Regulators
and officials now see potential in start-ups, and are invested in boosting
their size and number. “There are 50,000 registered start-ups in India, and
there will be 50,000 more by 2024 at this pace,” said Guruprasad Mohapatra,
Secretary at the Department for Promotion of Industry and Internal Trade of
India. There has been tremendous attitudinal change among government
departments, he said, speaking for himself as well as colleagues in different
parts of government. He added that this change has been accelerated since
2015-16 when a new policy came into effect.
Indian start-ups have come into their own in the last four to five years,
agreed Shailendra Singh, Managing Director, Sequoia Capital India, Singapore.
The optimism, the ability to dream, the amount and quality of capital
available, the sheer size and scale of start-ups, as well as their ambition and
ability to execute globally, are remarkable. “It is exciting to back these
companies that have both disrupted existing companies and become full-stack
online and offline businesses themselves,” he said, “Technology is intrinsic to
these companies, not only impacting them at a superficial level.”
Asian start-ups are significantly different from their counterparts in Silicon
Valley, Singh said, where markets are deep and very large, and companies have
the incentive to do one thing and do it very well. Companies also need not go
outside. In Asia, on the other hand, there are “lots of white spaces” and
individual markets are very small, so that companies can and must quickly
mutate to related businesses. For instance, Indonesian start-up Gojek started
as a bike rental service, and then branched out into logistics, payments, delivery,
etc.
Sharing the experience of the fast-growing hospitality start-up, OYO, Aditya
Ghosh, the company’s Chief Executive Officer said that OYO realized early on
that the best way to create higher margins was to own the entire value chain
end-to-end – operations, properties, customer experience and so on. It also
grew a diversified portfolio with multiple brands offering hotel rooms, holiday
homes, cloud kitchens and co-working spaces, resulting in an “omnichannel
presence”.
What business needs from the government is investment in infrastructure and
ecosystem, much of which relies on removing ground-level constraints, and
providing light-touch but adequate regulation that ensures Indian companies
enjoy credibility as they scale-up globally. It is essential for businesses to
have regular and deep engagement with policy-makers so they can take steps to
pre-empt a full-blown a crisis. They must also nurture and train talent to
create innovative mindsets for the next wave of start-ups.
India must also overcome some systemic challenges, such as low participation of
women in the workforce, said Ankiti Bose, Co-Founder and Chief Executive
Officer, Zilingo, Singapore, a four-year-old start-up that has brought
technology and seamless connectivity to supply chains in the global clothing
industry. With adequate data and regulatory support, Zilingo could “bring in
capital at an unprecedented scale” to the fragmented, typically small apparel
manufacturers and sellers in India, she said.
Mohapatra emphasized that the government is committed to improving women’s
participation – by providing preferential access to capital to women-led
start-ups, for instance – but the issue is of wider inclusion. “There are large
tracts of India untouched by start-up presence,” he said, adding that the
government is committed to spreading its start-up mission to the country’s more
disadvantaged areas.
The government is committed to providing technology start-ups with room to
experiment and develop without setting tight regulatory boundaries, as it did
with the IT sector and the aviation sector earlier, he added.