ES-I: A Blog to help First-Time Entrepreneurs in India

Taking inspiration from hundreds of startups incubated at IIT Madras & elsewhere over the years

Today, Incubation of startups, driving innovative technologies, is flourishing at numerous educational institutions in India. When we started some 25 years back, the institutions had a dilemma. We were often told that educational institutions are meant to pursue only Saraswati, the Goddess of Vidya (knowledge). Businesses are all about the pursuit of Lakshmi, the Goddess of Wealth. As per Indian tradition, mixing Saraswati and Lakshmi is not done. It would negatively impact the educational institutions. Therefore, our early incubation of startups were carried out quietly and largely without formal approvals. However, these startups showed that knowledge generated in educational institutions could indeed be commercialised for the benefit of society. It took considerable time, but the Saraswati – Lakshmi dilemma faded gradually.

By the turn of the century, there were committees discussing the process of incubation. Sometime in 2004 or 2005, Government of India (GoI) came up with a policy to support Startups and Incubation Centres at educational institutions. Thus, these incubators started emerging all over the country, but the momentum was slow. It took almost ten years for these institutions / incubators to inspire young students to seriously consider entrepreneurship. Since then, we have been learning rapidly, gaining experience and almost doubling every year in numbers. One of the biggest support for this process came when “Angel funding” came into being about ten years back. Soon, entrepreneurship was all-over the country. The “Startup India” drive from GoI has helped startups to become a trend, with more students from the top institutions opting to become entrepreneurs rather than pursue higher education abroad. The public sector oil & gas companies have recently come up with a rather large program to provide early support to these startups. CSR funding to incubators for startups has also provided a big boost.

As startups have started providing some decent returns to investors, this interest is multiplying. As more funding becomes available, startups are becoming better and better.

However, there is one problem. Many of these start-ups are founded by “first-time entrepreneurs.” They are often in their early twenties and may have just graduated from educational institutions. These youngsters, especially in India, rarely have any prior work-experience. Even the internships that they may do are limited and rarely teach them how to design and manufacture a marketable product, how to take a product to market, how to handle finance or manage an organisation. This set of blogs are for such first-time entrepreneurs (either youngsters or otherwise) and is an attempt to get them to understand what it takes to drive a startup to success.

There are a number of things that the leadership team of a startup needs to learn, so as to build a successful enterprise. Some of the more important questions that an entrepreneur needs to answer are:

• Does the market need your product? How will you succeed in marketing? Will your product make enough margins?
• Are you running out of cash? Do you have finance under control? Have you put the plan on paper?
• Do you have the team to make the company successful? Can you build such a team? Can you inspire them? Can you put them together?

We will reflect on these things and many more, going forward. We begin at looking at something that most first-time entrepreneur slip on, that is 'Managing Finances'.

Summary 
* The technology startup ecosystem in India has matured immensely over the last ten years. While innovation finds its roots in academia, startups are finding ways to commercialize these innovations and accelerate socio-economic impact. 
* Access to angel funding, support from industry and Government policy/initiatives, are strengthening the ecosystem in India, which is now more conducive for growth of startup businesses. 
* This blog is intended for first-time Entrepreneurs in India: the articles will reflect and chronicle paths startup founders must take or avoid, in their pursuit to create sustainable/ successful ventures.