In the last decade, Nepal has experienced an exponential rise in entrepreneurs and start-up businesses. Years ago, very few students in college wanted to become entrepreneurs, and today there are very few that don’t. Universities are now striving to develop this culture and coming up with business incubators. The young and growing population is also working towards the start-up revolution. The energetic youths are bringing innovative ideas and solutions. Recently there has been a noticeable growth of networking and mentorship events as well as alternative financing.
Due to lack of job security, political instability, limited financial access, and corruption, the start-up culture in Nepal has struggled to take off. The proliferation and exposure to the internet along with international private equity firms have played a pivotal role in making the start-up revolution happen. As start-ups cannot rely upon financial support from their government, private investors and sponsors are becoming more popular ways of funding new business ventures.
Start-ups are essential to sustainable economic development in Nepal. They exploit the opportunities and solve the problems in society. They create job opportunities that are massively important post-lockdown when unemployment rates are at their highest. Nepal also provides a unique advantage for new business ventures as there is such little competition. Unfortunately, it is believed that 90% of start-ups fail in Nepal, therefore highlighting the importance of support programs and platforms.
There are numerous platforms that have been created to support start-ups in Nepal. There are organized meetups that are designed to bring the young entrepreneurs together, along with; business houses, policymakers, investors, funding, and diplomatic agencies. This meetup is coordinated by the Nepal Entrepreneurs Society who is trying to encourage networking opportunities for job creators by providing a platform to share their experience of starting up and the problems they faced.
As well as meetups and networking events, there are specially designed programs for supporting start-ups. Nepal Realistic Solutions (NRS), a well-established business consultancy, offers one of the newest programs with big opportunities for start-ups in Nepal, based in Kathmandu but targeting all start-ups nationwide. Allowing start-ups, the opportunity to connect with sponsors and investors as well as providing meaningful analysis to assess their position in the market. They are there to help identify barriers and discuss solutions with the start-ups, offer marketing assistance, financial advice, training, and much more. The program also offers start-ups a space in their business magazine to tell the story of their company and market their products and services. There are also prizes for the chosen candidates, these prizes include; ISO 9001 certificates, free digital marketing services, and free use of the recruitment facilities.
NRS is one of few Nepalese companies aiding the growth of the start-up ecosystem. Other companies are also providing multiple programs and services for start-ups to take advantage, of these programs. They offer technical support, assistance with business plans, incubation, coaching and mentorship, fund matching, and events and seminars to help motivate and teach new start-ups.
There is a running theme throughout these programs, all are working for the same end goal. To help grow and improve start-up businesses within Nepal. There may be preferred programs, depending upon your start-up, although most of the programs have experts in all areas of business and could help one way or another. The start-up ecosystem is ready to take off and these programs are all supporting, why? According to the Minister of State for Finance Udaya Shamsher Rana, ‘developing entrepreneurship is imperative to the economic development of the nation.’
The Nepali government has also started to understand the importance of startups and when revealing their budget for 2021, have made provisions for them. A challenge fund of Rs. 1 billion will be created to provide seed capital of Rs 2.5 million to startups under project financing in order to attract entrepreneurs towards a startup business. Unfortunately, in the past, the government has announced budgets designed to help startups, yet there was no deployment.
The government has also promised to simplify policy to entice Foreign Direct Investment (FDI) into startups in Nepal. However, there is still a lack of coordination between different government entities and no defined timeline. Other benefits mentioned were;
-Startups will receive a 100% income tax waiver for five years from the date of start transaction
- A private sector industrial enterprise can provide seed capital of up to Rs.100,000 to a maximum of five startups and deduct it from its taxable income
The government’s budget is attempting to create a positive message to the startup sector, however with their track record, it is important that government departments and officials are held accountable for the timeline in their duties. If promises are followed through then a trusting relationship may be built between them and startups.
In the meantime, companies such as NRS who are already realizing how important startups are and are providing support programs for startups are an excellent place for young entrepreneurs to go for help. To register for the Support Startup Program, click on this link: https://forms.gle/aCqbMQ16AqSVSJAV9 and fill out the information requested. The NRS teams shall be in contact promptly for further processing.