The Indian Minister of Commerce and Industry recently inaugurated the US Startup SETU – Supporting Entrepreneurs in Transformation and Upskilling programme in the Bay Area of San Francisco, United States.
Understanding Startups
Startups often refer to companies in the early stages of their operation. They are usually initiated by one or more entrepreneurs who aim to develop a product or service they believe is in demand. These companies generally operate with high costs and limited revenue initially, leading them to seek capital from sources such as venture capitalists.
Growth of Startups in India
Within India, the Department for Promotion of Industry and Internal Trade (DPIIT) has recognized startups in 56 diverse sectors. Over 4,500 of these startups are in the emerging technology sectors, including Internet of Things (IoT), robotics, artificial intelligence, and analytics. Government efforts have been instrumental in increasing the number of recognized Startups from 471 in 2016 to 72,993 in 2022.
About Startup SETU
SETU or Supporting Entrepreneurs in Transformation and Upskilling is an initiative under the Ministry of Commerce & Industry of the Indian government. The program aims to connect Indian startups to US investors and other ecosystem leaders providing mentorship and assistance in funding, market access, and commercialization.
The Significance of Startup SETU
The primary objective of SETU is to breach geographical barriers between US mentors willing to invest in entrepreneurship and emergent Indian startups. Interaction will be facilitated through the mentorship portal under the Startup India initiative MAARG, or Mentorship, Advisory, Assistance, Resilience, and Growth program. This program acts as a single-stop solution finder for Indian startups and is accessible from any corner of the country.
The Need for SETU
About 90% of startups and more than half of well-funded startups fail during their early stages due to a lack of business experience. Entrepreneurs require proper guidance and moral support to make informed decisions. As India emerges as a leading startup destination, timely guidance is crucial. The Indian government invites industry stalwarts, experienced experts, and leaders to contribute to the nation by enhancing a startup’s journey.
Addressing Venture Capital
As addressed in the UPSC Civil Services Examination Previous Year Question, venture capital refers to a long-term startup capital provided to new entrepreneurs. It is usually provided by venture capital firms that specialize in building high-risk financial portfolios. This money is invested in exchange for equity in the startup. The investors, known as venture capitalists (VCs), anticipate returns on their investments after a medium-to-long term period, accepting the associated risk of losing their money if the venture doesn’t succeed.