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Last updated: 13 Sep, 2016  

startup.thmb.jpg Start-up 'Deadpool': No need to panic

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Bikky Khosla | 13 Sep, 2016

A Bangalore-based start-up analytics firm has recently compiled India's first 'Deadpool' list, cataloging nearly 800 dead or dying technology start-ups, which are from diverse segments of technology, including e-commerce, online education, mobile software, etc. In the past few years, India has seen a start-up boom that has pushed the number of tech start-ups in the country -- according to the Economic Survey published in February -- to more than 19,000. And now we are getting our own version of dot-com bust! Many, however, do not see this list -- which is not public and accessible for a fee -- as something to worry about.

The most cited cause of these failures is poor business model. Many of these start-ups entered into business without any strategic plans, and with expectations of quick returns they burnt a lot of cash on marketing or through discounts. Investors too judged them based on their popularity, without assessing their long-term sustainability and ability to make profit. The list includes a number of copycat companies, indicating that lack of differentiation and invention is another cause of failure. It is also pointed out that many of the start-ups failed to move out of metro sectors. In many a case, lack of marketing skills and not having the best technology are also cited as causing these failures.

The government contends that it is only a lean phase and far from a bust. A senior government official said that the failure could be due to start-ups' inability to scale up during a global slowdown. According to him, funds is not a problem as funding is coming through angel investors and venture capital investors. This view sounds logical though in the recent months the flow of such investments has dropped to some extent. Most importantly, I think we can see it as a sign of changing attitudes of our entrepreneurs towards failure. Despite all these debates, the need for providing a better start-up ecosystem to our entrepreneurs cannot be denied, however. The government has a lot to do in this respect.

Meanwhile, the Centre has recently approved six proposals to set up centres of excellence to promote and fund start-ups. Under the National Initiative for Development and Harnessing Innovation (NIDHI), a programme steered by the Department of Science and Technology, the government has earmarked Rs 500 crore to scale up the start-up ecosystem. It is also reported that the department has partnered with some large international corporates to initiate technology-driven, innovation-based programmes. If it really helps our start-ups then such moves are always welcome.

I invite your opinions.

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Lack of Mentor
Sunil Shetty | Thu Sep 15 01:37:06 2016
Most startups and entrepreneurs don't understand or underestimate the need of a mentor(s). When we(askmentor) startups 2 years ago- startups would say we will take a mentor when we reach a certain traction. Though today that thing has changed and startups contact us at ideation stage. Many of these Deadpool startups could have been in a much better state had they on-boarded a mentor at the very start of their journey. There is a need to create awareness about importance of mentoring for startups and entrepreneurs. Has this report looked into "Lack of Mentor/mentorship" as a reason for failure.

For Indians, the world is filled with full of oppurtunitees
Mahesh Manani, Nagpur (Maharastra) | Wed Sep 14 14:10:56 2016
Very correct, patience with proper motivation and courage to for navigate the hurdles on the path for new start-up entrepreneur is need of the hour, the Govt. only clears the way for finance, and administrative obstacles

Start-up 'Deadpool'
Kameswara Rao | Wed Sep 14 10:24:36 2016
Recently my house fell vacant and I said I will give it for office/residence. Few people have come for office purpose. When I inquired about their business they are uncertain and started saying food business. It perplexed me to decide to give or not. The reason is they are not sure of their business plans, how can I believe they can pay my rent every month. An enterprise should have definite plan whether it is small business or big. Having no knowledge on business one should not venture risking others money.

Good Article
Ajay | Wed Sep 14 07:06:28 2016
In the right direction.

Sanjay A | Wed Sep 14 06:39:49 2016
The deadpool is also due to irrelevance and redundancy of ideas and associated products. Most companies are into developing apps and e-commerce sites. E.g. chat, fitness or direction apps. However only a few appeal to the masses. Are the developers listening to needs of the customers versus their self-generated ideas? Are the ideas relevant and pragmatic and continue to remain so with the changing economy? Entrepreneurs also fall into a broad segment. On one end of the spectrum are highly energetic youngsters (20 ) wanting to venture out with funding from angel investors. On the other extreme are experienced professionals (55 ) who bring in substantial experience and funding. Sandwiched between the two are professionals who would like to try out something different. The startup ecosystem must cater to all segments. Good initiative by NIDHI/DST. Earmarking 500 crores is a good announcement but strategic utilization of 500 crores is subject to the lackluster ways of the government.

Millionaire overnight!
Debu Banerjee, Chairman | Wed Sep 14 04:22:36 2016
Very rightly said, many of these start-ups want to become millionaire overnight, which is the most dangerous mind set, which needs to be understood. Many have good ideas and intentions, but fail to right direction, because of lack of experience.Government should clear many hurdles for these start-ups to work in a more free and secured environment.Governments intentions are very good and the present government is forthcoming in this matter, but more needs to be done.

Welcome startup programme
Naveen J | Wed Sep 14 04:04:51 2016
Useful information & the said NIDHI / Skill development ministry should promote & conduct special training programme for new start-ups to create awareness of do's & dont's to improve their skills in grooming the start-ups instead of listing their firm in deadpool list.

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