months. However for a major industrial effluent treatment
technology, the process could be as long as 12 months.
3. What can a company expect at the end of this process?
A company can expect a complete technology/solution porting framework. This includes adaptation
of technology/solution to local conditions, local manufacturing/assembling framework, after-sales &
distribution, pricing and business model.
4. To which companies is this process applicable to?
The process is mostly applicable to companies that do not yet have any reference sites in India. The
following illustration further explains the applicability.
Roadmap to Technology/Solution Commercialisation
5. Who funds the technology adaptation process?
ETI Dynamics will both invest its own resources as well as source additional funding including
Government grants and other co-investors including other corporate and industrial partners. The
subscribing company is required to pay an initial small commitment fee to avail of this technology
adaptation process.
6. Who funds the pilot projects?
There are numerous successful techniques that ETI Dynamics utilizes to finance the pilot. These are:
(1) Government Grants
There are numerous Government grants available in India to support propagation of
technologies and solutions that help country’s development. Whilst each grant awarding
agency has its own procedures and guidelines, the common characteristics are:
(a) Pilots funding available from 30% to 100% of the project cost
(b) Pilots fully funded if installed in a research institution
(c) Pilots must have an Indian collaborator
(2) Other sources include:
a. International Development Finance Agencies
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b. Corporate Social Responsibility (CSR) Funds
(3) Joint investment
ETI Dynamics and the company to co-invest in developing the pilot
7. What are the risks involved?
ETI Dynamics has developed a very robust technology transfer framework with a number of
stakeholders within India and around the world. It is currently handling over 40 collaborations for
technology and knowledge adaptation process. It has a near 100% success rate in delivering the right
framework.
However in any process there are always risks involved. The ones that have been clearly identified
and should be addressed are:
 The IP owning company/institution doesn’t spend as much time on the adaptation process
– This is a critical issue and the company/institution has to spend time alongside with ETI
Dynamics’ adaptation teams. ETI Dynamics is not a consultant to the company. It is acting
as a principal collaborator and accelerator into the process and not working on behalf of
the company.
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The market is not ready as yet – There are instances where the market may not be fully
ready for the solution because of lack of regulation or other aspects. In that case the
process will still happen but will definitely take longer.
8. What happens to the Intellectual Property (IP)?
ETI Dynamics takes great care of protecting the IP of all of its partners.
If any new technology/solution that emerges as a result of the technology adaptation process then it
will create new intellectual property. The new IP will be an enhancement to the original IP. Both the
company/institution and ETI Dynamics will have a joint ownership of the new IP. The share of each
party will depend upon the level of investment made by all the stakeholder groups. This framework
evolves over the period of technology adaptation process.
9. We have a well-defined pricing strategy? Why still do we need to assess the pricing model for the
local market?
Each market has a different characteristic. What is the right pricing benchmark depends on numerous
factors and market dynamics. India is a very price sensitive but volume market. This requires local set
ups which many companies are not able to provide. For instance what works in the middle east or
Europe may not always work in India.
10. What are the outputs of the Technology Adaptation
 Complete assessment of application of local technology
 Complete assessment of competitive landscape and positioning of solution
 Complete assessment of standards and compliance
 Correct pricing model
 A local manufacturing/assembling roadmap
 A pilot/demonstration site
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2. Reference Site Creation
ETI Dynamics has a successful model through which the process of creating a full commercial reference
site is both accelerated as well as financed. A reference site is not a pilot/demonstration project but a
full commercial application of the solution. The only difference is that the site creation may or may not
be fully financed. This means that the solution provider may have to contribute some capital towards
creation of the reference site.
The process of applying for a reference site creation includes:
(1) Companies with innovative solutions are invited to put forth an expression of interest
(2) An assessment will be made whether the Technology Adaptation process is needed or not. If
not then a roadmap for reference site creation will be provided. Typically this will include
implementing the solution at the project site.
Need for a Reference Site
The reference site is the first commercial project for the solutions provider where its proposed solution
is implemented in the given market (in this case India). Therefore there will be a lot of unknowns
around its creation. This will include implementation issues, operational issues, pricing and licensing
issues. It is for this reason a reference site creation is crucial before a full market rollout. The reference
site funding will also be needed to fulfil the following requirements:
- Prove to the banks, equity investors and other financing institutions that the risks are fully taken
care of. This is through third party testing and certification.
- Prove to the Governments that the operational and delivery issues fully conform to the norms and
comply with the standards.
Funding of Reference Site
The reference sites are partly funded by the project developer. However there are elements of the
reference site that the developer will ask the Technology/Solution provider to fund (or get financed
from its own Government sources). The various elements are:
Reference Site Element
Funded by
1. Scoping and Feasibility
Solution provider or any other source
2. Preliminary Engineering Design
Solution provider or any other source
3. Detailed Engineering & Integration Design
Project Developer
4. Plant, Machinery, Equipment, Software, Materials
Project Developer
5. O & M
Project Developer
Royalties and Margins
The project developer will also ask the technology and solutions provider to backend the royalties and
margins and recover those after the successful implementation and mutually agreed milestones.
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Frequently Asked Questions (FAQ)
-Reference Site Creation
1. We have many reference sites available around the world so why is it necessary to go through a
reference site creation – can we not proceed straight to commercial negotiations?
In an ideal scenario that will be the case, however when it comes to new market – each has its own
nuance. In India the reference sites are required simply because there have been numerous instances
where technology/solutions brought in from other markets have failed spectacularly because the
adaptation process wasn’t conducted. This has created a level of skepticism so much so that the first
reaction anyone has that foreign technologies are very expensive and are not suitable for Indian
market. However we all know that this is just a knee-jerk reaction. It is therefore important to put a
reference site so as to provide overall confidence. Additionally in a number of cases reference sites
also become a pre-requisite to any Government tender application or for banks to provide funding
for the project.
2. How is a reference site different from a commercial site?
The reference site is not different from a commercial site in its implementation and operation. It is
only different in that the project developer (ETI Dynamics) will ask the solutions provider to cost the
project differently from any other commercial project.
Since the solutions provider will use the reference site to iron out all implementation and operational
issues which introduce an element of risk, it is only fair that the risk is shared jointly by all parties.
That is also the reason why the project is called a “Model Project” as many new models and
frameworks are developed and discovered through it. Typically both parties agree that any profit
margins or royalties are taken by the solutions provider after a successful implantation or at a
mutually agreed timetable.
3. Our solution offers only part of the offering, but the project requires many more components - how
will you proceed?
ETI Dynamics is a complete turnkey-solutions provider that develops and finances projects through
use of innovative technologies and economic models. It sources these solutions from around the
world including those that are locally available. Its teams are continuously seeking best in class
solutions. It is responsible for the complete end-to-end implementation of the project. It will be
beneficial to the solutions provider as it will get to understand and know about the potential
integration partners. In the case there are trusted partners that the solutions provider has then it
may like to introduce them to ETI Dynamics as well as the model project.
4. What if we are unable to proceed further with the proposed investment or model?
The solutions provider is not obliged to move further in this process. It will have the opportunity to exit the
process at the end of Technology Adaptation Process or before reference site creation.
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3. Commercialisation
Once the reference site is successfully created the solution provider has the option of tapping into
other market opportunities. With a reference site already successfully created the solution offering
becomes significantly more attractive to both the potential clients but also other joint-venture
partners.
The potential commercialization routes are:
(1) Implement Solutions to ETI Dynamics’ other projects
ETI Dynamics has a deep pipeline of projects it is developing. The solution which is already
implemented can be replicated to other ETI Dynamics projects.
(2) Find a joint venture partner
ETI Dynamics works with a large number of private and public sector organisations that are
interested in investing in the new technology/solutions led ventures. These introductions can
be made by ETI Dynamics.
(3) ETI Dynamics Licensing Division
ETI Dynamics also has a technology licensing division that develops markets around
technologies or knowledge based solutions. The division will typically license the use of
technology/solution, local manufacturing/assembling, invest in marketing, distribution and
after-sales support.
(4) Provide solution independently to other market
The company/institution can of course also independently market the technology/solution
without any collaboration.
Frequently Asked Questions (FAQ)
- Commercialization
1. How can ETI Dynamics help find an independent collaborator?
The hunt for local partners is always not a straight-forward process. ETI Dynamics’ technology
adaptation process is not a replacement of a local partner but improves the chances of finding many
potential suitors as there will be a clear market delivery strategy including what is the right pricing
model. The fact that ETI Dynamics builds market and technology innovation eco-system attracts
many companies who are keen to collaborate with it.
2. We already have a major network on the ground – can we not use that?
Yes, of course you can use your existing network.
3. What licensing terms can ETI Dynamics offer?
These vary from solution to solution and the extent of collaboration. Any licensing deal will have one
or more of the following key components:
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Licensing Fee
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Royalty
Minimum Guarantees
Training and Capacity Building
IP Management
Inclusions and Exclusions
Exclusivity
Project Timelines
ETI Dynamics has concluded a joint venture with other partners that are land owners. The project
timelines are listed below:
Phase
Status
1. Securing Land
Complete
2. Land permitting
In progress
3. Initiate selection of Master Planner and of EPC
(engineering, procurement and construction)
partner
4. Invitation to technology & solution providers
Global Call in May 2014
5. Financial Closure
January 2015
6. Construction Begins
January 2015
Global Call in May 2014
Frequently Asked Questions (FAQ)
- general
1. Who are the project developers for this project?
ETI Dynamics and Klazina Pvt Ltd (India) are the developers of the project. They will also be
financing the project through adequate capital structure of equity, mezzanine, debt and other
instruments.
2. Isn’t land acquisition a big risk in India?
Perhaps, but in this case the land has already been acquired
3. What are the global calls for?
Finland has been offered first right of refusal to fill as many areas possible in the build up of Smart
City. For areas where Finland is unable to offer any solution, other nations and companies will be
invited to bid.

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