Economic Times 8 May 2013
MUMBAI: It is seen as a land of entrepreneurs, economic growth and huge business potential, but India appears to be failing its promising startup companies which are struggling to find investors.
While there is no lack of ideas among the country’s vast young population, funding is declining from venture capitalists and rich “angel” investors, as they are known, who are often crucial to a young firm’s success.
“Risk-taking appetite from investors is low,” said Internet entrepreneur Nameet Potnis, who is trying to address the problem by setting up Nurtured.in, a platform to connect startups with early-stage investors.
“It is easy to set up an online business in India but very difficult to do business,” he told AFP.
Three decades after businessman N.R. Narayana Murthy and six other Indians sat around a kitchen table and formed leading IT outsourcer InfosysBSE 0.08 %, the country is yet to create a favourable business environment for new entrepreneurs.
Just five percent of thousands of Indian startups get funds from sources external to friends and family, analysts say.
It is one of the toughest countries in the world for a startup to flourish, according to a 2012 report by US-based research firm Startup Genome.
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