Challenges for New Venture Planning

SPECIMEN OF PROJECT WORK Project Title: Challenges for New Venture Planning A project submitted in partial fulfillment of the Requirements for the Degree of B.Com (Hon’s.) 2017-2020 By TULSI College Roll No – BCFIN17617 Registration No – KU1718136 University Roll No – 181605443199 UNDER THE SUPERVISION OF Dr. Aftab Alam Ansari Faculty of Commerce Karim City College, Jamshedpur - 831001 2020 1|Page

Karim City College Faculty of commerce, Jamshedpur CERTIFICATE OF APPROVAL This project entitled “Challenges for New Venture Planning” Is hereby approved as a creditable commerce study carried out and presented in a satisfactory manner to narrate its acceptance as prerequisite to the Degree for Bachelor of commerce (B.Com Hons.) which is being submitted. PROJECT SUPERVISOR EXTERNAL EXAMINER 2|Page

ACKNOWLEDGEMENT Working on this project entitled Challenges for New Venture Planning. Was a source of immense knowledge to me I would like to express my sincare gratitude to my project supervisor Dr. Aftab Alam Ansari for his guidance and valuable support, inspiring discussions and constant supervision throughout the course of this work. I am also thankful to my Honorable Principal Dr. Mohammad Reyaz for his inspiration. I am also thankful to our H.O.D. Dr. Aftab Alam Ansari for his help during my project work. I acknowledge with a deep sense of gratitude, the encouragement and interpretations received from our faculty members and colleagues. I would also like to thank my parents for their love and support. Name: TULSI College Roll No : BCFIN17617 Registration No : KU1718136 University Roll No: 181605443199 3|Page

CONTENTS Page No. 1. List of Tables 4pc 2. List of Figures 4pc 3. Chapter 1. INTRODUCTION 6-18 4. Chapter 2. LITERATURE REVIEW 19-29 5. Chapter 3 METHOD 30-41 6. Chapter 4. RESULTS & DISCUSSION 42 7. Chapter 5. SUMMARY AND CONCLUSION 43 8. Reference 44 4|Page

1. INTRODUCTION (Specimen) In introduction, following contents should be covered. 1. Background 2. Justify the choice of the topic and to state clearly the objectives 3. Scheme of chapterisation 2. Literature review 3. Methods A. Research Design B. Secondary data collection method C. Sampling design D. Statistical tools used 4. Results & Discussion Discriminately selected data compared the results and interpretations to other studies citing references form the analysis Must try to justify. How the results have contributed to the existing knowledge and profession practice 5. Summary and conclusions 6. References 5|Page

Chapter 1 Introduction A startup venture could be defined as a new business that is in the initial stages of operation, beginning to grow and is typically financed by an individual or small group of individuals. It is a young entrepreneurial, scalable business model built on technology and innovation wherein the founders develop a product or service for which they foresee demand through disruption of existing or by creating entirely new markets. Startups are nothing but an idea that manifests into a commercial undertaking. Grant Thornton (2016) define startup business as an organization which is • Incorporated for three years or less • At a funding stage of Series B or less(B Series means second round of funding) • An entrepreneurial venture/a partnership or a temporary business organisation • Engages in development, production or distribution of new products/services or processes • Revenue of up to INR 25 cr. • Not formed through splitting or restructuring • Employing 50 people or less Department of Industrial Policy and Promotion (DIPP) define a startup as an entity incorporated or registered in India with following parameters: • Established not prior to seven years, (for Biotechnology Startups not prior to ten years) • With annual turnover not exceeding INR 25Cr in any preceding financial year, and • Working towards innovation, development or improvement of products or processes or services, • It is a scalable business model with a high potential of employment generation or wealth creation It is to be noted that such entity is not formed by splitting up, or reconstruction, of a business already in existence. Also, an entity shall cease to be a startup if its turnover for the previous 6|Page

financial years has exceeded INR 25cr or it has completed 7 years (biotechnology startups 10 years) from the date of incorporation/ registration(‘Startup India’, 2017) Indian marketing is getting treasure for startups because tremendous opportunities available for their development. The startups usually tiny and initially financed through own funds rather than taking loans from outsiders. Startups build unique products or services in the market. They understand the common problems in the market. There are couple of examples are available where startups come out of the real problems faced in the market like Redbus, Ola cabs, Flipkart, Paytm makemytrip, these companies are regular application on the fingertips of the public. The growth and development of any country on the establishment of industries. The Indian market is headed by Entrepreneurs’ hub where there is a lot of resources available; the government is also giving preference for startups. According to The Ministry of Commerce and Industry released a notification on April 1st, 2015 to define a startup, an entity will be identified as a startup 1. Till up to five years from the date of incorporation. 2. If its turnover does not exceed 25 crores in the last five financial years. 3. It is working towards innovation, development, deployment, and commercialization of new products, processes, or services driven by technology or intellectual property.” 1. Government initiatives Indian government is serious in promoting entrepreneurship at the startup level and has taken a number of initiatives to ensure appropriate support. In this aspect it is relevant to mention ‘Make in India’ campaign introduced in September’14 to attract foreign investments and encourage domestic companies to participate in the manufacturing sector. The government increased the foreign direct investment (FDI) limits for most of the sectors and strengthened intellectual property rights (IPRs) protection to instill confidence in the startups.In order to make the country as number one destination for startups, Government of India (GoI) has introduced a new campaign called ‘Standup India’ in 2015 aimed at promoting entrepreneurship among women and to help startups with bank funding. Another commendable and far reaching initiative is ‘Digital India’ introduced in 2015 to ensure government services are made available to every citizen through online platform that aims to connect rural areas by developing their digital infrastructure which translates into a huge business opportunity for startups. 7|Page

2. The startup scenario in india It is to be noted that every year more than 800 technology startups are being set up in India. By 2020, it is estimated that around 11,500 tech-startups are going to be established with employment potential of around 250,000 technical people (NASSCOM, 2015). It is admirable to note that India is amongst the top five countries in the world in terms of startups with 10,000+ led by US with 83,000+ comprising 43% tech-based firms with 9% managed by women entrepreneurs. The number of incubators also has crossed 100 in 2014-15 to give boost to the startup saga (Grant Thornton, 2015).Sector wise, the distribution of Indian businesses is: Table:1 Break-up of Indian Startup Businesses Technology Based Non-Technology Based E-Commerce - 33% Engineering- 17% B2B - 24% Construction-13% Internet - 12% Agri- products- 11% Mobile apps - 10% Textile - 8% SaaS - 8% Printing & packaging – 8% Other – 13% Transport & logistics- 6% Outsourcing & support -5% Others-32% Source: Startups India- An Overview, Grant Thornton, 2015 3. The startup ecosystem Along with government initiatives, there is a definite movement in startup arena in India due to penetration of IT and internet. Many startups are coming up in service sector including education, legal, retail, insurance and health. With customers becoming aware of the benefits and convenience, the popularity and viability of startups is no more a difficult proposition for an entrepreneur. A number of venture capitalists and angel investors are aggressive and gung-ho on Indian startups as they see lot of potential with few expected to become unicorns (high valued 8|Page

companies) bringing in good returns. On the contrary, there are examples of few startups that failed and eventually closed their businesses due to various issues and challenges. India being a large country with over 130Cr population, boasts of high demographic dividends due to large number of young people. According to the latest UN report India with 356 million 10-24 year-olds have the largest concentration of youth population who are going to be the driving force behind innovation and creation with commensurate demand and consumption of goods and services (Mittal, 2014). India has a unique set of problems due to multicultural and multilingual regions that need innovations to find solutions to health, education, infrastructure, sanitation and for population at the ‘bottom-of-the-pyramid’ space. Each problem provides a unique opportunity for startups to create a business around it. India's tele-density reached 76.55 percent with a subscriber base of 95.76Cr bringing in convenience and reach to consumer segments including Tier-2 and 3 towns (TRAI,2017).This increased mobile penetration has given a fillip to Indian economy with E-commerce garnering increased share. Further, GoI’s digital push is going to improve connectivity and data to higher levels bringing in more software applications to find solutions for day-to-day issues. The reduction in data charges will also help start-ups to tap into new markets and even disrupt traditional businesses. 4. Issues and challenges of startups A successful start-up cannot start a business just with passion and an idea. A high level of leadership skills with clear understanding of market, excellent communication skills, maturity to see things in right perspective along with the ability to take calculated risks are required on the part of the entrepreneur(Aggarwal,2017). Lack of awareness, multiple clearances, unorganised market, poor infrastructure in Tier 2 /3 cities, lack of mentoring , stringent exit policies, corruption/red tape, technological risk, regulatory obstacles and lack of reforms keeping pace with the fast evolving market changes are some of the challenges as per Rashmi Guptey, Principal (Legal) of Lightbox India Advisors Private Limited. Some of the major issues and challenges are discussed below: 1) Financial Resources Availability of finance is critical for the startups and is always a problem to get sufficient amounts (Mittal, 2014; Truong, 2016). A number of finance options ranging from family 9|Page

members, friends, loans, grants, angel funding, venture capitalists, crowdfunding etc are available. The requirement starts increasing as the business progresses. Scaling of business requires timely infusion of capital. Proper cash management is critical for the success of the startups (Skok, 2016;Pandita,2017). A recent report paints a gloomy picture with 85% of new company’s reportedly underfunded indicating potential failure . 2) Revenue Generation Several startups fail due to poor revenue generation as the business grows. As the operations increase, expenses grow with reduced revenues forcing startups to concentrate on the funding aspect, thus, diluting the focus on the fundamentals of business. Hence, revenue generation is critical, warranting efficient management of burn rate which in common parlance is the rate at which startups spend money in the initial stages. The challenge is not to generate enough capital but also to expand and sustain the growth. 3) Team Members To find and hire the right kind of talent for the business with skills to match growing customer expectations are one of the biggest challenges (Truong,2016). Apart from founder(s), startups normally start with a team consisting of trusted members with complementary skill sets. Usually, each member is specialized in a specific area of operations. Assembling a good team is the first major requirement, failure to have one sometimes could break the startup (Skok, 2016). According to a survey, 23 percent startups failed because members did not work as a team. Chirag Garg, CEO, HyperDell, feels that bringing in affordable talent at the right time is a challenge. As per Nitin Sharma, Principal & Founding member, Lightbox India Advisors Private Limited “Hiring and retaining high quality talent, especially in the areas of product and technology remains a key challenge” (Choudhary,2015) 4) Supporting Infrastructure There are a number of support mechanisms that play a significant role in the lifecycle of startups which include incubators, science and technology parks, business development centers etc. Lack of access to such support mechanisms increases the risk of failure. 10 | P a g e

5) Creating Awareness in Markets Startups fail due to lack of attention to limitations in the markets. The environment for a startup is usually more difficult than for an established firm due to uniqueness of the product. The situation is more difficult for a new product as the startup has to build everything from scratch. 6) Exceed Customer Expectations The next most important challenge is gauging the market need for the product, existing trends, etc. Innovation plays an important role, since, that the startup has to fine-tune the product offerings to suit the market demands (Skok, 2016). Also, the entrepreneur should have thorough domain knowledge to counter competition with appropriate strategies. Due to new technologies that are emerging, the challenge to provide over and above an earlier innovation is pertinent. Namrata Garg, Director, SendKardo feels that the biggest challenge is the need to constantly reinvent yourself and come up with a service to be able to match up customer expectations and exceed them. 7) Tenacity of Founders Founders of startups have to be tough when the going gets tough. The journey of starting a venture is fraught with delays, setbacks and problems without adequate solutions. The entrepreneur needs to be persistent, persuasive, and should never give up till he/she achieves desired results. History is replete with startups who gave up the fight when things went wrong. Sometimes the product could be ahead of its time or may require complimentary technology /products for the use by the customers. For example, Apple had to delay introduction of iTunes till the regulations favoured the launch. It is also relevant to quote Steve Jobs who by commenting “A lot of times, people don't know what they want until you show it to them” reiterates the fact those products from startups mostly fall in the “new and untried” category where the success rate is minimal. 8) Regulations Starting a business requires a number of permissions from government agencies. Although there is a perceptible change, it is still a challenge to register a company. Regulations pertaining to labor laws, intellectual property rights, dispute resolution etc. are rigorous in India which takes about 30 days to comply compared to just 9 days in OECD countries. 11 | P a g e

Also, as per World Bank report, “World Bank Ease of Doing Business”, India ranks 142 out of 189 economies (Mittal,2014). 9) Growth Decelerators Some of the agencies which are part of the startup ecosystem themselves can sometimes become hurdles in the growing stages. As per Sneh Bhavsar, co-founder and CEO, OoWomaniya one of the major issues is the influence of incubators, institutes and similar organisations which try to control, manage and be the daddies of the start-ups in the name of helping, mentoring etc (Choudhury,2015).This needs proper coordination among the organizations for mutual benefit. 10) Lack of Mentorship Milan Hoogan, Vice President -Sales and Marketing at Erfolg Life Sciences feels that lack of proper guidance and mentorship is one of the biggest problems that exist in the Indian startup ecosystem (Choudhury, 2015) . Most of startups have brilliant ideas and/or products, but have little or no industry, business and market experience to get the products to the market. It is a proven example that a brilliant idea works only if executed promptly (Mittal,2014). Lack of adequate mentoring/guidance is the biggest challenge which could bring a potentially good idea to an end. 11) Lack of a Good Branding Strategy Absence of an effective branding strategy is another issue that prevents startups from flourishing at a faster pace. Hemant Arora, Business Head-Branded Content, Times Network opines that branding demands paramount attention as it gives an identity and occupies a space in the consumer minds(Choudhury,2015) . 12) Replicating Silicon Valley Koushik Shee, Founder and CEO, Effia , feels that Indian startups get influenced by Silicon Valley models which may not succeed in Indian scenario. Lot of tweaking and modifications could be required when transplanted into Indian markets keeping in mind Indian infrastructure in terms of roads, internet, electricity and telecom penetration (Choudhury,2015) . 12 | P a g e

Background Reasons for failure As regards major reasons for failure of startups, a survey based on analysis of 101 firms showed that 42% failed as the product had no market, 29% firms ran out of cash, 23% did not have the right team,18% closed due to pricing issues, 17% firms had poor product, 14% failed due to poor marketing and 8% had no investor interest(Griffith,2014). These reasons substantiate most of the issues and challenges that have been enumerated above. Opportunities for startups In spite of challenges and problems that startups are facing, Indian markets provide a plethora of opportunities to find solutions tailored to solve them. Below is a list of few of the opportunities that are discussed for consideration by startups. 1. India’s large population The population of India is a huge asset for the country. By 2020, it is expected that the working age population would surpass the non-working population. This unique demographic advantage will offer a great opportunity to any startup. Various infrastructure issues and the bottom- of- the- pyramid market would provide huge opportunities for the startups. 2. Change of mind set of working class Traditional career paths will be giving way to Indian startup space. Challenging assignments, good compensation packages would attract talented people to startups. Also, it is seen that several high profile executives are quitting their jobs to start or work for startups. To reinforce the trend being seen, a survey conducted by Economic Times also confirmed that the number of students joining startups and e-commerce companies has grown considerably in the recent years (Anand, 2016) 3. Huge investments in startups Huge investment in Indian startups from foreign and Indian investors is taking place. In 2015, more than 300 deals were done by 300+ angels and venture capital/ private equity players with around $6.5-billion (Rs 42,300Cr) investments making India the most sought after destination for investments. Some of the active players are New York-based Tiger Global 13 | P a g e

Management, Russian company- DST Global, Japanese telecom giant Softbank, Kalaari Capital, Sequoia Capital and Accel Partners. More and more are going to join the bandwagon as this is the tipping point in Indian commerce for making good returns by backing potential unicorns. 4. Government initiatives There are numerous government and semi-governmental initiatives to assist startups. • Start-Up India This initiative provides three-year tax and compliance breaks intended for cutting government regulations and red tapism. • MUDRA Yojna Through this scheme, startups get loans from the banks to set up, grow and stabilize their businesses. • SETU (Self-Employment and Talent Utilization) Fund Government has allotted Rs 1,000 Cr in order to create opportunities for self-employment and new jobs mainly in technology-driven domains. • E-Biz Portal Government launched e-biz portal that integrates 14 regulatory permissions and licenses at one source to enable faster clearances and improve the ease of doing business in India. • Royalty Tax Indian government has reduced the royalty tax paid by businesses and startup firms from 25per cent to 10 per cent 5. Investments by big business houses Big business houses are already investing in startups as they cannot use their infrastructure to concentrate on small outfits like startups which require different skill-sets. Industrialists like Ratan Tata (Ola, Bluestone etc), Azim Premji (DataStax,Myntra etc) and many more are investing in startups giving desired traction and respectability to the segment. 6. Examples of opportunities for startups Startups in Indian scenario have a tremendous scope in catering to local and niche markets that could be viable and sustainable with early potential of revenue generation. With small area of operations and right product /service the success rate could be high with possible 14 | P a g e

chance for expansion. The bottom-of-the pyramid space is a potential market for offerings ranging from food, clothing, water and hygienic items. The selection of items would be based on the entrepreneurs’ expertise and the area of operation. Given below in Table: 2 is a list of current offerings by startups followed by list in Table: 3 (Low-Tech) and Table:4 (High Tech) of few potential domains. Table:2 List of Current Startups and Area of Operations Area of Operation Startup Firm Name Online food delivery FRESHMENU,SWIGGY Online fish, meat delivery FRESHTOHOME Big data analytics for trade PEELWORKS Online pharmacy MYRA Platform to get local businesses online NOWFLOATS Logistics management software FAREYE Lifestyle tracking platform HEALTHIFYME Payments solutions for credit/debit cards PINELABS AI-driven solutions for retailers- STAQU Packaged ready-to-cook idli /dosa batter IDFOODS Peer-to-peer lending FAIRCENT Source: 17 Startups to Watch, TOI, 2017 Other areas with tremendous potential for startups to establish themselves and thrive are listed in Table: 3 and Table: 4 as low-end and high-end ventures with varying degree of investments and resources. These ventures could be solution providers for underdeveloped and developing countries having similar economic profile at a very affordable cost. Table:3 Startup Opportunities- Low-end Ventures Snacks and Tiffins Health drinks Franchising Waste management Media support services Food Processing Washing and Ironing Solar Energy products Retailing Supply of Drinking water Education & training Health& Pharmacy Diagnostics Centers IT and ITES Food Delivery Source: Author’s perspective Table: 4 Startup Opportunities- High-end Ventures (Export Oriented) 15 | P a g e

Auto-Components Ayurvedic medicines Horticulture Software Exports Biotechnology Engineering Goods Floriculture Organic Farming Source: Author’s perspective Objectives • To identify the problems faced by the startups over the acquiring of the capital through outsiders. • To find out the various channels available to obtain the funds and their procedure. • To ponder over the issues of development of inclusive entrepreneurship and innovation in India. • To deliberate on issues and challenges for development of entrepreneurship and innovation through startup • To draw policy lessons from international experience of fostering inclusive entrepreneurship and innovation • To make recommendations for actionable policy initiatives aimed at fostering inclusive entrepreneurship and innovation within the framework of the startup India programme. • Encourage and initiate collaborative thought process to explore new trends, opportunities, and challenges in Entrepreneurship and Youth Empowerment; also expand pool of Indian Entrepreneurs. 16 | P a g e

Scheme of Chapterisation The scheme of chapeterisation is organizing the pattern of study systematic way of organizing the study which challenge the researcher to take the responsibility to act accordingly which begin with commitment. When an individual is organized creativity automatically flow and brings more ideas. There arises the need of specific design layout .study has been organized in terms of five chapters and the specific design layout of this chapterisation is described below. Chapter 1 Introduction Background Justify the choice of topic and to state clerly the objectives Scheme of chapterisation Chapter 2 Litereatre review Chapter 3 Research Design Secndary Data Collecton method Statistical tools used Chapter 4 Result & Discussions Chapter 5 Summary & Conclusion Chapter 6 References 17 | P a g e

Chapter 2 Literature Review • Sunanda (2017) has done a case study approach on how to start and manage startup companies in India, entrepreneurial venture is a new business in the form of company or partnership business or temporary designed and search of a repeatable and scalable business model, and explained how the entrepreneurial are innovate to create job opportunities in the market. • Andaleeb & Singh,(2016) did research on financing sources for start-up companies in India, in this research paper identified the sources of financing with exclusively on financial ventures in India, explored views on stages for development of start-ups. The major goal of this paper was to know whether the country has made proper arrangements to fund the entrepreneurial ideas. • (Sharifi & Hossein, n.d.(2016) did research on understanding the financial challenges faced by startups in India, explained the major problem in the country is creation of employment opportunities. The researchers identified how the startups face the challenges over the pooling of money from different sources and what are the difficulties faced by them during that acquisition of funds. • (Čalopa, 2014) conducted research on Analysis of Financing sources for start-ups companies. They explored views on the development of start-up companies, their sources of financing with special emphasis on financing venture. This research paper emphasized on better understanding of the financing strategy of entrepreneurial ventures. • (Journal, n.d.) According to Mr.Anurag Garg Indian markets are getting flooded by the startups and highlighted the major sources available for acquiring of capital from the outsiders like seed capital, Banks and venture capital without moving to the capital market. This research paper explained the major problems faced by the startups in India especially hiring the talent, Absence of mentor and in the conclusion explained the role of entrepreneurs for industrial and market development. 18 | P a g e

The Prime Minister of India, Shri Narendra Modi had this year in his Independence Day speech announced the “Start-up India” initiative. This initiative aims at fostering entrepreneurship and promoting innovation by creating an ecosystem that is conducive for growth of Start-ups. The objective is that India must become a nation of job creators instead of being a nation of job seekers. The Prime Minister of India formally launched the initiative on January 16, 2016from Vigyan Bhawan, New Delhi. The event was attended by a vast number of young Indian entrepreneurs (over 2000) who have embarked on the journey of entrepreneurship through Start-ups. As a key component of this “Start-up India” launch,Government of Indiahas organized a globalworkshop on “ Innovation and Start-ups” on January 16, 2016. Shri NarendraModi, Prime Minister of India was the Chief Guest on the occasion. The main aim of the workshop was to provide a platform to bring together all stakeholders, stimulate dialogue on key challenges that the Indian innovation ecosystem currently faces, and provide the potential solutions to address them. Fostering a fruitful culture of innovation in thencountry is a long and important journey. This initiative will go a significant way in reiterating Government of India's commitment to making India the hub of innovation, design and Start-ups. Actually, the challenges of Startup India can be classified as: Culture Entrepreneurship and startups are only a recent phenomenon in the country. It is only in the last decade and half that people in the country have moved from being job seekers to job creators. Doing a startup is tough and every country sees more failures than success. More often than not an entrepreneur needs to be prepared to face failures and unprecedented hardship. However, culturally we are not groomed to fail and failure is frowned upon. Entrepreneurship thrives on celebrations and a society that fails to appreciate business failures stifles innovation and creativity even before it can start. A startup failing has to be OK as failures often teach an entrepreneur, what to do and what not to do. 19 | P a g e

Mentoring Doing a startup is perilous and often a lonely journey. You may have co-founders, but you may not necessarily possess the business acumen to succeed.Having a brilliant idea is different from making that idea a business success. For a startup, it is very important to have mentors who have been through a similar process of starting or have business experience. A great mentor is often what separates success from failure by providing valuable inputs. However, there is no formal mechanism to mentor startups in the country. Every mentoring that happens is on an ad-hoc basis. A startup that has raised funds can count the investors for some form of mentoring, but honest, unbiased,good business mentors are far and few in between.For startups finding a good mentor is often an uphill task. Policies Government is the single largest enabler for the entrepreneurial ecosystem. Government's role in ease of doing business and helping companies start is vital to ensuring success. The latest World Bank Ease of Doing Business (out of 189 economies) ranks India at an abysmal 142 where starting a business rank for the country is even lower at 158.It is uncannily difficult to start a business in India and myriad laws and regulations means it takes about 30 days to comply compared to just 9 days in OECD countries. The government's role has so far been limited to giving out grants and loans, but without an effective, enabling environment, implementation is far off the target. In this regard it will be interesting to see the contours of the recently announced Startup Fund in this year's budget. For startups to thrive and succeed, the government has a lot to do and understand the importance of entrepreneurship in economic development. Hiring The economy has been in a flux and along with the world economy the heady days of high growth are long gone. In an uncertain economy where one is not sure about demand, for a 20 | P a g e

startup, it is particularly difficult to make correct estimates on the number of employees needed. This, however, is the minor problem where the biggest issue is about finding skilled manpower. India's skilling need is so huge that National Skill Development Corporation (NSDC) has been mandated to skill 150 million Indians by 2022. For a startup, it is particularly difficult to attract and hire talent and skilled workers. A startup often cannot match the salaries drawn at larger companies nor is a job at a startup seen as a steady one. This means startups face severe hiring challenges and at times have to settle for the next best option. First generation entrepreneurs across the country are applauding the government's efforts to recognize their business ventures under the banner of Start-Up India, but for most challenges of funding, patents and creation of intellectual property remain.“The Prime Minister seated with entrepreneurs on a national platform is a very positive signaling,” said Abhishek Sinha, Co-Founder and CEO, Eko India Financial Services, who was also a panelist in one of the session. However, small problems such as bank funding in the lack of any collateral turn out to be big roadblocks for many entrepreneurs.“Banks are careful while giving out loans. When we started out, we had to depend on loans and credit cards.Even today the story is same,” he told Business Line.Minister of State for Finance Jayant Sinha had also noted that 90 per cent of funding, at present, comes from foreign venture capitals and domestic financiers could change the nature of innovation as well. A recent study by Grant Thornton revealed that in 2015 more than 600 such companies got funding, with over $2 billion deployed by PE and VC funds.In fact, the Rs.10,000crore of funds that would start with an initial Rs.2,500 crore annually would be a dip in the ocean given the vast potential of the sector and the huge number of companies. Prime Minister Narendra Modi's Start-Up Action Planhas a 19-point agenda including incentives such as self certification for complying with labor and environment regulations, a panel of facilitators to help file patent and intellectual property applications, tax exemptions for seed funding, capital gains and three year holiday on income tax as well as a Rs.10,000 crore financing support for four years.To be eligible, the Department of Industrial Policy and Promotion has defined startup “an entity, incorporated or registered in India not prior to five years, with annual turnover not exceeding Rs. 25 crore in any preceding financial year, working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.” 21 | P a g e

Patents Similarly, the long process of registration of patents and lack of incentives for research and development is another bone of contention, which according to many is a reason why many start-ups prefer to be domiciled abroad.“I have patents registered in the US and Singapore but have not been able to do so in India till now,” said another start-up owner.“The intent of the government is good and a lot has been done but not everything that was demanded has been given,” said Umesh Sachdev, Co-Founder and CEO, Uniphore Software Systems, stressing that more could be done for R&D that would have also helped in patenting. According to government data, as many as 2,46,495 pendency in patent applications and 5,32,682 trademark applications were pending as on November 1, 2015. Taxation Industry has also called for clear definition of digital products and services from a taxation point of view. “This is essential. We cannot have a long list of intangibles in our balance sheet. There has to be an acknowledgement that IT products are being created,” said Abhishek Sinha. As a start, the Centre has extended capital gain tax exemption for investment in newly formed manufacturing MSMEs by individuals to all start- ups and has promised that investment in 'computer or computer software' would also be considered as purchase of 'new assets' to promote technology. It is of common knowledge that a lot of VC and angel investors from India and abroad are actively investing in Indian startups. Over $3.84 billion was pumped into the ecosystem in the third quarter of 2015 itself. However, we have been observing that despite having raised good investments, many startups struggle to survive the competition and are eventually forced to shut down their businesses.I recently got to meet a number of Indian entrepreneurs across sectors at Startup India Rocks, a two-day conference organized by Scaale in Goa on the 7th & 8th of October. It was a good chance to hold direct confabs with startup founders and cultivate a deeper understanding of the dynamics of the ecosystem, the common challenges faced by native startups and a few more insights that could help one get the fundamentals of running business correct.It is extremely important to find out and resolve the factors that are 22 | P a g e

preventing growth and sustainability of startups in the country. Below are the 8 key things, influencing the failure or success rate of startups in India, according to founders and mentors of various startups. Right Talent Acquisition India is known for its affordable pool of talent, especially when it comes to technology. However, when one is starting up, talent acquisition becomes a pain, given that not everyone is flexible enough to work in a startup. Upon being asked about the major deterrents on Indian startups' path to a faster growth, Chirag Garg, CEO, HyperDell, exclaimed, “I see a lot of roadblocks actually! One of them is the fear of failure. Affordable talent, and the right time for the required talent is another challenge.”Failure to Mitigate the Gap Between Burn Rate and Revenue : Of late, it has been observed that once VC-popular food delivery startups, are now running low on cash. Amidst the growing competition, it becomes imperative for startups to scale up fast, and this is where external funding comes in. Startups and Investors go hand in hand, several Internet companies delay putting in efforts for revenue generation and focus more on raising investment. When fundraising comes to a halt, troubles start. Chirag maintained, “I think the right management of your burn rate is really a big concern”. Citing an example of Local Banya which shuts its operations a couple of days back, he said,“Many a time, we observe that as soon as a startup gets funded, it loses its conscious approach to the burn rate and goes haywire. Third Party Growth Decelerators Similarly, when I approached Sneh Bhavsar, Co-Founder and CEO, OoWomaniya with the same query, he asserted, “It is really interesting how the problems are evolving along with the evolution of startups in India.” According to him one of the major issues is “the influence of external organizations” that is businesses, incubators, institutes and all such organizations which are trying to control, manage, take advantage for their events, brand or just numbers, be the daddies of the start-ups and entrepreneurs in the name of helping, mentoring etc. He added, “In Ahmedabad, I have seen the most innovative, fast growing startups which also started making profits – they all were self-dependent, never incubated or mentored. Yes, they 23 | P a g e

may have grown slower in early stage but on any day it is better as they are profitable, sustainable. There are more daddies than kids in India's startup ecosystem.” Lack of Mentorship Lack of proper guidance and mentorship is one of the biggest problems that exists in the Indian startup ecosystem, believes Milan Hoogan, Vice President -Sales and Marketing at Erfolg Life Sciences. He is of the opinion that the current startup ecosystem consists of a lot of young talent coming out with some very unique ideas. These ideas have enough fuel in them to propel most of these start-ups to great heights. But, one of the biggest factors that slow the growth of these companies is the poor quality of mentorship they get. Most of these organizations are good with their ideas and/or products, but have little or no industry,business and market experience to effectively get their products out.Hoogan says, “I think having a good mentor right from the early stages, can help these companies in not only capturing the markets faster and have the first mover advantage, but can also help them in strategizing each of their steps from a more experiential standpoint. Plus, a mentor brings with him/her, a huge professional network that can be a huge bonus for the entrepreneurs. One of the best ways to find a good mentor is to be networking all the time. Meet new people, take part in the start-up based networking events, discuss about the industry and your ideas to improving it, learn about their respective stories.” Lack of a Good Branding Strategy Absence of an effective branding strategy is yet another issue that bars startups from flourishing speedily. Giving insights into the subject, Hemant Arora, Business Head – Branded Content, Times Network, said that branding is one of those areas in a business that demands paramount attention.However, given the question of affordability, many startups struggle to build a good branding strategy for their businesses. Arora maintains, “branding has to be a commitment. In fact, almost like a spiritual commitment for entrepreneurs looking at pacing up their product's long term commercial success. Branding starts at the same time as the business does…it's like a baby being born and given a name so that people can identify it with that name. Then comes the process of making it popular which is what advertising is 24 | P a g e

all about and that is completely objectified.”During his session on the subject, Arora gave a very lucid yet striking definition of advertising- the essence of advertising lies in the ability to influence your target audience positively towards your brand. Fragmented Market and the Dearth of Domain Knowledge The largely unorganized and fragmented market in India stands as one of the biggest hurdles for startups on their way to success. Umesh Chhikara, Co - Founder and CEO, Inkhorn Publishing India is of the opinion that before foraying into any business, one must cultivate a strong domain knowledge. “Consumer behaviour changes every 30 km in India, which makes it a highly complex, diverse and un -orchestrated market.” Chhikara opines that it's very easy for startups to bag capital these days. However, what is not easy is building a strategy to move ahead and capture the larger market. Only a few have managed to spread their footprints across the country. Most of them usually get stuck in stagnancy and eventually, shut down. Silicon Valley Replicas Topped by Infrastructure Deficit Emulation of ideas and business models is a common tendency that startups in India need to get rid of. Koushik Shee, Founder and CEO, Effia, questions Indian startups' infatuation with Silicon Valley models. He stated that most of these business models have been replicated from the West. Hence, few are profitable despite raising different scenario. Hence, we should build our models based on our market. India has a huge potential given that most of the market is still untapped due to the lack of internet penetration in rural and suburban areas owing to the issue of affordability and infrastructure deficit.”Nevertheless, She hopes that with Digital India initiative, things are going to change for good. Struggle to Reinvent Constantly Last but not the least, Namrata Garg, Director, SendKardo, opines that customers today are very adaptable to change. “The biggest challenge is the need to constantly reinvent yourself and come up with a service to be able to match up customer expectations. Having said that, I would also like to add that this 'roadblock' could as well be converted into a big opportunity. 25 | P a g e

Also, certain services provided by earlier applications have become pre requisite for customer today. So, you need to be providing something over and above constantly. It's all about providing the wow factor.”Startups are significant. They are the new 'in' in business sphere. They play a critical role in development of a country. Growing market, favorable funding, and technology have really made the startup ecosystem take off. Who would have thought some years ago that Filters! That's right, filters could make Instagram so popular. Or, you could call cleaners to cab and everything in between at doorsteps with a mere touch of a button. Startups are nothing but an idea that manifests into a commercial undertaking. The growing number of startups in India is certainly not an elapsing trend and is here to stay. Moreover, the recent Prime Ministerial visit has certainly helped impetus startup ecosystem in India. Indian startups take a lot of their learning from Silicon Valley. However, a direct comparison between Silicon Valley and Indian startup is not sagacious. Every country has their own set challenges in terms of government policies, permissions, raising capital, competition, unforeseen challenges, etc. Challenges faced by startups in India Hiring the right talent Hiring the right talent for your startup can be quite an uphill task. To find and hire the right kind of talent for the business with skills to match growing customer expectations is one of the biggest challenges. With low salaries in comparison with other corporates, hiring skilled manpower may not be possible and so you may have to settle for the next best option. You may have to convince people to join you. The key is to spread your passion and motivate people to be as passionate. Right talent will ensure rock solid foundation which will help your startup to take the plunge. Capital Investors and startups go hand in hand. Sometimes the investor's response to a startups ecosystem can be sluggish. Scaling is prudent in case of a startup and scaling comes from capital. The challenge is not to merely generate enough seed capital but also to support in expansion and sustenance and maintenance. It is critical to plan your finances in advance. Factor in all the elements and set a budget, try and maintain this as much as possible to be on track. Set a specific budget for PR, marketing, advertising. In the end, it's important to 26 | P a g e

remember that external capital can only give the necessary push to your business, it cannot run the business, hence focus on creating value and solving the problem of the people . Cultural views and lack of infrastructure support There is little tolerance for failure in our country.Our focus is still on getting reputable jobs in a reputable company. In complement to that, infrastructural support such as incubation and funding are not easy to find in India. Irregular power supply, telephone reception network, etc. can be a hindrance to the growth of any business. Corruption free environment, friendly regulations, good connectivity, healthy environment, efficient logistic support, can help a great deal in attracting investor in the country. Absence of mentor Young entrepreneurs usually have unique ideas however they lack experience. A brilliant idea works only if executed promptly. Industry insights, market knowledge, business experience is important to materialize the idea. Mere ideas cannot propel startups. Additionally mentors are tagged by a network system that can of great help to develop contacts and expand your existing business network. Learning from mistake While the economic can be arduous influence, mistakes in a startup environment are inevitable. The idea is to learn from mistakes and take quick actions toward some serious aftershock. Create a robust team and work in cohesion with the stakeholders.At Voler, we make no mistakes. We term them as 'area of opportunity', we learn from them and ascertain they are not repeated. In fact, each mistake provides us with learning which acts as a stepping stones to success. 27 | P a g e

Chapter 3 Research Methodology This research paper basically focuses on the challenges faced by the startups over the acquiring funding sources and challenges faced by them to make successful grant of loans from banks, NBFC and other private channels. This information basically collected through secondary sources especially from journal, articles, internet and news papers and through peers’ discussion. The study is descriptive & conceptual in nature After referring various case studies and observing existing startup management practices, researcher has made own analysis and elaborated on various critical challenges faced by Startup companies 28 | P a g e

Research Design I have used descriptive research to describe particular phenomena or relationships within a single group sample. The main goal of this type of research is to describe the data and characteristics of what is being studied. Thus a descriptive study generates a data on who, what, when, where, why and how pertaining to investigation of study. Descriptive designs are typically used as either pilot or preliminary studies and generally have rather basic statistical procedures. They are often more quantitative in nature, requiring questions as a data- collection method. The respondents are selected by means of randomized sampling methods. 29 | P a g e

Data Collection Method The data collection is essential part of research. The nature of data which is collected and used for this research is primary in nature. The relevant and required secondary data has been collected from journals, RBI annual reports, government regulation, magazines, and literature through various search engines. Primary Data : The primary data are those which are collected for the first time and which is original in nature. The primary data is a data that is gathered for a specific research in response to a particular problem through interviews, questionnaires or observations. Secondary Data : The secondary data for this study was obtained from published documents and literature relevant to the study. The secondary data is obtained through various kinds of documents such as research reports, RBI annual reports, books and articles, research papers from online journals and Government regulation for core banking and also from web information. For this study secondary data has been collected from various reliable sources. Turning a Startup into a success is not an easy task. Many factors need to be considered while starting a new business. If an entrepreneur is working on some business idea for the first time, he may face many challenges like raising capital or getting funding, finding suitable location, marketing strategy, return on investment, resource planning, positioning of product into right market, risk of failure etc. Below are some critical challenges that are faced while managing startups – 1) Idea conceptualization and implementation Many people think that funding is the biggest challenge for a start-up, but more important than that is putting the idea into reality. It means making a blue print of the business plan. Building up a sustainable business model which will not just get idea into reality but it will help to generate positive cash flows in its future course. It is being observed that most of the times people with completely unique and great idea fail to be realistic and their business plan 30 | P a g e

lacks feasibility. That is why implementation of the idea is as equally important as its conceptualization. 2) Funding After working out a proper implementation strategy, next big thing is planning of financial resources. It is important to estimate how much money is required, how much money is needed at what stage, whether to raise capital by giving share of ownership to some angel investor or through availing the loan i.e. deciding amongst equity and debt etc. This depends upon the business model, whether there will be small margins with big volumes or large margins with thin volumes, distribution business or manufacturing and many more such factors. An entrepreneur must meticulously plan for arranging finance as it is the blood of any business. Many big ideas fail to sustain till it actually reaches tipping point because of lack of adequate financial support. Likewise some businesses have to change their core product or services just for making sure that the company survives. With this it may lose its original vision and model. 2) Human resources It is said that money is not all that makes a business successful but the people in it. Finding out good employees is really a challenge now days. Another challenge is to make them stay with you for long, as good people easily find better opportunities.For any young startup, addition of every single employee is very critical. Good potential employees ask for high compensation packages which can be a challenge in terms of hiring as well as holding such talents in startups. Likewise sometimes properly trained and groomed employees choose to leave the job and start on their own. This again adds lots of cost in terms of hiring new ones or sometimes affecting existing business. 3) Market place It is easy to start working on some idea but finding suitable target market and customers is really a big deal. It requires lots of research about existing business models, customer demands, existing products or services available, geographical characteristics, economic and trade policies, legal policies and lot more. A product or service needs to be structured after essential analysis of the above mentioned factors. Few months of pilot study in various 31 | P a g e

geographies helps a lot to grab the pulse of the customers as well as market.After this, management needs to decide whether the product should be launched initially in specific territory or should be made available in selected cities or to be made available across the country. 4) Marketing With high accessibility and use of social media for marketing purposes now a days, positioning and targeting selected customer base has become very convenient. But it again becomes a challenge for start-ups as it is very costly to outsource it to the advertising firms. Hiring full time employee for social media management also can be a costly affair if it is not directly adding towards immediate results. Though costly, marketing is an integral part of start up management practices to showcase its product and services amongst target customer groups and to spread the awareness. This expense might be on a higher side at initial stages as it will reduce once the startup idea or brand becomes popular. 5) Competition One of the biggest challenges faced by startups is the fierce competition. They need to be very cautious as well as aggressive while designing the market strategy. It is more a threat if one is entering into established markets or trying to establish oneself into existing product or service line. Growth in emergence of various online business models poses a threat to new as well as traditional businesses. Apart from this, they need to be flexible as well as innovative at framing various policies in terms of offering, pricing, technology etc. Strategic Partnerships can be one of the solutions for coping up with such challenges occurring from competition. Sampling Design 32 | P a g e

The research objective is translated into research questions that enable the researcher to indentify the information needed. Probability Sampling Methods Random sampling is analogous to putting everyone's name into a hat and drawing out several names. Each element in the population has an equal chance of occuring. While this is the preferred way of sampling, it is often difficult to do. It requires that a complete list of every element in the population be obtained. Computer generated lists are often used with random sampling. You can generate random numbers using the TI82 calculator. Systematic sampling is easier to do than random sampling. In systematic sampling, the list of elements is \"counted off\". That is, every kth element is taken. This is similar to lining everyone up and numbering off \"1,2,3,4; 1,2,3,4; etc\". When done numbering, all people numbered 4 would be used. Cluster sampling is accomplished by dividing the population into groups -- usually geographically. These groups are called clusters or blocks. The clusters are randomly selected, and each element in the selected clusters are used. Stratified sampling also divides the population into groups called strata. However, this time it is by some characteristic, not geographically. For instance, the population might be separated into males and females. A sample is taken from each of these strata using either random, systematic, or convenience sampling. Non Probability Sampling Method Convenience sampling is very easy to do, but it's probably the worst technique to use. In convenience sampling, readily available data is used. That is, the first people the surveyor runs into. • Judgmental or purposive sampling: Judgemental or purposive samples are formed by the discretion of the researcher. Researchers purely consider the purpose of the study, along with the understanding of the target audience. For instance, when researchers want to understand the thought process of people interested in studying for their master’s degree. 33 | P a g e

The selection criteria will be: “Are you interested in doing your masters in …?” and those who respond with a “No” are excluded from the sample. • Snowball sampling: Snowball sampling is a sampling method that researchers apply when the subjects are difficult to trace. For example, it will be extremely challenging to survey shelterless people or illegal immigrants. In such cases, using the snowball theory, researchers can track a few categories to interview and derive results. Researchers also implement this sampling method in situations where the topic is highly sensitive and not openly discussed—for example, surveys to gather information about HIV Aids. Not many victims will readily respond to the questions. Still, researchers can contact people they might know or volunteers associated with the cause to get in touch with the victims and collect information. • Quota sampling: In Quota sampling, the selection of members in this sampling technique happens based on a pre-set standard. In this case, as a sample is formed based on specific attributes, the created sample will have the same qualities found in the total population. It is a rapid method of collecting samples. Statistical Tool Used Discussion: Strengths and Limitations of Secondary Analysis for LIS Research The major advantages associated with secondary analysis are the cost effectiveness and convenience it provides (Dale et al., 1988; Glaser, 1962; Smith, 2008). Since someone else has already collected the data, the researcher does not have to devote financial resources to the collection of data. When good secondary data is available, researchers can gain access to and utilize high quality larger datasets, such as those collected by funded studies or agencies that involve larger samples and contain substantial breadth. The larger samples are more representative of the target population and allow for greater validity and more generalizable findings (Smith, 2008; Smith et al., 2011). Access to this type of data presents opportunities for all 34 | P a g e

researchers, even the novice or unfunded researcher, therefore equalizing opportunities and building capacity for empirical research (Hakim, 1982) in LIS research. The use of existing data sets can accelerate the pace of research because some of the most time consuming steps of a typical research project, such as measurement development and data collection are eliminated (Doolan & Froelicher, 2009). In LIS research areas, such as information and technology that are constantly changing, utilizing existing data allows projects to be completed and findings to be produced much faster, and therefore the development and contribution of new knowledge occurs in a timely manner before they are considered dated by the field. Additionally, in the area of information policy, utilizing existing data can allow the researcher to answer important time-sensitive policy related questions quicker (Magee et al., 2006). Secondary data analysis provides many opportunities for furthering LIS research through replication, re-analysis and re-interpretation of existing research. It provides researchers with opportunities to engage in work to test new ideas, theories, frameworks, and models of research design. Yet there are unique methodological considerations when utilizing existing data to investigate new research questions and generate new knowledge. The most recognized limitation to the secondary data analysis method approach is “inherent in its nature” in that the data were collected for some other purpose (Boslaugh, 2007, p. 4). Since the data were not collected to answer the researcher’s specific research questions issues can arise. The specific information that the researcher would like to have may not have been collected; or data may not have been collected in the geographic region of interest, in the years the researcher would have chosen, or on the specific population that is the Qualitative and Quantitative Methods in Libraries (QQML) 3:619 626, 2014 625 focus of interest (Boslaugh, 2007; Doolan & Froelicher, 2009). In this particular project the researcher avoided some common pitfalls often associated with secondary analysis by participating in the primary research design plan and then ensuring a match between her research questions and the existing data through the previously described process. Yet, a significant limitation of this research was that the school identifiers collected in the primary study was not available to the researcher due to confidentiality reasons. The school identifiers connect to the participants, therefore school identifiers were removed from the dataset, in order to ensure all participants remain anonymous in accordance with the original consent agreement. Therefore, subjects cannot be contacted for follow-up questions 35 | P a g e

and additional data cannot be collected. While this lack of opportunity for follow-up or the collection of additional data from the participants has proven to be a limitation in furthering this research, it is important that secondary data analysis abide by the consent conditions of the original study (Heaton, 2008). A second major disadvantage of using secondary data is that the secondary researcher did not participate in the data collection process and does not know exactly how it was conducted. Therefore, the secondary researcher does not know how well it was done and if the data are affected by problems such as low response rate or respondent misunderstanding of specific survey questions. Hence the researcher has to find this information through other means such as documentation of the data collection procedures, technical reports, and publications (Boslaugh, 2007; Dale et al., 1988; Kiecolt & Nathan, 1985). In this research the researcher was at a disadvantage because she did not participate in the execution of the data collection process. In order to address these issues the researcher utilized documentation from the original study, information from published findings, and consultations with the original primary researchers and statistician. Ensuring a match between the research question and the existing data and following a process, as proposed, for careful reflective examination and critical evaluation of the data, can avoid most limitations of secondary data analysis. Analysis Sources of Finances to Startups In India The startups in India having paucity of funds, pooling the money from their own source of funds and all startup should follow the norms of corporate governance in India. Banks are lending the money on security; venture capitalist and private equity fund also provide money to startups. Banks Banks are intermediaries between public and Industrial units as they accept deposits from the general public and mobilize funds to industrial units. Industries require short term and long term funds to fulfill long term and working capital requirements; Banks provide secured and unsecured loans. The start-ups in India get loan from bank at every stage of the business life cycle. 36 | P a g e

In India both public and private sector banks are providing loans to start-ups and their continuous growth, In India it is easy to take the loans from private sector banks as the Interest rates are higher but it is recommended to take loans from public sector banks as the interest rates are pocket friendly. Process of getting loans from Bank- Usually start-ups follow certain norms to get loan approval from the banks. Registration of firm Submission of relevant documents along with license and clearance Business plan and complete project reports (Covers all the dimensions of Products and services) Submission of subsidy report(If eligible) Banker verifies track record i.e. checking of CIBIL Score should be above 700 Banker assesses the feasibility of firm Submission of collateral security documents There are various schemes and eligibility criteria available to start-ups in India Venture capitalist usually venture capitalist provides funding to risky business units. It is the best source of funds to startups without moving to capital markets in India but for the investors point of view it is high risk investment option. The venture capitalist basically supports for long term point of view like expansion and maintenance by providing of seed capital. It acts as an important tool for acquiring funds to start-ups. Role of venture capitalists Venture capitalist creates opportunities to turn the ideas of start-up into reality as they recommend the project execution properly. Many start-ups usually have the problem of come into the reality, this venture capitalist give assistance for solving all the problems like technical, financial and execution. Funding process is done in five stages- Seed stage (Providing capital sources to start-ups) 37 | P a g e

Stat-up stage( Submission of business plan) Second stage( transform the idea into product/service) Third stage(market expansion stage) IPO stage(Bridge finance) Private equity funds It is a form of venture capitalists. It is basically a collective investment scheme used for making investments in various equity securities, these are actually limited partnership funds with a fixed term of ten years. These funds are managed by professionals who are having sound knowledge about the market conditions. Providing funding for high net worth individual is another prerequisite for granting loans. Angel Investors Basically these Investors inject capital for startups in exchange for ownership equity and some of them invest in the form of crowd funding. The initial step for granting of funds through seed funding and it is secured by start-ups form their own money sources and pooling the money from friends and family members. Stages of getting funds through this platform – Preparation stage Application process stage Screening the right applicants Presentation of detailed business plan Deep dive into the project Going through the potential suppliers and customers Investment Submission of reports 38 | P a g e

Chapter 4 Results & Discussions The policies made for start-ups easy of doing business. The venture capitalists are one of the best sources of funding for start-ups. Private equity funding sources widen the route for start-ups in India. The initial step for granting of funds through seed funding. There are five stages available for funding sources from venture capitalist Major hurdles faced by the startups: Low quality of personnel skills Low quality technical skills Not having enough securities for mortgage loans Less confidence about the business plan High competition with global giants Less policies, programs and subsidies from government 39 | P a g e

Chapter 5 Summary & Conclusion The current economic scenario in India is on expansion mode. The Indian government is increasingly showing greater enthusiasm to increase the GDP rate of growth from grass root levels with introduction of liberal policies and initiatives for entrepreneurs like ‘Make in India’, ‘Startup India’, MUDRA etc. ‘Make in India’ is great opportunity for the Indian start- ups. With government going full hog on developing entrepreneurs, it could arrest brain drain and provide an environment to improve availability of local talent for hiring by startup firms. Small contributions from a number of entrepreneurs would have cascading effect on the economy and employment generation which would complement medium and large industries efforts catapulting India into a fast growing economy. The startup arena has lot of challenges ranging from finance to human resources and from launch to sustaining the growth with tenacity. Being a country with large population, the plethora of opportunities available are many for startups offering products and services ranging from food, retail, and hygiene to solar and IT applications for day to day problems which could be delivered at affordable prices. It is not out of place to mention that some of these startups would become unicorns and may become world renowned businesses by expanding into other developing and underdeveloped countries. 40 | P a g e

Chapter 6 References 1. G.S. Mongia, R.K. Sinha, Nationalisation of Banks Retrospect and Prospects 2. R.V. Kulkarni, B.L. Desai, Knowledge based system on Banking Sector 3. I.V. Trivedi, Indian Banking in the new millennium 4. M.P. Jaiswal, Anjali Kaushik, e-CRM Business System frontiers 5. DR. C.S. Rayudu –E-Commerce, E-Business 6. E-Commerce-S.Pankaj Newspapers 1. Business Standard Line 2. Economic Times 3. Times of India 4. The Pioneer 5. The Hindu 6. Hindustan Times 41 | P a g e