Startup India is a sham

A big challenge for arguably most early stage startups is going from 2-3 lakhs per month to 5-10 lakhs per month and more in revenue. Market is willing to provide credit or loans for the latter but not the former. It's the former that need it more but there are no collateral free loan options in the market that are reasonable. Even though India collects hefty tax and revenue from global businesses with digital platforms and products, it's unwilling to provide collateral-free loans to startups born in India. The best you can get is from NBFCs or private lenders at more than 12-15% interest (which is often more than the net profit for a lot of startups, hence impractical). Most govt loans and schemes aren't applicable to a large portion of startups because of their criteria. Even setting up the company can often take months. GST and taxes are a nightmare. Where is this "ease of business" that people talk about? Unless entrepreneurs bankroll everything from their own pockets, there is almost no way for bootstrapped startups to build and grow sustainably in India. I've never met a single entrepreneur who availed a govt scheme to get loans for their business in India. I wonder where all that budget money went.

LooseGoose

Stealth

a year ago

As if on cue - https://www.business-standard.com/industry/sme/alternate-financing-poised-to-capitalise-on-570-bn-sme-credit-opportunity-123082400815_1.html Apparently no one realised contributors to 30% of our GDP also need credit. But these new "alternate finance" and revenue based financing (RBF) platforms are also kinda shady. Either interest rate is too high, or your revenue needs to be routed through them/their payment gateway partner or some or the other shit. Already spoke to more than 5 such Indian platforms. Waste of time. Worse than bank loans.

Phoenix

Unicorn

a year ago

What is the catch with Velocity? Was quite intrigued to see their USP

LooseGoose

Stealth

a year ago

Same problems I described. Won't even entertain businesses that are below their threshold amount (B2C only, they don't entertain B2B). Plus signing up would require businesses to route the money through them, which is absurd. There is no USP, these platforms are becoming middlemen and creating additional barriers instead of doing the opposite. They even launched a useless marketing analytics tool that was supposed to give daily reports of your social media platforms on WhatsApp just to get sign-ups. Idk how many customers they have but I'm probably never going to sign up for Velocity. Probably the most polished product among the others but fundamentally problematic.