We knew startups have finally carved a niche for themselves, the moment our Indian Government decided to roll out the StartUpIndia Initiative. This initiative that claims to redefine and restructure the entire entrepreneurial ecosystem of India, has been well-received amongst much fanfare.
In the February 2016 Edition of Startup Saturday Delhi, we decided to dwell a layer deeper and re-examine if the StartUpIndia Initiative marks the beginning of an era, or is just another government hoax and we are getting our hopes up for nothing.
The panel of speakers were selected after careful evaluation, covering all aspects of Startups: the Entrepreneurs, the Investors and the Financial Advisors.
Speaker Session 1 : Vivek Mohan, CTO, Innov8 on Global Co-working Spaces
The first Speaker for the afternoon was Mr. Vivek Mohan, CTO of the popular co-working space, Innov8. Since the StartUpIndia Initiative is all about creating this ecosystem for startups, Vivek shared his insights on the Global Co-working Spaces. Remembering the renaissance era that witnessed the coming of age of Silicon Valley, Vivek spoke about how Silicon Valley in itself is an Ideology traversing much beyond the physical space. Praising the Indian startup ecosystem, Vivek added how the credit actually goes to the entrepreneurs that compelled the government to view viable opportunities in Entrepreneurship and finally come up with the StartUpIndia Initiative.
Talking further about the co-working spaces, Vivek discussed the 18 Mistakes that Kill a Startup by Paul Graham. Undoubtedly, his favourite two happened to be:
1. Bad Space, and
2. Spending too much.
Further extending his advice to the young and aspiring entrepreneurs, Vivek shared the benefits and challenges of working in a Co-working space. While it can be quite challenging to register the co-working space as your office, it offers a host of benefits. Getting an opportunity to come daily and work in the presence of other passionate folks who have embarked upon a journey same as yours is the key benefit of a Co-working space, where motivation and problem-solving comes free of cost.
Speaker Session 2: Pulkit Ahuja, C0-Founder, Cabsguru on Essential Entrepreneurship Lessons
Vivek was followed by Pulkit, who greeted the stage with his quintessential humility and sense of humour. He shared his experience moonlighting at his startup, Cabsguru, which is a second level aggregator of cab rental services like Ola, Uber and Taxi for Sure.
Honestly sharing the journey and the liberties they had to take in the beginning lest their startup doesn’t see the light of the day, Pulkit shared two key lessons with the fellow entrepreneurs:
1. It is always easy to ask for Forgiveness than Permission – To provide users with the most appropriate comparison of different prices offered by Ola, Taxi For Sure, Uber and other taxi rental services, they needed certain backend information. However, even after repeated tries, none of the service providers reverted and hence they went ahead with it anyway. Gladly though, there was no harm done. However, before acting on this advice, kindly read what our next speaker shared.
2. Mould yourself as per what the user expects – as a startup, always be ready to embrace change.
He further gave away his success mantra to the fellow aspirants, and it came wrapped up in a word we all have fond feelings for: TRIP! You must have enjoyed those weekend getaways or long trips with friends and families. Here is how the same word comprises the success mantra you need.
T – Team: To have a successful startup, build the right team.
R – Revenue Model, and for a successful revenue model, be close to the pulse of your user.
I – Investors or the right sort of Investment.
P – Patience! You need to be in the mental capacity to create something substantial and then just wait and watch!
Speaker Session 3: Gaurav Talwar from Felix Advisor, Financial Advisor for Startups
Does StartUpIndia Initiative really make India the Silicon Valley of the developing countries? Mr. Gaurav Talwar graced the stage and covered several key financial concerns people have with regards to the StartUpIndia Initiative.
Unlike Pulkit, Gaurav didn’t share the same opinion that Forgiveness is easier than seeking Permission – not in the financial matters at least. He advised budding entrepreneurs to focus on their business and get a financial expert on board to manage the finances. It get even trickier if you manage to score Foreign Investment. Speaking from experience, he advised entrepreneurs to not be complacent in paying taxes, adhere to guidelines and keep the accounting books clean, updated and organised.
Recently a lot of leading Startups have shifted bases from India to competitive markets like Singapore. Grofers has been one of the recent examples. While this sort of a brain drain is for the policy makers to control, Gaurav did share key insights for entrepreneurs contemplating shifting headquarters to the USA, Singapore, Brazil or other such competitive markets offering further ease of carrying out business. If you are contemplating moving bases, do consider the following:
1. The best country for your business is subjective. Let the unique requirements of your business decide the preferred country.
2. Feasibility of doing the business, with regards to the opportunities and policies.
3. People: You would need people you can trust to manage your business in your absence; find a team you can depend upon.
4. Startup Specific Country Policies: Certain countries, such as Singapore would expect you to fly at least once a year, if you have shifted bases there. However, Mauritius doesn’t come with any such restrictions, hence offering more freedom.
Panel Discussion on Narendra Modi’s #StartUpIndia Initiative
After already covering StartUpIndia in brief snippets, it was time for a full-fledged panel discussion on the initiative.
First, we had Amit Mishra, Country Head of F6S, explaining the definition of a Startup that would qualify for the schemes and benefits under the StartUpIndia initiative. The company can be either Private Limited, Partnership firm or LLP with less than 5 years in business from the date of registration and an annual turnover of less than 25 Crore. Furthermore, to qualify as a Startup the company should develop an innovative and commercially valuable product that adds value to the society at large.
Whoof! That sounds quite a lot, right? Hence, we next move to Pulkit Ahuja from Cab Guru and asked him to share the ‘Top 3 problems entrepreneurs face in India’. Quite straight-forwardly he called them out as:
1. Taxes – especially the huge variation between taxes applicable on different sectors.
2. Banks – and their insistence on making you (as an entrepreneur) do all the running around.
3. Corporate Card – which is difficult to receive if you do not have a physical office / on lease documents.
However, he is hopeful that the StartUpIndia Initiative is soon changing the scenario. For one, banks have started coming up with schemes and waivers specifically for the startup businesses.
At which point, we took the attention to Gaurav Talwar. Covering the Financial Perspective, he shared the 3 Biggest Benefits of StartUpIndia for Entrepreneurs:
1. Creating the Cult Feeling around the Startup Ecosystem
2. Tax Benefits – since from the date of inception and with an annual turnover under 25 crore, no startup is supposed to pay taxes for 3 years. Besides, if a small time investor is investing into a Startup by selling his property, the income from the sale is not scrutinised under taxes.
3. Government is setting a Fund of Funds and hence not directly interfering with the progress of startups. Government will put its funds in the Incubator Funds that would evaluate and fund the startups.
Finally, covering the Investors’ perspective, we had Prakhar from Mumbai Angels. He did give the green signal to the present day startup age, calling it perhaps the best time for people to startup. However, he was quick to advise entrepreneurs to know their limitation and not do something just because it is hot.
Furthermore, he encouraged entrepreneurs to work on Idea simplification. Often, investors find it the easiest to invest in a startup that comes up with the simplest of solutions to pressing problems.
However, a general consensus of panelists voiced the same concern. We all have to still wait for the budget and the revised policies. Till the time these changes are reflected in the budget and the policies, all this is still a hearsay.
Written by: Sahil Verma