There is a similar agenda between India’s startup community and the Indian Government, and that is to steer India to become the world’s largest startup ecosystem. The matured ecosystem of the US, UK, Europe, and Isreal is lauded, and Indian worldwide want India to race at the top of the technological advancement which will lead to creating the best startups which will address the Indian economy at a large scale in the world.
There is no doubt that this unique common agenda is unparallel and there is no point to be discussed for anyone who will question the intent of any two of them, i.e the Indian startup or the Indian government. The Indian government has been continuously reiterating, that the government is always willing to help ambitious startups and entrepreneurs to grow quickly. There are many pet projects that are introduced by the Narendra Modi Government, and that as Startup India, Digital India, Make in India, and many such more startup projects that are introduced in India and they are there for the development of India and also help grow the Indian businesses to the International level.
In this attempt of the government to see India rise and shine in the startup and make its own valuable position in the market, the Indian government has introduced many policies and regulations for startup associations, industry groups, and startupreneurs. Every politician in India has been in its favor and is willingly taking this agenda of the Indian startup’s growth ahead.
Now the important question comes here, if every individual party is in the favor of the government’s decision and they all are willing to help the government, then what exactly the problem is coming and what is the thing that is not letting this procedure work? It is important to note that while there is support from various political parties for the government’s policies and regulations to support Indian startups, there are still challenges that need to be addressed.
Problem In The Startup Success
India is one of the fastest-growing economies in the world. All the doors of foreign direct investment are opened to a large extent in every individual sector of the Indian economy, and also the money from overseas is flowing for the startup businesses in India. Every individual foreign big investment group and venture capitalist wants to earn a penny from India’s huge consumption economy.
The interest of foreign investors in India is opening the window of many opportunities for startups who are looking to scale and is also providing a significant boost to India’s startup community, to go to the global level for innovative startups. In this condition, India is a free bird, unlike its competitive country China, which is facing the threat of being treated like a dumping ground for the capital.
Obstacles Faced By The Indian Startup
Let’s discuss the top 10 major problems that are faced by entrepreneurs in India:
- Government Policies: If the entrepreneurs are considered as the planet in the solar system, then the Indian government is the Sun of that solar system, which is the only single largest facilitator. There is a slow and steady increase in government policies for Indian startups, but still, India is maintaining these policies, and while considerating these policies India is still maintaining ease in doing their business and is able to make the profit turn out of that business. Because of the rules and regulations, it is taking more effort for entrepreneurs to start a business in India. No doubt that from the start only the government is taking proactive measures for the funding of the startups and then, they are developing their ecosystem for the startup businesses, but still the Indian startups witnessed a slow-down in the startup phase, and as a result for the same there was a dip of almost 50% in the registration of the new startups.
- Talent: In startup businesses, the factor that is uncertain is the employment factor, because of the company’s reaching scale. But this is not considered one of the major problems, there are many other important and big problems, and they are finding the right skilled talent for your business. Talent is crucial for starting a successful startup business because it is the foundation upon which the entire organization is built. When it comes to startups, talent is more than just having a team with the right skills; it is about having a team that can work together effectively and is committed to the company’s vision and goals. Investors want to seek new talent and they want to work with those new talents because the fresh slot will give them new and innovative ideas, that obviously, the previous slot can’t provide to their startup businesses. Many startups grow in their early stage successfully if they are having the right talent with them and they are utilizing it properly.
- Funding: Raising capital is considered a long-drawn challenge for many startups. Funding for small investments such as angel investment and seed funding is likely easier to find an investor for them, as the amount of investment is comparatively small than the investment which is made for setting the big businesses. There are many such cases in which the company spends their startup money too fast on their startup business, but they don’t get the desired result that they actually deserve after spending that much money and resources. Entrepreneurs should set their goals prior and then should go for the investment part as it helps them to save a lot of money and also utilize their ideas appropriately. The entrepreneurs should set their goals for a set time period such as five years, and in those five years they will be putting the set amount of money into their startup and they will not be doing any extra funding out of that limited budget only.
- Opportunity: India is a population that has the majority of the youth population living at present. India is a country where there is more talent, innovation, a workforce, and future leaders who are living in the country. But on the same side, India has a lot of challenges that are to be faced and solved, such as we know that India is the second largest population in the country and the number to be first largest is not that far. And at present, the first and foremost problem for entrepreneurs is to solve this problem and then, make such opportunities that help the people to serve rich services and thus solve a variety of problems. A large population makes India a strong case for rich services and innovative ideas for startup businesses. For this let’s take an example that digital platforms can be used to provide the access to medical facilities in areas that are not having the services of medical facilities or are backward areas.
- De-globalization: De-globalization is the possession that includes the concepts such as made-in-India goods, which means that this includes making and using products that are totally Indian. There should not be the usage of any such products that are not made in India and they are being sold in India. This is also an opportunity for Indian startups to grow and make their position worldwide, as India is a pool of many talents and you can utilize those talents to increase the production rate in the market, which will automatically tend to bring profit for your market. Where there are these many opportunities for the Indian startup, there are many difficulties also that come in the way of this process, and the entrepreneurs who successfully overcome these problems are becoming successful in their businesses. The promotion of local industries and the use of domestically produced goods can have many benefits for the Indian economy. It can help to create employment opportunities and boost the local manufacturing sector, which can lead to higher economic growth and also can reduce the country’s dependence on imports and improve its balance of payments position.
The early-stage startup investment is becoming popular day by day in the Indian startup industry and startup investment is becoming the new normal in the Indian startup industry. Let’s go through the reasons why early-stage startup investment is in trend nowadays, and is becoming an asset in new Indian startup businesses.
1. Availability of large talent pool seeking to be entrepreneurs: The point of “availability of a large talent pool seeking to be entrepreneurs” refers to the presence of a significant number of skilled and motivated individuals who are interested in starting and growing their own businesses. This is an important factor for startups because having access to a talented pool of potential entrepreneurs can help to fuel innovation, drive growth, and enhance the overall success of a startup.
One advantage of having a large talent pool seeking to be entrepreneurs is that it can lead to increased competition and innovation within the startup ecosystem. With more talented individuals looking to start their own businesses, there is a greater likelihood that new and innovative ideas will emerge, leading to the creation of new products and services and the development of more efficient and effective business models.
2. Favorable regulatory environment: The Indian government is trying its level best to provide all the possible solutions to startup businesses. Considering this there are many startup programs that are started by the Indian government, to help the entrepreneur develop their startup businesses which will benefit the startup. Also, different strategic inventions have been launched that will help to bring success in the business, and the programs that will give the basic knowledge requirement, to the entrepreneurs that are required before starting any startup businesses.
The aspiring entrepreneurs are taking all these reforms in their mind and are then planning for their startup business, which will definitely give them huge success and will tend to be profitable in the upcoming future. If a startup will have all the favorable conditions which are required to start a business, then surely the startup will be a success in the coming future, because, from the starting phase, only the startup was getting all the things that were required and was climbing the steps of its success.
3. Startup ecosystem built by corporations: There are many startup businesses, that are already well-established, but then also face problems such as innovation capacity, and early-stage startups that are seeking growth, but are facing a lack of money for the success of their startup businesses. There are many startup programs partnership that is successfully launched in the market and they are easily accelerating the growth of early startups in India.
At this time, India is witnessing a huge growth in the rising number of startup companies, and also they are having a huge scope in profit. The funding for the startups is in rising condition from the start and they are generating more revenue the matured investment phase in the Indian startup ecosystem, is rising continuously which is a benefit for the startup businesses. India is a land where there is innovative talent, an innovative market, favorable government policies that bring success in the startup businesses, and most important capital infusion by the established corporates.
In conclusion, the clash between India’s startup community and government is a complex issue that requires careful consideration and dialogue from both sides. While the government’s efforts to regulate the sector and protect consumers are necessary, they must also be balanced with the need to foster innovation and growth in the startup community. Ultimately, it is important for the government to work collaboratively with startups to create policies that support their success while also ensuring the protection of consumers and the public interest. It remains to be seen who will prevail in this ongoing clash, but a constructive and collaborative approach is key to finding a mutually beneficial solution.
While there are valid concerns about the need for regulation in the startup sector, there is also a risk of stifling innovation and hindering the growth of the sector if regulations are too stringent or restrictive. Therefore, it is important for the government to strike a balance between regulation and innovation, which requires a collaborative approach and open dialogue with the startup community. This balance between regulation and innovation is particularly important for the Indian startup sector.
To this end, the Indian government has taken some positive steps to support the growth of the startup sector, such as launching initiatives like Startup India and setting up a dedicated Ministry of Commerce and Industry to oversee the sector. However, there have also been instances where government regulations have clashed with the interests of startups, such as the recent clash over new regulations for e-commerce companies and the concerns around data localization.