Startup India, It is a dream of each and every individual to have his own business and be his or her own boss, and have a successful venture out of it, bringing us to the concept of a start-up. A startup is a small company usually started by an individual or a set of like-minded entrepreneurs in search of a scalable and repeatable business model.
Service-Based Startups are driven by customer needs. They offer services and solutions as per customer requirements. Features of these type of companies:-
1. Comparatively Higher pressure work environment.
2. Completing the deadline is the most important aspect.
3. A person should always be multitasking.
4. Includes appraisal from seniors and more reviews.
5. Less scope of Research & Development. But would be able to learn new things a lot.
The service-based start-up economy, although it is on a boom currently, it is always difficult going through the preliminary stages of growth and maturity in India. Here is a list of a few of the challenges that a typical service-based start-up would face in India.
Dependence on “Gut-feel” rather than costly market research.
Bootstrapping is very common in investors in India as they cannot be convinced to come on board just by our concept. As a result of this, the founders have to either self-fund or get loans at very high rates of interest from unusual sources for the initial stages in which research is going to be a big capital investment, which they feel is better to be avoided.
Little or no-Mentoring
Regular management practices will not work well in a start-up environment, as most decisions have to be taken in a situation of high risk and poor data to back those decisions. As a result, traditional managers are not well equipped to handle the start-up situation. Nor are there enough mentors with a high level of industry knowledge and exposure who can guide the young start-ups, as the wave of start-ups is just so new.
No Branding strategy
When any start-up initiates a radically new service or offering the real challenge goes into developing the MVP – Minimum Viable Product. As a result, the importance of branding steps a second seat or completely ignored, in the enthusiasm of creating something path-breaking.
“To be or not to be” – Procrastination
Since start-up attracts the Newbies and given the uncertainties of such a ventures industry, reputed hardly look them as an option. Therefore, most start-ups have to build and grow on non-specialist managers giving way to longer decision-making time and lost opportunities.
Hitting the market without evaluating enough options
Since research is a costly affair, the startup entrepreneurs have to jump into deciding on creating the MVP without checking it out to a broader set of audiences. Not testing on a larger consumer base can lead to lesser trails thereby reduced options.
Although skilled personnel is not quite bad in India, start-ups cannot afford them all the time. Often, however, the multi-skill required to make start-up success stories are very rare to find.
Policy of Government
India lacks a clear long-term start-up roadmap, as economic liberalization is quite new to India. Given the size of the nation and the priorities, the government seems to keep the road-map on the back burner.
Not Experimenting Often Or Enough
Experiments can provide answers to many questions, which are badly required by any start-ups. However, either due to turn around time or due to financial situations, they are often omitted or stymied.
Building The Right Team
At the heart of every successful venture lies a good team and Team-work. Due to limited resources and short-sightedness of the founders, good team building does not happen in the initial phase of the conceptualization, resulting in cohesionless teams.
Not able to execute: 20% Idea and 80% Execution
Success lies in the skillful execution. Ideas can create a castle in the air, but the visionary has to take these blocks of brick to build the castle. This means that it is not just enough to have a great noble idea; execution also matters equally or even more than the idea itself. As we have seen in the incubation centers of many IIM’s which incubate hundreds of start-ups every year, only one in every ten start-up ends up being a successful venture.