Rohit Gawli, Chief Executive Officer, Lokal Kitchen, 0
Two Indian policies; Make in India and Make for India were bought into action with the aim of revitalizing the Indian economy through domestic manufacturing and consumption. Although I feel more could be done for India, the 3rd largest startup ecosystem in the world.
The term ‘startup’ has been defined as ‘a young company which could be an entrepreneurial venture or a new business’. First announced in 2016 by the government to align with Make in India, Startup India’s primary objectives included funding support, financial incentives, incubation and facilitating industry-academia partnerships for all enterprises that meet the criteria prescribed under the GSR notification 127 (E) issued by the Ministry of Commerce and Industry.
India’s startup sector is expected to witness a consistent year on year (y-o-y) growth of 12 percentages – 15 percentages. Moreover, startup India’s website states that India has approximately 50,000 startups as of 2018. And yet we have a huge gap to address when it comes to creating the supportive infrastructure or the right conditions to help Indian startup owners. Here are a list of top challenges along with growing trends in the Indian startup ecosystem:
• No Or Less Funding/ The Funding Gap: Currently, most Indian entrepreneurs feel getting adequate venture funding is very tough. Most startup ideas don’t get funded for a long time, not only in India but pretty much any place in the world. Although, there is one perception amongst most Indian startup founders, which is that funding a startup is much harder in India than in more mature startup ecosystems (for example, the US). I believe that the problem India is facing is that of a
conceptual gap, a gap that exists between “great ideas” and “fundable ideas”. I also firmly believe that while this gap is not unique to India, it appears to be relatively large in India. Sooner or later it will become necessary to understand and decode this gap to be able to bridge it.
•The Startup Scaling Gap:Entrepreneurial ideas can build from a hobby or a passion with no business model to huge businesses with massive return potential. There is a mismatch between bringing the idea alive from concept to competition, and actually implementing it in the market to scale up. Many ideas are great on paper, but the unit of economics does not work well when you’re trying to implement it in reality.
•The Technological Gap:There is a huge need for innovative technological solutions, particularly those that alleviate poverty and benefit a large number of people. Given the scale of India and its resource constraints, low-cost, high-impact solutions are required. Technology startups play a crucial role in accomplishing this, because of their potential for scalability and exponential growth. There is a dire need for the government to enable policies and initiatives that will imbibe and support the entrepreneurial spirit of IIT graduates.
• The Diversity Divide: In general, a gap exists between those who provide solutions and those who are supposed to actually use them. In order to build successful home grown products, startups need to bridge this gap and develop an in-depth understanding of the customers and their needs. This is extremely difficult in the Indian context: India is a highly diverse country with a plethora of cultures, languages, ethnicities and religions.
• Employing Experienced Employees: For many job-seekers, joining a startup as an employee is not an attractive career option, due to the inherent risk that the startup might fail, besides, a startup is not able to provide as many benefits as a MNC usually provides. Instead, the majority of Indian millennial generation will prefer to work for large brands, which promise more stable jobs. In addition, startups can rarely compete with big company’s in terms of salaries or reputation.
The majority of indian millennial generation will prefer to work for large Brands, which promise more stable jobs
•The Startup Scaling Gap:Entrepreneurial ideas can build from a hobby or a passion with no business model to huge businesses with massive return potential. There is a mismatch between bringing the idea alive from concept to competition, and actually implementing it in the market to scale up. Many ideas are great on paper, but the unit of economics does not work well when you’re trying to implement it in reality.
•The Technological Gap:There is a huge need for innovative technological solutions, particularly those that alleviate poverty and benefit a large number of people. Given the scale of India and its resource constraints, low-cost, high-impact solutions are required. Technology startups play a crucial role in accomplishing this, because of their potential for scalability and exponential growth. There is a dire need for the government to enable policies and initiatives that will imbibe and support the entrepreneurial spirit of IIT graduates.
• The Diversity Divide: In general, a gap exists between those who provide solutions and those who are supposed to actually use them. In order to build successful home grown products, startups need to bridge this gap and develop an in-depth understanding of the customers and their needs. This is extremely difficult in the Indian context: India is a highly diverse country with a plethora of cultures, languages, ethnicities and religions.
• Employing Experienced Employees: For many job-seekers, joining a startup as an employee is not an attractive career option, due to the inherent risk that the startup might fail, besides, a startup is not able to provide as many benefits as a MNC usually provides. Instead, the majority of Indian millennial generation will prefer to work for large brands, which promise more stable jobs. In addition, startups can rarely compete with big company’s in terms of salaries or reputation.