Investors pumped $9 billion into Bharateeya startups in 2015 and the momentum continues with over $38 million invested in the first 10 days of 2016. The real question is whether ‘Startup India Standup India’ initiative can create an ecosystem involving a combination of capital raising measures and incubation centres minimising the bureaucratic hassels.
By the time this article is published ‘Startup India Standup India’ Scheme as announced by the Prime Minster Narendra Modi would have already been launched on January 16. For the first time in the history of Bharat, the government is paying so much interest and giving the much-deserved recognition to the startup sector. While addressing the nation on the 69th Independence Day from the Red Fort, Prime Minister said, “We are looking at systems for enabling startups. We must be number one in startups… Startup India; Stand up India.” He even stated that each of the 1.25 lakh bank branches should encourage at least one dalit or tribal entrepreneur and at least one woman entrepreneur.
While he was at Silicon Valley, the Mecca of finest startups, his interaction with the CEOs generated a wave of optimism in the startup industry.
However the Prime Minister has time and again stressed for startups to be more active in aiding to solve Bharat’s problems through social entrepreneurial ventures. There are certain expectations by the startup ecosystem which if met, is enough to face-lift the dynamics of the present-day scenarios. These developments are need of the hour at the dawn of ‘Startup India Standup India’ initiative which will recognise entrepreneurial engagements at the highest policy levels.
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Easing of ‘Ease of Doing Business’ in Bharat
Out of 189 economies, Bharat ranks at a dismal 142 in terms of ease of doing business. Policy initiatives that improve this discouraging figure will directly become a motivating factor for mushrooming of new entrepreneurs of Bharat. Being ranked at 142 also suggests that Bharat is currently entangled in a web of complex law, rules and regulations that act as speed breakers to the growth of indigenous businesses. Significant provisions for startups in the Budget session in February 2016, can very well be encouraging for the ecosystem.
According to a 22-year-old business developer, Ayush Rajesh, “We just want to start with an idea, anything that calls for paperwork should be done away with, especially with respect to startups. If government wants to do anything significant for ease of doing business, it should do away with paper work by making the procedural formalities online, only.”
Legal Framework Support
The legal framework of the country, if made conducive to startup growth and development -so much so that they face little legal clashes, can not only speed up startup penetration, but also ensure better presence in terms of productivity and development. Surprisin-gly, the government is yet to define the term ‘online marketplace’ or explicitly mention what constitutes retail and wholesale trading on such platforms, making the legal area for startups highly complex and confusing.
Easier Insurance Norms
Entrepreneurs who want to start an online venture to sell or compare insurance products face stringent regulations. The entrepreneur has to first apply for a licence from Bharat’s Insurance Regulatory and Development Authority and have a minimum net worth of Rs 10 lakh. Since 2011, only seven startups have managed to get themselves registered, including AccurateQuotes, a part of PolicyBazaar.com, MyInsurance Club.com, Policymantra.com and InsuringIndia.com.
Faster Internet Services
While the reach of mobile and Internet is growing in Bharat, there is still miles to go when it comes to efficient connectivity. Prabhu Guliani, senior marketing consultant at Socio Wash, an early stage startup says, “We understand that we might not have a physical infrastructure, but what is stopping us to build a digital infrastructure? We have a digital India programme running, and order to yield early fruits of it, first thing needs to be done is to have a completely digitised Startup India programme, as nearly half of the ventures that get started have an online presence and market alone”.
We still have a long way to go when it comes to broadband or mobile internet connectivity. At a disappointing average internet speed of 2.0 Mbps, we provide the slowest internet speed in entire Asia-Pacific and currently rank 115th internationally in terms of average internet speed. It’s no secret that Internet connectivity is the lifeline of any startup. Putting Digital India Programme on fast track can help in addressing this issue.
Investment Ready Bharateeya Diaspora
The Bharateeya Diaspora is a pool of talent in terms of technical and business expertise. Though PM Modi is significantly regenerating the interests of Bharateeya Diaspora to connect back with Bharat, efforts must be made to specifically encourage them to invest in local businesses and entrepreneurial ventures, through huge amount of investment ready capital they already.
Incubating Entrepreneurs in Universities
Cash heavy foreign universities always support entrepreneurial ventures which evolved in their campuses. Easing their entry into the Bharateeya educational and incubator space by allowing them to fund, invest and patent Bharateeya entrepreneurial ideas is incremental for the innovation and invention acumen of Bharateeyas and our entrepreneurs. CIIE, a startup incubator run by IIM Ahmedabad, can serve as an indigenous example in this domain. Bharateeya college students particularly should be encouraged to become entrepreneurs.
Recently graduated 22-year-old Abhinav Arora, had started a startup teaming up with graduates from IIT Delhi. “There is hardly any initiative, plan, or encouragement to incubate startups in prestigious university like Delhi University, It’s sad that a lot of talent is getting wasted today, sometimes helplessly unemployed, because there’s hardly any effort to support our ideas to be self-employed.”
It is also important to draw inspiration from successful models of startup developments abroad and seek its application in the domestic scenarios.
Recently, Belgium’s capital Antwerp received Startup Nations Award for Local Policy Leadership through its Mayor. The city that has experienced a vast turnaround of its missing startup ecosystem fell in the hands of ambitious policy initiatives like “Antwerp Startup City Program of 2014”.
Startup Poland for example, represents innovative entrepreneurs with a goal to build awareness of the great potential of startups among decision-makers, politicians and local government officials. Startup Poland Manifesto, its highlight, which is now in the hands of the Polish President and all his Ministers, calls for following action: Promotion of the startup investing culture; Consultations with the public sector regarding legislative changes that improve growth of the startup ecosystem; Increase of the data’s availability gathered in public offices; Entrepreneurship education in schools from an early age; Better and more effective incentives for the creation of “startup schools”; Simple procedures for the transfer of public funds; Tax mechanisms friendly to business angel investors.
With External Affairs Minister, Smt Sushma Swaraj all set to visit Israel in days ahead; the visit can prove to be interesting development when it comes to startups as well. The challenge for the government is to create an ecosystem to ensure the startups do not have to go through the long government procedures and regulations. -Divyansh Dev