A Policy Direction From Review of Literature for Determinants and Problems of the Start-Up Ecosystem in India

Introduction

The start-up is a young innovative business that uses a novel combination of various inputs to create new products. It is essential to meet the social, economic and technological needs of consumers and producers. New firm or start-up helps to create innovative products, market and technology driven activities. Technology driven activities provides the incentive for new entrepreneurs to start a new business that solve social-economic problems of the people (Kritikos, ‎2014). Entrepreneur is the active player in the business sector and starts new business in the technical and non-technical fields. Innovative entrepreneurs help to make a country globally competitive through creating more jobs, products, markets, advance skills, technologies and innovation (Kritikos, ‎2014). Formation of new firms and start-ups also help to reduce high unemployment rate and increase contribution of people in economic growth and development (Almus et al., 2004; Deena & Gupta, 2021). The start-up ecosystem is essential to increase employment in multiple dimensions (Kim et al., 2018). It beneficial to increase national income and reduce poverty (Pai & Kumar, 2020). The start-up activities revolve rapid innovation, job creation, developing new skills and marketing (Xiang & Huang, 2019). Intellectual capital, risk and collaboration among the stakeholders prepare a foundation for new start-up (Xiang & Huang, 2019). Thus, start-ups are working as a key driver and engine for social and economic development.

The start-up ecosystem includes incubators, accelerators, investors, services providers, government, academician, research organizations and companies (Korreck, 2019). Hence, collaboration among the mentioned stakeholders is beneficial to increase technological advancement and innovation. Thereupon, technological advancement and innovation play an important role to make a person as an entrepreneur (Sopjani, 2019). The start-up culture of an individual is influenced by their education or experience, family background, entrepreneurial skills, entrepreneurial culture and venture capital, financial availability and marketing strategies (Arafat & Rehman, 2012; Ghosh & Bhowmick, 2014). Also, start-up ecosystem assists to cultivate new firms. Technology-driven prospects, innovative business processes and scalable business models have a crucial contribution to increase start-up ecosystem (Kuratko, 2004). An entrepreneur faces several difficulties like resources constraints due to lack of new technologies, finance, advance skills, knowledge, innovation, marketing and appropriate business model to start a new venture (Sopjani, 2019; Singh & Jyoti, 2023b). Hence, technological skills, availability of finance and appropriate marketing enhance start-up ecosystem.

The research institutions cultivate and promote innovation, and develop and discover technologies that promote start-up ecosystem. The success of individual person in entrepreneurial career primarily depends on their capability, talent, education and business skills (Djankov et al., 2007). The start-up ecosystem is a function of environment of business, risk-taking behaviour of individual, innovative idea and technology, and active participation of financial institutions in business activities. The start-up can be defined as a new firm that is in the 1^st stage of new business. It can be defined as producing and selling of innovative goods and services, and testing innovative business model (Ressin, 2022). Accordingly, most scholars provided definition of start-up ecosystem as per their own perspectives. Despite that, most international organizations argued that start-up ecosystem plays a crucial role to increase jobs, innovative goods and services, and competition (Jyoti & Singh, 2020).