The startup culture in India is just another love story

The Nine Chambered Heart a book by Janice Pariat, narrates the journey of a woman through her nine experiences of falling in love. Notably, however, every story eventually ends in heartbreak. The first chapter is beautifully moulded and hence, engrosses the reader in a story of love that develops from dedication between an innocent school student and her art teacher. The chapter is rather shocking for a reader because books about love rarely describe love emerging between a student and a teacher. Yet, the shock comes to be acknowledged as beautiful when the chapter ends with the imagery of a thousand paper cranes in an art exhibition.

Though the first chapter is a delicious delight, the chapters ahead keep losing their charm and essence of individuality with every passing page. All of the remaining eight love stories take place in a constant setting which is a shared flat in which the protagonist lives. Though the flats are in different places in most of the chapters, very little focus is placed on distinguishing the flats from each other. Therefore, the reader develops a rigid perception of the nature of a flat in their minds which contributes to making the rest of the book quite monotonous. Moreover, every consequent chapter seems like a recycled version of the previous chapters. And, ‘recycled’ as a word also seems to be the best descriptor of the startup ecosystem in India at this stage.

The flourishing startup culture in India has led to an increase in the number of new ventures but has also reduced their quality and individuality. India ranks fourth in terms of the number of new startups every year. 800 new enterprises are launched in India every year but many are built to compete with each other because they are built using the same business ideas. SRKay, an equity firm, has recently reported that more than 90% of startups fail in India. Why do they fail? Perhaps, it’s because founders believe too much in their passion. Passion could be enough to make the founder of the start-up give their best to the company but it certainly isn’t enough to make their start-up different from others. Too many people in the current startup environment are passionate about the same ideas. Market research is the key to making a new enterprise work and to determining if it is unique enough to be launched.

Reports show that 13% of the founders starting new companies have no prior experience in the field within which they are starting their company. Moreover, even a greater number of founders do not do market tests to check if their product is desired in the market. Market testing is important to determine consumers’ desirability for the product. What startups fail to understand is that creating a market for the product can actually be more difficult than starting a new business. Without the necessary market research, there is a high possibility that the start-up is just a recycled version of others which are coming into the market. Establishing a new business without market research is similar to the belief naive new authors have about love stories. They all believe that their love stories are unique and are likely to explode in the market when very similar ones are on bookshelves already. How can you know if your idea is different without first browsing through all the shelves to know about what is already there?

Many founders try to find solutions to a simple problem instead of finding difficult problems to solve because their sole aim is to create a startup in the market. The passion which drives start-ups is “creation” and many founders fail to take into the account the usefulness of their creation which ultimately leads to their downfall. The startup scenario is similar to a love story where there is too much passion but no compatibility, it is doomed to fail in the long run.

Just like many new authors are excited to publish their book and take into little consideration the reputation of the publisher which is publishing them, startups do the same. Most care more about money flowing into the startup than about who is funding them. The argument may seem irrelevant yet it makes a huge difference to the potential success of the enterprise. A venture capitalist with expertise brings in valuable contacts and insights for the start-up. However, a venture capitalist who simply invests money adds no value to the company. It is a well-known fact that money alone cannot sustain a new business.

Just like a love story is very difficult to write in these times due to their saturated presence in the market, backing new businesses can be a very poor investment. The rate of success when investing in a startup is 10%, this is lower than the probability of winning a coin toss. The uncertainty is high and with many poorly researched ideas floating around in the market, investment decisions are difficult to take. However, there is always hope. A great percentage of profit will always await the ones that are unique, be it a startup or a love story.

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Vidhi is an Economics and Finance major and is in her third year at Ashoka. She is interested in Macro-economics and believes that good economic policies can change the face of the nation and improve the quality of life of millions. She is also a trekking enthusiast and absolutely loves to travel. Mountains are the love of her life. Simplicity in people baffles her.

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