“I predict the 21st century is going to be the Indian Century” – Jeff Bezos, Founder & CEO, Amazon.
India is currently the world’s third largest start-up ecosystem, with 38 firms being valued at over $1 billion. Despite the economic downturn due to Covid-19, India gave birth to 12 Unicorn Start-ups (Billion Dollar) in the year 2020, and in the year 2021, just within 4 months 10 Start-ups has been added to the list.
But what exactly is a Start-up ??…… Is every new business a start-up??
Just because your business is new, or your business idea is unique, doesn’t qualify your business to be called as Start-up in India.
An entity shall be recognized as a Start-up in India, if it has been duly approved by Department for Promotion of Industry and Internal Trade (DPIIT) and has been allotted DIPP Certificate Number.
Are you eligible to be recognized as an Start-up by DPIIT
An entity shall be considered as a Start-up:
- Upto a period of ten years from the date of incorporation/ registration, if it is 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.
- Turnover of the entity for any of the financial years since incorporation/ registration has not exceeded one hundred crore rupees.
- Entity is working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation.
Provided that an entity formed by splitting up or reconstruction of an existing business shall not be considered a ‘Start-up’.