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Introduction

India’s startup ecosystem, the third-largest in the world, is a bustling hub of innovation and opportunity, with more than 127 thousand DPIIT (Department for Promotion of Industry and Internal Trade) recognized startups and 114 unicorns valued at over $350 billion. Starting a business venture in this vibrant landscape is exciting. However, turning an idea into a successful business demands strategic planning and execution. This comprehensive guide can be your roadmap for launching and scaling a startup in India. In this guide, we’ll walk you through the complete journey of transforming your startup dream into reality.

Before You Begin

Despite the huge potential of startups, a huge number of startups fail to achieve their full potential. As per Investopedia, almost 90% of startups fail within the initial five years. There can be various reasons for the high failure rate, but one key reason is the product-market fit, which means the situation where a startup gives out a product or solution which does not resonate with the customer. However, such a situation can be avoided for your startup by following the below mentioned steps:

• Step 1 — Viable Idea: A robust idea that addresses a specific market need is the foundation for a successful startup which can be identified and defined through brainstorming, leveraging your expertise, and analyzing market trends.

• Step 2 — Market Research: After finalising the idea, it needs to be validated by conducting market research. The research aims to provide information regarding the following aspects:

1. Competition: Identification of existing and potential competitors, their strengths and weaknesses is determined through market research.

2. Identifying Target Audience: Through this market research target audience is identified by understanding their needs, preferences and behaviours.

3. Demand Assessment: One should not pour their heart and soul into an unvalidated idea. It should be feasible and tested in the real world by gathering feedback through surveys, focused group discussions etc to know the actual interest and demand.

Business Planning

After identifying the idea and doing the market research, a detailed business plan should be framed which can act as a roadmap to guide the startups through various phases of growth. A good business plan shall contain strategies and planning relating to the below mentioned aspects:

• Marketing and Sales
• Management and team building
• Revenue Structure
• Funding
• Product/Services Portfolio
• Expansion 

Taking Shape – From Idea To Action

After all the planning has been done and all the strategies are decided it’s time to shape your business by giving it a legal identity and registering it with the authorities. The following steps are required to be taken in order to shape your idea into a business:

• Step 1 — Choosing the right business structure: Choosing the right business structure is crucial for your startup as the ownership and decision-making power depends on the business structure of a startup. Generally, there are five major types of structure, which are listed in the table below along with their features:

Structure	Minimum People	Maximum People	Legal Identity	Liablity
Proprietorship	1	N/A	No	Unlimited
Partnership	2	50	No	Unlimited
LLP	2	No limit	Separate	Limited
Private Company	2	Members:20Director: 15	Separate	Limited
Public Company	Shareholders: 7Directors: 3	No limit	Separate	Limited

• Step 2 — Compliance and Regulations: After incorporating your business by deciding the right business structure. You should follow all the applicable regulations and ensure the relevant compliances such as convening board meetings, return filing, maintaining records etc. Following are the key compliances and regulations which every business needs to fulfil:

1. GST: If your business comes under the mandatory registration criteria or fulfils the thresholds for GST registration then you should register immediately and file the return within the stipulated periods.
2. Sector-Specific: If your business is subjected to any sectoral regulators then you should also register with the Regulator and comply with their regulations such as RBI, IRDAI, SEBI etc.
3. Return Filings: After commencing your business you should file your returns promptly. If failed you can be subjected to hefty penalties and your licence/registration may also be revoked. Furthermore, in serious cases, there are provisions for imprisonment as well.
4. IPR: If you have any special right which can be registered as Intellectual Property such as Trademark, Patent, Copyright, GI etc, then you must register immediately to safeguard your interests.

Funding your Startup

After structuring your business one most important step for any startup is funding. This is the stage which decides the faith of any startup. Because it’s only through funding that you can establish your business and make it a successful business. Sources for funding can be broadly divided into two categories, which are:

1. Bootstrapping: It simply means to launch and grow a business using your own funds such as savings or revenue. In bootstrapping you rely on your own resources instead of relying on outside investors. Through this approach, you can keep control in your hands but in most cases, it results in slower growth.
2. External Funding: Unlike bootstrapping, if you rely on external resources and outside investors you may have easy access to funds which will result in faster growth. But the tradeoff is you may lose a significant amount of equity or control in your business to secure the external funding. There can be various types of external funding, some popular ones are:
   1. Loans: You can take loans from banks or other financial institutions to fuel your startup. The upside of funding through a loan is that you don’t lose decision-making power but the downside is that you will be paying high interest.

1. Angel Funding: When HNIs invest their own money in early-stage startups, in exchange for equity in the company it is called Angel Funding. These investors are known as angel investors, who take high-risk, high-reward bets on the startup’s success.
2. Venture Capital: When VC firms raise money from investors and use it to invest in startups and young businesses in exchange for an ownership stake, it’s called VC funding. It’s also a high-risk, high-reward gamble for both the VC firm and the startup.

3. Government Initiatives: Governments also prompt startups because they bring in huge revenues and provide jobs. In India, various schemes such as MUDRA loan, Standup India, Startup India and many more are introduced to help startups with the funding.
4. Crowdfunding: This is not a very popular startup funding source, but still an option for founders to fund their start-ups. There are various platforms such as Kickstarter and Indiegogo which can help with crowdfunding.

Other Important Things

Besides all these above-mentioned steps and processes, there are a few more things which need to be considered for building a successful startup such as:

1. Team Building: Every founder should put in an equal amount of effort to find their A-team. Because after a point the founders can’t manage all the affairs on their own and they need to delegate their work so that they can focus on more important things. However, the team should be trustworthy and efficient and should have faith in the founder.
2. Marketing and Sales: A proper strategy for marketing and sales should also be put in place to enhance the customer base and attract the highest possible number of customers. There are two common types of marketing
   1. Digital Marketing: It includes SEO and content marketing, social media marketing and email marketing
   2. Offline Marketing: It includes participating in industry events, trade shows etc. Traditional advertising methods such as print media, radio, and TV can also be used if they align with your target audience.

Furthermore, a comprehensive sales strategy can be built by using tools such as lead generation, customer relationship management (CRM), robust sales funnel etc.

3. Financial Management: Managing the finances of the startup is also crucial for the overall growth of the business. It includes the management of expenses and increasing revenue. 
4. Feedback and Improvement: Lastly it’s important to take feedback from customers and improve your product or services. This will result in higher client retention and satisfaction levels.

Registering Your Startup with the Startup India Program

If you have incorporated your startup you may also seek to register your startup under the Startup India scheme. The Department of Trade Promotion and Internal Trade (DPIIT) is entrusted with the responsibility of registering startups under this scheme. To be eligible for DPIIT recognition, your startup must meet the following criteria:

1. Should not be less than 10 years old from the date of incorporation
2. Incorporated as a company, partnership, or LLP.
3. Have a turnover of less than Rs. 100 crores in the past financial years.
4. Not be created by splitting an existing entity.
5. Work on creating new products, services, or processes and have the potential to create jobs or wealth

Benefits of Registering with the Startup India Program

By registering your startup you may get numerous benefits such as:

• Income Tax Exemption: Startups can get income tax exemption for three consecutive financial years. Startups can also avail exemption from levy of capital gains tax on investments which must be reinvested into the business.
• Self-Certification: Startups can self-certify compliance with labour and environmental laws, reducing the regulatory burden and facilitating ease of doing business.
• Financial Support: The government has set up a Fund for Startups with a corpus of Rs. 10,000 Cr, which is managed by SIDBI. The purpose of the fund is to provide equity funding for innovative startups. Startups can also avail credit guarantee schemes which facilitate financial support without requiring collateral.
• Public Procurement: Startups can apply for government tenders even if they don’t satisfy the prior experience and turnover criteria. This helps them compete with established businesses.

• IPR Benefits: The process of patent application and examination has been made fast-tracked for startups. Startups can also avail rebates on the fees for filing the IPRs.

• Winding Up: Startups can wind up their business within 90 days of making the application which is a significant reduction in time and effort as compared to winding up a regular business.
• Credibility: Obviously if a Startup is recognised by a government institution, it will add credibility and will easily gain the trust of investors and customers.