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Starup The Way Ahead Seminar
Starup The Way Ahead Seminar
ON
Himanshi tandon
First of all, I am thankful to The Great Almighty, who bless me sound health,
abilities and gives courage to perform and complete my work in a successful
manner.
I wish to express my sincere gratitude to Prof. for providing me an opportunity
to do my project report on “Start-ups in India”. Her exemplary guidance,
constant encouragement and careful monitoring throughout the project are so
great that, even my most profound gratitude is not enough.
My gratitude is incomplete without the thanks to the other staff members of
the University Business School, for their constant help and support throughout
the project. I also acknowledge with a deep sense of reverence, my gratitude
towards my parents, family and friends, who has always supported my morally
as well as economically.
At last, but not the least, I am thankful to everyone who directly or indirectly
helped me to complete this project report.
Himanshi Tandon
Preface
India is the second largest populous country in the world with 1.2 billion
population strength. To cover up this large population there exist large
potentiality of job market in India. But According to the latest Asia Pacific
Human Development Report, India is facing severe scarcity of job market;
growth in unemployment among young graduates and it will last for next 35
years. According to Labour Ministry data, around 1 million people enter the
workforce in India every month. To eradicate this scarcity of job market, ours
Honourable Prime Minister Narendra Modi, announced on 15th August 2015,
“Start Up India, Stand Up India” to promote Bank Financing for start-ups and
offer incentives to boast entrepreneurship and job creation.
In recent years, the Indian start-up ecosystem has really taken off and come
into its own driven by factors such as massive funding, consolidation activities,
evolving technology and a burgeoning domestic market. The numbers are
telling from 3,100 startups in 2014 to a projection of more than 11,500 by
2020, this is certainly not a passing trend. It’s a revolution. And it’s going to
change the way the markets are working today in India. The strategies of the
Central Government take into account the collective aspirations and enterprise
of the risk taking Indian. The success of the Silicon Valley start-ups has many
indomitable and resolute Indians in the heart of it.
India aspires to contribute to 15-20 percent global GDP. It happens when
Startup movement attains critical mass. Start-up India looks beyond the
argument that it is a better packaging of existing institutional support. The
complexities of managing the diversity of thoughts, processes and people of
India are very well known. The plan of Start-up Indians is to flourish under an
ocean of changes in mindset and thinking. It is giving feather to wings of the
unstoppable Indian.
CONTENTS
1. Introduction …………………………………………………………………………………………….6
5. Startup India……………………………………………………………………………………………..14
6. Action Plan…………………………………………………………………………………………………15
9. Conclusion………………………………………………………………………………………..32
10. Bibliography………………………………………………………………………………………33
Introduction
Indian Institutes of Technology (IITs) have been ranked the world's fourth
largest producer of billion-dollar start-ups, according to a study by UK-based
accounting company Sage. IIT alumnus accounts for 12 billion-dollar start-ups
including Flipkart, Snapdeal, Shop Clues, Zomato and Ola. Stanford University
topped the list with 51, followed by Harvard University and The University of
California (26 Jan 2017). Start-up is defined as “an entrepreneurial venture or a
new business in the form of a Company, a partnership or temporary
organization designed and search of a repeatable and scalable business model.
“Start-up India brings excitement and immense possibilities for the future.
India acknowledged the stark reality of modern business and its complexity.
The Central government tried to address the problems faced by the young,
entrepreneurial Indian, whose risk-taking ability is unparalleled across the
globe. Policy paralysis and lack of transparency were just few of the
bottlenecks faced by the entrepreneur.
Technology has a predefined role to play in Start-ups. The Internet-led industry
contributes $30 billion today, which is a fraction of the $250 billion by 2020.
USA internet business could grow from $240 trillion today to $3.5 trillion and
China from $700 billion to 1.5 trillion during the same period. The sheer size of
change that Start-ups can choose to bring is mammoth and exponential. Start-
ups have been the flavour of the season over the last few years for the Indian
markets.
However, 2015 has turned out to be a year offering a bit of a reality check to
one and all and redefined the dynamics to a great extent. The year also set the
tone for the next stage in the evolution of the start-up ecosystem. The
maturity in decision making that should ideally come in at this stage would be
a step in the right direction taking the start-up space in India towards greater
heights, as it deserves. The larger problems plaguing the businesses, such as
the unorganised and fragmented Indian market, lack of clear and transparent
policy initiatives, lack of infrastructure, lack of knowledge and exposure,
complications in doing business, etc. The framework and course of regulations
need to be updated and adopted as per the times. The right policy matter
announcements by lawmakers can be a push. In times like these, pro reforms
announcements are required to provide the much-needed impetus to the
general business environment in the country in the start-up space.
What is Start-up Company ?
A start-up venture could be defined as a new business that is in the initial stages
of operation, beginning to grow and is typically financed by an individual or small
group of individuals. It is a young entrepreneurial, scalable business model built
on technology and innovation wherein the founders develop a product or
service for which they foresee demand through disruption of existing or by
creating entirely new markets. Start-ups are nothing but an idea that manifests
into a commercial undertaking.
Grant Thornton (2016) defines start-up business as an organization which is
a) Incorporated for three years or less
a) At a funding stage of Series B or less (B Series means second round of
funding)
b) An entrepreneurial venture/a partnership or a temporary business
organization
c) Engages in development, production or distribution of new
products/services or processes
d) Revenue of up to INR 25 cr.
e) Not formed through splitting or restructuring
f) Employing 50 people or less
Department of Industrial Policy and Promotion (DIPP) define a start-up as an
entity incorporated or registered in India with following parameters:
• Established not prior to seven years, (for Biotechnology Startups not prior
to ten years)
• With annual turnover not exceeding INR 25Cr in any preceding financial
year, and
• Working towards innovation, development or improvement of products
or processes or services,
• It is a scalable business model with a high potential of employment
generation or wealth creation
It is to be noted that such entity is not formed by splitting up, or reconstruction,
of a business already in existence. Also, an entity shall cease to be a start-up if
its turnover for the previous financial years has exceeded INR 25cr or it has
completed 7 years (biotechnology start-ups 10 years) from the date of
incorporation/ registration (‘Start-up India’, 2017)
The Start-up Scenario in India
The start-up scenario in India is really India ranks 3rd when it comes to its ‘start-
up ecosystem’ with the first two spots occupied by the USA and China
respectively. What a tremendous shift it has been from the situation only a few
years back with over 1000 start-ups being added to the list in the year 2018
alone. India has the 3rd largest startup ecosystem in the world; expected to
witness YoY growth of a consistent annual growth of 12-15%
India has about 50,000 startups in India in 2018; around 8,900 – 9,300 of these
are technology led startups 1300 new tech startups were born in 2019 alone
implying there are 2-3 tech startups born every day.
Cities like Bangalore and the ones in the NCR region can be rightfully called the
start-up hubs of India for housing almost 80% of the total count.
Ecommerce start-ups in India constitute 60% of the total start-ups and hence
dominate the field.
India has succeeded in becoming a leader in the start-up space in the past
decade. The pace of growth in the startup ecosystem has increased to 15%
year-on-year in 2018, while the growth of the number of incubators and
accelerators has grown to 11%. Significantly, the number of women
entrepreneurs stood at 14%, up from 10% and 11% in the previous two years.
Startups in the country have been able to create an estimated 40,000 new jobs
over the year, taking the total jobs in the start-up ecosystem to 1.6-1.7 lakh
Bangalore has been listed within the world’s 20 leading startup cities in the 2019
Startup Genome Project ranking. It is also ranked as one of the world’s five
fastest growing startup cities
The Indian startups have gone on to raise sizeable ticket sizes from various
global and domestic funds. The top 15 deals constituted about 40% of total
deal value, demonstrating that most funds are valuing deal quality more than
quantity.
Private equity deal volume in India rose for the second straight year, and while
the average deal size declined slightly from the prior year, the total value of
$26.3 billion in 2018 was the second-highest of the last decade. The number of
deals greater than $50 million increased from the previous year.
It wouldn’t be wrong to say that the start-up ecosystem in India is not just
growing in scale but also maturing with years. Where till a few years back the
monopoly of cities like Bangalore and NCR was clear in the industry, now
smaller cities like Pune and Jaipur have also made their mark with the recent
emergence of start-ups. As a result of which India holds the 57th position in
the Global Innovation Index. The sector was dominated by B2B ventures
previously but now the rise in the number of B2C ones is evident. In that case,
it is not surprising that about 35 billion USD has come into the country for
investment in the past 4 years. India is growing, undeniably. So is the start-up
scenario in India. A lot of new and encouraging stories of start-ups have
garnered much-deserved attention. The start-up ecosystem in India is both
growing and maturing over the years.
IT SERVICES
HEALTHCARE & LIFE SCIENCES
EDUCATION
PROFESSIONAL & COMMERCIAL SERVICES
4.7 Lac
jobs reported by
39,000+ startups
590+ 44% 30
districts with of the States and
atleast one recognised UTs have a
recognized startups have dedicated
startup at least one startup policy
woman director
319 53,226
eligible orders received
startups have by startups with
been granted a value of over 37+
exemption under Rs 2,279 Crores regulatory
80-IAC of the through GeM reforms have
Income Tax Act portal been undertaken
by States and UTs
2.8 Lac
39 users
regulatory enrolled in
reforms enabled Startup India
with the help of L&D program
various Ministries.
DRIVERS OF STARTUP ECOSYSTEM
• Increasing smartphone penetration, expected to reach 490.9 million by
2022
The increasing smartphone and internet penetration is one of the major drivers
of this growth. The number of active internet users in India is growing at a rapid
scale with a year-on-year growth of 11%. The speed and magnitude of growth
are immense and so has increased consumption of data and information from
innumerable sources helping people make informed decisions.
KEY
PILLARS
KEY OBJECTIVES
• Support creative and innovative ideas through incubation and research and
development to transform them into valuable products, processes or
solutions to improve productivity and efficiency.
https://en.wikipedia.org/wiki/Startup_India
https://www.indiatoday.in/india/story/startup-india-19-key-points-of-pm-modis-action-
plan-304205-2016-01-17
https://cedcommerce.com/blog/the-maturing-startup-scenario-in-
india/#:~:text=There's%20a%207%25%20year%20on,%2435.3%20billion%20worth%20of%2
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