• Startup J&K - Initiative of Industries & Commerce Department, Government of J&K

Frequently Asked Questions

  • General
    • What is StartupJK?

      StartupJK is a one-stop platform for all stakeholders in the Startup ecosystem to interact amongst each other, exchange knowledge and form succesful partnerships in a highly dynamic environment.

    • How do Investors add value to Startups?

      Investors particularly venture capitalists (VCs) add value to startups in a lot of ways:

      1. Stakeholder Management: Investors manage the company board and leadership to facilitate smooth operations of the startup. In addition, their functional experience and domain knowledge of working and investing with startups imparts vision and direction to the company.

      2. Raising Funds: Investors are best guides for the startup to raise subsequent rounds of funding on the basis of stage, maturity, sector focus etc. and aid in networking and connection for the founders to pitch their business to other investors.

      3. Recruiting Talent: Sourcing high-quality and best-fit human capital is critical for startups, especially when it comes to recruiting senior executives to manage and drive business goals. VCs, with their extensive network can help bridge the talent gap by recruiting the right set of people at the right time.

      4. Marketing: VCs assist with marketing strategy for your product/service.

      5. M&A Activity: VCs have their eyes and ears open to merger and acquisition opportunities in the local entrepreneurial ecosystem to enable greater value addition to the business through inorganic growth.

      6. Organizational Restructuring: As a young startup matures to an established company, VCs help with the right organizational structuring and introduce processes to increase capital efficiency, lower costs and scale efficiently.

    • Why do Investors invest in Startups?

      Investing in startups is a risky proposition, but the low requirement for overhead capital combined with high upside potential, makes it lucrative for investors to put their bets on startups.

      The Thomson Reuters Venture Capital Research Index replicated the performance of venture capital industry in 2012 and found that overall venture capital has returned at an annual rate of 20% since 1996 – far outperforming modest returns of 7.5% and 5.9% from public equities and bonds respectively.

    • How can I register a profile on the hub?

      Registering a profile on the hub is a fairly simple process.

      On clicking the “Register” tab on the top right hand corner of the page which you will be directed to our “mygov” platform for authentication where you will be asked to fill details such as your name, email address, etc. This will give you a one time password for verification as well as a link to set a new password.

      Sign in using the login credentials you created in step 1. This will direct you to the Hub where you can select and create the profile of a stakeholder which best defines your role.

    • How do we connect to enablers after creating a profile?

      The system is build to connect you to your relevant stakeholders based on your industry and preferred stage. Under the profile of every enabler there will be an option to “connect/apply”. Upon clicking, a request will be sent to the respective profile for acceptance. Once accepted, you will able to see the enabler as a new connection.

      Please note that you can connect with upto 3 users per week.

    • Can a foreign company register under StartupJK?

      Any entity having atleast one registered office in India is welcome to register on the hub as location preferences, for the time being are only created for Indian states. However, we are working on international relations and will soon be able to enable registration for stakeholders from the global ecosystem.

    • I want to share events, tools & templates, reports, blogs, etc. How can I publish these on the Hub?

      For publishing content, you can get in touch with us on contact@startupjk.com

  • For Startups
    • What qualifies as a “Startup” for the purpose of StartupJK scheme?

      Startup means an entity, incorporated or registered in India:

      • Upto a period of seven years from the date of incorporation/registration or upto ten years in case of Startups in Biotechnology sector
      • As a private limited company or registered as a partnership firm or a limited liability partnership
      • With an annual turnover not exceeding Rs. 25 crore for any of the financial years since incorporation/registration
      • Working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation

      Provided that an entity formed by splitting up or reconstruction of an existing business shall not be considered a ‘Startup’.

      An entity shall cease to be a Startup:

      • On completion of seven years from the date of its incorporation/registration, ten years in case of Startups in Biotechnology sector, or
      • If its turnover for any previous year exceeds Rs. 25 crore

    • How does a Startup obtain benefits under various Government schemes including the ones announced in the Action Plan on January 16, 2016?
    • For how long would recognition as a “Startup” be valid?

      An entity would cease to be a 'startup' upon expiry of:

      • Up to 7 years from the date of its incorporation/ registration; however, in the case of Startups in the biotechnology sector, the period shall be up to 10 years from the date of its Incorporation/ registration; OR
      • If its turnover for any of the financial years has exceeded INR 25 crore

      Startups would be required to intimate DIPP of any such cases within a period of 21 days.


    • Can an existing entity register itself as a “Startup” on the StartupJK Portal and Mobile App?

      Yes, an existing entity that meets the criteria as indicated in response to Question 1 can visit the StartupJK Portal and Mobile App and get itself recognized for various benefits


    • What is the timeframe for obtaining certificate of recognition as a “Startup” in case an entity already exists?

      The process of registration in such cases shall be real time and the certificate of recognition would be issued typically within 2 working days upon successful submission of the application.

  • For Patents
    • What is the procedure to claim reimbursement by patent facilitators to services offered to startups?

      After a patent application is received by the Patent Office, the facilitator shall submit the claim for fees as per the fee schedule given in SIPP Scheme. A letter addressed to the Head of Office of the respective Patent Office, giving details of claimed fee for drafting of application and his ID proof as a registered Patent Agent, shall be submitted along with the invoice.

    • What is the procedure to claim reimbursement by Trademark facilitators to services offered to startups?

      The facilitator shall submit the claim for payment of fees to the respective Head of Office of the Trade Marks Registry. A letter addressed to the Head of Office of the respective Trade Mark Office, giving details of claimed fee for drafting of application and his ID proof as a registered Trade Mark Agent, shall be submitted along with the invoice.

  • More FAQs
    • What factors are considered by the Investors to invest in startups?

      Different investors use different criteria to judge an investment. The importance of these factors would wary depending on the stage of investment, sector of startup, management team etc. Listed below are typical investment criteria used by investors:

      1. Market Landscape: Refers to the addressable market which the startup is catering to.

      Factors: Market size, obtainable market-share, adoption rate, historical and forecasted growth rates, macroeconomic drivers, demand supply

      2. Scalability and Sustainability: Startups should showcase the potential upscale in the near future, a sustainable and stable business plan.

      Factors: Barriers to entry, imitation costs, growth rate, expansion plans

      3. Objective and Problem Solving: The offering of the startup should be differentiated to solve a unique customer problem or to meet customer need. Ideas or products that are patented showcase deemed potential in the startups.

      4. Customers & Suppliers: Laying out your customers and suppliers, helps investors understand your business better.

      Factors: Customer relationships, stickiness to the product, vendor terms, existing vendors

      5. Competitive Analysis: A true picture of competition and other players in the market working on similar things should be highlighted. There can never be an apple to apple comparison, but highlighting the service or product offerings of similar players in the industry is important

      Factors: Number of players in the market, market share, obtainable share in the near future, product mapping to highlight similarities or differences between competitor offerings

      6. Sales and Marketing: No matter how good your product or service maybe, but if does not find any end use, there is no good.

      Factors: Sales forecast, targeted audiences, marketing plan for the target, conversion and retention ratio etc. 

      7. Financial Assessment: A detailed business model that showcases the cash inflows over the years, investments required, key milestones, break-even point and growth rates should be made out well. Assumptions used at this stage should also be reasonable and clearly mentioned.
      See sample valuation template here (to be sourced under templates section)

    • How do Investors earn returns from investing in Startups?

      Investors realize their return on investment from startups through various means of exit. Ideally, the VC firm and the entrepreneur should discuss the various exit options at the beginning of investment negotiations. A well performing, high-growth startup that also has excellent management and organisational processes is more likely of being exit-ready earlier than other startups.

      Venture Capital and Private Equity funds must exit all their investments before the end of the fund’s life. The common exit methods are:

      1. Mergers and Acquisitions: The investor may decide to sell the portfolio company to another company in the market. For ex: The $140mn acquisition of RedBus by South African Internet and media giant Naspers and integrating it with its India arm Ibibo group, presented an exit option for its investors, Seedfund, Inventus Capital Partners and Helion Venture Partners.

      2. IPO: Initial Public Offering is the first time that the stock of a private company is offered to the public. Issued by private companies seeking capital to expand, it is one of the preferred options for investors looking to exit a startup organisation.

      3. Exit to Financial Investors: Investors may sell their investment to other venture capital or private equity firms

      4. Distressed Sale: Under financially stressed times for a startup company, the investors may decide to sell the business to another company or a financial institution

      5. Buybacks: Founders of the startup may also buyback their investment from the fund.


    • What is a Term Sheet?

      A term sheet is a “Non-binding” list of propositions by a venture capital firm at the beginning stages of a deal. It summarizes the major points of engagements in the deal between the investment firm and the startup.

      A term sheet for a venture capital transaction in India typically includes four structural provisions: valuation, investment and management structures, and changes to share capital.

      1. Valuation: Startup valuations is the total worth of the company as estimated by a professional valuer. There are various means of valuing a startup company, like Cost to Duplicate approach, Market Multiple approach, Discounted cash flow (DCF) analysis and Valuation-by-Stage approach. Investors choose the relevant approach based on the stage of the investment and market maturity of the startup.

      2. Investment Structure: It defines the mode of the venture capital investment in the startup, whether it is through equity, debt or a combination of both.

      3.   Management Structure: The term sheet details out the management structure of the company, including the composition of the board of directors, and prescribed appointment and removal procedures.

      4. Changes to share capital: All investors in startups have their own investment timelines, and they accordingly seek flexibility in seeking exit options through subsequent rounds of funding. The term sheet addresses the stakeholders’ rights and obligations in respect to subsequent changes in the company’s share capital.