The Loss Economy of Start-ups

The Loss Economy

 

There is a decline in the creation of new businesses and startups. Established businesses have always held the edge and the larger those businesses become, the fewer are the startups that sprout. It’s harder for small businesses to compete with big ones, to offer competitive prices, and still stay in business. One of the reasons for the loss economy of start-ups is the corporations doing entrepreneurship. Some of the companies have departments devoted entirely to entrepreneurship. Others provide their employees with time to devote to new ideas and it is observed that capitalists are putting less money into startups and more money into entrepreneurial activities of big companies. Another reason for the decline of start-ups is the decreasing desire of college graduates to get out on their own. As the cost of education has risen in the last few decades, the amount of debt for graduates has risen as well and recent graduates are far less likely to go for the startups if they have debt. Economists also suggest that the market is not truly competitive as the existing companies have found ways to block competitors. For e.g.You Tube, Instagram chose to sell out to Google and Facebook. Startups and small businesses have always boosted the economy with revolutionary technology and created new industries and they are a source of money-making for the owners as well as for the employees. The government must help startups promote themselves, not just in India but across the globe, as well as create policies that are startup-friendly so the startups get a major boost and they further create better employment opportunities for the youth of the nation. The government should enable the easy availability of loans across the country. Startups can have more tax-friendly norms to sustain the pressure which sometimes adds to their cost.

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