NASSCOM Report on Fuelling Entrepreneurship - Start-up survey findings and policy recommendations | nasscom | The Official Community of Indian IT Industry

Terms of use

Terms of Use

The use of this site and the content contained therein is governed by the Terms of Use. When you use this site you acknowledge that you have read the Terms of Use and that you accept and will be bound by the terms hereof and such terms as may be modified from time to time.

All text, graphics, audio, design and other works on the site are the copyrighted works of nasscom unless otherwise indicated. All rights reserved.
Content on the site is for personal use only and may be downloaded provided the material is kept intact and there is no violation of the copyrights, trademarks, and other proprietary rights. Any alteration of the material or use of the material contained in the site for any other purpose is a violation of the copyright of nasscom and / or its affiliates or associates or of its third-party information providers. This material cannot be copied, reproduced, republished, uploaded, posted, transmitted or distributed in any way for non-personal use without obtaining the prior permission from nasscom.
The nasscom Members login is for the reference of only registered nasscom Member Companies.
nasscom reserves the right to modify the terms of use of any service without any liability. nasscom reserves the right to take all measures necessary to prevent access to any service or termination of service if the terms of use are not complied with or are contravened or there is any violation of copyright, trademark or other proprietary right.
From time to time nasscom may supplement these terms of use with additional terms pertaining to specific content (additional terms). Such additional terms are hereby incorporated by reference into these Terms of Use.

Disclaimer

The Company information provided on the nasscom web site is as per data collected by companies. nasscom is not liable on the authenticity of such data.
nasscom has exercised due diligence in checking the correctness and authenticity of the information contained in the site, but nasscom or any of its affiliates or associates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this site. The information from or through this site is provided "as is" and all warranties express or implied of any kind, regarding any matter pertaining to any service or channel, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement are disclaimed. nasscom and its affiliates and associates shall not be liable, at any time, for any failure of performance, error, omission, interruption, deletion, defect, delay in operation or transmission, computer virus, communications line failure, theft or destruction or unauthorised access to, alteration of, or use of information contained on the site. No representations, warranties or guarantees whatsoever are made as to the accuracy, adequacy, reliability, completeness, suitability or applicability of the information to a particular situation.
nasscom or its affiliates or associates or its employees do not provide any judgments or warranty in respect of the authenticity or correctness of the content of other services or sites to which links are provided. A link to another service or site is not an endorsement of any products or services on such site or the site.
The content provided is for information purposes alone and does not substitute for specific advice whether investment, legal, taxation or otherwise. nasscom disclaims all liability for damages caused by use of content on the site.
All responsibility and liability for any damages caused by downloading of any data is disclaimed.
nasscom reserves the right to modify, suspend / cancel, or discontinue any or all sections, or service at any time without notice.

For any grievances under the Information Technology Act 2000, please get in touch with Grievance Officer, Mr. Anirban Mandal at data-query@nasscom.in.

New

See all

No notification found.

NASSCOM Report on Fuelling Entrepreneurship - Start-up survey findings and policy recommendations

Garima Prakash

@GarimaP

October 29, 2022

Public Policy

322

Rising strength of the start-up ecosystem in India

India has emerged as the third-largest ecosystem for start-ups globally, with 100+ unicorns and over 79,000 start-ups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT) across the country.

021 witnessed start-up funding from Private Equity (PE) and Venture Capital (VC) investors of USD 48.2 billion, being the highest in the last decade. This was coupled with 65 companies raising USD 17.7 billion via Initial Public Offering (IPO), an increase of 2.7 times in issue size, as compared with 2020. This demonstrates the confidence and strength of the Indian start-up ecosystem. In 2022, PE and VC start-up funding continues to be strong at USD 5.1 billion for six months ending 30 June 2022, although global downside trends in funding as well as valuations are expected to continue in 2022, which may impact start-up funding in India as well. Irrespective of the trend at any point in time, access to capital is key to the success of any start-up ecosystem.

The Report and Survey Findings

In the above context, this report by NASSCOM, in partnership with TiE Delhi-NCR and Grant Thornton Bharat, analyses the state of access to capital to the start-ups in India. The report covers findings of a detailed survey of the start-up ecosystem in India comprising founders, investors, incubators, etc., and examines the issues and challenges in access to capital, throughout the life cycle of a start-up, i.e., from early stage to listing.

The survey indicates that:

Access to capital and various funding options are the most important enablers as well as the top challenge, particularly for early stage start-ups. For others, access to capital continues to be the most important enabler but other aspects, such as ease of doing business and listing, also attain importance.
Over 40% of the respondents highlighted access to capital as the most important enabler for success of the start-up, followed by access to various funding options (debt, equity, structured debt, public markets etc.,) at 23%, ease of doing business at 20%, access to mentorship at 13% and ease of liquidation and tax incentives at 4%.
49% respondents highlighted PE and VC as the most preferred option for raising capital, followed by bootstrapping/founder-funding (22%), incubators (18%) and listing (11%).
Challenges: 36% respondents highlighted lack of innovative funding instruments, followed by, valuation mismatch between founders and investors (22%), lack of funding platforms such as crowdfunding (23%), lack of funding in place of business and tax incentives (19%).

The report covers an in-depth analysis of various sources of funding available to start-ups, both domestic and overseas, as well as listings, both in India and overseas. The report explores ways in which direct overseas listing may be made possible for the advantage of start-ups in India and the regulatory changes required in India to implement them.

Recommendations

The key recommendations, which have been dealt in detail in the report, include:
1. Increased impetus for domestic investors by way of tax reforms, especially by harmonising tax rate on Long Term Capital Gains (LTCG) applicable to resident and non-resident investors; harmonising tax rate on LTCG applicable to listed securities and unlisted securities.
2. Creating and enhancing market opportunities for start-ups through government procurement reforms.
3. Supporting creation of industry-led innovation clusters to enhance collaboration between start-ups, industry and academia
4. Regulatory and tax reforms to enable direct overseas listings.

The recommendations are an outcome of the survey findings, interactions with the start-ups, entrepreneurs, mentors and investors.

The Report can be downloaded from here.

In case you have any feedback or are interested in discussing this topic with us, please write to garima@nasscom.in or tejasvi@nasscom.in with a copy to policy@nasscom.in.

Start-ups tech start-ups access to capital funding policy recommendations

Disclaimer

That the contents of third-party articles/blogs published here on the website, and the interpretation of all information in the article/blogs such as data, maps, numbers, opinions etc. displayed in the article/blogs and views or the opinions expressed within the content are solely of the author's; and do not reflect the opinions and beliefs of NASSCOM or its affiliates in any manner. NASSCOM does not take any liability w.r.t. content in any manner and will not be liable in any manner whatsoever for any kind of liability arising out of any act, error or omission. The contents of third-party article/blogs published, are provided solely as convenience; and the presence of these articles/blogs should not, under any circumstances, be considered as an endorsement of the contents by NASSCOM in any manner; and if you chose to access these articles/blogs , you do so at your own risk.

Garima Prakash

Manager, Public Policy and Government Affairs

Reach out to me for all things policy about e-commerce, international trade, export controls, start-ups and fintech

Nasscom Public Policy Highlights | ...

Sudipto