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How the Indian Startup Scenario can be Improved - A Way Forward

Ajay JainStartup mentor & investor, innovator, strategic consultant

INTERNATIONAL CONFERENCE - 2018

Flow

• Startup Ecosystem – Various Players

• Indian Startup Scenario

• Women In Entrepreneurship

• Suggestions

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Startup Ecosystem – Various Players

• Entrepreneur – dreamers, believers – 50% founders are engineers!

• Government – State & Central - Startup India initiative, various policies

• Investors – angels, institutional investors including VCs, PEs, banks & others

• Corporate – market access, partnership, acquisition

• Mentor – experienced individuals who act as critical sounding board for startups

• Regulation – ease of doing business! (China is not an open economy)

• Research – universities, CCMB & others who can support startups

• Incubators/accelerators – suitable environment, operational support

• Media – great vehicle for publicity of startups

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Indian Startup Scenario – A Glance

• India competes with Israel to be the third largest startup base, US & UK retain 1st & 2nd spot (data by Zinnov; as China’s information is not public it is not in the list, but it is definitely ahead of India)

• 1000+ new startups added in 2017 (down by about 30% YoY)

• Total tech startups around 5200 (difficult to calculate)

• Top Cities – Bengaluru, Delhi, Mumbai

• Top-tier 2/3 cities - Pune, Ahmedabad, Chandigarh, Jaipur & Kochi

• 190+ active incubators/accelerators

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Female Entrepreneurs Landscape

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Female Entrepreneurs Landscape

But beneath the surface

• 63% of participants who tried to raise fund in 2016 did not have a favorable experience

• 65% believe that the Indian start-up ecosystem may be in a technology bubble

• 70% of participants were open to an exit

• Majority Indian startups fail within 1.8 years of inception

• Is the economy ready to provide market access?

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Some suggestions - Government • The Central Government has taken good steps in

enabling/helping Indian startups & this needs to be applauded

• But the government needs to ensure market access for these startups such as to encourage startups to build solutions for Government problems

• Have specialised teams to focus on different sectors such as artificial intelligence (AI), mixed reality (VR/AR) & quantum computing

• Encourage women to be entrepreneurs

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Some suggestions - Corporate

• There is lot of good intent by corporate looking at startups as a means of innovation

• Most MNCs have internal ventures that fund & work with startups, even sharing technologies. But India corporate houses have not announced such venture houses

• Corporate technical experts can give invaluable advice to startups – this needs to be taken up in a systematic manner

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Some suggestions - Media

• Media is much more powerful these days – they can make or break elections

• Try not to celebrate small achievements

• Try to focus on the failures & the struggles of startups – sadly startup has become the in-thing!

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Some suggestions - Entrepreneur

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Some suggestions - Entrepreneur

• It is a rough road ahead – one of the most difficult ones

• An idea is worth a dime

• India is a land of businessmen, but traditional businesses & startups differ

• Do not startup just because you want to get VC money or fame – startup because you believe in the idea & the rest will follow

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Some suggestions - Investors

• Investors provide the much needed support to startups

• In India, startup investment is almost a statement

• Early stage investors need to be patient

• Apart from money, investors need to groom the startups –but not impose themselves on the founders

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Some suggestions – Incubators/Accelerators

• Incubators/accelerators are a great community place for startups

• But we need to have much more serious players aka Y-combinator

• Further sector focused incubators/accelerators would be much appreciated

• Incubators gain mileage from startups, but there needs to be a shift from coaching institutes mentality to proper education

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Some suggestions – Research

• Research institutes are a great place for ideas to grow & next-generation technology to be harnessed

• Alas, the Indian university system lacks the ability to ensure research & innovation meets the market

• Professors can really play a major role in strengthening the Indian startup ecosystem

Overall Indian Startup Summary• Indian Startup Bandwagon is on a roll!

• We have decent unicorns to showcase

• But we need to fix certain major issues for it to really meet the expectations

• Indian economy is still not mature as a market for deep technology startups

• Indian founders follow a me-too approach of looking at western counterparts – rather than solving local issues with local solutions

• Startup is a great journey but not as glamorous as it is made to be!

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Ajay Jainajay003@gmail.com@003ajhttps://www.linkedin.com/in/ajayjainprofile/

Thank YouINTERNATIONAL CONFERENCE - 2018