Startups, if loosely defined, are new or emerging business entities, which aim to meet a market need by offering an innovative or unique product, service, or process. It is an early stage in the life cycle of a business or an enterprise where the entrepreneur moves from the business idea stage to acquiring funds, setting up the framework for the business, and beginning to start operations for the business.
The Startup Trend
It’s not like there never have been any new businesses or enterprises coming up, but in the last few years, the word STARTUP has caught the fancy of the generation and from there on there has been no looking back. Every individual at some point or the other thinks of starting their own venture, secure funding and then make it big into the business world. Earlier also people used to start their own business, borrow money from others to fund their business, and then set open their shop. So what is it that separates the earlier business models and the new ones? Well there’s one basic difference at the core of all these new ventures that have come up, they all are looking to provide innovative solution to customer demands and needs through their unique product or services. The thing with the Startup trend is that it has given individuals and not just the youth the confidence to start something of their own, and with the kind of support pouring in from venture capitalist and government, the fear of failure also diminishes to a large extent.
The Mother of all Startups
When Flipkart, the largest e-commerce player in India, started shop a decade back in 2007, it never imagined it would be one of the highest valued companies in India. Started by two IIT Delhi students, and ex-Amazon employees, Sachin Bansal and Binny Bansal, Flipkart today is valued at $11.6 billion. Having eaten up competition like a chocolate Pie, Flipkart today has under its belt, Myntra.com, Jabong.com, ebay.in among many others as its subsidiaries. Flipkart employs more than 33000 employees across verticals in its organisation. The company had its share of turbulences and shocks, and is struggling to post profits on the board, but when you are the only largest player in your category competing with an Amazon, and trying to cater to a population of 1.25 billion people, there’s a little chance of you struggling for too long.
Now, Flipkart is just one example of the millions around us, where people have gone ahead done their own thing and along the way created opportunities and jobs for a million others. Today India is home to 26,539 Startup companies, with 6,022 investors supporting them, with an average valuation of $2.8 million and $8k average salary and more and the journey just seems to have begun.
Now if one has to look at the governments take on the whole Startup thing and they being the next job drivers for the economy. The Indian Prime Minister, Shri. Narendra Modi, on January 2016 launched the Startup India, Stand-Up India policy aiming at promoting the growing Startup culture in the country. Through the Startup India, Stand-Up India policy, the government has gone ahead and simplified regulations and norms, and eased tax laws, which has given a big boost to the entire Startup enthusiast in the country. The government has further started Startup incubators plans, where new upcoming and promising Startups are trained, mentored, and supported to help them become self sustainable.
Startups and Job Growth
The whole Startup a phenomenon has not only led to solutions of existing consumer problems in a unique manner but also has generated lot of direct and indirect employment for individuals. The employment opportunities are not only limited to e –commerce only, but has in fact impacted the entire value chain with logistics, warehousing, customer support among others. If one has to look at how it has impacted job creation in an indirect manner, well one can always argue that it has given platform to small sellers, vendors, artisans, women to promote their crafts, goods, and services. Moreover, with different government initiatives like Make in India, Skill India, Digital India, among others, the Startup story towards growth and job creation compliments each other and works as ancillary units.
Going by the reports released by KPMG and Snapdeal, Startups are going to create approximately 1.45 million jobs by 2021 with warehousing and logistics contributing around 55% of it. One can fairly say thus that the Startup scenario in India is more than just a bubble, and that this culture is here to stay.