Startups and legal issues: A study of the applicable framework in India

Abstract

The key objectives of this project can be categorized under the following themes: • Identification of major challenges faced by Indian startups while dealing with investors, creditors, employees and other stakeholders. • Analyzing the adequacy and efficacy of legal provisions for nurturing Indian startups • Evaluating the Startup India campaign of the Indian government and identifying gaps, if any, in the execution. • Suggesting recommendations for offering a conducive legal environment and facilitating ease of doing business for Indian startups. Methodology:- We contacted 17 startups during the month of July 2017, and successfully conducted personal and/or telephonic interviews of 20 to 30-minutes duration with the Founders of 13 startups. The list of the startups along with the contact details is available in the Appendix. The interview questionnaire and the list of startups have also been provided in the Appendix of this report. The interviewed startups ranged from being a month old (May 2017) to 4 years old (September 2013). They also catered to a diverse set of sectors varying from handlooms and sporting apparels, to the technology domain in the form of digital magazines, aggregator platforms, technology apps, etc. A few of the startups were social enterprises as well dealing with dyslexic children, building playgrounds with spare tyre material, and eco-friendly dustbin liners. The sample of Founders interviewed also had a healthy mix of both male and women entrepreneurs. In our endeavor to seek a holistic view of the startup ecosystem, we also conducted interviews with Mr. Rajiv Sawhney, Chief Operating Officer, N S Raghavan Centre for Entrepreneurial Leaning (NSRCEL), which is the incubation hub of IIM Bangalore, and Mr. S.A. Karthik, Founder of Quasar Legal, with 20+ years of experience in the legal domain. Profiles of both the interviewees have been attached in the Appendix.