Startup definition in India

The Startup India Action Plan defines a startup as “a company or a legal entity that is working to develop or has developed a new product, service or process with innovative elements and is at a stage of being self-sustainable and scalable.”

The definition includes the following criteria:

  • The company must be less than 10 years old.
  • The company must have annual turnover of less than INR 100 crore (US$13.3 million).
  • The company must be working on a new product, service or process that has innovative elements.
  • The company must be self-sustainable and scalable.

Multiple choice questions:

  1. Which of the following is not a criterion for a startup under the Startup India Action Plan?
    • The company must be less than 10 years old
    • The company must have annual turnover of less than INR 100 crore
    • The company must be working on a new product, service or process with innovative elements
    • The company must be profitable
    • The answer is The company must be profitable. The company does not need to be profitable to be considered a startup under the Startup India Action Plan.
  2. A company that is 11 years old can still be considered a startup under the Startup India Action Plan if:
    • It has not yet crossed the annual turnover of INR 100 crore
    • It is working on a new product, service or process with innovative elements
    • It is self-sustainable and scalable
    • All of the above
    • The answer is All of the above. A company that is 11 years old can still be considered a startup under the Startup India Action Plan if it has not yet crossed the annual turnover of INR 100 crore, it is working on a new product, service or process with innovative elements, and it is self-sustainable and scalable.
  3. A company that is working on a new product, service or process with innovative elements, but is not yet self-sustainable and scalable, can still be considered a startup under the Startup India Action Plan:
    • Yes
    • No
    • Only if it has not yet crossed the annual turnover of INR 100 crore
    • Only if it is working on a product that is disruptive
    • The answer is Yes. A company that is working on a new product, service or process with innovative elements, but is not yet self-sustainable and scalable, can still be considered a startup under the Startup India Action Plan.

Conclusion

The Startup India Action Plan defines a startup as a company that is working to develop or has developed a new product, service or process with innovative elements and is at a stage of being self-sustainable and scalable. The definition includes the following criteria: the company must be less than 10 years old, the company must have annual turnover of less than INR 100 crore, the company must be working on a new product, service or process with innovative elements, and the company must be self-sustainable and scalable.