Challenges Encountered by a Startup in India

1. Managing and running a startup is a challenging task for the entrepreneurs. It is necessary to reduce the risks and prevent disputes wherever possible. A startup seems to fail mostly in legal challenges of running a business. It is important for a startup to avoid the run-in with clumsy nature of the Indian judicial system. Below are some of the challenges encountered by a startup in India. 1. Business Structure: One should be detailed about the kind of business that you want your startup to be. According to that, the structure of your startup is made- whether it is a sole proprietary, partnership, private company, or a public company. After deciding the structure of the startup, it is necessary to ensure that all the important agreements are correct. This is done to ensure that there are no legal barriers when any dispute rises in future. 2. Taxation: You should abide by the tax laws in order to prevent punishment and penalties. Every startup needs to be specific about the tax charges that it needs to pay to the central and state governments. Businesses should be well aware of the latest tax laws and how it effects the structure. 3. Labour Laws: When astartupbeginsits operations and hires employees, it is related to the labour laws of the country. This is one of the toughest challenges that a startup faces, and therefore should abide by all the necessary labour laws. These laws include minimum wages of employees, provident fund, payment of gratuity, maternity advantages, and prevention of sexual harassment in the working environment. 4. Business Licenses: For smooth functioning of a startup, a license is needed. For instance, a business related to food has to get licenses concerning food safety, food adulteration, and health. A startup needs to abide by the terms stated in the license. 5. Protection of Intellectual Property: Once the startup progresses, it creates an intellectual property which includes algorithms, researches, codes, designs, etc. It becomes necessary to protect this intellectual property and avoid its misuse by other companies and units. Some startup underestimate this and later face the challenges related to copyrights. The founder should be well aware of the main principles of IP rights such as patent filing, copyright protection, and trademark.

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