A startup is a young business, created and given shape by a not-so-young entrepreneur, usually. If the entrepreneur is in his/ her twenties and comes with a maverick idea that could work, yes that is a start-up. It is a known fact that most successful entrepreneurs started off in their forties to build big businesses. And, when you get to that age, it is only natural that everything comes with a pinch of salt. That forgotten salt is what we shall discuss here.
Start-ups are usually passionate ventures, in most cases, could be that the entrepreneur is pursuing his own passions and is creating the market for the same where it may not actually exist - a difficult proposition. Or the startup could be actually looking at a gap in the market and trying to address it, in which the passion could be a secondary aspect, short-term stuff that may be headed to failure or to giddy heights.
Whatever the situation is, at both these ends, risk looms large, the reason why the failure rate is high with start-ups. One has to have the passion and there should be an actual market gap, which is quite a rare phenomenon. By the way, if you are of the idea that making money is successful, think again. For any startup, success is about building a business right from scratch and letting it address the needs of many. Yes, money is a game-changer; however, money follows success and not vice-versa.
The start-ups we see in India are not actually start-ups. Let us see why?
- First Category: Most start-ups (I am addressing the online ones) that I see today in India are not actually start-ups, they are addressing the same market in a more technology oriented manner. Flipkart, Snapdeal and most other “successful start-ups” are just online stores selling merchandise sourced from manufacturers across the country. They offer a better collection of products and the ease of buying from anywhere. Period. I fail to see any new idea here. I have seen apparel stores and shoe shops since I was born. They are not contributing anything new to the society apart from ease of use.
- Second Category: Many others like TinyOwl, FoodPanda, DineIn and others have brought food and other services to your door which any other local vendor will do with ease. Again, the choice and logistic are enhanced. They are actually not responsible for quality or quantity delivered. I am not sure if any of these “entrepreneurs” are actually experienced in the culinary industry. If we look at Dominos or KFC delivering food through online orders, how different are these apart from offering more variety. What is the new idea? And then, why are they called start-ups?
A startup is about unique products or unique USP’s that can contribute to the society and these are rare to come by. Been seeing some adverts lately from BigRock, if I not mistaken – involving a maid training school to supply maids at an international scale. Humor apart, the idea is actually good. That can be a great venture given that the market gap exists; however addressing that could be a logistical nightmare, especially when it comes to sourcing and training.
If there are venture funds that fail to identify the right start-ups and keep flogging dead ideas that may or may not work, it is no real risk. A fund-able idea, the next big idea and any other idea - all ideas are born small, do not look for a fund-able idea, the secret is to enhance the idea so that it becomes fund-able at the same time keeping its uniqueness intact. The concept of venture capital will become a term-loan kind of financing situation, once your "fund-able idea" is funded. Time to think and act for any entrepreneur – look before you leap.
Whoever said, entrepreneurship is easy.
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