Grig and Trout : Virtues of a leader

Grig is a kind of sweet water fish( in Odia language called “Dandikiri”), a finger size, weight would be around few ounces, generally found in ponds, rivers. These fishes stay near top surface of the pond , keep on jumping with a little disturbance at the surface, to thwart enemy by pretending its much larger and more strength. Trout is a sweet water fish(in Odia language called “Balia”), much bigger than Grig, maximum size it would grow half meter, with weight around of 50 pounds, much stronger. This fish prefers to stay at bottom of the pond or river, dont get disturbed with little disturbances, very difficult to catch.

My mother always gives example of grid and trout, to tell that people with real power, intelligent and rich in qualities don’t boast of their virtues, whereas people with little knowledge always jumps and boasts like grig. One should always follow trout. Dont always boast of your virtues, show your power only when needed at the right time. Now a days its difficult to find a trout, everywhere people keep on jumping, boasting to tell people that they have qualities, virtues to lead but in reality they dont know their strength. With lack of capability, they don’t concentrate on work  and always blame others for failure. A leader is somebody who always credits its team for success. If you talk to a leader you will feel yourself important, worthy whereas if you talk to a manager/boss  then you will feel that manager/boss is important. A leader always leads from the front and a good leader takes a little more than his share of the blame, a little less than his share of the credit. Beware of such people.

Startup India Initiative : Key challenges

India’s startup space is now talk of the world with startups now have easier access to capital, mentors, and there is lesser taboo associated with starting a new venture. This has brought lot of challenges too – lot of crowding in ‘upcoming sectors’, founders unable to grow their ventures beyond a certain point, administrative red tape etc. Only a small percentage of startups are able to sustain themselves and grow and expand.

The recent #startupindia program by Modi govt is a great initiative and it should have been started longtime back as mentioned by our hon’ble President. The active engagement of PM Modi with key CEOs has given a fillip to the startup ecosystem. At the startup event in California, he said, “When I shifted to Delhi last year, I thought of my government as a startup. So, I also saw some of the bumps you face on the road. I understand your challenges, but also the wonderful feeling of creating something new.” There are lots of ideas put forth in this program and some of them key points  are

Startup India Key Points

1. One-day incorporation via a mobile app

2. The exemption of startups from labour inspections for the first 3 years

3. 3 year tax holiday for startups

4. Faster exits for startups

5. Capital gains exemption on startups

6. Credit Guarantee Fund for loans to startups

7. Fund of Funds that invests in startups

Currently starting a company is not that rosy and there are lots of administrative challenges associated. The key issues are

Angel Tax: This was introduced in the Finance Act, 2012, mandated that if an unlisted company raise capital from any individual against an issue of shares in excess of the fair market value, then it will have to pay 33 per cent tax under Sec 56 (2) of the Income Tax Act.  The government has made no attempt to recognize the fact that angel money by private investors is a big part of the ecosystem and the current tax regime is a big disincentive. This has meant startups are now shifting base to countries like Singapore.

Administrative Bottlenecks: Unfriendly regulations and policy paralysis have led many startups in India to set up ventures in other developing countries. Currently, most of the startups fail to compete with the large firms as public procurement rules are tailored towards larger firms, mostly PSUs and MNCs.

Harshad Lahoti, Founder of Ah Ventures, says, “In India, a same level of compliance is required for a private company valued at Rs 20 lakh or Rs 20,000 crore and the New Companies Act has made matters worse. Delayed justice due to over-burdened judiciary is also a huge deterrence for investors, both domestic and international.”

Lack of infrastructure: Good roads, lower polluted environment, high speed Internet, corruption free business environment are very crucial to draw the interest of overseas startups in India.

However, due to rapidly-rising population, Inadequate infrastructure, A politician-realtor nexus and rising pollution. most of the metro cities in India are lacking the basic charm to attract talents. Bangalore is called silicon valley of India and recently Capgemini threatened to leave city.

These are the points, Modi govt should concentrate to make India a startup destination of the world.

  • Favorable infrastructure with less traffic, less pollution, high speed broadband
  • To create a favorable environment for small-ticket co-investments which can help early-stage entrepreneurs raise between Rs 25 lakh and Rs 2 crore.
  • To encourage the vast diaspora of innovative, educated, and smart Indians to move back to India and start up.
    Encourage the US tech majors to set up operations/support startups in India.
  • Cost of capital needs to be brought down through disruptive technologies like P2P lending marketplaces. FinTech innovations like P2P lending and crowdfunding need an impetus and clarity from the government.
  • Law like US’ JOBS Act should be enacted in India to open alternative avenues of raising capital for SMEs and startups.
  • Persuade the US tech majors to play a bigger role in Digital India without diluting net neutrality.
    Get universities and research Institutes to set up hubs in India.
  • Allow moratoriums for student loans for those pursuing entrepreneurship.
  • Consider matching investments for seed investments by central funding agencies.
  • Legal centres to help startups in understanding the legal framework surrounding various businesses in India.
  • Simplify regulations for companies for first three years of operations including incorporation, annual filings and closure.