What is a Start up? How to begin a Start up in India?

What is a Start up? How to begin a Start up in India?

We come across the term "Startup" everyday in newspapers and television. However, most people are not aware what exactly a startup is. Also, many educated youth with innovative business ideas don't have a clear idea of how to start a business. As a entrepreneur myself, I wish to elaborate on the concept so that it would be useful to millions of youth looking for a kick-start through self-employment.

A Start up is an entrepreneurial project, usually started by a small group of individuals or a single person. The initial capital investment in startups is usual small. Often, startups begin as a result of ideas. These firms mostly offer an innovative product or service to consumers. For example, a startup could be an e-commerce site selling an organic product produced at homes. Flipkart in India is an example of a startup venture. Paytm has revolutioned mobile commerce in India. Startups can tap the power of crowdsourcing to acquire ideas for business. They can also rely on crowdfunding to finance their projects. Typically a small amount of money is collected from a large number of people through an online platform.

As far as India is concerned, Startup ecosystem is only getting started. Right now, most of the Startups are IT (Information technology) based companies and e-commerce sites. We have a long way to go to match the kind of Startups that evolved in Silicon Valley in the US. Just recently, State bank of India (SBI) created a dedicated start up fund of Rs 200 crore to help entrepreneurs and spur innovation

How to begin a Startup in India?

First of all, you need to have a business idea which must be innovative. A group of friends with such an idea can start a business. You could use Crowdsourcing to obtain more ideas for your business. For example, if your startup is based on the idea of collecting Plastic waste and use the same for manufacturing Decorative objects, you could use Crowdsourcing to find out how you could market your products. The government itself is running incubators to nurture Startups and provide them adequate assistance. They also provide Skill training to personnel employed in startups

The Indian government has recently brought a new policy enabling Startups to set shop without much paperwork and procedures. Once your startup is established, the next step is obtaining funding. There are many venture capital funds that are ready to invest in Startups. Tax exemption from capital gains tax has been provided to these funding agencies. You could also use Crowdfunding to obtain funds for your Startup.

Please visit india.gov.in for details regarding Startups

Angel investors: You could avail the services of Angel investors. Angel investors are mostly entrepreneurs themselves with money in their hands and who are willing to invest in people who have business ideas. They can also provide mentorship in the initial days of beginning a Startup. Sometime ago, industry Stalwart Ratan Tata invested in many startups in India. Former Infosys chief financial officer T V Mohandas Pai is also an investor in startups. Corporate companies will also step in to help you with finance if you have the right ideas

10000startups.com is a startup initiative by NASSCOM in India

Do market research: You need to do extensive market research in order to make your product or service successful. You can use the internet itself to do market research on a subject. Learn the preference of customers, their decision making, grievances etc. You also need to study about your competitors in your domain and what they are up to.

Legal advice: Startups need legal advice in order to deal with issues like Patent suits, Tax disputes etc. You could hire a lawyer for this purpose. The government under its “Startup India” plan is planning to provide free legal assistance for startups

Start up India Plan: “Startup India” is the special scheme of the central government to encourage startups to grow in the country. The aim is to encourage entrepreneurs. Our Prime minister Mr Narendra Modi has promised many incentives like Tax holiday and capital Gains tax exemption. Startups will be exempt from payment of income tax for 3 years. A liberalized patent regime is also provided to encourage startups innovate more products. An easy exit plan is also provided in case of bankruptcy. Soon the government will launch a mobile app for startups to interact with government agencies

Startup villages: The government is encouraging “Startup Villages” in India. These are business incubators which will handhold entrepreneurs and create a cluster of startups. A Startup Village based on technology startups has been started in Kochi. The government has funded Rs 300 for the project and the concept is envisaged to be developed on the lines of Silicon valley in the USA. Students will be provided funding for converting ideas into prototypes. The best prototypes will be given an interest-free loan of Rs 1 crore. So far more than 3,000 jobs have been created

SBI Entrepreneur Scheme: Under its entrepreneur scheme, SBI (State Bank of India) provides financial assistance to qualified and experienced entrepreneurs to setting up Startups. Technocrats who are unable to meet the normal margin requirements can avail the scheme. The person needs to possess the required educational qualification or technical expertise. For assistance upto Rs 5 lakh, no margins are required. For further information, you could visit www.sbi.co.in