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Knowledge Base - How to Start Business
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    Guidelines for New Entrepreneurs

    What is the Procedure toRegister a Startup Companyin India and how much willit Cost?

    On January 16, 2016, the Prime Minister of India, Shri NarendraModi announced a new initiative called "Start-Up India" initiative,fostering the promotion of entrepreneurship by creating a systemthat is conducive for start-ups.

    This initiative will provide budding entrepreneurs and experienced businessmen an easier access to funding and incubators by offering them an easy-to-use platform that can be downloaded on to anysmartphone device.

    Key points of the initiative:

    1. Single window clearance, and creation of App
    2. 10,000 Crore funds of funds
    3. 80% reduction in patent registration fee
    4. Exempted from capital gain tax
    5. Tax exemption on profits for 3 years
    6. Reduction in red tape
    7. New compliance system (self-check)
    8. IPR (Intellectual Property Rights) protection
    9. 90-day exit window

    An eligible start-up is defined as the following few entities:

    1. Private Limited Company (The Companies Act,2013)
    2. Registered  Partnership  Firm  (The  Indian  PartnershipAct,1932)
    3. Limited  Liability  Partnership  (The  Limited  LiabilityPartnership Act,2008)

    In order for a "start-up" to be considered eligible for the initiative,it needs to meet the following requirements:

    1. An entity is considered as startup up to 5 years from thedate of its incorporation/ registration
    2. Its turnover for any of the financial years has not exceededINR 25 crore
    3. It is working towards innovation, development, deploymentor  commercialization  of  new  products,  processes  orservices driven by technology or intellectual property
    4. It is supported by a recommendation (innovative nature ofthe business), OR by an incubator funded by Gol, OR isfunded  by  Gol,  OR  is  granted  a  patent  or  trademark  inassociation with nature of business.

    REGISTRATION OF START-UP

    Option 1: An entity can register itself through MCA or Registrarof Firms using the existing processes and subsequently register itself on the Startup India portal and mobile app as a "Startup" toavail the benefits.
     
    Option 2: An entity can register itself through the Startup Indiaportal and mobile app using a seamless process. This facility wouldbe made available in the second phase of the Startup India portaland mobile app launch.
     
    1. Log in to Startup India Portal
    2. Choose your legal entity
    3. Input your incorporation/registration number
    4. Input your incorporation/registration date
    5. Input PAN number (optional)
    6. Input your address with postal code & state
    7. Input authorized representative details
    8. Input director(s)/partner(s) details
    9. Choose  and  upload  supporting  documents  and  self-certification
    10. Incorporation/registration  certificate  of  company/LLP/Partnership
    11. Registration to avail tax and IPR
    12. Certify the official notification terms and conditions
    First Steps Toward Industry Startup
    Before you start any new business or manufacturing unit, you need to identify your skills and what kind of businesses you can start and then you need to calculate investments related to land and building (rented or owned), Cost of Plant and Machinery, Labor Cost, Raw Material and at-least 2-3 Months Working Capital.
     
    BANKABLE PROJECT REPORT
    Before you start any industry, you need to get project report prepared. Readers who do not know about project report, let me explain - A Project Report is a document which provides details on the overall picture of the proposed business. The project report gives an account of the project proposal to ascertain the prospects of the proposed plan/activity.
     
    Project Report is a written document relating to any investment. It contains data on the basis of which the project has been appraised and found feasible. It consists of information on economic, technical, financial, managerial and production aspects. It enables the entrepreneur to know the inputs and helps him to obtain loans from banks or financial Institutions.
     
    The project report contains detailed information about Land and buildings required, Manufacturing Capacity per annum, Manufacturing Process, Machinery & equipment along with their prices and specifications, Requirements of raw materials, Requirements of Power & Water, Manpower needs, Marketing Cost of the project, production, financial analyses and economic viability of the project.
     
    Below are few mandatory details you should include in your project report:
    1. Present Market Position and Expected Future Demand,
    2. Market Size,
    3. Statistics,
    4. Trends,
    5. SWOT Analysis and
    6. Forecasts.
     
    Report provides a comprehensive analysis from industry covering detailed reporting and evaluates the position of the industry by providing insights to the SWOT analysis of the industry.
     
    Report should include:
    1. Plant Capacity,
    2. requirement of Land & Building,
    3. Plant & Machinery,
    4. Flow Sheet Diagram,
    5. Raw Materials detail with suppliers list,
    6. Total Capital Investment along with detailed calculation on Rate of Return,
    7. Break-Even Analysis and
    8. Profitability Analysis.
     
    The report should also provides a bird's eye view of the global industry with details on projected market size and then progresses to evaluate the industry in detail.
     
    If you need any help in creating project report or need any detail related to starting new industry, please contact us.