StartupTalky

Tag: Israel Startup Growth

  • What stops India from becoming a startup ecosystem: Indian Startup Failure?

    The  Startup scene in India took off after it realized the potency of this sector. This was not because of some magic and it obviously didn’t happened overnight. This took a long time. It took off due to many internal reasons like massive Fundings, growth of Angel Investors chain, boom in technology and the need to change.

    The startup ecosystem in India is the 4th largest in the world. India has produced some very famous startups like   Paytm , OYO Rooms , Redbus , Zivame. In 2018, 8 startups were evaluated at $1 Billion. But among a ocean of startups, why only 8 ?

    Is India a saturated market?

    India stands unchallenged , holding the second spot in global population. It is a major economy that is dependent equally on both the rural and urban sides. However, major startups serves only the pat living in the urban areas. Due to this the population of the rural areas go unnoticed. The main problem is here. Too many startups are serving a very small part. This makes the economy more and more saturated. This chasing of very few customers by a lot of companies makes the startups to fail.

    Problems for startups in India

    • Fear to take risk:  A major problem is the Funding in India. Investors in India lack trust and the risk taking factor. Only a portion of investors have the will to give in to a new comer. Due to this a majority of startup population cannot succeed.
    Startup rate of nations
    Startup rate of nations
    • Managing the Business: After a business takes off and starts to shape up it is required to be maintained well. Not only from this point. The founders should take care of the management from the start to prevent the company from going into problems like debts.
    • Pressure from the surroundings: There’s a term for people who gym. Its called ego lifting. Ego lifting is something that is born out of jealousy and pressure from friends. Startups also follow this. This leads to their downfall.

    Why Foreign countries?

    Countries abroad provide a lot of scope to Startups. Moving abroad gives the Startup a broader audience. A more technological advanced audience. Apart from all the money saving and tax reasons. Moving abroad also enables the startups to gain fame for being associated with foreign countries.

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    Using better infrastructure

    What we all already know is the fact that India doesn’t have a proper infrastructure. Our nation lacks financially, technologically. All this affects the infrastructure directly. Startups move abroad to use the better infrastructure.

    Foreign countries have hubs and clusters. Countries like Estonia have special things to provide. They are minimal taxes, low rent places and many other things. Countries like these have there own angel investors chain.  Different countries specialise in different sectors. For example Israel is known fro its strong base in Security and Agriculture.

    Sales

    When it comes to population or number of customers. India is not behind. So, wheres the issue? The issue lies in the fact that not a major portion of the population is through with the technological advancements. Not many are interested to know about what goes around in the world. This narrows the range for any startup in India.

    To increase the sales and the range startups move abroad.

    Finding Money

    To find money one should know where to look. Only 8 Indian startups made about $1 Billion in a year. The failure rate is much more than the success. So, current India is not a place to look for money. Due to this not many investors come forward in order to fund the startups.

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    So, Indian startups move abroad to get the investments rolling. Above this the population outside India has a very acceptable  mindset.

    “Businesses, by very definition, are aspirational and going international is part of it. It gives more exposure, better access to financial investors, and of course a hope of revenue growth,” said Yugal Joshi, vice-president of Texas-based consulting firm Everest Group.

    Favourite countries for Startups

    Serbia

    In the recent few years Serbia has seen US companies building up operations there. Serbia is changing rapidly to evolve into a hub for application development , programming and IT outsourcing. The reasons behind this sudden change is the multilingual and well educated population. They also provide for fancy and attractive incentives for IT investments from other countries.

    Australia

    The countries small yet talented workforce and closeness to Asian markets, makes this a good option for startups. The country also attracts a lot of immigrants who are highly qualified.

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    Estonia

    Estonia is a place with one of the highest per capita rate in terms of startups. Estonia is the most suitable place for entrepreneurs. It has a very entrepreneur friendly tax policy. It provides many attractive incentives to foreign investors.

    India too appears in the list for suitable places. But the country is still like molding clay. It is still building and it would take time. It would take time to generate investors or a proper ecosystem. But for now India is not a suitable ground to play for startups.

  • 10 Reasons Why Israel is Well Ahead in Startup Race

    Israel spends about 4.4% of its GDP on research and development. The country is a startup on its own. Almost every family has an entrepreneur in them as their culture is developed on entrepreneurship. It often termed as a startup nation. Various startups are coming up in various domains, especially dominated by tech-driven startups. This tiny nation has built what we call a perfect startup ecosystem, with the government, defense forces, investors and people joining hands in building up this. We as a developing nation should pick up some positive points from them.

    According to Statista, the number of startups founded in Israel between 2014 and 2017. In 2017, the number of startups founded in the country was 700, a decline compared to the previous year’s 932. In 2019, the ease of doing business score in Israel reached 73.23. During the period of consideration, the ease of doing business in Israel was 49 in worldwide comparison.

    So, in this post we’ve shared some insights why Israel is well ahead in startup race. Here are some reasons why Israel is a hub for entrepreneurs and entrepreneurship

    Reasons Why Israel is Well Ahead in Startup Race

    Why Israel is Well Ahead in Startup Race?
    Why Israel is Well Ahead in Startup Race?

    Support from Government

    Israeli government started building the startup ecosystem from 1974, by commissioning OCS for Research and Development. Currently, it supports around 30 incubation centres and provides various grants ranging in millions of dollars for startups in tech sectors. The focus is more on tech, biotech and medical technology. Government has also reduced Corporation tax for tech companies from 25% to 6-7% ( depending upon the business ) and AHS removed bureaucratic obstacles to encourage hi-tech mergers. Also in In 1993, the Israeli government initiated a plan called Yozma (Hebrew for “initiative”) offering attractive tax incentives to foreign venture-capital investments in Israel and promising to double any investment with funds from the government.

    The Large Pool of Venture Capital

    With the highest number of venture capital investment in this tiny country, investments per startup have exponentially increased within a few years. The countries have around 75+ active venture capitals, out of which around 20% VCs are international ones with local offices. Some many other VCs do not have a physical presence yet invest heavily in the startup of this nation. Also, the International business person comes back to the country to share their knowledge and money. Some of them became angel investors to back up startups.

    Buzzing Startup Culture

    People are quite enthusiastic about starting their venture. Meetups at coffee shops and people discussing new ideas and innovations are quite common. Israeli startups are more focussed on cybersecurity, edtech, medical technologies and SaaS(Software as a service). Since the population of Israel is less so their target audience is from other big countries like USA, India etc.

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    Co-Working Spaces

    There has been tremendous growth in coworking spaces and accelerators. These help people with the same passion to interact and grow together. Many great and revolutionary ideas came out of these spaces. The startup city of Israel, Tel Aviv has about 80 accelerators and incubators. These have also helped many potential ideas to turn into successful ventures.

    Israel Defense Forces

    Innovations and building technology for IDF have resulted in big startups sprouting up in technological and defence domain. They have helped in solving complex military problems and exporting defence technologies to improve their GDP. Due to the compulsory military training for both men and women makes them relevant and displaced, which eventually helps in their entrepreneurial skills.

    Culture and Community

    Israel is a country of refugee and immigrant, making it a very diverse country. The two-thirds percentage of people in the country are willing to take the risk of entrepreneurship. The culture of the country is made on entrepreneurship. Also, since it is a very small country, there is no local or regional. market, hence forcing the entrepreneurs to think globally. Also, they have tricks and ways to cooperate with funding for themselves.

    Survival Leads to Innovation

    As mentioned above Israel is the country of migrants, they have survived through a lot of suffering. This has to lead to a lot of innovations in Israel as it said survival leads to innovation. This innovation has indulged the spirit of entrepreneurship in the Israelis. They gave then continued this process and keep on building entrepreneurship in their country.

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    Discipline Towards Business

    Israel’s entrepreneurs both men and women, due to their military training are the reason behind their discipline nature and approach towards their business. These are why they are dedicated to their business. They focus on their work ethic and how it’s going to compete in the markets of the world.

    Silicon Wadi

    It is the Silicon Valley of Israel. Situated in the coastal plains of Israel. It is an area with a high concentration of high- technology companies. It is the reason behind the name of Israel as the “startup nation of the world “. It covers much of the country’s High tech industry. Many international technology companies along with ahem their research and development sector situated in here. Example are Intel, IBM, GOOGLE, Facebook, Microsoft etc.

    It is also the home of popular Israel is companies like Zoran Corporation, CEA Inc. Redware etc. It is the perfect place for having a startup and making it a successful one.

    Easy Procedure of Starting a Startup

    It is not very tough to start a startup in Israel. Starting a startup is easy in the startup nation. If someone is willing to, do so, then read the market ecosystem, gather a team of own, form an idea, join a incubator or accelerator if details like pitching, licensing is wanted to be avoided or someone wants to go independent and have the resources, few bucks a relevant idea then Israelis go for it.

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    Conclusion

    Israel is a small country with a population of mere 8 million but the development it’s doing in the field of a startup is commendable. From government to investors everyone is backing the startups. Even though there is risk there but that risk is worth taking for Israelis and they are taking it. Also, there is no end of startups there but each startup is different from the other and has something to offer which is new and needy. They believe in world domination with their products and hence they are working toward it through their startups.