Mrs Neha Sagar

Sarthak Trehan
14021204206
B.com(Hons)

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 Declaration

 I hereby declare that the project work entitled“ Start-ups in India

”submitted to the “ Dyal Singh College “, is a record of an original work
done by me under the guidance of Mrs Neha Sagar , Faculty Member ,
Dyal Singh College, Delhi University.

 This project work has not performed the basis for the award of any Degree
or diploma/fellowship and similar project if any.

SARTHAK TREHAN

B.com (hons)

Class Roll No-14/50056

Exam Roll No-14021204206

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 ACKNOWLEDGEMENT

I have taken efforts in this project. However, it would not have been possible
without the kind support and help of many individuals. I would like to extend
my sincere thanks to all of them.

I am highly indebted to “Mrs NEHA SAGAR” for her guidance and constant
supervision as well as for providing necessary information regarding the project
& also for her support in completing the project.

I would like to express my gratitude towards my parents for their kind co-
operation and encouragement which helped me in completion of this project.

My thanks and appreciations also go to my classmates in developing the project

and people who have willingly helped me out with their abilities.

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 TABLE OF CONTENTS
S.NO CONTENTS Pg. NO

1 INTRODUCTION OF START-UPS 5

2 EVOLUTION OF START-UPS 6

3 CULTURE OF START-UPS 8

4 CASE STUDIES OF TOP START-UPS 9-13

5 SOURCES OF FUNDING OF START-UPS 14

6 GROWTH OF STARTUPS USING SWOT 15

ANALYSIS

7 ADVANTAGES OF START-UPS 16-17

8 TRENDS OF INDIAN START-UPS 18-19

9 CHALLENGES FACED BY STARTUPS 20-23

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10 REFERENCES 24

INTRODUCTION

 A start up company (start up or start-up) is an entrepreneurial venture which is

typically a newly emerged, fast-growing business that aims to meet a marketplace
need by developing or offering an innovative product, process or service. A start up is
usually a company such as a small business, a partnership or an organization designed
to rapidly develop a scalable business model.

“A start up is a company working to solve a problem where the solution is not

obvious and success is not guaranteed”.

According to Merriam-Webster, start-up means “the act or an instance of

setting in operation or motion” or “a fledgling business enterprise.”

 A start up is a company that is in the first stage of its operations. These companies are
often initially bankrolled by their entrepreneurial founders as they attempt
to capitalize on developing a product or service for which they believe there is a
demand. Due to limited revenue or high costs, most of these small-scale operations
are not sustainable in the long term without additional funding from

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 EVOLUTION

 Start up companies can come in all forms and sizes. Some of the critical tasks are to
build a co-founder team to secure key skills, know-how, financial resources and other
elements to conduct research on the target market. Typically, a start up will begin by
building a first minimum viable product (MVP), a prototype, to validate, assess and
develop the new ideas or business concepts. In addition, start ups founders do
research to deepen their understanding of the ideas, technologies or business concepts
and their commercial potential.

 The size and maturity of the start up ecosystem where the start up is launched and
where it grows have an effect on the volume and success of the start ups. The start up
ecosystem consists of the individuals (entrepreneurs, venture capitalists, Angel
investors, mentors); institutions and organizations (top research universities and
institutes, business schools and entrepreneurship programs operated by universities
and colleges, non-profit entrepreneurship support organizations, government
entrepreneurship programs and services, Chambers of commerce) business
incubators and business accelerators and top-performing entrepreneurial firms and
start ups. A region with all of these elements is considered to be a "strong"
entrepreneurship ecosystem.
 Investors are generally most attracted to those new companies distinguished by their
strong co-founding team, a balanced "risk/reward" profile (in which high risk due to
the untested, disruptive innovations is balanced out by high potential returns) and
"scalability" (the likelihood that a start-up can expand its operations by serving more
markets or more customers). Attractive start ups generally have lower "bootstrapping"
(self-funding of start ups by the founders) costs, higher risk, and higher
potential return on investment. Successful start ups are typically more scalable than an
established business, in the sense that the start up has the potential to grow rapidly.

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 7
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 CULTURE

 Start up founders often have a more casual or offbeat attitude in their dress, office
space and marketing, as compared to traditional corporations. Start up founders in
the 2010s may wear hoodies, sneakers and other casual clothes to business
meetings. Some start ups have recreational facilities in their offices, such as pool
tables, ping pong tables and pinball machines, which are used to create an
attractive, fun work environment, stimulate team development and team spirit, and
encourage creativity. Some of the casual approaches, such as the use of "flat"
organizational structures, in which regular employees can talk with the founders
and chief executive officers informally, are done to promote efficiency in the
workplace, which is needed to get their business off the ground

 Some start ups do not use a strict command and control hierarchical structure,
with executives, managers, supervisors and employees. Some start ups offer
employees stock options, to increase their "buy in" into the start up (as these
employees stand to gain if the company does well). This removal of stressors
allows the workers and researchers in the start up to focus less on the work
environment around them, and more on achieving the task at hand, giving them
the potential to achieve something great for their company.

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 COMPANY-FLIPKART

 FOUNDER(S)-SACHIN BANSAL & BINNY BANSAL

 REVENUE-RS 15129 crore (2016)

 Sachin Bansal started Flipkart in 2007 from a one-room apartment in Bangalore along

with his schoolmate Binny Bansal. The store started by selling books online and later
expanded to categories such as apparel and electronics.

 Now valued at over US$17 billion, Flipkart is amongst the top 10 ecommerce

companies in the world. Earlier an employee at Amazon India, Sachin is now amongst

the wealthiest internet millionaires in India.

 Flipkart has launched its own product range under the name "DigiFlip" with products

including tablets, USBs, and laptop bags.After the failure of its 2014 Big Billion Sale,

Flipkart carried out a second Big Billion Sale, where it is reported that they saw a

business turnover of $300 million in gross merchandise volume.

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 COMPANY-OLA CABS

 FOUNDER-BHAVISH AGGARWAL

 REVENUE-419.25 crore (2014-15)

 Co-founded in 2010 by tech graduate Bhavish Aggarwal, Ola Cabs is the

biggest online taxi and car aggregator in India today, strongly rivalling Uber.

 The transportation startup was founded in Mumbai and raised angel funds

from Snapdeal co-founder Kunal Bahl and Shaadi founder Anupam Mittal.

Valued at over US$5 billion now, Ola has about 250,000 cabs and auto

rickshaws in its app, operational in about 85 Indian cities.

 Ola was founded as an online cab aggregator in Mumbai, but is now based

in Bangalore. As of September 2015, Ola was valued at $5 billion.

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 COMPANY-PAYTM

 FOUNDER-VIJAY SHEKHAR SHARMA

 Born in a small town near Delhi, Vijay Shekhar Sharma was the first

amongst his immediate family to graduate from a tech school and then

travel overseas for a job. Vijay launched One97 as a telecoms software

company in the early 2000s and later pivoted it to Paytm, an online

marketplace in 2009.

 Paytm is now widely used for payments and mobile credit top-ups. The

company last year raised about US$700 million in capital from Ant

Financial, the affiliate epayments division of Chinese ecommerce

powerhouse Alibaba.

 In 2015, Paytm became the first Indian company to receive funding

from Chinese eCommerce company Alibaba, after it raised over $625

million at a valuation of $1.5 billion. In August 2016, Paytm received

an investment from Mountain Capital, one of Taiwan-based Media

based company, which valued Paytm at of over USD$5 billion.

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 COMAPANY-ZOMATO

 FOUNDER(S)-DEEPINDER GOYAL & PANKAJ CHADDAH

 After collecting and pinning menus on his office soft board at Bain & Co, Deepinder

Goyal decided to give his hobby a digital push by scanning the menus on a website

for everyone to see. The site became popular. Deepinder and his colleague at Bain,

Pankaj Chaddah, decided to pursue it commercially.

 In 2008, they hired a CEO for their venture. After 18 months, the duo decided to quit

their jobs and live the startup life full-time.

 The website soon listed 1,200 restaurants in New Delhi – and the team hasn’t looked

back since. It has expanded to over 22 countries. The company is now valued at close

to US$1 billion.

 The service began as "Foodiebay" .In November 2010, Foodiebay was renamed as
Zomato. Between 2010-13, Zomato raised approximately US$16.7 million

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 COMPANY-OYO ROOMS

 FOUNDER-RITESH AGGARWAL

 At 21 years of age, Ritesh Aggarwal is India’s youngest millionaire entrepreneur,

having created budget hotel startup OyoRooms.

 Ironically, Ritesh was thrown out of rented place in New Delhi when he couldn’t pay

the rent. He slept the night in the stairway.

 Ritesh had come to Delhi to study in college. But after just three days he realized that

formal education is not something he wants to waste his time on. He dropped out and

started a bed-and-breakfast chain called Oravel Stays, which later pivoted to become

OyoRooms.

 OYO Rooms, commonly known as OYO is an Indian hotel brand that owns and

operates as well as aggregates standardised hotel rooms. It currently operates in more

than 200 Indian cities

 Oravel was designed as a platform for booking budget and premium accommodation.

Realising the great variability in the budget sector, he pivoted Oravel to OYO in 2013.

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 SOURCES OF FUNDING FOR STARTUPS

 Bootstrapping. Self-funding from your savings (if you have it) is always preferred.
Advantages: no time going hat-in-hand to investors and you don’t have to relinquish
any control in your company.
 Friends and family. Tap your inner circle before expanding your horizons. As a
rule of thumb, professional investors like to see real skin in the game–your own, of
that of people who trust you.
 Loans or lines of credit. If your company needs only a temporary or small
infusion of cash, try for a Small Business Administration loan (offered at a lower
interest rate because it is guaranteed by the government) or a bank line of credit.
Warning: Commercial banks are often dismissive of start-ups unless you have
personal collateral at risk–say, your house
 Incubators. A start-up incubator is a company, university or other organization
that ponies up resources–laboratories, office space, consulting, cash, marketing–in
exchange for equity in young companies when they are most vulnerable.
 Bartering. Exchanging goods or services as a substitute for cash can be a great
way to run on a little wallet. Example: trading free office space by agreeing to be the
property manager for the owner. This technique can also work with legal, accounting
and engineering services.
 Form a partnership. A more established company may have a strategic interest
in helping to develop your product—and be willing to advance funding to make it
happen.
 Commit to a major customer. Some customers would be willing to cover your
development costs in order to be able to buy your product before the rest of the world
can. Their advantage: control over your production process (to make sure it meets
their requirements) and the promise of dedicated support. Even large companies look
to their best customers to fund new projects–this is the essence of good business
development.
 Angel investors. Venture capital firms and angel investors may help startup
companies begin operations, exchanging seed money for an equity stake in the firm.
Venture capitalists and angel investors provide financing to a range of start-ups
 Venture Capital Firms. Venture capitalists and angel investors provide
financing to a range of startups (a portfolio), with the expectation that a very small
number of the startups will become viable and make money. VCs take their pound of
flesh in equity and control.

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 GROWTH OF START-UPS USING SWOT ANALYSIS

 USE SWOT TO BRING YOUR TEAM TOGETHER: A simple and fun session to
explore your new business can unify your team and galvanise them into action around
the few key factors that come out of a SWOT analysis session. Consider involving a
few trusted advisors (eg your accountant or business adviser) in this session to gain
fresh external perspectives of your new business
.
 NARROW YOUR FOCUS TO CREATE OPPORTUNITIES FROM YOUR
STRENGTHS: How can you leverage your Strengths to create new Opportunities?
How best should you introduce your new product or service to your specific target
customer segments? How can you concentrate on a few actions, rather than spread
yourself too thin?

 DON’T IGNORE YOUR WEAKNESSES: Think through what it takes to turn a

Weakness into a Strength, and any Threat into an Opportunity. Can you test your new
product or service with customers such that Weaknesses are addressed before
launching it? Are you properly informed and organised to deal with these issues?

 IDENTIFY OBSTACLES TO YOUR GROWTH: If there are any Threats that

could impact your future growth, how can you address them? For any remaining
Weaknesses, how can you remedy or even abort launching this line of business until
you have specific plans to mitigate them?

 COMPETE ON YOUR OWN TERMS: A powerful method to discover your

competitive advantage is by comparing your SWOT with that of your main
competitor – side by side. Every competitor has weaknesses. Rather than defend
yourself against your weaknesses, it can be useful to emphasise how your strengths
bring benefits to the customer in areas in which your competitor has weakness.
Likewise, it is also critical that you do not take on your competition in a customer
segment where you are weak and they are particularly strong.

 CONCLUSION-If executed correctly, a SWOT analysis helps you craft a strategy

that helps differentiate yourself from your competitors. It helps you compete
successfully in your chosen market - on your terms. It helps you focus on your key
strengths to take the greatest possible advantage of opportunities available to you.

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 ADVANTAGES STARTUPS HAVE OVER BIG BUSINESSES

 Agility.
 Startups are young and formless for the first couple of years. You may have a solid

business plan and an operations strategy in place, but there’s nothing confining you to

those structures. Big corporations are forced to keep their models the same to keep the

board of directors, the investors and their customer base happy. As a startup, you can

do whatever you want.This agility comes in handy when something disrupts the

industry, such as a new technological development or an even newer competitor. Big

businesses must absorb the blow and respond slowly as their massive gears begin to

turn. As a startup, you can turn on a dime and rebuild everything from the ground up,
if necessary.

 Team chemistry.

 Some major corporations have casual atmospheres, but for the most part, any big

business you walk into will be filled with walls, offices and cubicles. The people from

accounting don’t know the people from marketing, and the CEO probably doesn’t
know anyone below him/her.

 In a startup, you have no choice but to bond with the other members of your team.

You may have three people or three dozen, but you’ll be working so closely together

on work that matters to all of you that you’ll have a natural chemistry in your working
relationships.

 That chemistry matters more than you might think. It means your workers will be

more productive and more satisfied with their jobs, giving you more reliable work and
a lower turnaround.

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 Less bureaucracy.

 In large corporations, everything must be formalized. Every minute process is well-

documented, and there are rules surrounding everything. Usually, when a decision is

to be made, it must undergo rigorous evaluation by multiple people in multiple

department. In essence, the gears of bureaucracy slow everything to a crawl and

formalize processes that never needed formalizing in the first place.

 Competitive pricing.

 Pricing is a difficult issue to speak about broadly. Each industry must consider

different factors when it comes to pricing. For example, in food product development,

larger companies have a pricing advantage because they have access to more

equipment, they can do larger runs and save money on items per piece. However, for
most industries, start ups have the advantage when it comes to pricing.

 Start ups have less overhead. Because fewer people are using fewer resources to

develop products and services, they can be priced more aggressively than those same

products and services churned out by a multi-level, massive corporation. You’ll also

have more flexibility in pricing, open to negotiation, so you’ll be able to secure more
clients.

 Personality.

 Finally, and perhaps most importantly, because startups have fewer people within an

organization, they tend to have a much better, more accessible brand personality. The

CEO is just another member of the team and makes appearances at most meetings,

giving a face to the company. The employees, taking a smaller salary and having

more freedom, all actively want to be a part of the company, so they’re happier and

more fun to work with. Some customers will naturally gravitate toward you because
you are a start up. You’re novel and you’re an underdog. People love that.

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 TRENDS OF INDIAN START-UPS

 The impact of start ups has been significant in all walks of life. In recent years, India
has emerged as one of the top three countries globally in terms of the number of start
ups founded. The total venture investment in start ups during the period 2005-15 is
estimated at ₹1117 billion (using 2015 as the base year). Actual investment could be
much higher since details of investment amount are not available for many of the
deals. The average annual growth rate in investment flow during the period 2005-15 is
about 42 percent. Between the years 2005-15, more than 10,000 start ups have
received funding.
 The average annual growth in the number of start ups that have been funded for the
period 2005-15 has been 16 percent. In most sectors, there has been an equivalent
Indian start-up to that of a foreign start-up. While many foreign start ups have also
started operations in India, the presence of an Indian start-up meant that the Indian
consumer need not have to wait till the foreign company started operations in India
 Indian start-up landscape is very vibrant as seen by the number of companies founded.
In some of the sectors, the number of companies founded in India is close to the
number of companies founded globally. The average investment per round in a start-
up is higher globally, but the difference is not very large.

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India is the 3rd Largest Start up Hub

 According to Grant Thornton, India ranks among the top 5 countries, in terms of the
number of start ups - with a figure of over 10,000, out of which almost 800 start ups
are formed annually. Moreover - 4,300 out of those 10,000 start ups (43%) are
technology based ones, which is only slated to increase to 11,500 by the year 2020.
Also, majority of the start ups or its investors are from metro cities. The state of start
ups in the country can also be safely termed as young, as 28 years is the average age
of start up founders. .

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 CHALLENGES FACED BY START-UPS

1. Money

 Yes, you need money. Unless you’re remarkably lucky and the cash flows in straight
away from sales or investors, you will be in trouble. Cash flow issues will hit you
hard, either delaying roll-out of products, hiring key staff, or fitting out new offices.
 You will need capital to fund software or product development, office space,
marketing (yes, you’ll need that too), and yet from it most success flows. The last
thing a start up needs is to trim back costs, and shed staff, just when it needs to focus
its energies elsewhere.

2. Neglecting marketing/sales

 Some start ups encounter problems because they haven’t put enough resources into
marketing and sales. Sometimes they ignore them completely.
 It’s a false economy to put your faith in customers discovering you unless you make a
concerted effort to grow them with a proper structured plan to promote your start up.

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3. Lack of planning

 It’s amazing how many start ups falter because they forgot to plan. Or perhaps they
did, but just never covered all the bases. Key areas like sales, development, staffing,
skills shortage, and funding should be part of your business plan, or be flexible
enough to cope if events take an unexpected turn.
 Contingency planning is vital, but so is a proper business plan. If your plan is all
optimism, and fails to allow for surprises – and you can bet your life they’re just
around the corner – then you’re heading for big trouble. Get the details right, no
matter how small.

4. Finding the right people

 Certain skills are crucial not only for your business to survive, but also to grow.
Knowing the exact skills needed – and how to get those essential people – may
determine how well your start up thrives. Delays in finding the right personnel will
not only eat up valuable time, but also lead to severe bottlenecks, perhaps delay
rollout of new products or services. These are delays no start up can afford.

5. Time management

 There’s never enough time. There are a million and one decisions to be made and, last
time I looked, there are only 24 hours in a day. So, start by eliminating or minimizing
distractions – anything that gets in the way of running your business.

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6. Weak co-founders

 Hard to believe, but your co-founders may be part of your start up’s woe. They may
have helped develop a great product, but lack the skills needed to help run the
business. Start ups may need new executives to spread the workload. Failure to
recognize the problem may exacerbate your woes.

7. Scaling up

 It’s not just a question of adding a few extra employees: they must be in the right
areas – perhaps HR (you suddenly have a lot more staff), administration, payroll,
support, perhaps even developers. You may also need a larger office space, or to set
up offices in other cities or abroad. Such is the price of success. If you have a plan and
the cash to fund all this, great. If not, then prepare for a painful process.

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8. Unwillingness to push yourself beyond the comfort zone

 The founder or CEO may think he/she has all the answers, but do you really have
what it takes to think – and act – outside your comfort zone? Ask yourself how much
can you push yourself: Can you make a convincing pitch to potential investors when
you need funding?
 The ‘build it and they will come’ approach doesn’t always work.

9. Competitors

 No one ever said it was going to be easy, and despite your product or services being
great, it’s a crowded marketplace. New rivals may have altered the playing pitch, so
having the right strategy, or being able to think on your feet quickly and adapting to
the new reality will define your success – or failure.

10. Lack of Mentor

You may have a great product/idea, but lack the necessary guidance, market experience, and
knowledge to move a stage further.

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 REFERENCES

 https://en.wikipedia.org/wiki/Startup_company

 https://www.forbes.com/sites/natalierobehmed/2013/12/16/what-is-a-
startup/#422135324044

 http://www.afr.com/it-pro/5-tips-to-grow-your-startup-using-swot-
analysis-20150226-13pkj5

 Head of start up “X-PREP” –“Vatsal Rustagi”

 http://blog.ficci.com/trends-startups-ecosystem-india/7075/

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