BUSINESS FUNDAMENTALS
FOR ENTREPRENEURS
Prof. Devdip Purkayastha
Indian Institute of Technology Bombay
Desai Sethi School of Entrepreneurship
https://www.iitb.ac.in
1
MODULE 21
STARTING UP A NEW TECHNOLOGY
VENTURE
WEEK 11, MODULE 21
STARTING UP A NEW
TECHNOLOGY VENTURE
PART 1
WEEKS 9 - 12
BUSINESS RISK BUSINESS INFORMATION
17 18
& MANAGEMENT & MANAGEMENT
BUSINESS TYPES SOCIAL BUSINESS
19 20
& MODELS DEVELOPMENT
STARTING UP A NEW STARTING UP A NEW
21 22
TECHNOLOGY VENTURE SOCIAL VENTURE
CREATION
BUSINESS CASE COURSE RECAP
23 24
DISCUSSION & WRAP UP
Module-21 Topics
What is a Startup?
MSME vs Startups
Types of Startups
Market Discovery
Startup Methodologies
Startup Business Model
What is a Startup?
A startup is an early stage, innovative
company designed to develop and validate a
scalable business model in response to a
market need.
Startups are typically technology-driven,
aiming to solve a unique problem or meet an
unmet demand using a novel technology.
They operate in conditions of high
uncertainty, often exploring new markets or
creating disruptive solutions, which sets
them apart from traditional small businesses.
Startups usually prioritize rapid growth,
aiming to achieve significant market impact
or scalability.
Startup Characteristics
Innovation: Focus on novel products,
services, or approaches to existing
problems that ‘disrupt’ existing
businesses.
Scalability: Potential to grow exponentially
without a proportional increase in costs.
Risk and Uncertainty: Operate with high
levels of risk, as they often explore
unproven markets.
Lean Structure: Quick-&-Fast approach,
frequently using methodologies like Lean
Startup and Agile Development
Funding and Investment-Driven: Often
funded by venture capital, angel investors,
or seed funding, with milestones to attract
further investment.
Types of Small Business
MSME
STARTUPS – MARKET PULL
STARTUPS – TECH PUSH
MSME Enterprises
https://www.msme.gov.in/know-about-msme
MSME Definition
https://www.msme.gov.in/know-about-msme
Ministry Report
https://www.msme.gov.in/know-about-msme
No. Of MSMEs
https://www.msme.gov.in/know-about-msme
THREE MINUTE
REFLECTION
Think of a 3-4 MSME in your
neighborhood?
▪ What businesses are they in?
▪ What are their estimated
turnover and investments?
WEEK 11, MODULE 21
STARTING UP A NEW
TECHNOLOGY VENTURE
(Continued Part 2)
Startup Definition
https://www.startupindia.gov.in/content/sih/en/startup-scheme.html
India Legal Definition
https://www.startupindia.gov.in/content/sih/en/startup-scheme.html
India Startup Landscape
https://www.startupindia.gov.in/content/sih/en/startup-scheme.html
Tech Startup vs MSME
TECH STARTUP MSME
Steady, incremental
High, exponential
growth focused on
growth focused on
stability and
Growth Orientation scaling quickly and
profitability within
capturing large
local/regional
market share
markets
Centers on
Operates with
innovation, often
traditional business
Innovation & creating new
models, offering
Business Model products, services,
established products
or business models
or services
to disrupt industries
High-risk,
Lower risk, more
high-reward due to
conservative
Risk & Uncertainty new markets and
approach in stable,
technologies, with
established markets
frequent pivots
Tech Startup vs MSME
TECH STARTUP MSME
Venture capital,
Primarily funded
angel investment,
through personal
Funding & Capital and seed funding;
savings, bank loans,
Structure aims for rapid growth
or government
and possible exit
subsidies
strategies
Designed for rapid Focused on local or
scalability with regional markets with
Scalability & Market
potential for global limited scalability due
Reach
reach, often through to operational
digital platforms constraints
Operates under
Operates flexibly in regulatory
Regulatory & early stages but may frameworks with
Operational face strict benefits like tax
Framework compliance as it incentives and
grows simplified
compliance
Market Pull Venture
Origin of Innovation & New
Market & Customer problems
Ventures
Problem-Solution-Market
High
Focus
Lower market risk,
Risk Factors
Higher technical risk
Driven by Market, Customer,
Product Development
Competitor
Emphasizes problem-solving
Marketing Strategy
and user benefits
Funding Phased, Milestone based
Consumer goods,
Examples Service Industries &
Aggregators
Technology Push Venture
Origin of Innovation & New
Technological advancements
Ventures
Initially low
Problem-Solution-Market
(Technology-centric
Focus
roadmap)
Higher market risk,
Risk Factors Potentially lower technical
risk
Driven by technology
Product Development
capabilities & adaptation
Emphasizes technology
Marketing Strategy
features and innovation
Funding Upfront R&D, Long gestation
GenAI, Space, Defense,
Examples
Genetics, Pharma Molecules
Gartner Hype Cycle 2024
https://www.gartner.com/en/newsroom/press-releases/2024-08-21-gartner-2024-hype-cycl
e-for-emerging-technologies-highlights-developer-productivity-total-experience-ai-and-securi
ty
Product Disruptions
Startup/ Product Category
Description of Disruption
Product Disrupted
Shifted music consumption from
CDs and MP3 players to a
Music players
Apple iPod portable digital music library,
(CDs, MP3 players)
making personal music more
accessible.
Combined phone, music player,
Mobile phones, camera, and internet into one
Apple iPhone
Digital cameras device, setting a new standard for
smartphones.
Revolutionized reading by making
Kindle e-books widely accessible,
Physical books
(Amazon) impacting physical book sales
and distribution channels.
Created a new category of
compact, durable cameras for
GoPro Action cameras
extreme sports, disrupting
traditional
Before the iPod, the Walkman
Sony Portable music players
disrupted the music industry by
Walkman (cassette tapes)
enabling portable listening,
Service Disruptions
Service
Startup Category Description of Disruption
Disrupted
Transformed traditional retail by offering a
Amazon vast selection of goods online with
Retail shopping
eCommerce convenient shipping, impacting physical
stores globally.
Taxi and Revolutionized ride-hailing by allowing
Uber transportation users to book rides via app, disrupting
services traditional taxi industries worldwide.
Created a shared lodging marketplace,
Hospitality and
Airbnb providing an alternative to hotels and
accommodation
enabling people to monetize their homes.
Secure Online Built a a secure online payment platform
UPI
Payment that can replace Credit / Debit Cards and
(BHIM)
Platform Cash payment
Enabled direct hotel booking through an
Hotel booking
Booking.com online platform, changing how consumers
and travel
(Aggregator) book accommodations and impacting
agencies
traditional travel agencies.
Deep Tech Startups
Startup Field/Technology Description of Innovation
Pioneered mRNA technology to
rapidly develop vaccines, including
Biotechnology &
Moderna the COVID-19 vaccine, transforming
mRNA technology
vaccine development speed and
adaptability.
Advanced space exploration with
Space travel & reusable rockets, reducing launch
SpaceX
rocket engineering costs and enabling more frequent,
affordable space missions.
Developed ChatGPT, a
Artificial Intelligence state-of-the-art language model,
OpenAI
& natural language bringing AI-powered conversational
(ChatGPT)
processing tools to businesses and individuals
worldwide.
Provided a user-friendly platform for
Cryptocurrency &
buying, selling, and managing
Coinbase blockchain
cryptocurrencies, making blockchain
technology
technology accessible to the masses.
Focuses on commercial quantum
computers, offering quantum
Rigetti
Quantum computing computing as a service to industries
Computing
like finance, healthcare, and materials
science.
THREE MINUTE
REFLECTION
Think of a 2-3 Technology
Startups that you use?
▪ What products and services
do they offer?
▪ When did they start?
▪ What is different from
traditional businesses?
WEEK 11, MODULE 21
STARTING UP A NEW
TECHNOLOGY VENTURE
(Continued Part 3)
Market & Problem Discovery
HACKATHONS
PERSONAL EXPERIENCE
COMMUNITY INTERACTIONS
SMART INDIA HACKATHON
SMART INDIA HACKATHON
SMART INDIA HACKATHON
NATIONAL MISSION
FINTECH HACKATHON
BANK OF BARODA HACKATHON
SELF REALISATION
SOCIAL PROBLEMS
THREE MINUTE
REFLECTION
Visit the Smart India hackathon
website?
▪ Identify 1-2 problems you are
also facing?
▪ What are few ideas that can
be used to solve these
problems?
Startup Methodology
LEAN STARTUP
AGILE DEVELOPMENT
DESIGN THINKING
Traditional Product Development
Design Thinking
Design Thinking
Lean Startup
Lean Startup
Agile Development
Business Model Canvas
Business Model Canvas
THREE MINUTE
REFLECTION
Think of a Product / Software that
you use?
▪ How do you think the Product
was developed?
▪ Are the features and benefits
relevant and useful?
End of Module
Indian Institute of Technology
Bombay
IIT Bombay, Powai, Mumbai 400 076, Maharashtra, India
Phone: +91 (22) 2572 2545 | Fax: +91 (22) 2572 3480
https://www.iitb.ac.in/alumni
