Either you make your own dreams come true or someone else’s. Cliche, isn’t it?

In the last few years, corporate world observed a flurry of the startup establishments as most of the business minded people are eager to be leader of their own startup establishment rather than working under someone else’s leadership roof.

However, this is one side of the coin.

On the other side, time taken by most of these startups to close down their business is less than the time taken by such companies for their incorporation due to diversified reasons such as lack of financial resources and innovation, inability to run the company management, employing scantily productive personnel and poor management strategies.  

In order to salvage the startup fraternity from perceiving a catastrophe of startups failure and embolden more entrepreneurs to establish startups, Indian Government had initiated startup India campaign conferring various incentives (tax exemptions, patent reforms, and incubation programmes) to the startup fraternity with the intent to transform the nation into hub of startup and innovation companies.

But in reality, the Startup India campaign appears to be quite vulnerable as the survey conducted by Entrepreneurship Development Institute of India divulges that out of total Indian adult residents only 5% (own their business – among the lowest rates in the world) and 11% (engaged in “total early-stage entrepreneurial activity [(TEA]) and business discontinuation rate (26.4%) remains one of the highest in the globe.

The said survey revealed certain interesting stats about Indian’s entrepreneurial activity in comparison with other BRICS nations in terms of established business ownership as follows:

Brazil has the highest established business ownership of 17% followed by China (8%), India and Russia (5%) and South Africa (3%) respectively.

One of the highlight of the survey is that more than 50% of the TEA have low-growth expectation and no intention to increase their employee base and only 5% of TEA are willing to employ more than 5 employees and rest of TEA’s target is to recruit 1-5 employees.

Despite government support for the startups fraternity, these statistics expose the fact that either talented personnel are not enthusiastic to arrive into startup ecosystem with the fear of failure or expand their business/employee strength owing to the risk factors involved. Apprehensions of corruption, too many formalities and red-tapism from the government side are some key factors leading to dampening of spirits of many would-be entrepreneurs.

It is evident that government needs to revisit the laws/schemes related to the startups to modify, if needed, to pass on oxygen to the aspirations of talented personnel to be entrepreneur of a startup.

It is important to educate the nation as a whole about the incentives offered by the central government to startup fraternity to embolden more enthusiastic business minded people to land into startup ecosystem and to utilize the incentives offered by the central government to the full extent possible to be a successful startup entrepreneur – ultimately achieving the objective of transmuting the nation into a land of startups and innovation companies. 

Research inputs by Paruchuri Baswanth Mohan