This week we bring a business coach to you who has helped 400+ entrepreneurs and innovators in their startup journey. Dr. Praveen Tiwari spoke to Business Coach and Consultant Mr. Vikas Singh about the success of Startup ecosystem of MP.
When did you think about establishing an Incubator in Indore?
It all started in mid 2013 when we decided to start an incubator in Madhya Pradesh. There was no talks on incubators or startups back then here in MP.
When and why did you start the first Incubator In MP?
We started on 8th January 2016 . Everything that you see around yourself are the creation of an entrepreneur. He puts all his energy, time and resources even his entire life at risk to make these things but we have no support system that helps entrepreneurs in our country. Conditions in Madhya Pradesh are even worse. We decided to take the onus of helping entrepreneurs and to start an incubator in MP on ourselves.
What challenges you faced in the beginning?
The biggest and most difficult task was to convince government to support the cause and make a startup policy. Everyone in the government liked the idea but they took almost 2.5 years to take the first step.
What have you achieved so far?
SRIJAN has developed 32 startups by far. It’s startups have bagged 15 national/international awards and have crossed the valuation of 100 crores. SRIJAN has been the Genesis of all the start up activities happening in MP. Today we have a full fledge startup policy. Government has started allocating funds for startups and incubators. Today more than 400 registered startups are there in the state.
What future you see for startups in India?
We certainly have a very bright future. India is going to lead the world in innovations and startup in early future.
What are the challenges ahead?
Lack of capital is the biggest challenge that we are facing today. Both state and central.government should take this on priority and allocate funds for startups. Bureaucratic inertia is the second big challenge that we have in front of us. By the time bureaucracy responds the entire markets gets changed. We need to promote private sector players to run incubators and give them support. If our best brains enter in it then we can lead the world.
What are the basic knowledge startups usually lacks?
Most of the startups are started by young entrepreneurs who start it with a whim or passion without being aware about the market reality. Therefore their analysis about competition, technology , customer needs, Client acquisition cost, HR cost go wrong. They plan very poorly on financial and business development areas as well .
If they get a good mentor who had been there or done that and who can guide them properly they won’t face much issues. Secondly many entrepreneurs don’t work in details on each aspect that the mentor suggest therefore they fail.
What is the basic reason that 70 to 80% of startups get failed after good start?
If you see indian entrepreneurs they are very poor at documentation and therefore they don’t make enough documents to support their ideas and therefore they fail. They themselves are not clear about their brand identity, therefore they position themselves wrongly, that results in increased marketing budget and pathetic sales which ultimately causes losses. They don’t really know how they want to project themselves in the market.
People have this conception that small cities cannot produce big startups how true is it?
It is partially true because startups need a robust ecosystem to thrive if there is no ecosystem in town then startups face difficulties in growth.
What are the key advises?
When a person wants to be entrepreneur he needs understand what are his best skills , inclination or strengths are if he starts making his startup around it that always helps.
Secondly he should make a team of very senior and experenced people as his mentors. It should act like and advisory board for him. Ideally the board should involve four to five people.
A person who is domain expert and has run the same business for at least more than a decade.
Second person should be an expert account and finance guy.
Third an excellent lawyer
And fourth should the person who can act as a marketing mentor
Ideally ecosystem of startup include
1) Other big companies in similar industry.
2) Availability of funds. In both forms as debt funding ( Banks, government support, NBFCs)
3) Availability of HR at right tiime, at right cost with right kind of skill sets
4) Availability of clients/ Customers
5) Availability of private financers, angle investors , VEnture capitalist etc .
6) Availability of raw material , suppliers and vendors
7) Availability of mentors
8) right kind of government policies etc