It is a known fact that India is the worlds biggest sourcing destination when it comes to the Information Technology sector. The IT industry has put India on the global map and moreover, largely driven economic growth. Software is one of the major divisions of this trade which is growing by leaps and bounds. Young techies in India have established software firms which are highly successful.
If you have a brilliant software product or service in mind but dont know how to go about establishing your company, then all you have to do is read this article. We assure you that at the end, you will be well-equipped with all the information required to start a software business in India. Listed below are the steps:
Software Product or Service, Decide your Focus:
If you launch a product on a large scale and then begin to realize the various flaws in it, you would be heading for complete disaster. The software sector has tremendous potential for growth provided you understand what the consumers want and that can only be achieved with comprehensive research. When we talk of software, there are 2 areas namely, products and services.
Software products can be described as a series of applications developed for specific tasks. These products can be aimed at individuals, businesses or even a market portion. For example, one can create a set of programs which helps users to manage their diet by inserting their daily meals, find out which foods are healthy etc.
Alternatively, software services entail promoting or maintaining products which are built by your firm or others. Moreover, you can specially design software for a particular business and help them set it up and handle their upkeep. The best way to find out whether your product or service is viable is to carry out an exhaustive market survey. You must also find out competitors who are dealing in the same area as you plan to and study their offerings.
Design a Business Plan:
The primary step is to think of an innovative product/service that will fill a gap in the market. Once you are confident about the business you wish to launch, the next stage is to construct a strong business layout. This plan will contain every little detail about your software start-up which includes:
- Aim of the business
- Product/Service information
- Target audience
- Current scenario of the niche market
- Financial plans
- Branding practice
- Various licenses and taxes involved
- Product competition
- Technological know-how to be employed in developing the software
Make sure that you provide all the information while making the business plan. We would recommend creating versions; one that is comprehensive which can be referred by the owners/partners and second which is customized that can be utilised to generate funds. The business outline should be adaptable as you might have to make some modifications during the start-up.
Arranging for finances:
Not just software, no business can begin without the required funds. It is only with money that you can start developing your product/service, pay for various expenses such as staff salaries, advertising etc. You can build capital in the following ways:
- Charity begins at home. Invest a part of your savings into your brainchild. It is indeed risky but if you are not confident about spending for your start-up, dont expect others to capitalize on it. Discuss your idea with friends, relatives and see if they are interested in being a part of your venture.
- Explore the possibility of taking a loan for your business. There are several banks who can grant loans based on your financial security and project viability. However, before you decide on the loan amount, keep in mind the interest to be paid.
- Look up some of the best angel investors in your city. These are high net worth individuals who have the capacity to finance anything between INR 10,00,000 to 1 crore if they feel your idea is unique and profit-yielding. Mumbai Angels for example, is an association of investors which was initiated in 2006 and boasts of funding some start-ups which have turned into multi-million entities.
Getting in touch with angel investors is not a simple task. You need to display great networking skills by interacting with other entrepreneurs to find out how they went about raising capital and ask them to introduce you to some angels. Another useful tip is to attend venture capital events where you can directly speak to some financiers and pitch your idea.
Once your funds are in place, the next and the most important step is to complete registrations and necessary legalities.
We will throw light on this vital aspect in the second part of the blog. Click here –> Part 2