The World Intellectual Property Organization’s (WIPO) annual Global Innovation Index 2020 has placed India in the list of top 50 innovative countries in the world. This is the first time India has entered this list and amidst the COVID-19 pandemic, gives some respite to the current state of affairs in the nation.
With 34 unicorns, India is the world’s second-largest startup ecosystem. There are major factors as to how the startup environment in India has been progressing at a good rate. Let us look at some of the major components that aim to encourage the Indian startup ecosystem:
Government schemes:
The Government of India has launched many schemes so as to drive entrepreneurship in India. These schemes are:
Startup India Initiative:
Startup India Hub is an online platform for all the contenders of the startup ecosystem in India. It has been established with the aim of creating a network of startups by bringing together all participants, from aspiring entrepreneurs to investors. The Startup India Hub has been developed under Startup India, the leading initiative of the Government of India and is also one of the important subsets of the “Make in India” initiative.
The Prime Minister of India, Narendra Modi launched the Startup India Initiative in the year 2016. Its goal is to increase prosperity and employability by encouraging the entrepreneurial spirit. The Department of Industrial Policy and Promotion is maintaining this initiative and is treating it as a long term project.
Some of the benefits for the startups recognized by this initiative are:
1. Self-certification: Startups shall be allowed to self-certify (through the Startup mobile app) with 9 labour and environment laws.
2. Patent Application and IPR Protection:
Founders can easily fast-track their patent application and get up to 80% rebate while filing patents.
3. Income tax exemption: Startups recognized under this initiative are exempt from paying the income tax for 3 years. The same applies to investments above fair market value.
4. Easier Public Procurement norms: Startups can get listed as sellers to the government and benefit from exemptions on Earnest Money Deposit(EMD) and other stringent requirements.
5. Easy closure of startup: In case a founder or founders want to close their company, they can easily do so within 3 months under the Insolvency & Bankruptcy Code, 2016.
Website: https://www.startupindia.gov.in/
ASPIRE:
The ASPIRE scheme’s goal is to increase employment, reduce poverty, and improve innovation in rural India by promoting the agro-business industry. Micro Units Development Refinance Agency (MUDRA) Bank has been created to enhance credit/loan facilities and lift the growth of small businesses in rural areas. In 2015, the government allocated Rs. 10,000 crores to promote the startup culture in India. The MUDRA banks provide loans of Rs. 10 lakh to small enterprises and businesses which are non-corporate, and non-farm small/micro-enterprises. It comes under Pradhan Mantri Mudra Yojana (PMMY) which was launched on 8 April 2015.
Website: https://aspire.msme.gov.in/
Ministry Of Skill Development and Entrepreneurship
In 2014, Prime Minister, Narendra Modi decided to dedicate an entire ministry to develop the entrepreneurship sector in India. He felt that it is the government’s duty to contribute in the skill development of the residents of India. Moreover, this ministry’s main aim is to reach 500 million people by the year 2022 by providing gap funding and skill development initiatives.
Website: https://www.msde.gov.in/
Credit Guarantee Scheme for Startups (CGSS)
The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE ) was set up by the Government of India to provide business loans to micro and small industries, and startup businesses with zero collateral. Through this scheme, the new and upcoming startups in India can avail loans at highly subsidized interest rates without providing any collateral. Along with SIDBI (Small Industries Development Bank of India), the government provides a maximum amount of up to Rs. 100 lakhs under this scheme for encouraging new enterprises as well as reorienting the existing ones. Set up mainly for manufacturing units, this loan can be obtained in the form of working capital or term loan.
Website: https://www.cgtmse.in/
The Women Entrepreneurship Platform (WEP)
NITI Aayog has launched a Women Entrepreneurship Platform (WEP) for providing a network to the budding and existing women entrepreneurs across the country. SIDBI has collaborated with NITI Aayog to support this initiative.
WEP is built on three pillars- Iccha Shakti, Gyaan Shakti & Karma Shakti. It provides free credit ratings, mentorship, funding support to women entrepreneurs, apprenticeship and corporate partnerships and also encourages these entrepreneurs to share their entrepreneurial journeys, stories & experiences to foster mutual learning. Women Entrepreneurs who are at the ideation stage, have just established with their startups, or are a well-known startup can register under the scheme to take the benefit. Corporates, NGOs, research organizations, incubators, accelerators, etc. who provide support any kind of support to the women entrepreneurs are also eligible to benefit from this scheme.
For more details, please visit: https://wep.gov.in/
Major competitions that take place in India to select the best startups and assist them in becoming successful are:
India Tech HK:
India Tech HK is a trailblazing initiative by a community of people who aim to connect investors ( from Hongkong, China Greater Bay area and India) with the Indian startup ecosystem. It provides the perfect platform for entrepreneurs to showcase their ideas to potential investors.
The goal of this community:
- Engage the startup community and build awareness of the Indian Startup Ecosystem
- Act as a bridge to connect India & the China Greater Bay area
- Enabling investments in the Indian startup sector
- Providing support to Indian startup entrepreneurs
It also organizes Pitch Day events and Hackathons to give entrepreneurs and college students a chance to pitch their groundbreaking tech ideas to a panel of investors and jury. Accordingly, the winners obtain cash prizes and guidance from seasoned investors and startup founders to build their startup idea into a company.
ClimateLaunchpad India
ClimateLaunchpad is the world’s largest green business ideas competition. Its mission is to bring forward startups that have the potential to address climate change. It does so by organizing a competition that provides a platform for entrepreneurs to introduce their ideas. ClimateLaunchpad is part of the Entrepreneurship offerings of EIT Climate-KIC.
ClimateLaunchpad is run by a central team, located in the Netherlands, and is supported by national teams who organize the competition in their respective country.
There are three rounds to the competition:
Step 1: Online Course & Boot Camp
ClimateLaunchpad kicks off with a 3-day Boot Camp in India. Its trainers will teach you all you need to know about kickstarting your business.
Step 2: Intensive coaching and National Finals (and if applicable Regional Finals)
The Boot Camp is followed by a period of intensive coaching. After that, you enter the National Finale where you’ll pitch in front of the National Jury. If applicable, the top teams may go on to Regional Finals. Winning teams of National and/or Regional Finals get to compete in the Global Grand Final.
Step 3: Global Grand Finale
The overall winner of the Global Grand Final receives € 10,000; the runner-up gets € 5,000 and the idea that comes in third place wins € 2,500. The top 16 teams selected by the judges to perform in the Final Round of the Global Grand Final, automatically get direct access to the Climate-KIC ClimateLaunchpad Accelerator, the well-known business school where great ideas nurture into great businesses.
Atal New India Challenge :
Atal New India Challenge is the creation of the Atal New Innovation Mission and aims to find entrepreneurs with affordable solutions that boost the national economy. The Ministry of Agriculture and Farmers Welfare, Ministry of Railways, Ministry of Road Transport and Highways, Ministry of Drinking Water and Sanitation, Ministry of Housing and Urban Affairs are the investors in this competition who provide grants to the entrepreneurs in order to support their upright causes. This competition encourages entrepreneurs to create solutions from existing technologies to be readily available to common people justifying a national cause.
Innovation World Cup series:
Innovation World Cup series is a global startup competition focusing on the domains of the Internet of Things and wearable technologies. It partnered with the Startup India Hub (Government of India) in 2018 to encourage Indian entrepreneurs to take their IoT solutions to the next level and transform budding ideas into successful startups.
PLUGIN:
PLUGIN, the ‘Collaborative Incubation cum Acceleration Program for Hardware & Systems Startups’ is a joint initiative of the Department of Science and Technology (DST), Government of India, Intel Technology India Pvt. Ltd (Intel India), and Society for Innovation and Entrepreneurship (SINE). It focuses on hardware and system startups working in the industrial/manufacturing, retail, banking and healthcare sectors. The startups should utilize the following technologies in developing their solutions, these include Artificial Intelligence (AI), Machine Learning & Deep Learning (ML/DL), Vision-based technologies, Internet of things (IoT), Speech technologies, Cloud computing, Security.
The total fund of up to INR 1 crore as seed funding will be distributed among the top-performing (2-3) startups as equity/ convertible instrument towards the end of the program.
Smart India Hackathon
Smart India Hackathon is a nationwide initiative to provide students a platform to solve some of the unrelenting problems we Indians face in our daily lives, and thus inculcate a culture of product invention and an approach to problem-solving. The last edition of the hackathon recorded over 5 million+ students from various engineering colleges compete for the top prize at 35+ locations. With SIH, the students also get the opportunity to work on challenges that private sector organizations face and create top-notch solutions for some of the top companies in the world, also helping the private sector hire the best minds from across the nation.
Top universities in India that sponsor entrepreneurship and innovation:
Conquest:
This annual competition is conducted by the entrepreneurship cell of BITS Pilani which boasts of one of the most dynamic Entrepreneurship development cells in the country to encourage students to take part in the startup culture. It aims to encourage college students to develop new ideas and solutions while going through the process of achieving their degree. Students pitch their ideas and showcase them in front of a panel of some recognized investors who are willing to pay up to INR 40 million if they come across a brilliant idea.
Investors backing Conquest are:
- Blume Ventures
- Lightspeed Ventures
- Trifecta Capital
- Accel Partners
- Uber Technologies
- Oracle Startup Cloud
- Future Group FZ LLC
The Top 10 selected startups relocate to Bangalore for a 10-day accelerator program where they are provided free accommodation and co-working space. The Top 50 start-ups are mentored one-on-one by titans from the entrepreneurial world from customer acquisition, product management, fundraising, UI/UX, sales, and marketing sectors.
Eureka!
Eureka! is organized by the students of IIT Bombay and is an annual international business plan competition focusing on students and working professionals from across the globe. It has been active for the last 13 years and has grown from a competition consisting of 50 teams contending for INR 50,000 to over 2000 teams from around the earth contending for more than INR 2.4 million in cash and prizes.
Eureka is open for people with ideas and innovations in cleantech, core sciences, telecommunication, biotechnology, web portals, electronics, manufacturing, service, entertainment, IT-software, retail, power, banking/finance, hospitality, HRD, consultancy, food processing and tourism areas.
UDDYAM
UDDYAM is the annual innovation and entrepreneurship event of S.P. Jain Institute of Management & Research, conducted in association with the Technopreneur Promotion Program (TePP), Department of Science and Technology (Govt. of India). In this event, innovative ideas are given to the students and they are invited to come up with business-plans for these ideas. The winner gets a cash prize of INR 50,000; the first runner-up gets INR 30,000 and the second runner-up gets INR 20,000.
Ventura
Ventura is organized by the Entrepreneurship Cell of NIT Trichy. It aims to foster an entrepreneurial spirit among students, working professionals and entrepreneurs by giving them a platform to present their ideas. These are the categories in which the participants can present their solutions: Rural Entrepreneurship, Women Entrepreneurship, Social Entrepreneurship, Biotechnology, Core Science, Telecommunication, Education, Electronics, Manufacturing, Nano Technology, IT-Software, Entertainment, Agriculture, Energy, Health, Biomedical, Web Portals, Consultancy and Food Processing.
Empresario
Empresario is the annual business model competition organized by the Entrepreneurship Cell, IIT Kharagpur in association with International Business Model Competition (IBMC). The competition provides a platform for students to get excellent professional mentorship from experienced, varied and illustrious mentors, and to showcase their ideas in front of venture capitalists, angel investors and industry titans.
EXIMIUS
Eximius is a national entrepreneurship summit organized every year by IIM-Bangalore. The summit aims to celebrate entrepreneurship and foster entrepreneurial talent among the participants and features 20+ competitions, 25+ speaker sessions, workshops, fireside chats and product demonstrations by startups. Various renowned industry leaders attend this summit and enlighten the participants by speaking on topics like strategy, startup fundraising, IPO pitch, public policy, product management, business idea pitch and more.
There are nearly 849 venture capital firms in India. These firms are considered to be one of the most essential contributors to the building of a startup into a successful company.
Let’s talk about some of the leading venture capital firms in India:
1) ACCEL PARTNERS
Accel Partners is one of the oldest venture capital firms in India and forayed into the Indian startup ecosystem in 2008. Headquartered in California, this VC firm has invested in hundreds of companies and focuses mainly on internet technology companies. It generally invests an amount of US$500K to US$ 50M depending on the nature of the startup.
Investment domains: Infrastructure, Mobile & Software, Internet and Consumer Services
Startups funded: Myntra, BookMyShow, BabyOYE, Freshdesk, Flipkart, CureFit, UrbanClap, etc.
2) SEQUOIA CAPITAL
Sequoia Capital India is an affiliation of VC firm Sequoia Capital, which is based in California. It entered the Indian market in 2006 and specializes in startup funding at the early, seed and also in the growth stage with a fixed investment structure for each of these stages.
Investment domains: Healthcare, Consumer Internet, Financial Sector and Technology
Startups funded: JustDial, Zomato, Practo, Groupon, CARS24, Urban Ladder, CRED, etc.
3) NEXUS VENTURE PARTNERS
Founded in 2006, Nexus Venture Partners is among the top venture capital firms in India to look out for. It has been a forerunner of investing in global technology products and technology-led businesses in India. It mainly invests US$ 500K to US$ 10M in small businesses and startups in their early stages.
Investment domains: Data Security, Mobile, Infrastructure, Bio Data Analytics, Agribusiness, Consumer and Business Services
Startups funded: Craftsvilla, Snapdeal, Shopclues, Apollo, Aryaka, Delhivery, etc.
4) KALAARI CAPITAL
Kalaari Capital, founded in 2006, is a recognized venture capital firm in India. It primarily invests in technology-based startups and small businesses in their early and seed stage. It not only provides adequate capital to startups but also a reliable advisory board to assist young founders with effective business solutions.
Investment domains: Internet, ECommerce, Curated Web
Startups funded: Snapdeal, ScoopWhoop, Myntra, Urban Ladder, Instamojo, etc.
5) BLUME VENTURES
Blume Ventures, founded in 2011, is another well-known venture capital firm in India and is also known as the “founder’s venture capital”. It holds over a decade’s experience in startup funding and offers complete support and guidance to budding entrepreneurs.
Investment domains: Mobile Applications, Internet & Software Sectors, Telecommunication Equipments, Research and Development
Startups funded: Cashify, HealthifyMe, Belong, Exotel, MilkBasket, etc.
In the last decade, India has hatched innumerable startups across every field. As per the latest data, over 50,000 startups were registered in India till 2018 and the number keeps on increasing steadily. While discussing the startup ecosystem of any country, how can we forget talking about its leading startups?
Below is a list of the Top 5 popular startups in India:
1. One97
Headquarters: Noida, Uttar Pradesh
Domain: Commerce and Shopping, Financial Services
Total funding: US$4.4 Billion
One97 Communications is the company operating Paytm, a digital goods and mobile commerce platform offering multiple products and services including mobile recharge, bill payments, conveyance tickets, hotel reservations, games, and much more.
2. Ola Cabs
Headquarters: Bengaluru, Karnataka
Domain: Transportation
Total funding: US$3.8 Billion
Ola operates a ride-hailing platform. Its mobile app enables users to book a range of cabs, bikes, and other vehicles for their conveyance. In addition to India, Ola has expanded its services to other countries including Australia, New Zealand, and the UK.
3. OYO
Headquarters: Gurugram, Haryana
Domain: Hospitality, Hotels and Tourism
Total funding: US$3.2 Billion
OYO operates a hotel chain that offers a suite of stay experiences across India. It revolutionizes budget hospitality with comfortable and affordable hotels through its mobile app. It also provides a portfolio of offers for all types of travelers in India and abroad, in China, Malaysia, Nepal, Indonesia, and UAE.
4. ReNew Power
Headquarters: Gurugram, Haryana
Domain: Energy
Total funding: US$2.8 Billion
ReNew Power is an Indian wind energy firm. It is dedicated to renewable energy and owns, builds, develops and operates renewable energy production facilities with utility-scale wind, utility-scale solar, and rooftop solar projects. It is the largest autonomous renewable energy company in India.
5. Snapdeal
Headquarters: Gurugram, Haryana
Industry: E-commerce and Shopping
Total funding: US$1.8 Billion
Snapdeal is an online shopping platform, offering products across 600+ categories like electronics, fashion, home and appliances from a 500K strong seller base.
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