Why Making In India Is Still “Hard” For Startups:
We all have heard about the suicide of VG Siddhartha founder of cafe coffee day. He died by jumping off the bridge into the river in 2019. He was reportedly under the financial strain of 11000 core rupees and he also alleged in his side note that he was harassed by income tax officials.
His death shocked the business fraternity. Someone of his stature took this extreme step was unbelievable for us to hear.
It won't be exaggerating to say that India is still not a favorable place to do business. Despite many policies launched by the government to encourage businesses, businesses are not just happening.
The reason is simple enough, there are too many complications to start a new business. Many start-ups come into existence but due to adverse atmosphere, they don't transpire into the success.
Indian government launched "Make in India" on 25 September 2014 to encourage manufacturing in India. We all thought that finally, we have a government which is serious about businesses.
There was positive hype all around, immediately after the announcement, investments projects worth crores were committed. India emerged as a top destination for foreign direct investment overtaking China and USA.
The three main objectives listed out of MII we're:
● To increase the manufacturing growth rate by 12–14% per annum
● To create 100 million jobs by 2022
● To ensure that the manufacturing contribution to the GDP increases to 25% by 2022.
It was a too ambitious target but it also fell prey to lack of planning and execution. Though it provided a conducive atmosphere, yet there were issues already facing the start-up ecosystem in India with which they failed to grapple with.
Let's take a glance into the reasons why make in India still hard for start-ups:
1.They define success equals to funding
2. They are not aware of the fundamental techniques of bootstrapping
3. They don’t understand positioning
4. They expend money on irrelevant things and run out of cash
5. They recruit too many people too soon without validating
6. They commence manufacturing a product without validation
7. They chase investors instead of customers
8. They network randomly, without focus
9. They talk to investors early and blow the whistle
10. They don’t take into consideration the business model and way to monetization.
11. They have the risk aversion.
I will not say that nothing improved, there was progress but the pace was slower than it should have been, considering the hype created after the launch of make in India. We failed to see any start-up reaching the global stage in the last five years similar to the likes of Face book and Amazon.
But we need not be so pessimist. Things are changing for the better. The government started recognizing the importance of a conducive start-up ecosystem and is very much supportive of it now. Therefore, the start-up ecosystem should incorporate some insights into themselves such as:
1. Uncovering the right team encompassing co-founders who share your vision and passion for your idea
2. Conceiving a mentor and coaches around entrepreneurship and your explicit industry.
3. Longer bootstrapping or searching for seed funding.
4. Creating the right culture with customer focus in your company.
5. Finding beta customers or segment of the market to refine your idea and the product.
6. Building a social system that is encouraging.
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