Start-ups and funding

Starting a business takes two things: planning and resourcing.

• Planning sets the objectives, the business model (how the business will make money), a market analysis, the strategies, and plans for what to do if things go wrong.
• Resourcing secures the capital, people, technology, raw materials and infrastructure.

The Government's Startup India scheme (notification G.S.R. 127(E), 16 January 2019) defines a start-up as:

• a private limited company, a partnership firm, or a limited liability partnership (LLP);
• up to 10 years old;
• with a turnover under ₹100 crore in every year;
• working on innovation, with the potential to create jobs and wealth;
• not formed by splitting up or reconstructing an existing business.

Where the money comes from:

• Personal investment: the founders' own money, which also shows their commitment to others.
• Venture capital: investors buy a share (equity) in high-growth, high-risk technology companies, planning to sell it later at a profit.
• Angel investors: wealthy individuals who fund the early stages, often bringing ideas and experience as well as money.
• Business incubators: organisations, often in universities and research institutes, that support young high-tech ventures, usually for about two years.
• Government grants and subsidies.
• Bank loans: the most common source, but the bank needs a convincing business plan, and usually a personal guarantee.