How to Start a Startup in India | A Simple 8 Step Guide

Starting a startup in India can be a difficult thing. However, it can be made easy with the right approach and guidance. 

 

Step 1 - Define the problem statement

Step 2 - Do research and planning

Step 3 - Register your business

Step 4 - Get bootstrap funding

Step 5 - Make a Minimum Viable Product (MVP)

Step 6 - Test your product

Step 7 - Get licenses and permit

Step 8 - Set up the infrastructure

 

Steps to Start a Startup in India

 

Step 1 - Define the problem statement

 

Before looking for how to start a startup in India, you must have a clear idea of the problem you are trying to solve.

 

Even if you are setting out to do something that is not new, it is important to understand the problem to start a startup successfully. 

 

Thus, here are 3 steps that every successful entrepreneur follows for this purpose: - 

 

• Understand the problem. 

Understand the problem that you are trying to solve. What are the factors that make up the problem? Is my idea taking care of all those factors? 

 

For eg. Paytm solved the problem of carrying and unreliability of a wallet.

 

• How big is the problem?

 

You need to see the scale of the problem. Identify the people who face it. How much inconvenience they have with it. Or if it is something that they actually value.

 

For eg., Tesla’s space-x is working to solve a big problem. Having an alternate planet to live on in case something happens to the earth.

 

Moreover, it will change the boundaries of travel. 

 

• Is my idea unique?

 

Lastly, figure out a solution that solves the problem most uniquely.

 

Even if the solution is already there, figure out how you can make it easier and faster.

 

It is important to know if someone has tried to solve it before. Why could they not do it? 

 

Step 2 - Do Research and Planning

 

Research

 

When you are looking for how to start a startup in India, you most probably might be new to the business world.

 

Which means you will have to do plenty of research about everything before taking another step.

 

So, once you choose a startup idea, research the industry it belongs to.

 

For this purpose, you might need to look up the following:

 

• What industry your product or service belongs to?
• How is that industry performing these days, and what is its current scope?
• Is the idea you chose profitable?
• Is it feasible and has expansion potential?
• Does it fulfil the needs of society?
• Who are your competitors?
• How are they performing?
• Are your competitors generating profit?
• Where are they located?
• How much did they invest?
• Who are they targeting?
• How are they targeting your customer?

 

Also, research all other things you think might be useful for your business idea.

 

Planning

 

Use all your research and plan your idea accordingly.

 

• What will be your business activities?
• List of products and services.
• What will be your pricing strategy?
• What will you name your business?
• How much will you invest?
• What is your business model?
• What is your five-year plan?
• Who will be the director?
• What will be the profit-sharing?
• Who will you target?
• How will you target?

 

Research and planning are the base to start a startup in India. 

 

Therefore, consult an expert or someone who has previous experience in starting and running a business.

 

It will serve you as a support to take your baby steps confidently.

 

Lastly, before going any further, be sure of the following things:

 

• Be super passionate about your startup.
• Your idea should be valuable and fulfil the market need.
• You are ready to work hard more than you think you need to.
• Be ready to accept failures.
• Have a PLAN B.

 

Step 3 - Register your Business

 

Here is a list of business structures you can register your startup as:

 

• Private Limited Company Registration
• One Person Company
• Sole Proprietorship
• LLP (Limited Liability Partnership)
• Partnership Firm

 

A sole proprietorship and a one person company can be registered and operated by an individual. Also, it is helpful if you are short on resources and funds. Besides, sole Proprietorship has minimal compliances.

 

Whereas, you will need to find a good partner for a Private Limited Company, LLP and Partnership. 

 

Choose the right business structure on the basis of:

• Tax perspective
• Investment and withdrawal.
• Scaling plan
• Business type

 

To know the right structure for your business, get in touch with our expert by filling out the form on your right.

 

We will help you choose the legal structure for your business and the process to register it.

 

Here is a list of documents required for registration:

 

• Passport size photo of all Owners
• PAN Card
• Identity Proof (Passport, Voter ID, Driving License)
• Aadhar Card
• Address Proof of Business Office (Electricity Bill, Internet Bill, Mobile Bill)
• Rent agreement or No Objection Certificate (NOC)

 

Step 4 - Get Bootstrap Funding 

 

Bootstrap funding is the first round of funds that your business will need. Usually, founders rely on their own funds, friends and family for bootstrap funding.

 

Funding is crucial for a business.

 

79% of the startups fail to operate for more than 5 years because of money issues.  

 

Some founders may lack funds, while others might not know how to use them optimally.

 

Therefore, planning and using your finances is crucial.

 

Besides, here are some source of funds for startups that helps budding entrepreneurs:

 

• Crowdfunding
• Angel Investors
• Venture Capitalists
• Bootstrapping
• Incubators
• Funding from Government Schemes
• Borrowings from Friends or Family
• Business Bank Loan
• Credit Card
• SMERGERS

 

Step 5 - Making an MVP (Minimum Viable Product)

 

Once you have registered your business, you can start developing your product.

 

For this purpose, make an MVP (Minimum Viable Product) and choose a target niche.

 

An MVP is a product with basic features but enough to check the viability and interest.

 

Make sure your MVP is close enough to your exact product.

 

For eg: If your idea is to make an Ayurvedic cosmetic brand. You can develop some sample products at home.

 

After that, order some packing material from Vistaprint. Set up an ecommerce store on Shopify.

 

Step 6 - Test your product

 

Find out the right sample audience for your product. Selecting the right audience is important to get the right feedback.

 

Once you have identified the audience, release your MVP in the market. After that, collect feedback from your sample customers.

 

It will help you with making sure that your final product actually fulfils their needs.

 

Moreover, it will save time and money, as you can take the product off the market if it is not performing well. 

 

Not only this, but it will also help you with generating early feedback and leads.  

 

As the people who have tested your product will believe they have contributed to building the final product.

 

With this in mind, they will be willing to pay more, rather than go with your competitor's product.

 

Step 7 - Get Licenses and Permits

 

The requirement for licenses and permits will depend on your type of business.

 

Therefore, it is better to get in touch with a legal expert after you have decided on your business activities.

 

However, here are some licenses your business may need:

 

• GST Registration
• Shop and Establishments Act License
• MSME Registration 
• FSSAI Registration (for food business)
• Import Export Code (for import-export business)
• Trademark Registration (to protect your brand identity)

 

Also, visit your local municipal corporation to find out if you need any particular permit to start a business in your city.

 

Get Start-up India Registration

 

You can also be recognised under the startup India scheme and enjoy the following benefits:

 

• Income tax exemption.
• Lower registration fees for IPR. 
• Exemption from EMD to file government tenders.
• Business connections and networking opportunities.
• Access to government funds and government e-market.

 

However, only 3 out of 100 applications get accepted. Thus, you will need a professional to apply for Startup India Registration.

 

Step 8 - Set up the infrastructure

 

You can start your business from home initially. But have a proper place set up like an office.

 

You might need to have business meetings and other conferences.

 

Therefore, it is suggested not to mix up your personal and office life. 

 

It may create distractions to your work and make you look unprofessional.

 

Besides, you can even rent a studio apartment and set up your office there.

 

Hiring for your Startup

 

Hiring is the most important part to start a startup in India.

 

However, before hiring your dream team, you need to consider the following points:

 

• Self Assessment: Identify your strength, potential and weakness related to work.
• Identify the main job positions: The job position will differ from business to business. Also, it will depend on the scale of your business. Accordingly, look up the salaries on Glassdoor. 
• Building a Startup Culture: Being very blunt, startups do not pay well. So, what makes people stick is a good culture and a better environment. It will ensure employee retention, a motivating environment and a productive workforce.

 

At StartEazy, we can support you on the journey to becoming a successful entrepreneur.