Dear Readers,
“Startup” is often treated as a catch-all buzzword among businesses. But despite popular belief, the term isn’t just reserved for tech companies in Silicon Valley.
So, what constitutes a startup?
In short, they’re typically companies that tick the following boxes:
a) Entity is working towards innovation, development or improvement of products or processes or services,or if it is a scalable business model with a highpotential of employment generation or wealth creation.
b) Entity must be incorporated as a private limited company (as defined in the Companies Act, 2013) or registered as a partnership firm (registered under section 59 of the Partnership Act, 1932) or a limited liability partnership (under the Limited Liability Partnership Act, 2008) in India up to a period of ten years from the date of incorporation/ registration.
c) Turnover of the entity for any of the financial years since incorporation/ registration has not exceeded 100 crore rupees.
Provided that an entity formed by splitting up or reconstruction of an existing business shall not be considered a ‘Startup’.
Startups depend on coming up with a better, faster, cheaper way of solving an existing problem. Some startups find an entirely new idea that disrupts the way we think about a problem or market altogether. The drive to do something different, to make something that didn’t exist before, has led pioneers to launch new businesses since before companies existed.
Variants of startup:
There are three common variants of startups across a variety of industries, all of which have different approaches to scaling. Unicorn is a popular term used in the venture capital industry to refer to aprivately held startup company that has reached a valuation of $1 billion.
Companies that have become so successful in their early years that the term“unicorn” is simply insufficient. These variants include the decacorn (companies valued at over $10 billion) and the hectocorn (those valued at over $100 billion). Today, India is home to three decacorns and some more are on the way, to be named – Byju’s, Paytm and Flipkart.
Indian Startups that turned Unicorns:
In this fast-paced and dynamic economy, Indian unicorns are blooming. These startups are generating large-scale employment as well as providing breakthrough solutions and technologies. As of April 2021, there are more than 600 unicorn companies around the world. Getting to a billion-dollar value is difficult, especially when the market isexperiencing a liquidity crisis during a global pandemic. These newly crowned Indian unicorns certainly deserve an applause.
India is the 3rd largest producer of unicorns in the world. In the milestone year of 2021, the fast-growing unicorn sphere inside the Indian startup ecosystem experienced tremendous growth. Cred, Upgrad, CoinDCX, Vedantu, Grofers, Globalbees,Meesho, mamaearth and others in the list, are among the 46 Unicorns that India saw in 2021 alone, more than doubling the total number of Unicorns to 90.
How are Unicorn Startups evaluated?
The growth and success of every unicorn startup are determined by how much disruptive impact it has on its chosen market, as
The fastest unicorn startups in India is evaluated by taking less time to become unicorn as Mensa – it became a unicorn in 6 months and the slowest ones by longest time as Five Star Finance Company – it became a unicorn in 37 years.
The only e-commerce site that doesn’t require an introduction is Flipkart, whose massive billion days event is one of the most anticipated online occasions for millions of Indians. This company, which was created by Sachin and Binny Bansal and has a recorded valuation of approximately $37.6 billion as of 2021, is regarded as the most valuable in India.
Characteristics of unicorns that keeps them separate from normal startups:
- Privately owned and get more funding: They Adopt fast growth strategies like firms can go through as many rounds of funding as possible in a very short period, this eventually helps them stay ahead of the competitors and overtake the market in a short span
- First & ground-breaking innovations: These kinds of startups possess as pioneers and first innovators in their field and create a space for them naturally in the market by changing the ways things are being done. Examples: Google, which revolutionized how the search engine operates, and Uber which changed the way people commute.
- Consumer-focused: These startups are consumer-driven. Simplifying problems and making life easier for their customers is the main propriety of these startups. Such type of customer-driven startups attracts a huge pool of customers. Example: Canva.
- High technology: Finally, these startups are very advanced when it comes to technology like AI & ML. Their main focus is to provide a super-easy user interface and make their customer’s life easier.
Conclusion
Though we understood how to build a startup and make it a unicorn, growth and sustainability are challenging in this competitive market. Futuristic strategies, quick learning, and implementation of machine learning and artificial intelligence in the market with intelligent innovations as a pioneer in the chosen market to solve customer problems and being engaged with the focused customers are the keys to becoming successful unicorns.
Disclaimer: This Article is only a knowledge sharing initiative and is based on the Relevant Provisions as applicable and as per the information existing at the time of the preparation. In no event RMPS & Co. or the Author or any other persons be liable for any direct and indirect result from this Article or any inadvertent omission of the provisions, update etc if any.
