Should startups funnel their funding and investments into their existing bank accounts, or is it wiser to open a separate one? What are the other mistakes that startups make in India? Sharath Shyamasunder, Founder and CEO of The Startup Zone, with extensive experience working with over 5000 startups, discusses these issues with EFY’s Mukul Yudhveer Singh.
Founder and CEO, The Startup Zone
Q. What are the most common mistakes startups make in India?
A. Most startups ignore legal compliance. Many founders, while being highly skilled at tech and products, ignore legal and financial compliance. This usually happens because they are extremely busy with the products and do not keep track of the due dates and compliances involved in the legal processes. Besides the ones that are to be filed with Registrar of Companies (RoC), there are a bunch of forms that startups usually miss.
Q. What does this mean for them?
A. They end up paying a lot of penalties. This often happens in the pre-revenue stages of a startup. In the long run, it also affects their ability to raise funds. Another prevalent problem in the startup industry is attempting to comply with legal and financial laws without having a professional on their team or a reliable compliance partner. This results in these startups spending much time and money on incorrect filings.
Q. Can you give an example of such a mistake?
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