Analyzing the Indian Market: A Start-up Guide to Entrepreneurship

This report provides a comprehensive guide to entrepreneurship in India, analyzing the market scenario and conditions for start-ups. It explores the nature of entrepreneurship, including the prevalence of e-commerce and food delivery businesses, and discusses the role of family businesses and the impact of political and economic factors. The report highlights both the opportunities, such as increased funding and the growth of the IT sector, and the challenges, including high failure rates and cultural barriers. It also examines support systems like government initiatives, incubators, and funding sources. The report uses examples like Flipkart, Olacabs, Zomato and Quikr to illustrate success stories in the Indian market and concludes by emphasizing the importance of strategic planning and financial stability for start-up success. The report also provides relevant references to support the analysis.

Running head: INTRODUCTION TO ENTREPRENEURSHIP
INTRODUCTION TO ENTREPRENEURSHIP
Name of the Student
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Author Note

1INTRODUCTION TO ENTREPRENEURSHIP
Introduction
The purpose of this paper is to provide a start-up guide for the country of India, which
will analyse the market scenario and market conditions for the start-ups to start their business in
this lucrative region. Description of the start-up businesses will be given in this paper with
selected focus on topics like number of fresh start-ups, success as well as failure rates of the
start-ups, start-up activities by population or location, innovation activities and political, cultural
or societal barriers of starting a business. Analysis of support opportunities will also be done here
with selected focus on government support, firm or industry incubators, accelerators, business
angels, venture capitalists, banks, crowd funding initiatives, mentoring and coaching. An
example will also be discussed with the focus on success or failure of the sample business in
relation to the start-up scene in Indian market place. At last, a conclusion will be provided where
summary of the main findings will be main discussed topics will be given.
Entrepreneurship in India
It has been already discussed that India possess the power of starting a business mainly
for its density of population present in this market place. In this context, it can be said that
entrepreneurship or start-up business is the overall process of structuring, launching and
operating a fresh business, which can be treated as small in nature. In other words, the term
entrepreneurship helps to describe the ability as well as desire to design, organize and control a
business operation along with facing and mitigating the risks faced while operating the business
to earn revenue from this business. It is an act of starting a new and fresh business by a person.
Entrepreneurship possess a bright future in the Indian market place, but there are presence of
various obstacles which either halts the growth of the business or closes the entrepreneurship

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business (Agrawal and Sahasranamam 2016). One of the most lucrative options where most of
the entrepreneurship business in India are e-commerce and food delivery business. The food
delivery business can be regarded as the best option of starting and performing entrepreneurship
business in the market place of India. India is regarded as the rising giants of the Asian market
place. They are the second most populated nation across the world, thus, provides the
opportunity for start-ups to perform in this highly competitive market place and sustain within
the sector where they performs. Almost 50 million small businesses are performed in this Indian
market place currently which is regarded as more than double of the same kind of businesses that
are performed in the region of the United Kingdom (forbesindia.com 2020). According to the
data provided by the Government of India. Micro, Small and Medium enterprises contribute
almost 10% of the overall Gross Domestic Product of this nation, thus, it can be said that
entrepreneurship business do play an integral part in shaping the growth of the market place of
India (Swetha and Rao 2013).
Nature of Entrepreneurships in India
It has been already discussed that India is a lucrative market place from the viewpoint of
performing entrepreneurship businesses here. The family businesses started and performed in
India plays an integral role in the growth of the economy of this nation, and provides the power
to fight in this global competitive market place. But there are factors which restricts the start-ups
and mark them as failed attempts made by the entrepreneurs. Political factors along with the
economic reforms acts as barriers in performing entrepreneurship business in the market place of
India. The entire landscape of the economy of India changed when the government of India
liberalized the economy in the year 1991 (Shah 2013). Family businesses after this started to face
intense competitions from the multination business houses, and ended the dominance power that

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are possessed by the business owned by families before 1991. The business entities from the
infrastructure and technology sector succeeded as they are customer focused as well as managed
professionally. The old and family-managed businesses, which actually formed the backbone of
the economy of this nation, needed to be more developed and become more institutional in order
to extend their life cycle of the products or services offered by them (Mahajan 2013).
India is complex in nature when the nation is evaluated from the viewpoint of religions,
castes and languages. The parties related to politics often creates barrier in the start-up
businesses, which has resulted in closure of shut down of these entrepreneurships businesses in
the region of India. It can be stated that the modern entrepreneurs often do not come from the
traditional business families that belongs from this particular place. Rapid growth in their
respective is the one and only business aim of those entrepreneurs, which also reflects in the
mindset of these entrepreneurs (Patel and Chavda 2013). Advancement in the field of technology
has helped these entrepreneurs in various sways to grow their businesses in the market of India,
and usage of social media platforms by the people along with the smartphones has helped to
made most number of people about the businesses that are performed by these entrepreneurs
along with the details of their offerings. It can be stated in this context that almost 90% of the
start-up businesses that are performed in India fails within the first five years, and this is mainly
for the lack of innovation that is required on identification and meeting the needs and
requirements of the customers present in the Indian market (Dangi 2014). Further it can be noted
in this context that there are not a single city from India in the list of ten most popular start-up
cities across the world.
Entrepreneurs who initiates the start-up business fails to use the required innovation in
solving the issues or problems that are faced by customers of this market place. Negative

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working capital along with negative cash flow is also another major reason of failures of start-up
businesses in this region. So the success rate of the start-up business in Indian market is very less
as compared to other regions of the world. Absence of long-term plans along with expanding the
business performed without possessing sufficient gross margin also hampers the success of the
start-ups that are initiated by different entrepreneurs (Yadav and Goyal 2015). Wrong
positioning of the product or service that is offered by the entrepreneurs is also another major
reason of failure of the start-ups in this particular market place. Cultural challenges also acts as a
barrier of facing success by the start-ups. It can be noted in this context that more than 1,200
start-ups were established in the year 2018, which totalled the number of start-up businesses in
this region to 7,200, which has increased after that and has reached almost 8,000 at the end of the
year of 2019. But, as mentioned, the success rate is very less in India for start-ups due to lack of
strategic planning as well as strategic management planning (Jindal and Bhardwaj 2016).
Opportunities for Start-Ups
It has been seen that there is 108% growth in funding that is required for a start-up
business to perform their business operations, which is resulted from USD 2 billion in the year
2017 to USD 4.2 billion in the year 2018. But the factor which worried the most was the decline
in funding for the organizations at the seed stage. Though it has been already discussed that India
is becoming a start-up hub and the opportunity available in this market place for growth is huge.
The major challenge is how fast an organization can transform from one stage to the other along
with successfully evaluating the needs and requirements of the customers who are available in
the Indian market place. The seed stage funding of start-ups in India has declined from USD 191
million in the year 2017 to USD 151 million in the year 2018. It has been also found that there is
a 50% rise in the number of start-ups related with the industry of information and technology

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since the year 2017 (Satar 2016). Flipkart can be regarded as one of the most successful start-ups
from this region, who possess the power to fight with global giants like Amazon and maintain
the competitive advantage over others who operates in the market place of India. Another
successful start-up business that tasted success in operating in India is Olacabs, who also possess
the strength to fight with globally reputed giants like Uber. Zomato and Quikr are also other
examples of successful start-ups who has overcome the barriers of entrepreneurship and has
sustained in this competitive Indian market. Recently, Uber Eats, a sub-division of the services
that are provided by American organization Uber as a food delivery application has been brought
by Zomato.
Conclusion
From the above discussion, it can be stated that entrepreneurship plays an integral part in
the development and uprising of the economy of India. Though there are barriers in the form of
political aspects along with lack of innovation and planning, the market place of India still
possess a lucrative place for start-up businesses to launch and operate. Proper financial back-up
and planning are required along with strategic plan of action so that the start-ups will be able to
sustain in this highly competitive market place.

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References
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