Is Your Company a Startup?

Does your company fall under the startup paradigm? Understand how to get the startup recognition for your business.


Several entrepreneurs across the business landscape have launched and grown startups time and again. You may have started a company of your own, but are you sure it falls under the startup paradigm? How do you figure this out? There is a difference between startups and small businesses. 

Firstly, startups are not smaller versions of large corporations. They’re organizations that search for repeatable and scalable business models that can be executed quickly while impacting the market.

Small businesses look for business models that work from day one and not that work down the line as they are self-sustaining organizations that generate revenue from day one. They don’t require major investments and bring relatively small amounts of sales with lesser employees.

How to figure out your company is a startup?

Startups aim to disrupt and take over the market with an impactful business model. They require initial investments which do not generate immediate results. Therefore, startups usually are not profitable in their initial years and some never even reach profitability.

Startups look for the right business model which scales to enormous heights in a massive market as quickly as possible.

Startups look for major investments headlong. They look for investors who are looking to take risky major investments but choose who they pitch their confidence in.

Startup India Scheme

It is an initiative of the Government of India, first announced by Prime Minister, Narendra Modi. It focuses on three areas:

Simplification and handholding; funding support and incentives; Industry-Academia Partnership and Incubation. It also plans to discard restrictive policies like License Raj, Land Permissions, Environmental Clearances, etc.

Under this scheme, the government launched the I-MADE program, to help Indian entrepreneurs build 1 million mobile app start-ups, and the MUDRA Bank’s scheme to provide microfinance, low-interest rate loans and over 75 startup support hubs across Indian Institutions. The Department for Promotion of Industry and Internal Trade (DPIIT) coordinates implementation of Startup India initiative with Government Departments. DPIIT recognition gives access to a host of tax benefits, easier compliance and IPR fast-tracking.

For DPIIT startup recognition your company must follow the following criteria:

Period of operations should not be exceeding 10 years from Date of Incorporation

Must be incorporated as a Private Limited Company/Registered Partnership Firm/Limited Liability Partnership

Annual turnover should not exceed Rs. 100 crores for any financial year since incorporation

Entity cannot be formed by splitting or reconstructing an already existing business

Should work towards development or improvement of a product, process or service with a scalable business model, high potential for creation of wealth and employment

The Government of India has made substantial progress in making the Startup India initiative a reality boosting the entrepreneurial spirit across India.

Smruthi Krishnan
Smruthi Krishnan
Smruthi interviews and writes on inspiring entrepreneurs and the success stories of start-ups. She is currently pursuing Economics major from Delhi University.

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