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Damn! This was one of my startup ideas! Have you ever said this to yourself? Have you ever had an Idea and then discarded it within few seconds without realizing their full potential? If yes then don?t worry, you are not the only one. I have heard people saying ?I had the same startup idea two years ago in my dorm room in college?. There are a dozen successful companies that are working on these ideas that were born and immediately discarded in many dorm rooms. The fact that not even a tiny percentage of that money is reflected in your bank account affirms the fact that ideas not followed up with proper execution have zero value. Ideas in their initial stage are like infants, in that they are unable to stand up and walk on their own. They need to be nurtured with patience. They have to evolve with time in order to take off. If you patiently evolve your product and idea, you might have a shot at success. Here?s how to cope when the going gets tough:
  1. Try not to give up: You might want to give up when things don?t turn up the way you want to. But do not give up because of the problems; they are a part and parcel of every startup. You should only consider giving up if you have lost all faith in the startup?s vision.
  2. Do not run after a different idea: When your original idea is giving you problems in execution, your interest will suddenly waver to more attractive ideas for you to go after. And it will seem to you that your new ideas won?t have problems that you are facing with the current one. Which is not so, hence it is better off pursuing your current idea where you know the underlying problems rather than pursuing a new one where you have no idea what problems may crop up.
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  1. Be open to making minor modifications to your existing idea: While you should not go into a completely different direction, you should be open to making minor changes in your idea or business model as you iterate and get customer feedback.
 
  1. Don?t be tempted to raise money to solve your problems: When you are not making money from the market, you might be tempted to raise it from investors, and you might very well be successful in raising money despite your problems. But the investment also brings higher accountability and pressure.
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  1. Don?t be tempted to spend money to solve your problems: Some problems cannot be solved by throwing money at them. You can get users through ads but they will leave soon if your product is not good enough, you can?t nail traction without nailing your product first. Hiring more people than absolutely required will shorten your runway and add inefficiencies in the team.
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  1. Be easy on yourself and give yourself some time: This phase can be one of the most frustrating ones in a startup. You will not get solutions on demand. You have to give yourself time to experiment different things and find out what works.
  Start-up process entails complex procedures and many bureaucratic hurdles, entrepreneurs are better off using professional services. Hiring a virtual lawyer and virtual accountant can save time and help ensure that the process goes smoothly. For any Legal and Accounting support, Happy to help you,?let us?talk at?Wazzeer. For more interesting updates follow us on?Twitter,?Facebook,?LinkedIn?and?Google+   It is a summarization of an article from Your Story. For more information, visit http://yourstory.com/2015/07/keep-your-ideas-alive/
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Every startup has to invest a lot of time and effort to raise money to scale and keep the business going. All the effort and time invested can go for a toss, if you miss one important but under-estimated aspect. Every VC/Angel investor, before pumping in their money, will perform a due-diligence process. This process varies in tenure and complexity based on the industry, nature of transaction, and also the stage of investment. Any deal is successfully closed, only after satisfactory-completion of due-diligence, failing which, the deal drops dead. Sometimes, they get a legal opinion, before proceeding. Here are a few points for startups to focus on when setting their house in order:
  • Incorporation (legalisation):?The most basic mistake that most entrepreneurs commit is their failure to corporatise or legalise their entity and because of this has been the bane and downfall of many a startup. A legal entity adds professionalism to the startup as well as confidence to the other transacting party.
  • Revenue registration/dues:?The one thing that every person hates is?Tax. Yes, that obligation to pay the government whenever due, no matter what. But it is prudent that startups get their revenue registrations in place first, as even non-filing/registration, attracts the long arm of the law.
  • Founders? agreement:?A founders? agreement is really important for any startup. No one remembers what they have typed in their mail the previous night, let alone verbal agreements that are the norm during the startup phase. Putting things in words is not a reflection of lack of trust, it?s just prudence.
  • Legal issues:?No matter how frivolous, real, or imaginary; all it requires to scare away potential investors is to utter ?lawsuit?. Let your legal health do the talking, rather than trying to convince someone to put their money in a place, which is replete with legal landmines.
  • Organization:?After you have incorporated your startup, you need start striving to put relevant processes, procedures, etc., in place from the moment you set up shop.
  • Accounting:?Pull up your socks and start keeping account of all your income and expenditure. Maintain Income and Expenditure statement, P&L Accounts, other Financial statements.
  • Employee agreements:?Every employee who works must be contracted with basic clauses to protect the interests of both the parties. Also, records of past employees to be maintained. Basic compliances like Labour law, PF etc., to be met.
  • Intellectual property:?Ownership of Intellectual Property, including non-exclusive licenses, infringement, inappropriate use and potential action, have to be dealt and agreed upon.
  • Third-party agreements:?The same rules apply for every third-party that transacts with the enterprise. Vendors, associates, affiliates, contractors, and other partners need to sign proper agreements, with non-disclosures, how the relationship is defined, responsibilities, and IP assignment.
  • Previous fundraising documents: If you have already raised funds, then future investors would like to know the details of fundraising, utilisation, its impact, etc. Put these in order so they can understand them thoroughly.
?   It is a summarization of an article from Your Story. For more information, visit http://yourstory.com/2016/04/startup-compliance-regulatory-health/
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As per new information,?The Securities and Exchange Board of India?(SEBI) is considering changes in its plans for a capital-raising platform which is highly targeted at startups. SEBI is considering sweeping changes to the listing framework for tech-based startups that will allow them to trade publicly on regular stock exchanges. On 23 June 2015, Sebi unveiled a set of new rules that were supposed to make it easier for India?s 3,100-odd start-ups to list on an alternative listing platform. The response to the new rules was not good, both start-ups as well as the bankers were concerned about the ability of Indian investors to judge the value of early-stage companies, and worried about liquidity on the alternative trading platform. A source told Mint that taking note of the concerns, Sebi?s primary market advisory committee (PMAC), in a meeting on 30 May, recommended that the regulator give up on the idea of an alternative listing platform. The source further added ??Instead, the regulator could consider a relaxed listing framework. Under this proposed framework, technology-based companies, with less onerous listing requirements, could list directly on the main board of stock exchanges,? According to the minutes of the PMAC meeting which was also reviewed by?Mint, start-ups may be allowed to list on the main stock exchange for an initial period of three years. But, for these three years, the Issue of Capital and Disclosure Requirements (ICDR), applicable to all listed companies, would not apply to the start-ups. Instead, start-ups will be required to comply with a diluted version of the listing guidelines, similar to those that were prescribed for the proposed start-up listing platform. At the end of the three-year period, these companies would need to become compliant with the ICDR guidelines. As part of the proposed rules, Sebi will also dilute some of the norms related to investors in public share sales by start-ups. It is a summarization of an article in Live Mint. For more information visit http://www.livemint.com/Money/Qwj2ZdwfMJX7EwgEg3ZYXL/Sebi-may-scrap-planned-listing-platform-for-startups.html
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Singapore based mobile advertising Company InMobi has been fined $ 950,000 by The Federal Trade Commission on charges of ?deceptively tracking the locations of hundreds of millions of consumers, including children, without their knowledge or consent to serve them geo-targeted advertising. In an?official statement, the FTC alleged that InMobi misrepresented the software. It said that its advertising software would only track consumers? location when they opt for it or put it with their device?s privacy setting. But, as per the complaint, the software tracks the location of the consumer without their permission and also when the consumers have denied permission to access their location information. Violation of Children?s Online Privacy Protection Act Further, the FTC alleged that InMobi also violated the Children?s Online Privacy Protection Act (COPPA) by collecting data of their location from apps which were clearly directed at children, in spite of promising that it would not do so. The complaint noted that InMobi?s software tracked location in thousands of child-directed apps (having hundreds of millions of users) without following the steps required by COPPA to get a parent or guardian?s consent to collect and use a child?s personal information. Terms Of Settlement InMobi is subject to a $950k civil penalty which was earlier fixed at $4 Mn but was reduced on account of the company?s financial condition. Further, it will have to comply with the following terms
  • To delete all information collected from children, and prohibited from further violations of COPPA.
  • InMobi will be not be allowed to track consumer?s location without their consent, and will be required to honor consumers? location privacy settings.
  • The location information of consumer, it collected without their consent, should be deleted and is also prohibited from further misrepresenting its privacy practices.
  • InMobi will be required to institute a comprehensive privacy programme that will be independently audited every two years for the next 20 years.
InMobi Puts It On Technical Errors InMobi issued out a statement saying, ?With best intentions to adhere to COPPA requirements, InMobi implemented a process to exclude any publisher?s site or app identified as a COPPA app from interest-based, behavioural advertising. During the investigation by FTC, InMobi discovered that?there was a technical error at InMobi?s end?that led to the process not being correctly implemented in all cases. As a result, some COPPA sites were served with interest-based campaigns on the InMobi Network. InMobi promptly notified the FTC of this issue as soon as it was discovered and has made it clear from the outset that this was by no way means deliberate. Any family safe ads that may have formed part of targeted campaigns would have been undertaken to target the adult owner of the device.? It is a summarization of an article from Inc42. For more information, visit https://inc42.com/flash-feed/inmobi-ftc/
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Last week, the Indian Government permitted 100% FDI in food retail, including retail through ecommerce. This was done to strengthen the sector, provided these items are produced, processed or manufactured in the country. This will enable Walmart to look at their food business, in India, closely and perhaps even start B2C food retail. ?Also, it will help Indian hyperlocal grocery startups, like?Grofers and?BigBasket?etc. raise funds easily. A Walmart India spokesperson, told?ET, ?The decision by the government to allow up to 100% foreign direct investment (FDI) through FIPB in marketing of food products produced or manufactured in India, including through e-commerce, is very progressive and will help in reducing wastage, helping farm diversification and encourage industry to produce locally within the country. This far-reaching reform will benefit farmers, give impetus to food processing industry and create vast employment opportunities. We will study the policy document when government finalises and issues it.? This will help to curb food wastage in India. According to Harsimrat Kaur Bada, Food processing minister, India is responsible for wasting food worth INR 92,000 Cr and with these foreign funds, India can build infrastructure at farm gate level for benefit of farmers. This will majorly help players expand their market in Tier-II and Tier III cities as last mile connectivity and high fulfillment costs can be met by the new inflow of capital. Saurabh Kumar, co-founder of Grofers said, ?We welcome the decision as it will benefit the domestic food industry & help improve the essential supply chain ? something that is needed to ensure future food security for the country. However, we are awaiting clear guidelines on this before we can comment further.? Most of the grocery startups sell household items such as soaps, shampoos with food. So in order to avail this benefit they have to separate the food business from the remaining portfolio to raise additional funds. It is a summarization of an article from Inc42. For more information, visit https://inc42.com/flash-feed/100-fdi-food-retail-startups/  
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Amazon India is now well ahead of Flipkart in overall website traffic, including both PCs and mobile, according to data gathered by Kotak Institutional Equities from web traffic analytics company SimilarWeb. Even though separate numbers for mobile and PC traffic of these two companies was not available for the period from November 2015 to May 2016, it showed that?Amazon?generated between 33% and 62% more monthly traffic than its Indian rival. Amazon had an average monthly user visit of around 180 million, far ahead of Flipkart’s 120 million. In February, Flipkart’s app ranking fell off the top 10 ranks in Google Playstore, while Amazon climbed up a few positions. Amazon India was at No. 14 and Flipkart was two positions below that at No. 16, according to Kotak, which got the data from mobile-app analytics company App Annie. In terms of app downloads,?Flipkart?said in February that it surpassed 50 million installs on Google Playstore. Amazon’s app downloads are between 10 and 50 million. In December, Amazon had confirmed that its Indian site is the most visited e commerce site in the country. This was based on PC traffic but now it seems that, now, Amazon has also encompasses the mobile web. This must have happened because Flipkart was more focused on its mobile app and wanted to go app only, like its subsidiary Myntra, as around 70% of the traffic comes through mobile. But Myntra recently got back on the web, in an admission that the plan had backfired. As now Amazon is catching up in mobile space too, it?s time for Flipkart to be in action.   It is a summarization of an article from Times Of India. For more information, visit http://timesofindia.indiatimes.com/tech/tech-news/Amazon-India-builds-big-web-lead-over-Flipkart-Report/articleshow/52876210.cms
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Uber, one of the world’s largest online taxi aggregators, seems to be giving in to Karnataka State Government’s rules and regulations for ride hailing services. As per the new rules and regulations, if you want to obtain license, then you need to install digital printers, panic buttons and a signage of ?Taxi? on all the vehicles. But the new rules have still not come into action. Around 100 cab drivers on UberX were given digital meters and a panic button, free of cost, without further clarity on as to whether the drivers will have to bear the cost of the device or not. Confirming on the developments, Uber said that they have currently borne the hardware cost for 100 cars. An Uber spokesperson said ?As part of the compliance requirement to obtain licence we have supported some drivers in Bangalore with some of the hardware requirements and we bore the cost for these as the requirement was for only 100 cars for the licence? Another spokesperson of the digital printer manufacturer, DMT Technologies in Bangalore also confirmed on the development stating that they have sold almost 200 digital meters to Uber in the last two months.? The cost of each printer was around Rs 4,500 with the price hiking up to Rs 9000 when receipt printing and GPS was added to the offering. “We feel that these regulations are out of step with the progressive rules that are needed to create an enabling environment for a nascent industry likes ours and that is why we have challenged it in court,” an Uber spokesperson told ETtech. Challenging the regulations in court, Uber said that the Karnataka High court has adjourned the hearing of the case (between such online taxi companies and themselves), while extending the previous interim order till the next date of hearing. It is a summarization of articles from Your Story and Economic Times. For more information visit, Your Story http://yourstory.com/2016/06/uber-gives-in-to-karnataka-government/ Economic Times http://economictimes.indiatimes.com/small-biz/startups/uber-gets-digital-meters-physical-panic-buttons-to-comply-with-karnataka-governments-guidelines/articleshow/52832810.cms
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In a?recent Union Cabinet, the government finally approved of?INR 10, 000 crore for ?Fund of Funds for Startups?. This is in line with the??Startup India Action Plan??announced by the government in January. The fund will be used to generate employment for?18 lakh people?on full deployment and will?support seed stage, early stage and growth stage startups. ?A corpus of INR 10,000 crore could potentially be the nucleus for catalysing INR 60,000 crore of equity investment and twice as much debt investment,? an official statement said. The day to day operations of the fund will be taken care of or managed by the SIDBI (Small Industries Development Bank of India) An amount of INR 500 crore has already been provided to the corpus of FFS in 2015-16 and INR 600 crore earmarked in the 2016-17. The startups are concerned as recently only?one out of 250 applications has been approved. To combat that, DIPP has?planned?a strategy to upgrade the action plan and get more enterprises to take part in it. For legal help in filing of patents, the startups don?t need a certificate of recognition from the government. Not only this, the service would be free, and there are also plans to impose a cap on fees that can be charged by incubators for certifying a startup as an ?innovative business.?   It is a summarization of an article from Inc42. For more information, visit https://inc42.com/flash-feed/pm-modi-government-approves-inr-10-000-crore-corpus-startups/
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Setting up your startup involves a lot of work and effort. Many things need attention, including developing a proof of concept, finding product/market fit, and hiring the first set of employees. With these many things to be handled, slips are bound to happen. One of the most common areas where most startups make a wrong choice is establishing a solid legal foundation. Some of the most common?legal?mistakes made by startups:
  1. Wrong legal entity: Choosing the right legal entity right at the outset is important. Some structures to choose from include a Registered Company (Public/Private Limited), LLP, proprietorship, and partnership. The more widely accepted one is a registered company, especially for any deals with foreign clients.
  2. Not tracking expenses: Many try and gather all receipts only when tax returns have to be filed! What is not documented is not deducted, and therefore, it is like leaving money in the open.
  3. Lack of documentation: Each and every interaction, be it meeting minutes or anything else, must be on the record. It is important to have all documents in order at all times. Legal due diligence can make or break an investment deal.
  4. 4. Missing founders? agreement: The founders? agreement should contain all essential clauses such as ownership, vesting rights, and the roles and responsibilities of each founder, including salaries and terms of employment.
  5. Mixing capital and revenue expenses: What expenses are considered assets /capital expenditure and which ones are called revenue expenses deductible in the P&L A/c. Higher-value items that will last significantly longer than one year are called Capital Expenditure/Assets/Equipment. Things that are consumed over the course of a year come under revenue expenditure. If the equipment or capital items are by accident deducted as revenue expense, the tax department can determine that the expense has been improperly characterized and a deduction does not apply. Hence, be careful in accounting all such expenses.
  6. Mixing personal and business expenses: This can be a source of confusion when taxes are being filed, and in some cases, can lead to deductions being disallowed on an ad-hoc basis by the revenue authorities and higher tax outgo as a result. The company should therefore have a financial account at the onset and separate records as well.
  7. Not protecting intellectual property: Intellectual property (IP) is a startup?s most valuable asset. Trademarks, patents, and copyrights are the three essential components of IP. It is essential to not let anyone claim a right to your IP. Non-disclosure agreements are a way of ensuring this. Startups often neglect the protection of IP and suffer later.
  8. Non-compliance with securities laws: Startup founders commonly issue stocks to angel investors, family, and friends. However, stocks issued without complying with specific disclosure and filing requirements under securities law can lead to serious legal issues at a later stage.
  9. Missing regular tax payments: Businesses, be it sole proprietors or otherwise, are required to pay taxes in advance. This means they need to determine their taxes for the year in advance and pay as prescribed installments.
  10. Not ensuring professional help for tax-related issues: A startup must appoint a tax consultant to ensure all regulations are being followed. This will also give you more time to focus on building your company, forming strategic relationships, and other things.
    It is a summarization of an article from YourStory. For more information, visit http://yourstory.com/2016/03/legal-mistakes-startups/
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Food tech startups are in controversy after Gurgaon-based food-tech startup?InnerChef?accused Bangalore-based?FreshMenu, an online first restaurant, of unethically using InnerChef?s brand name in their search ads. Rajesh Sawhney, co-founder of InnerChef, tweeted about FreshMenu?s questionable behaviour of using InnerChef?s name for advertising itself and asked it to behave responsibly by focusing on making better food rather than usurping InnerChef?s name. Innerchef has also mailed Google Adwords asking them to look into the matter as it is against Adwords policy and has accused Freshmenu of copyright infringement, misleading content, unclear relevance of the ad as they have no association to ?InnerChef?. Rajesh Sawhney told Inc42 ?It?s unfortunate that Freshmenu resorted to unethical advertising misusing and misrepresenting InnerChef in their Google campaign. We will protect our brand against any such cheap tricks by competition. We have already written to Google to ban them. It?s also unfortunate that they are focusing on such malicious advertising instead of improving their product and consumer experience.? Freshmenu has replied to Rajesh Sawhney tweet saying that the ads have been taken down and it was totally unintended. Rajesh Accepts their apology asking them not to repeat this kind of behavior in future.   It is a summarization of an article in Inc42. For more information, visit https://inc42.com/buzz/innerchef-accuses-freshmenu/
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