providing sufficient incentives for a start-up

providing sufficient incentives for a start-up

Young people can go a long way in fostering their potential provided they get sufficient incentives to start off.

Six years ago, Bhausaheb Janjire, 26, a domestic worker in Pune and the son of a bonded farm labourer, took an astonishing step. He raised Rs 50,000 in seed capital to start a telecom components business. His venture now has a turnover of Rs 10 crore, employs over 300 people, and exports to markets in West Asia and Myanmar. Shailender Singh, 28, who ran a attachakki business in a Haryana village, took a small loan 10 years ago to start a new venture.

Today, Singh is the CEO of a human resource development firm, and has trained and outsourced 3,000 people to large companies. Increasingly, bottom-of-the-pyramid young entrepreneurs in urban and rural India are climbing up the value chain, from income generation to self-employment to entrepreneurship.

Lakshmi V. Venkatesan
Lakshmi V. Venkatesan
Job seekers at the grassroots are becoming wealth and job creators, mirroring the success stories of their better-known brethren in the hi-tech sectors. Still, highly successful micro-entrepreneurs like Janjire and Singh are just a handful.

Young people in general have relatively little money and experience, or even access to social networks that could be useful for business. But they are energetic, creative and eager to learn. The right kind of programmes can go a long way in fostering their potential provided they get sufficient incentives to start off. At present, there are few programmes tailored to meet their unique needs. We need a national agenda to provide them the skills they require to get started.

Stakeholders such as the private sector, financial institutions, the government and even society at large need to work together in a public-private partnership mode to fill the gaps. Capability mentors such as NGOs and educational institutions should identify skills and capabilities; programme designers like government agencies should provide the framework for startups through friendly policies and infrastructure; and scaling facilitators like the private sector and financial institutions should provide capital and business strategies.

Capability mentors: NGOs should act as counsellors and motivators for potential entrepreneurs. Educational and vocational institutes need to provide them with practical knowledge. Entrepreneurship training should focus on short, functional modules that impart hard and soft skills using information technology and mobilebased learning tools. Partnerships with the private sector are also needed to develop programmes based on market realities.

Programme designers: While the government has started according priority to skill development through initiatives like the National Skill Development Corporation, entrepreneurship training is also vital. Local governments from the panchayat level can offer space and utilities for incubating micro-entrepreneurs.

Scaling facilitators: Corporates can play a significant role by providing business advice to budding entrepreneurs, and by helping them integrate into the value chain. Financial institutions need to develop specialised instruments for ]entrepreneurs who do not have access to security and collateral. Social venture funds, a nascent field in India, need to cater to youth with viable business ideas that may have a longer incubation period.

The author is Executive Vice President of Bharat Yuva Shakti Trust, a corporate initiative to promote entrepreneurship