Start-ups in India: Challenges, and Managements [2020]

Start-ups: Abstract

The Start-ups in India aim to be one’s own boss and create employments for others. This needs a great number of gads and the potential to set up everything. People have a qualified educational degree but don’t have a job to earn money. Half of India’s population belongs to a middle-class family. They are well educated, well equipped with skills, has potential, young aged who want to work but don’t have it. Young entrepreneurs have great ideas, produced, and services but due to different obstacles, they are unable to achieve their goals.

Innovations are indispensable for the development of a nation and so the importance of start-ups cannot be denied. To encourage new innovations and ideas of the entrepreneur the government makes these types of schemes. The paper discusses a few Challenges of a startup, government initiatives, risk management, IP perspective, and Legal start-ups.

Keywords: Start-ups, Start-ups in India, Entrepreneur, Innovations

What is Business Start-ups?

             A start-ups is basically a young company founded by entrepreneurs to develop a unique product or service and bring it to the market. By its nature the typically start-up tends to be shoestring operation, with initial funding from the founders itself. A start-up is an entrepreneurial venture in search of enough financial backing to get off the field. For creating something new the first most important thing is an idea and then comes money. Even if you have idea dealing with issue of money is quite difficult.

Start-ups are always risky propositions but potential investors have several approaches to determining their value. In the early stages, start-up companies have little or no revenue coming in. They only left with the thing of an idea that has to develop, test, and the competition in the market.

 Start-ups have no history and less profit to show. Starting up a new business in the field of high competition they need a strong and attractive idea to get success in this field. If an idea seems to have merit, potential investors may use any of several approaches to estimate how much money it could take get if off the field and can work accordingly.


Challenges faced by Start-ups in India 

Every start-up founder knows from the outset that there are going be obstacles in their road but still the work with a positive mindset. Overcoming the obstacles and achieving the goals are the main focus of the beginners. “Survival of the fittest” is the adage not just relevant for humans alone, it is, in fact quite true for start-ups as well.

A successful start-up cannot start a business just with passion and an idea. A high level of leadership skills with a clear understanding of the market, excellent communication skills. And maturity to see things in the right perspective along with the ability to take calculated risks. Some of the Challenges are given below –

Poor Business Planning for Start-ups –

It is the key for start-ups to get their businesses off the ground. In this technological landscape, writing a formal business plan based on a vague requirement of some institution is suicidal. Due to poor planning, many businesses fail in the very first year because they do not effectively factor in challenges.

Fierce Competition in start-ups of a business–

The corporate word is quite fierce. There is always a competition going on between the giants. The competition environment keeps the start-ups on their toes. Competition poses one of the biggest challenge for the survival of start-up businesses. All if you have an online business start-up, the competition gets tougher.

Lack of Finance for start-ups–

Cash flow-id essential for start-ups to survive. One of the key challenges that small businesses face today relates to finance. As income increases, the expenditures also increase, and start-ups rely heavily on investors who provide us with the financial support. With this, the entrepreneurs have to make sure that they have enough funds to go around. In the meantime, they also have to pay their employees, contractors, and other peoples who are working for their start-ups.

Unrealistic Expectations from the business –

Success does not come alone, it brings expectations with it. Most of the time, these expectations seem realistic. Start-ups tend to face challenges when they set ‘unrealistic expectations’ following a booming success. In order to succeed in a competitive business world, start-ups need to have high. So controlled expectations, keeping in view of the resources available, the extend of growth potential, and other factors as well.

Lack of Proper Marketing Strategy for start-ups–

It is always a challenge for start-ups to figure out the best ways to market their products. The fact that small businesses need to maximize their return on investment with efficient and result oriented targeted marketing also makes them vulnerable in terms of trust they have developed.

Cyber Security

Surviving the challenges in this age require small start-ups especially the ones operating online – to be super agile to counter the so-called online security threat. The rate of Cyber Crimes has increased dramatically during the past couple of years. In order to safeguard the all-important online data, start-ups need to have robust and military guard security systems in place.

Finding the Deserving Employ for a start-up–

As your company grows, you might find facing another personnel problem realizing that you’ve hired the wrong people. These kinds of uncomfortable truths can be revealed when a start-up expands and the cracks suddenly appear magnified. It is so very important to make it a priority to layout your hiring strategy right at the start.

Winning the trust of Consumers for business–

To win consumers’ trust and loyalty, start-ups ness to work aggressively to implement a consumer-centric working philosophy. So as to enable them to succeed in their pursuit of attaining the highest sustainable growth and progress they desire to achieve in this tech-savvy and challenging business world. To face and tackle the so-called challenges of a violated business world, start-ups need to be resilient and focus on keeping their integrity intact against all odds.

Neglecting Marketing and Sales

Some start-ups think they can ignore these two functions completely and hope the word of mouth will be enough. It’s a false economy to put your faith in customers discovering you unless you make a concerted effort to grow them with a proper structured plan to promote your start-up. When you’re building your sales and marketing functions from the ground up, take the opportunity to make them as aligned and integrated as possible right from the get-go.


No matter how great your product or services are, it’s a crowded marketplace. So you need to put yourself in a potential customer’s place and see how you stack up. When it comes to your competitors, you need to hit the right balance between “us” and “them”. Don’t define yourself solely in relation to your competitors, you need to be confident enough to what you bringing to the table.

Risk Management in Start-ups

Risk and Management are the two sides of the same coin. Our market works on the thinking that the there is a relationship between risk and reward. The greater is the potential, the higher is the risk involved in it. In the market of opportunities and competition there is more chances of risk rather than the success. A successful entrepreneur archives through a keen awareness and management of risks. Risk is an integral part of entrepreneurship, it should not overwhelm you.

Product Risk in business start-ups–

Decide what you are selling. It seems like an easy thing to determine for an entrepreneur. But the ability to explain what your product is the problem is solved and why it’s worth investing in much harder than it seems and it must be your top priority when starting a business. If you are unable to do so your business won’t get success.

Getting Prepared to start–

In business, you can never allow to assume yourself to get comfortable with the status, because it is always changing. Surprises may be knowing at your door with a bundle of risks with themselves. Risk is inevitable, avoiding risks is next to impossible. Risk management is the key, always tilting the venture in favor of reward and away from risks.

Operational Risks in start-ups-

Operational risk is the type that arises from human error or misjudging without your organization. Managing operational risk therefore overlaps significantly with the management of reputational risk. Training employees is best practice public relation is important, but it is also crucial to have the right tools and apps to both monitor your online reputation and craft a digital presence that consumers find appealing.

Financial Risk in the business–

These cover both external and internal risks. External risks include changes in the interest rate or commodity prices, internal rates. On the other hand, the cash flow shortages, depreciation of assets, and customers defaulting on payments without prior notice.

Cyber Security Risk

Employees need to be educated in the safe use of the web, company data needs to be protected, as does the personal information of customers. Developing counter-measures which satisfy the ISO/IEC 27001 international information security management standard is a good place to begin. 

Legal Risks 

A breach in the contract with the partners of the startup is the best example of legal risk. Your business could also be in trouble for non-compliance with regulations imposed by the company authorities.

Strategic Risks

Strategic risk is something you face when your business fails to adapt to changes in the market or the industry. Companies can go out of business if they are unable to respond to fluctuations in customers’ demand. The innovation of superior technology, or an overall increase in competition. Many times, companies fail simply because they are too short-sighted to chase fresh business opportunities.

Market Risk in the set-up–

Knowing your customer and why, how, and where they buy related products is arguable. The most important part of the risk section before launching your product in the market. If your market risks fall in your favor and you get into your market early enough, there’s no reason why your business can’t get success.


Startup and their founders have a lot of things presented on their plates, and a lot of issues that loudly announce themselves as front of mind. Every startup company faces the challenges of being pulled in multiple directions. Competing interests consume your precious resources including time, people and the thing that is most precious to startup is the cold hard cash flow.

On the list of priorities, Intellectual Property (IP) probably rates as a middling concern if you’re somewhat conscientious of the topic, less so if you’re more of an ideal person content to leave the difficult business aspects of running a company to others. But intellectual property is as important as any other priority on the list, if not more so. IP represents the foundation, the backbone of your work, and often the bulk of the company’s value. Ignoring your Intellectual Property is a mistake, and the well-intentioned procrastination we all engage in next schedule doesn’t equal action.


Make sure to obtain your IP protection before you go to market to publicly disclose your innovation. Unless you are in a few moving area, you may want to consider waiting to file for IP protection until you are further in development process. If you are able to test the market for a specific amount of time following your initial filing, then you will be able to see how your product sells and what causes your product to gain transaction.


YOU NEED TO UNDERSTAND WHAT YOUR IP is if you intend to take the necessary steps to protect. Most are able to easily point out the most obvious examples, the prototypes, and other physical manifestations of what you’ve created or hope to create.  Identifying your IP doesn’t have to be a difficult or painful process. You just have to sit down and make a list of all of your creative, assets, whether you’ve used them or not.


Learn what it will cost to get your IP on file and when you will incur additional costs going forward. In some cases, creative IP attorneys can develop ways to push some of your IP costs down the road. If you can’t afford the rough estimate that is given, consider spending your money where it will produce the greatest value for your company.


Once you have a handle on what your IP is, you need to take the necessary steps to protect it. But getting the right protection can be complicated if you don’t know what you’re doing. Protecting your IP also means making sure that it belongs to your company rather than your employees any employment agreements you have should address IP ownership in regards to work your employees are creating for you.


India is a developing country with a developing legal system. India’s startup ecosystem is young, but with the past few years have seen rapid growth in new legal entrepreneurs with strong public and private commitment to investing in the innovation business. Finding the right and deserving legal startup lawyers in India can be daunting and we understand the financial pressures faced by the start-ups. Legal advisory services are aplenty in India, there are probably one-step legal services to startup, early stages companies, and investors.

Building a career in the legal field is quite difficult. If you are thinking to have a startup then obstacles are inviting you with open hands. In India law is regarded as the essence of the society which regulates the human as well as the organizational behavior. The major impact of globalization across the globe and the boom in the various sectors like eCommerce, healthcare, education, technology, and others have also not left the legal sector of the country untouched in order to bring some revolutionary changes in the system.

Understanding the scenario and keeping in mind the need for legal help many startup have ushered in the respective domain to help the companies. The legal startup is not everyone’s cup of tea, hard work, dedication, connection, communication, and all these things play a vital role in constructing a legal startup. You need to be focused on your works because the competition level is far bigger than your expectations.

Some of the top Legal Start-ups are

  1. – Company with a technology driven platform that uses AL and machine learning to automate the legal service process to start-ups and SMEs, across domains.
  2. Burgeon Bizsupport – Company with one stop shop for growth companies with investment.
  3. Grandhi Law Chamber – Company with a well-rounded legal advisory firm cross-border IP services and corporate advisory and commercial litigation service.
  4. DrCompliance – Company with offers varied legal and financial services to companies across domains and has emerged as a professional in providing corporate advisory and solutions.
  5. – Company which provides an online platform to receive quick, affordable, and quality legal advice from lawyers across India.
  6. Krishnomics Legal – Company that aims to be a leading provider in Tax and Corporate Legal Solutions.
  7. QuickCompany – Company with fastest online – Company and Trademark Registration in India Involves easy step search and register private limited, LLP, OPC in India, Pay fees upload documents and you are done.


The Indian Government has introduced many schemes with the intention of increasing the GDP rate of growth from grass root level with the introduction of various different liberal policies and initiatives for entrepreneurs in and around India like ‘Make in India’, Startup India’, MIDRA, etc. With these initiatives, the new and young generation will get support to start and innovate something new which brings a great change.

Starting from a small business to taking up to the heights young people have the potential, the government just has to frame it and share it. Being a country with a huge number of population, the plethora of opportunities available are many for a start-up offering products and services ranging from food, retail, and hygiene to solar and IT applications for day to day problems which could be delivered at affordable prices. Believe in yourself and potential and go for something new. 

Author: Supreet Kaur (Chandigarh University)

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