Indian Enabler Ecosystem is Producing tomorrow's Trailblazing Entrepreneurs
This appropriate quote has laid the foundation of India’s startup ecosystem. Innovation, invention, reshaping and redefinition are the four pillars of a startup. Startups are one of the dazzling cornerstones of Indian economy which is helping India to get out its status of third world country and becoming one of forerunners of world economy and standing in the same row with one of the wealthiest economies across the globe, United States of America. From the time immemorial, Indian economy was drooping and tottering. It was quite dependent on the wealthiest Leaders like the US, UK, Japan or Russia, but today we can proudly announce that India has the status of third largest economy in the world.
India is a populous country unlike the US and UK. So, improving the economic condition of India needs a stubbornly robust economic system and initiatives which make every corner of the society brighter and shinier. Indian enablers are a few bright stars in the universe that are coming up and bearing the heavy load of those potential brains. They are bound to create wonders in the near future.
Entrepreneurship is all about creating and innovating ideas and execute it in its finest form. A greater number of startup companies have stepped into the industry, taking potential risk, leading the local youth and thus developing the rational nation towards a self-dependent economy. As its undeniable consequence, the number of startups increased in 9x speed. In 2016, there were only 452 startups, but till the end of 2022 there are 84,012 registered startups in India. This wave of awakened entrepreneurship has invigorated the growth by creating millions of potential job opportunities, developing new innovative products & services and fostered the welfare of the whole society. Indian Gross domestic product (GDP) is expected to grow by 6.9 percent in the fiscal year (FY) 2022-23 and 6.2 percent in FY 2023-24.
For the creative and risk-taking leaders, it is very important to know their companions who will guide them, nurture their ideas and shelter them till they reach to a ground-breaking level. Working capital is incredibly important for any startups because it is the life blood of a company. It helps in i) Research and development of product ii) Buying raw materials & equipment iii) Marketing & Sales promotion iv) Buying or renting Office Space & Admin Expenses v) Prototype Creation vi) Legal & consulting services vii) Licenses & certifications viii) Hiring or recruiting staffs.
Let’s take a look at the Godfathers of Indian startups:
Investors & Mentors: Investors are the parent of the startup companies who provide them initial funding and help them to go ahead. There are multiple forms of investors. Notable of them are
1. Angel Investor: They are always focused on helping the startups to grow in the initial stages instead of obtaining a profit from it.Angel investors are also referred to as business angels, seed investors, private investors, angel funders, or information investors. According to Wealth Pursuits, in the last financial year, angel investment farms has raised $24 billion and incredibly contributed towards the growth of 64,000+ startups. Most surprising truth regarding this is 22 percent of the Angel investors are women. Ratan Tata of Tata Motors, Anupam Mittal of Shaadi.com,Binny Bansal of Flipkart are few eminent names of Angel investors in India.
2. Venture Capitalist: They nurture and guide the new farms and work as the backbone of the company and look for multiple ways to absorb the return on their investment. According to the data of The Economic Times, total of 1,726 VC funding deals worth $20.9 billion were announced in India in 2022 compared to 1,715 deals worth $33.8 billion in 2021. Matrix partner, Sequioa Capital, and many more are famous venture capitalists of India.
3. Accelerators: Startup accelerator provides resources and services such as guest speakers, advising hours, a negotiated amount of capital and sometimes a shared coworking space. The most popular sectors for startup accelerators include tech hardware, AI and biotech. Few well-known accelerators are Airbnb, Dropbox and Reddit, and Techstars, which has sponsored over 21 startups. Accelerators can reduce the cost of launching a startup by as much as 50 percent.
4. Incubators: They help gearing up the sale of your business by providing technological facilities and advices, initial growth funds, network and linkages, co-working spaces, lab facilities, mentoring and advisory supports. Incubators provide foundational business services, to support founders from ground zero as they find product-market fit. The startups that are connected to an incubator has 87 percent success rate. Nearly, 350millions of startups are being created every year and the number of incubators is increasing by leaps and bounds. Presently, there are more than 7000 incubators in India. Venture Catalysts, CIIE.CO, WE Hub are the famous incubators across Indian Subcontinent.
I see startups, technology and innovation as exciting and effective instruments for India’s transformation - Shri Narendra Modi
5. Government Bodies: We cannot forget that India is village centric country where maximum part of the land parcel is belonged to a village. Unlike the dazzling, hot and happening lives of urban population, the villagers are greatly detached from the light of development. Thanks to the wide reach of broadband and mobile internet that lion’s share of Indian villages is now connected to the whole world. Here, government came to the forefront with multiple number of startup schemes and initiatives so that the culture rich innovative products and ideas do not die out.1000 crore rupees was allocated for the Fund of Funds for Startups Scheme by 15th and 16th Finance Commission cycle, out of this fund 7,527.95 crore was approved for Alternate investment fund (AIF), for Karnataka alone the amount of AIF is 1,719.75 crore. Startup India Action Plan was organized on 16th January 2016 by our honorable PM.
6. Foreign Investments: FDI or Foreign direct Investments are a boon for the Startups as it boosts the manufacturing as well as the service sectors. Before receiving the amount of FDI, the startup company has to pass the regulatory compliance and get the necessary certifications. Indian startups had raised $16.2 billion of foreign investment during the 2022.
Last Note: Indian people have now realized that making our own products and services, patronizing young visionaries and more innovative ideas, the country can make their ways to the top position. Increasing number of startups in India has hit hard and has changed the age-old thought process of being a mere salaried person in a company. It encourages the young aspiring minds that are ready to take a deadly jump and walk through the stony rough roads full of thorns and achieve unbound happiness through success. Business Schools like IIM, ISB are working as the frontliners by guiding, teaching and nurturing the innovative ideas and showing them the shortest and easiest ways of executing those ideas and also helps in raising funds by introducing them with many well-known business farms and eminent personalities where the students can approach in future. Indian Startup Ecosystem has seen15X increase in the total funding of startups, 9X increase in the number of investors and 7X increase in the number of incubators. India is a proud parent of 108 Unicorns with a total valuation of $340.80 billion.