Did you know? 3 startups are globally launched every second. However, a CBI statistic report shows that, on an average, 9 out of 10 new startups turnout as a failure.
Startup is defined as “an entrepreneurial venture or a new business in the form of a Company or project initiated by an entrepreneur or a group of entrepreneurs, to seek, effectively develop, and validate a scalable business model.” Startups have been the flavor of the season over the past few years for the Indian markets, and this has resulted into the emergence of many home grown unicorns (privately held startup companies that are valued at over US $1bn) across the nation.
India saw the initiation of only 3,100 startups in 2014; but the digits gradually rose to 7,200 startups in the year of 2018, and this number is expected to reach up to 11,500 by the year 2020 i.e. this very year. Thus, we can see that the Indian startup ecosystem has really taken off in recent years and this is not a passing trend, but a revolution as a whole.
Indian Institutes of Technology (IITs) have been globally ranked as fourth largest producer of billion-dollar startups. Zomato, Ola, Flipkart are few of the startups initiated by the alumni of IITs that belong in the US $12bn startup club.
Startups are going to change the way of markets working in the present India. The success of the Silicon Valley startups has made many Indians undefeatable and determined. India aspires to contribute to 15–20% of the global GDP, and it will happen when the startup movement attains sustainable growth and efficiency.
The strategies of the Modi Government has taken into consideration the collective aspirations and enterprise of the budding entrepreneurs and has thus launched various schemes over the past few years to promote a culture of entrepreneurship and startups in the country. Let us start with the Make in India program which was launched in September 2014. The national program is aiming to transform India into a global manufacturing hub, and contains many proposals which are designed to attract investments from both local and foreign companies in various areas of importance viz. automobile, IT, pharmaceutical, tourism, railways, infrastructure, aviation, and more. Make in India has set up an investor facilitation cell to help foreign businesses locate partners and sites.
Several measures have been taken for domestic companies under the Stand up India initiative, which was addressed by PM Modi in his Independence Day speech in 2015. Stand up India is aiming at promoting entrepreneurship and job creation at grass root level especially for the SC/STs and women. The said program revolves around several schemes to provide financial assistance. These include: setting up a ₹10,000 crore fund as venture capital MSME (Micro, small and medium enterprises) sector, allocating ₹20,000 crore to set up a specialized bank for MSME sector (Mudra Bank), and earmarking ₹1000 crore to support the startups.
The Stand up India program was quickly followed by the Startup India program launched in January 2016. This program is aiming at promoting bank financing for startup ventures to boost entrepreneurship and job creation, and restrict the role of states in policy-making. The Rural version of the same program has been named as Deen Dayal Upadhyay Swaniyojan Yojana. It defines startup as “A unit that is incorporated and registered in India not before 5 years, with annual turnover not exceeding ₹25 crore in any preceding financial year.” The program has in place mechanisms such as Startup India learning program, online recognition of startups, facilitated patent filing, incubator support, tax benefits, etc. The government has also proposed to hold two conferences every year as a networking platform for various stakeholders.
Other initiatives of the government include the Atal Innovation Mission (AIM platform), Support to Training and Employment Program (STEP platform) for women above 16 years of age, Biotech Push, and National Skills Development Mission (NSDM).
Startups in India have given rise to more startups. Enablers like NASSCOM and iSpirt aim to provide funding and support for startups. The promise of an initial capital of ten thousand crore over a period of four years from the government is capable of attracting tenfold investment by 2022. Incentives in the form of tax holiday for three years are a benefit worth considering.
Indian entrepreneurs are now enjoying the benefits of the ‘India Thesis’ on every global investor’s allocation. Indian capital is late to the game (better late than never) but must now focus on capturing the new opportunities on the path towards India’s destiny as the third-largest economy behind the US and China.
Thus we can say that it is #ApnaTimeAagaya moment for the Indian Startups.
~ Falak Doshi / Panacea Intec (OPC) Pvt. Ltd.
You can also read this article on Medium: Startups of India(This is a link)
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