“It’s not about ideas. It’s about making ideas happen.” – Scott Belsky
In a world of stiff competition where most of the people are after securing top positions in multinational companies, there has been a parallel section of people who have taken a different course of revolutionising the world, the so-called ‘entrepreneurs’. They prefer working for themselves rather than as an employee for a company and assume all the risks and rewards of the business. The adage, “Get busy fulfilling your dreams, or you’ll end up fulfilling others’ dreams” seems to fit perfectly into their description.
The India of today is completely different than what it was before. The plethora of examples depicting the growth of the startup ecosystem in India reminds us of how ‘The Golden Age of Startup’ has arrived in the country, bringing with it unbelievable innovations. Startups have started to make a mark amidst this competitive world with the help of their revolutionary products and creative business models. This has induced global investors to come forward and venture in India’s startup ecosystem.
The startups of today have essentially become the source of ‘roti, kapda, and makaan’. If we‘re hungry, we have FoodPanda to deliver sumptuous meals anytime. If we’re confused about clothing, we go for Myntra. Startups like Housing.com help in providing comfortable living at reasonable prices.
The change in the pattern of entrepreneurship has been quite evident since the 1990s when certain reforms had transformed the functioning of the nation. Economic liberalisation, globalisation, and privatisation brought with it several measures to reduce import tariffs, end License Raj, encourage foreign investment and reduce the tax rate. These steps provided an impetus to India’s entrepreneurial ecosystem. It also led to a massive structural shift from the capital-intensive manufacturing sector to the asset-light services sector. The opening up of India’s closed economy also led to an increased sense of competition and exploration of new sectors. Narayan Murthy, founder of Infosys recalls, “Once licensing was abolished, it allowed companies to make decisions in their boardrooms rather than in the corridors of North Block”.
The past decade has witnessed an unbelievable growth in the number of startups as well as investors coming into the country. With more than 4000 startups operating in India presently, the country has witnessed an average annual growth rate of 16 percent in the number of startups. Having the third largest startup base in the world behind UK and USA, the startups have been highly responsible for employment opportunities and economic growth in the country. Moreover, India’s considerable rise in ‘Ease of doing business’ index has favoured entrepreneurs to establish their hold.
The startups of the country have not only been restricted to revenue growth but have also helped to engage in diplomatic ties with other countries as well as empowering women. The recent ‘Global Entrepreneurship Summit ‘ which was held in Hyderabad and co-hosted by USA and India bears testimony to the fact of how the relationship between countries is growing every year with more trade and people to people ties. With a theme of ‘Women First, Prosperity for All’, the summit highlighted a critical role of women entrepreneurs in fostering global growth and prosperity. The summit witnessed the founders of Indian startups like OYO and Ola and an all-female delegation from more than 10 countries across the globe. Moreover, nearly 300 investors graced the event which showed how the startups in the country have become investment friendly. With cities like Hyderabad having a robust startup ecosystem, I believe that the summit presented the enabling environment of innovation and entrepreneurship as well as the significant role of women entrepreneurs in the country.
One of the significant changes in the startups has been their entry in the global market and expansion of their operations overseas. The leading Indian startup, OYO has received funding of $800 million from SoftBank Vision Fund and has entered into countries like China, UK, and Malaysia. Overtaking Taj and Oberoi group of hotels in valuation, OYO has become one of the leading hospitality companies in China within a span of one year.
The recent acquisition of FoodPanda India by the taxi aggregator Ola saw its foray into online food ordering and the delivery segment in the country. The huge customer base through this acquisition along with the investments made by Ola has been giving tough competition to its rival company Uber which has been making strides through its unit, UberEats.
Traditionally, profit maximisation has been the sole aim of a startup and serves as a key determinant of their success. However, today we witness a change in their perspective as a number of entrepreneurs have started to bring about a change in society through their business. These entrepreneurs tend to bring about a social impact in society along with profit -making.
One of the striking examples is of an Indian startup named ‘HelpUsGreen’ which has been working to clean up the mighty river Ganga by recycling thousands of tonnes of floral waste from temples. It has come up with the world’s first profitable solution to the monumental temple waste problem: ‘flowercycling’. Collecting floral wastes from temples on a daily basis, these flowers are handcrafted into charcoal -free incense and biodegradable material through its ‘flowercycling’ technology. The efforts of this initiative to bring about a change through their actions made them even get recognized on an international platform by the United Nations(UN).
Amidst this ongoing frenzy, it is time for us to look back and assess the kind of startups which have emerged in the country.Taking a close look at the pattern of startups, idea arbitrage seems to have become a major opportunity in India. Idea arbitrage refers to the concept of taking an idea from one country and duplicating it and adapting to another country. For the Indian startup ecosystem, the startups of the Silicon Valley have been serving as the best role model and several entrepreneurs have been mimicking the successful models from the valley.
The startup ecosystem has a lot of challenges ranging from human to financial resources as well as the sustainability of growth in the long run. Despite the challenges, there are a plethora of opportunities available for the startups offering products and services for day to day problems at affordable prices. The Indian Government has introduced several schemes and initiatives like ‘Make In India ‘,’Startup India ‘ and ‘Mudra’ for the growth of the startup ecosystem of the country. With contributions from these startups, there has been a cascading effect on the economy with a tremendous increase in employment generation and industrial growth. The meteoric rise in the quality of entrepreneurship and innovation serve as a reminder to the fact that the day is not so far when India would create its own Silicon Valley.
By Rahul Kabra