Sonia S Dhemare (60) Final

PROJECT REPORT
ON
A STUDY ON SOURCES OF FINANCE FOR STARTUP
BACHELOR OF MANAGEMENT STUDIES
SEMESTER – VI
(2018-2019)
SUBMITTED
IN PARTIAL FULFILLMENT OF REQUIREMENT FOR THE
AWARD OF DEGREE OF
BY
SONIA SAMPATRAO DHEMARE
ROLL NO. -60
B. K. BIRLA COLLEGE OF ARTS, SCIENCE & COMMERCE

(AUTONOMOUS)
MURBAD ROAD KALYAN (W)
1
B. K. BIRLA COLLEGE OF ARTS, SCIENCE, & COMMERCE
(AUTONOMOUS) KALYAN
(Conducted by Kalyan Citizens’ Education Society)

(Affiliated by University of Mumbai)
CERTIFICATE
This is to certify that SONIA SAMPATRAO DHEMARE OF T.Y

Bachelor of Management Semester VI (2018-2019) has successfully
completed the project on “A STUDY ON SOURCES OF FINANCE
FOR STARTUP” under the guidance of DR.(MRS)CHANDRA
HARIHARAN IYER
PROJECT SUPERVISOR:
COURSE CO-ORDINATOR:
INTERNAL EXAMINER
EXTERNAL EXAMINER
PRINCIPAL
2
DECLARATION
I, SONIA SAMPATRAO DHEMARE student of T.Y BACHELOR OF

MANAGEMENT STUDIES semester VI (2018-2019) hereby declare that I have
completed the project on “A STUDY ON SOURCES OF FINANCE FOR STARTUP”
I further declare that the information imparted is true and fair to the best of my
knowledge.
SIGNATURE
Name: Sonia Sampatrao Dhemare
ROLL NO.:60
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ACKNOWLEDGEMENT
I hereby express my heartiest thanks to all sources who have contributed to
the making of this project. I oblige thanks to all who supported, provided
their valuable guidance and helped for the accomplishment of this project.
I am thankful to Mumbai University for giving me such a challenging task
to explore the urbanization which includes not only thinking and analyzing
various facts and updates about real work, our principal Dr. (Mr.)
AVINASH PATIL and the course coordinator Mr. Anil Tiwari Sir for
having such a wonderful course.
I am very much grateful to my project guide Dr.(Mrs) Chandra Hariharan
Iyer who in spite of busy schedule spent valuable time to guide me and
helped in completion of this project.
I also extent my hearty thanks to all my family, friends and all the
well-wisher.
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Index
No. Content Page No.

1. Chapter I –Introduction 1
1
1.2 Definition:
1.3 Objective of the study:
1.4 Selection of problem :
1.5 Background of the study :
1.6 Stages of the startup lifecycle :
1.7 Advantages of startup :
1.8 Disadvantages of startup:
1.9 Challenges faced by startup:
1.10 Sources of finance:
1.11 Initiatives taken by the government:

2. Chapter –II Research Methodology 20
20
2.1 Research design :
2.2 Sample Design: 20
2.2.1 Target population:

20
2.2.2 Sampling frame:
2.2.3 Period of study: 20
2.2.4 Sample size: 20

2.3 Method of Data Collection:
22
2.4 Structure of Questionnaire:-
2.5 Statistical Tools used for the study:- 23
2.6 Analytical tools used for the study:-
5
24
3. Chapter –III Review Of Literature 25
REVIEW OF LITERATURE
4. Chapter IV –Data Analysis & Interpretation 32
and Presentation
5. Chapter V – conclusion & Suggestions 80
Biblography 81
Appendices
82
1 Questionnaire
List of Tables:
6
7
1 INTRODUCTION
1.1 Meaning:
A start up is a new company that is just beginning to develop. Start up are usually small
and initially financed and operated by a handful of founders or one individual. These
companies offer a product or service that is not currently being offered elsewhere in the
market or that the founders believe is being offered in an inferior manner.
Start ups have played and continue to play significant roles in the growth, development
and industrialization of many economics all over the world. Start up is flagship
initiative of the Government of India, intended to build a strong eco-system for
nurturing innovation. Startup will drive sustainable economic growth and generate large
scale employment opportunities and minimize unemployment.
1.2 Definition:
Paul Graham says that "A startup is a company designed to grow fast. Being newly
founded does not in itself make a company a startup. Nor is it necessary for a startup to
work on technology, or take venture funding, or have some sort of "exit". The only
essential thing is growth. Everything else we associate with startups follows from
growth. A startup business is defined as an organization:
• Incorporated for three years or less
• At a funding stage of Series B or less
• An entrepreneurial venture/a partnership or a temporary business organization
• New and existence for not more than five years
• Revenue of up to INR 25 cr.
• Not formed through splitting or restructuring.
Department of Industrial Policy and Promotion (DIPP) define a startup as an entity

incorporated or registered in India with following parameters:
• Established not prior to seven years, (for Biotechnology Startups not prior to ten
years)
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• With annual turnover not exceeding INR 25Cr in any preceding financial year,
and
• Working towards innovation, development or improvement of products or
processes or services,
• It is a scalable business model with a high potential of employment generation
or wealth creation.
1.3 Objective of the study:

A business can raise funds from various sources. Each of the source has unique-
characteristics, which must be properly understood so that the best available source of
raising funds can be identified. There is not a single best source of funds for all
organisations. Depending on the situation, purpose, cost and associated risk, a choice
may be made about the source to be used. For example, if a business wants to raise
funds for meeting fixed capital requirements, long term funds may be required which
can be raised in the form of owned funds or borrowed funds. Similarly, if the purpose is
to meet the day-to-day requirements of business, the short term sources may be tapped.
1. To study the sources of finance for startup.
2. To understand the stages in startup.
3. To study the initiatives taken by Government for startup companies.
4. To know the various sources of finance.
1.4 Selection of problem

There are a lot of things a business needs to consider before selecting the best sources
of finance to use.
Financing is needed to start a business and ramp it up to profitability. there are several
sources to consider when looking for start-up financing. But first you need to consider
how much money you need and when you will need it. The financial needs of a
business will vary according to the type and size of the business.
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1.5 Background of the study
To start a business, some form of investment is usually required at the outset. This
investment may be provided by self, friends and relatives, financial institutions as a
resort to borrow the money. To run a business, start up or growth company, it is crucial
and challenging for entrepreneur to find the appropriate financial sources. The changing
face of financial market in current economy, such as commonly used stocks and bonds
have become vital source of finance for companies. Financial institutions have
expanded not only in size but also across borders and in the kind of business they do has
resulted huge capital flow. With the increase in options, volatility [ CITATION
Rob14 \l 1033 ]of market and risk for investors have also highly increased. Often
entrepreneur rational decision in recognizing the current stage of their business and
using the appropriate mix of capital to fund their business in its initial phase can be
crucial for company existence, success, and growth. Degree of development of
domestic financial market has a major impact on business growth and expansion and for
most of the startups it becomes key to survive and grow. Despite having great business
idea and innovation, they required various resources to enter the market. So, when it
comes about accumulation of financial resource it become key to start the
entrepreneurial journey.
Financial institutions facilitate the transfer of funds from surplus units to fund deficit
units and provide benefits for both the saving units and deficit units in the societies. In
general terms, financial sources can be a person, group or institution that provide
monetary solution. However, accessibility of financial sources form financial
institutions is directly linked with economic development. Hinson (2010) states that
approximately 90% of people living in developing nation do not have access to
financial services. The way money is raised by small to big companies have changed
virtually beyond recognition within last three decades; thirty years ago, banks were still
the main source of finance however today the banks plays the second fiddle to the
equity and bond market. Within the last decade, the diversity of financial institution has
increased in terms of geography of operation and functionality where the mobility of
fund for the business through bank has diminished. The availability of numbers of
financial sources depend upon the development of financial system in that region or
country.
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1.6 Stages of the startup lifecycle
PRE STARTUP Discovery-
Identify a potential scalable product/service idea for a big enough target market.
Validation- The service or product discovered hits the market, looking for the first
clients ready to pay for it.
STARTUP Efficiency-
The entrepreneur begins to define his/her business model and looks for ways to increase
customer base constantly. Scale- Pushing the growth of the business aggressively while
increasing its capacity to grow in every possible sustainable manner.
GROWTH Maintenance-
Maximizing benefits and facing problems derived from the global dimension in terms
of competition that the business has achieved Sale or Renewal - The decision to sell the
startup to a giant or acquire huge resources that the brand will need to continue growing
as a venture.
1.7 Advantages of startup

1.7.1 Agility
Startup are smaller and less structured. They are also innovative and keep improving
their business models, processes, and portfolio. These allow them to adapt to disruptive
technologies and changes in market conditions. Established competitors face vested
interests, a historic path, and a strong team culture. This makes them resistant to
change.
1.7.2 Efficiency (Lean and Mean)

Established companies have high administrative overheads. They offer their services in
a more efficient, cost-effective and competitive manner. They are likely to be aware of
their limitations and tend to focus on their core strengths. This causes them to partner
with other small organizations. Customers often benefit with a superior value
proposition.
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1.7.3 Team Culture
Employees of large corporations get attracted by prestige and big salaries. They easily
lose sight of the company’s vision, mission and values and the success of its customers.
The employees form a close-knit community that shares passion, beliefs, and values.
They must work together for the good of the company, its customers and the world at
large.
1.7.4 Personalization
They deliver their products and services with a personal touch. This creates a uniquely
personal experience for their customers. They also take time to study and understand
their customers’ business requirements. This allows them to build lasting relationships
with specific offerings and responsive solutions.
1.7.5 Versatility
Startups helps employees multitask and the salesperson could double up as the
relationship manager. This adds continuity to customer relationships and enables
startups to respond to emergencies. Most startups support learning and have a higher
tolerance for mistakes. Both factors enhance the versatility of startup employees.
1.7.6 Flexibility
Your organization could have rather unique needs and demands for products and
services. These might not be met by established service providers operating in a rigid
manner. Startups are very flexible and are more likely to work at the hours, the place
and in the manner that suits you.
1.7.7 Fun
Last but now least, working with a startup could be a lot more fun. A startup doesn’t
have to please everyone and may decide to select clients that are fun to work with.
Spontaneous fun activities after work are a lot easier to organize in a startup. Your
colleagues could become your best friend.
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1.8 Disadvantages of startup
1.8.1 Risk
Most startups fail within their first year of operations, so the risk of failure is high.
Working under such high risk can blur a startups strategic vision. So they either fail to
seize market opportunities or overestimate their sales projections. High risk also hinders
a startups ability to attract experienced and competent staff.
1.8.2 Compensation
It takes blood, sweat, and tears to build a company, and long working hours are the
norm for startups. The rewards might be low since it takes time to generate revenue and
make profits. Some startups give up since it’s demotivating to work without proper
compensation.
1.8.3 Market Access

Many customers prefer a business that they have worked with over a new startup.
Besides it is more expensive to acquire new customers than to retain old ones. Without
a customer base, understanding market needs also becomes a real struggle. All these
factors combined increase the cost of business development for startups.
1.8.4 Team Composition

Some startups are born out of desperation since the founder could not find or hold on to
a job. Such founders often struggle to build a team that the business needs to succeed. A
successful startup requires founders/co-directors with complementary personalities and
competencies. Even then disagreements can creep in when the going gets tough.
1.8.5 Resources
Growth hacking, cloud computing, and venture capitalism allow startups to gain market
entry. Most startups operate on a shoestring budget, against competitors that are well-
resourced. It gives the competitors an edge in product development, sales, and
marketing. They use that edge to push startups out of the market when they become a
threat.
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1.8.6 Processes
Startups are flat organizations that lack defined business processes and operational
procedures. This exposes them to poor customer service, legal liability, and financial
losses. Startups might thus opt to outsource non-core business processes to external
service providers. But the high associated costs could form a barrier.
1.8.7 Stress
We did mention that working for a startup is fun, but it could also become very
stressful. Low compensation, many responsibilities and long working hours are more or
less expected. Add legal prosecution, imminent business failure, and screaming
customers and work becomes unbearable.
1.9 Challenges faced by startup

1.9.1 Money
The first and most common type of challenge is to gather the money to launch a startup
and keep it running. Capital is essential for hiring staff, getting an office space,
development of a product, and for marketing as well. People forget to take such costs
into account and start spending as soon as some cash flows in. It results in cost-cutting,
shedding of staff, and eventually going into losses.
1.9.2 Fierce Competition:

The corporate world is quite fierce. There is always a competition going on between the
giants. Competition poses one of the biggest challenges for the survival of startup
businesses. And if you have an online business startup, the competition gets tougher.
The competitive environment keeps the startups on their toes, as there is no margin of
error available. Both B2B and B2C organizations always tend to feel the heat of the
fierce competition. In order to survive in this competitive business environment that
covers both traditional and online businesses, the startups need to play aggressively, and
punch above their weight to gain the much needed recognition amongst the clusters of
ever challenging and expanding businesses.
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1.9.3 Unrealistic Expectations:
Success does not come alone. It brings expectations with it. Most of the times, these
expectations seem realistic, But in the real sense of the word, are merely unrealistic.
This same concept holds true for young startups.
Startups tend to face challenges when they set ‘unrealistic expectations’ following a
booming success. Remember, success is short-lived and expectations never end. This is
where startups need to translate what the real expectations are? Sustainability is the
name of the game. And sustainability requires consistent efforts.
In order to succeed in a competitive business world, startups need to have high but
controlled expectations, keeping view of the resources available, the extent of growth
potential, and other market factors as well.
1.9.4 Hiring Suitable Candidates:

One of the most important factors that define organizational culture within a startup
company is the synergy of the team. A team comprises of individuals with similar
capabilities and identical focus. In order to develop a highly successful team culture,
organizations in general – and startups in particular – need to hire suitable candidates.
There is a huge pool of aspiring individuals available. Selecting a suitable candidate
that fits the job well enough is a peculiarly tricky task. It is one of the biggest
challenges facing the startup businesses in this digital age. When hiring a suitable
candidate, organizations must remember one golden rule: Birds of a feather flock
together.
1.9.5 Partnership Decision Making:

Partnership is the essence of success. And this logic holds true for startups as well. In
this ever-expanding and ever-changing digital era, where organizations need to battle
hard for their survival, startups also find it difficult to find trustworthy partners. It’s
really a big challenge for startups today. And as far as tech startups are concerned,
stakes in partnership are much higher for them.
Going into a partnership pays great dividends for the startups, but they need to consider
a variety of factors before making any decision to collaborate with another company
working in the same ecosystem. To reap out maximum benefits out of a partnership,
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startup businesses should look for organizations that enjoy a sound presence within the
market and a good reputation amongst the industry giants.
1.9.6 Financial Management:

Money begets money. Remember the fact that when income increases, the expenditures
also increase. There is no doubt about it. One of the biggest challenges that startups face
today relates to financial management.
It is a fact that small startups rely heavily on financial backups from the so called
investors. At times, when there is a cash influx, small firms, most importantly startups
tend to find it really hard to properly manage their finances, and they bog down against
the pressure.
In order to address this kind of situation, startups need to play a safe and cautious hand,
by keeping all the cards close to their chests. Taking help from a reputed financial
consultancy firm may really help out in managing financial crises facing today’s startup
businesses.
1.9.7 Cyber Security:

This is the digital age. And surviving the challenges in this age requires small startups –
especially the ones operating online – to be super agile to counter the so called online
security threats. Hackers are everywhere, and they are going to take advantage of any
loophole within the systems installed within a startup firm.
The rate of cyber – crimes has increased dramatically during the past couple of years.
The percentage is going to increase in the coming years as well. Startups that are active
online do face online security threats. Be it unauthorized access to startup’s sensitive
information, employee records, bank accounts’ information, or any other related
information that is deemed important for the survival of a tech startup, they are at risk.
In order to safeguard all the important online data, startups need to have robust and
military-grade security systems in place. A virtual private network (VPN) connection
serves the purpose of protecting a startup’s information, and employee records, by
offering the much needed encryption and data security to the startup’s employees,
thereby restricting unauthorized access to organizational data over the web.
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1.9.8 Winning Trust of Customers:
Customer is the king. And that’s absolutely right. Winning a customer’s trust is one of
the most important challenges that businesses in general – and startups in particular –
face today. With a highly satisfied and loyal customer base, startups can scale and make
progress towards excellence.
Customers are the real force behind a startup’s success. Their word-of-mouth power and
their presence on social media can give tech startups an edge against all the traditional
businesses. To win customers’ trust and loyalty, startups need to work aggressively to
implement a customer-centric working philosophy, so as to enable them to succeed in
their pursuit of attaining the height sustainable growth and progress they desire to
achieve in this tech-savvy and challenging business world.
1.9.9 Lack of planning and visualizing

Planning is an essential component of startup culture. It is surprising how lightly people
take it and forget to cover important things like budget, resources, and potential risks as
a part of their business plan. As a result, they falter and fail.
Create a detailed plan and include every little thing, so that your startup doesn’t come to
a standstill when something goes unexpectedly.
1.9.10 Time management

Even 24 hours in a day aren’t always enough when you are working or leading a
startup. There are always clients to be called, meetings to be arranged, and decisions to
be taken. Thus, one must learn how to manage time in the most effective way.
Start with prioritizing tasks at hand and rank them in order of their importance. Give a
deadline for each task so that they can be completed on an estimated time-frame.
1.10 SOURCES OF FINANCE

A business can raise funds from various sources. Each of the source has unique-
characteristics, which must be properly understood so that the best available source of
raising funds can be identified. There is not a single best source of funds for all
organisations. Depending on the situation, purpose, cost and associated risk, a choice
may be made about the source to be used. For example, if a business wants to raise
17
funds for meeting fixed capital requirements, long term funds may be required which
can be raised in the form of owned funds or borrowed funds. Similarly, if the purpose is
to meet the day-to-day requirements of business, the short term sources may be tapped.
1.10.1 Crowdfunding
A relatively recent type of business funding is crowd-sourcing, soliciting funding from
hundreds or even thousands of small investors. Though each investor may only make a
small contribution, the sum total can equal what a single large investment firm or bank
might provide. Crowd-sourced financing can actually be fun: a catchy video or a
product idea that strikes people as cool can be enough to get a funding campaign in
gear. However, a percent of the funds raised typically goes to the crowd-source
platform rather than in your coffers. In addition, funders may expect a quick return on
their investment, such as receiving your new, cool product a few months after the
funding round has completed. This can put you at a disadvantage, in that you might not
be able to deliver, as promised, which can result in a public failure for your company.
Modern technology has made it easier for people to share their problems on an
interactive social platform. Crowdfunding platforms are basically set up for individuals
to pitch their business ideas or challenges to a community of investors or people willing
to support their ideas or cause.
How it basically works is that an individual makes a business pitch on the

crowdfunding platform, he shares his business model and it's potential for growth. If his
idea is bought by the crowd funders on the platform, they'll make a pledge to support
his business model publicly and donate funds respectively. Crowdfunding essentially
creates public interest for your business, thus running some free marketing and
providing finance for your business at the same time. Crowdfunding eliminates the
intricacies involved in placing your business in the hands of an investor or a broker and
wields that power to simpletons on the crowdfunding platform has a potential to attract
venture-capital investment as the business progresses. The heavy competition inherent
in crowdfunding platforms can prove to be difficult if someone or people are pitching
the same business idea as yours. If your business pitch isn't as solid as your
competition, then there is a probability that your business idea will be overlooked or
rejected.
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1.10.2 Debt financing:
Debt means borrowing money, and debt financing mean borrowing money without
giving away your ownership rights. Debts finance means having to pay both the interest
and the principal at a certain date; however, with strict conditions and agreements for
the reason that if debt conditions are not met or are failed then there are severe
consequences to face. Usually, the rate of interest and the maturity or the payback date
of debt borrowings is fixed or pre-discussed. The payback of the principals can be done
in full or in part payments as agreed upon in the loan agreement. Debt can be either a
loan form or in the form of sale of bonds; however, they do not change the conditions of
the borrowings the lender of the money can claim his money back as per the agreement.
And hence lending money to a company is usually safe for you will defiantly get your
principal back along with the agreed interest above the same.
Debt financing can be both secure and unsecured financing security is usually a
guarantee or an assurance that the loan will be paid off, this security can be of any type;
whereas some lenders will lend you money on the basis of your idea or on the goodwill
of your name or your brand. Various types of security can be offered to avail a debt
finance based on a security or debt finance can be availed as a different type of
unsecured loans as well.
 Debt financing does not give the lender ownership rights in your company. Your
bank or your lending institution will not have a right of telling you how to run your
company and hence that right will be all yours.
 Once you pay back the money your business relationship with the lender ends.
 The interest you pay on loans is after deduction of taxes.
 You can choose the duration of your loan it can either be long term or short term.
 If you choose a fixed rate plan you the amount of the principal and the interest will
be known and hence you can plan your business budget accordingly.
 You have to pay back the money in a specific amount of time
 Too much of loan or debt creates cash flow problems which create a trouble in
paying back your debts.
 Showing too much of debt creates a problem in raising equity capital as debt is
considered high-risk potential by investors and this will limit your ability to raise
capital.
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 Your business can fall into big crises in case of too much of debt especially during
hard times when the sales of your organization fall down.
 The cost of repaying the loans is high and hence this can reduce the chances of
growth for your company.
 Usually, the assets of a company are held collateral to the lending institution in
order to get a loan as a security of repaying the loan.
1.10.3 Equity Financing:

The company needs cash or additional cash to grow always. These funds can be raised
either by debt or equity financing. Now that you know about debt financing let us
explain equity financing. Unlike debt financing equity financing is a process of raising
funds by selling the stocks of the company to the financer. Selling of stocks is giving
ownership interest of the company to the financer. The proportion of ownership given
to the financer depends on the amount invested in the company. Finance is required for
every business and in every stage of business be it the startup or the growth of the
company.
Equity financing is another word for ownership in a company. Usually, companies like
equity financing because the investor bears all the risk in case of business failure the
investor is also in a loss. However, the loss of equity is the loss of ownership because
equity gives you a say in the operations of the company and mostly in the difficult times
of the company. Besides just the ownership rights the investor also gets some claims of
future profit in the company. Satisfaction of equity ownership comes in various forms
for examples some investors are happy with the ownership rights, some are happy with
the receipt of dividends, whereas some investors are happy with the appreciation of the
share price of the company. The risk here is less because it is not a loan and it need not
be paid back. Equity financing is a very good way of financing your business if you
cannot afford a loan. You actually collect a network of investors which increases you’re
the credibility of your business. An investor does not expect immediate returns from his
investment and hence it takes a long term view to your business. You will have to
distribute profits and not pay off your loan payment. Equity financing gives you more
cash in hand for expanding your business. In case business fails the money need not be
repaid. You can end up paying more returns than you might pay for a bank loan. You
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may or may not like giving up the control of your company in terms of ownership or
share of profit percentage with investors. It is important to take the consent or consult
your investors before taking a big or a routine decision and you may not agree with the
decision given. In the case of a huge disagreement with the investors, you might have to
only take your cash benefits and let the investors run your business without you.
Finding the right investors for your business takes time and efforts.
1.10.4 Business Incubators:

A business incubator is a company that helps new and startup companies to develop by
providing services such as management training or office space. The National Business
Incubation Association (NBIA) defines business incubators as a catalyst tool for either
regional or national economic development. NBIA categorizes their members’
incubators by the following five incubator types: academic institutions; non-profit
development corporations; for-profit property development ventures; venture capital
firms, and combination of the above.
Business incubators differ from research and technology parks in their dedication to
startup and early-stage companies. Research and technology parks, on the other hand,
tend to be large-scale projects that house everything from corporate, government or
university labs to very small companies. Most research and technology parks do not
offer business assistance services, which are the hallmark of a business incubation
program. However, many research and technology parks house incubation programs.
In India, the business incubators are promoted in a varied fashion: as Technology

Business Incubators (TBI) and as Startup Incubators -- the first deals with technology
business (mostly, consultancy and promoting technology related businesses) and the
later deals with promoting startups (with more emphasis on establishing new
companies, scaling the businesses, prototyping, patenting, and so forth). The mission on
creating specific innovations among the young minds of researchers via. 101
specialized incubators have been boosted in various parts of India through AIM-India.
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1.10.5 Venture Capital:
Venture Capitalist often called investment specialists who raise money from different
sources (Private and institutional) to finance new business that have a potential for huge
growth and needs huge amount of capital in exchange for proportion of ownership.
Their main objective is to invest in the high-risk growth firm for considerable profit on
the investment. Like Business Angel, venture capitalist is not well defined group.
Rather, they are the group of investors that provide the fund at higher level than
business angel.
Venture capitalist are generally more attracted to invest in the companies that
successfully pass the initial two phase (seed and start up) of business lifecycle. Suppose
you come with business idea, and you invest some money from your personal source
known as seed money. Most of the business funding requirement rise quickly between
the start-up phase and growth phase. So, the company seeks other sources such as
commercial banks Business Angel & Venture Capital. Most of startup do not fit to
commercial lending which drives business with huge potential to attracts investors such
as Business Angel & Venture Capitals. Business Angel have the limitation to invest
because their investment depends upon their wealth. So, if your business is too
expensive to angle to fund the whole process of business, Venture Capital generally
invest in the startups that are in the growth and maturity phase of life cycle.
1.10.6 Business Angel:

Business angels, or informal venture capitalists, are seen as playing an important role in
the financing of firms in their early phases of development.
A business angel may be defined as (Mason and Harrison, 2008, p. 309):
“A high net worth individual, acting alone or in a formal or informal syndicate, who
invests his or her own money directly in an unquoted business in which there is no
family connection and who, after making the investment, generally takes an active
involvement in the business, for example, as an advisor or member of the board of
directors.”
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In other words, business angels invest their own funds directly into a small number of
companies while taking on active roles in the businesses. Unlike venture capital firms
that have fiduciary responsibility to other investors, angels tend to use various financial
instruments ranging from pure debt to pure equity. Many business angels are active or
former entrepreneurs or high-ranking managers. While most business angels work
alone, they do sometimes cooperate with others in small investment groups, such as
business angel networks. These financial sources consist of wealthy individual or pool
of individuals who invest in the business who does not fit in commercial lending and
business that have potential to grow. Angel and professional investor are individual or
group of individual who invest their own money in the early stages of business for new
and high risk ideas with a goal of higher return. Private Investor are categorized into
three groups: business angels, professional investors, and venture capitalists. Both,
business angel and professional investors wants to maintain close relationship with the
entrepreneur and can be great source for business expertise and credibility. However,
private investor differs from business angel in terms of the rate of return where private
investor expects higher rate than Business angel. Angel and professional investor
financing usually limited to the early development stage of the business depending upon
their personal wealth. Angle financiers are rare for most business ideas but they are key
for starts ups in terms of flexibility in agreements and knowledge. Private investors
preferred by some entrepreneur because of their connection, personal relations, and
expertise in the specific area/sector. As the business starts to grow after the initial
phase and success, there will be requirement for huge capital which cannot be fulfilled
by angel investors. So, at that stage businesses seeks venture capitalist firms or another
big source for. They are the corporate entities that provide the funding at a level higher
than most angel investors.
1.11 Initiatives taken by the government

1. Self certification
The main objective of the government is to reduce the load on the start ups hence
allowing them to concentrate fully on their business and keeping the low cost of
adherence. It will include labour laws and environment related laws.
23
2. Start-up India hub
A single contact point will be created for the start-ups in India, which will enable them
to exchange knowledge and access to funds.
3. Register through app

An online portal, will be available in the form of a mobile application, which will help
entrepreneurs to interact with the government and other regulatory officials.
4. Patent protection
A monitoring system for patent inspection at reduced costs is being created by the
central government. It will enhance perception and acquisition of the Intellectual
Property Rights (IPRs) by the entrepreneurs.
5. Rs 10,000 crore fund

The government will develop a pool with a starting aggregation of Rs 2,500 crore and a
total aggregation of Rs 10,000 crore over four years, to help new entrepreneurs. The
important role will be played by the Life Insurance Corporation of India in blossoming
this collection. The fund will be managed by a group of professionals selected from the
start-up industry.
6. National Credit Guarantee Trust Company

A National Credit Guarantee Trust Company (NCGTC) will be created with a budget
of Rs 500 crore per year for the next four years to help the drift of funds to
entrepreneurs.
7. No Capital Gains Tax

Investments through venture capital funds are exempted from the Capital Gains Tax.
The same policy will be executed on start-ups.
8. No Income Tax for three years

Start-ups would not pay Income Tax for the first three years.
24
9. Tax exemption for investments of higher value
In case of ventures of higher amount than the market price, they will be exempted from
paying tax.
10.Building entrepreneurs
Creative study plans for students will be implemented in over 5 lakh schools. Apart
from this, there will also be an annual businessman grand provocation to develop high
class businessmen.
11.Atal Innovation Mission

This Mission will be propelled to revitalize ideas and motivate creative youngsters.
12. .Setting up incubators

A private-public partnership model is being considered for 35 new incubators and 31
innovation centres at national institutes.
1.12 CONCEPTUAL FRAMEWORK

 Demographic factors:
A Conceptual Framework is used in research to outline the possible courses of

action or in order to present the preferred approach to an idea or thought. It is an
analytical tool with several variations and the contents. It is mainly used to make the
conceptual distinctions and organize an idea.
In the below given diagram, Gender, Age, Profession, Experience all these are
the Independent Variables whereas the Bank loan, Venture capital, Crowdfunding,
Innovation, all these are the Dependent Variables. This study mainly helps in data
analysis to know the Significant Variables and test can be done through Dependent and
Independent Variables.
 Independent Variables:
25
GENDER
INDEPENDENT
VARIABLE
AGE PROFESSION
 Dependent Variables:-
BANK LOAN
VENTURE
INCUBATORS
CAPITAL
DEPENDENT
VARIABLE
GOVERMENT
CROWDFUNDING
SCHEME
26
In the below given diagram, this study mainly focuses on the relationships between
the socio-demographic factors such as the Marital Status, Age, Qualification, Income,
Experience these are all known as Independent Variables whereas the Investment
Habits, Investment Avenues, Risk Bearing Capacity these are all known as Dependent
Variables. Independent Variables and Dependent Variables help us to understand the
Significant Variables. Significant Variables can be done through data analysis.
Conceptual Framework helps to make the information small and relevant.

Through this we can find the significant variables done by the data analysis. Data
analysis helps us to gather, review, and then analyze to form into a finding or
conclusions. Independent Variables and Dependent Variables can test by data analysis.
27
2 RESEARCH METHODOLOGY
Research methodology is the process used to collect the information and the data for
the purpose of making the business decisions. The research methodology may include
the research, interviews, surveys, questionnaires and the other research techniques that
could include both the present and the historical information. Research methodology
chapter mainly concentrates on the research design, sampling design, data collection
method, analytical tools applied for the study, etc.
1.13 Research design :-

The research design is a qualitative research which allows the researcher to
gather the information and to do an in-depth exploration of the issues, and therefore
research design follows a less structured format with fewer respondents than the
quantitative methods.
1.14 Sample Design:-

A sample design is a definite plan for obtaining a sample from a given population.
Sample design refers to the techniques to the procedure adopted in selecting the items
for the sampling design. Descriptive analysis used for the study in order to know the
sources of finance for startup.
1.14.1 Target population:-

Target population was the working women.
1.14.2 Sampling frame:-

The sampling method used for the research work is Simple Random Sampling.
28
1.14.3 Period of study:-
The period of study was from November-2018 to March-2019, the study was mainly
based on primary data. The secondary data was collected from various sources
throughout the period of the study.
1.14.4 Sample size:-

Sample size determination is the act of choosing the number of observations and also
the replicates to include in a statistical sample. The sample size is an important feature
of any empirical study in which the goal is to make the inferences about a population
from a sample.
This study is mainly based on a simple random sampling method and a sample
size of 100 respondents of students were collected for the purpose of study and were
given enough time to fill out the questionnaires. There were 9 questionnaires and all
questions were compulsory.
1.15 Method of Data Collection :-

Data collection is the process of gathering and measuring the information from the
variety of sources to get a complete and an accurate picture of an area of interest. Data
collection enables a person or the organizations to answer relevant questions, evaluate
the outcomes and to make predictions about the future possibilities and the trends.
There are two sources of data collection:
A. Primary Data Method:-
Primary data are also known as primary data it is data collected from a source.
Primary data refers to a first-hand data or first-hand information. In primary data
method, we can collect the data by our-self using the methods such as the questionnaire
method, interview method, etc. The primary data was collected through the structured
questionnaire which was filled by the respondents.
There are many methods of collecting the primary data which are as follows:-
 Questionnaire method.
29
 Interview method.
 Focus group method.
 Observation.
 Case studies.
A. Secondary Data Method:-
Secondary data is used to increase the sampling size of the research studies and it is
also chosen for the efficiency and the speed that comes with using an already existing
resource. Secondary data is the research data that has previously been gathered and can
be accessed by the researchers. Secondary data may be available in the form of the
company records, trade publications, libraries, etc. The secondary data used for the
study by collecting the data from various reports published by the various websites,
journals, articles and other research paper on investment awareness among Indian
working women in various regions.
There are many methods of collecting the Secondary data which are as follows:-
 Company records.
 Daily newspapers.
 Standard textbook.
 Various websites like Google scholar, Research gate, etc.
1.16 Structure of Questionnaire:-

The structured questionnaire was divided into different sections. The first section
covers personal variables which are independent variables based on the assumptions
that there were measurable differences with the amount of levels with regards to the
perceptions of dependent variables. The second section covers the factor of study with
dependent variables.
The dependent variables are as follows:-
a. Bank Loan
b. Government Policies
30
c. Crowdfunding
d. Incubators
e. Innovation
f. Venture capital
g. Financial Gap
h. Attitude of the Entrepreneur
1.17 Statistical Tools used for the study:-

There were various statistical tools used for the study:-
 Descriptive Statistics.
 Correlation Matrix.
 ANOVA.
 Regression analysis.
 Z-test.
 Percentage analysis.
 Ranking analysis.
 Average score analysis
1.18 Analytical tools used for the study:-

Data analysis gives a meaningful data that has been collected. More than 150
respondents were given questionnaire out of which only 100 respondents filled the
form. There were 9 questionnaires and all questions were compulsory. After
verification as to completeness of collected questionnaire, samples were finalized.
The data corresponding to the values in the Likert scale were entered for each
statement in the questionnaire. The MS Excel data analysis tool was used for
statistical data analysis. The statistical tools includes, average score analysis,
percentage analysis, regression analysis, etc. Average score analysis is mainly
used in the category of different respondents on the various aspects relating to the
study. Percentage analysis is the simple and common method to represent the raw
streams of data as a percentage for better understanding of the collected data.
Percentage analysis is used in making comparison between two or more variables
31
to find the efficiency of each variable. Regression analysis is a set of statistical
processes for estimating the relationships between the variables. Regression
analysis includes many techniques for modeling and analyzing the various
variables, when it focuses on the relationships between the dependent variable and
one or more independent variables.
1.19 Limitations of The Study:-

 It has been assumed that the information provided by the respondents is true
and factual.
 Time was the main constraints. As far as the depth of the research paper is
concerned, it would be unfair to assume that the sufficient amount of the data
has been collected within such a limited time frame.
 The information given by the respondents might be biased because some of
the respondents might not be interested to give the correct information.
 Some respondents were not comfortable to share the information related to the
income and investment decisions because some of the respondents thought it
was personal.
32
3 REVIEW OF LITERATURE
Literature review is the process of getting the information through the articles,
related to the topic of research topic, journals, newspapers, online databases or any
other sources. Literature review also helps in understanding the findings and views of
earlier researchers who had carried out their research in an area similar or related to the
topic of the study.
1.20 Variables:
VENTURE
CAPITAL
FINANCAIL
BANK LOAN
GAP
GOVERNMENT VARIABLE ATTITUDE

SCHEMES
CROWDFUN
INCUBATORS
DING
INNOVATION
1.20.1 VARIABLE :1
[ CITATION Rob14 \l 1033 ] argue that startups in the US rely more on outside debt
financing through Bank loans than is commonly thought. As a source of finance for the
33
startup firms, Banks are the most well know sources of finance after owner’s capital.
Banks are financial institutes that provided finance to all type of firms irrespective of
their size. In any bank-based system, major role is played by the banks in facilitating the
flow of money between various investors and organizations along with the surplus cash
that require them. Countries where bank based financial system have very strong banks,
with major purpose of monitoring corporations and are involved in the strategic
decision making of that market. Banking finance is important for startup firms since
they rarely obtain long term debt or equity, as they must rely on the bank credit as a
major source of finance, since they obtain much of the external capital from the
entrepreneur’s own funds, and informal investors like family members, friends and
colleagues. The decision for startup firms to opt for banking finance depends upon
different criteria’s like time frame, amount of credit availability, level of interference
and supervision and they vary across firms. For the startup firms it is vital to rely on the
finance from the banks since the financial situation of the startup firms appear to be
very opaque for the investors, therefore without the presence of a financial intermediary
firm like the banks it becomes too costly for the investors to gain information in order
to grant credit to the startup firms. Hence bank plays an important role of classic
financial intermediaries, solving the problem for the startup firms by generating the
information about them, by setting terms of the loan contract to improve the incentives
of the startup firms. For any startup firm, acquiring bank finance opens up many ways.
Acquiring capital through lending from banking institutions is convenient for short-term
working capital from the startup phase and onwards. Bank loans will normally require
security in the form of credit or tangible assets. Banking institutions are generally the
most important source of financing for companies in general, they are rarely involved
with knowledge-based ventures that are in early-development stage Hence, the
entrepreneur must often be personally liable for the loan. In addition, bank loans may
negatively affect the company’s financial freedom as they impose a lower limit on the
liquidity of the firm to ensure its ability to pay off debt and interest. The benefits from
debt financing through banking institutions is that ownership structure remains
unaltered, required return does not exceed the interest associated with debt, and it is a
flexible form of funding.
34
1.20.2 VARIABLE :2
[ CITATION Gop18 \l 1033 ] states The current economic scenario in India is on
expansion mode. The Indian government is increasingly showing greater enthusiasm to
increase the GDP rate of growth from grass root levels with introduction of liberal
policies and initiatives for entrepreneurs like ‘Make in India’, ‘Startup India’, MUDRA
etc. ‘Make in India’ is great opportunity for the Indian start-ups. With government
going full hog on developing entrepreneurs, it could arrest brain drain and provide an
environment to improve availability of local talent for hiring by startup firms. Small
contributions from a number of entrepreneurs would have cascading effect on the
economy and employment generation which would complement medium and
large industries efforts catapulting India into a fast growing economy. The startup
arena has lot of challenges ranging from finance to human resources and from launch to
sustaining the growth with tenacity. Being a country with large population, the plethora
of opportunities available are many for startups offering products and services
ranging from food, retail, and hygiene to solar and IT applications for day to day
problems which could be delivered at affordable prices. It is not out of place to mention
that some of these startups would become unicorns and may become world renowned
businesses by expanding into other developing and underdeveloped countries
According to Mensah, 2004 said that government official schemes are those introduced
by government either alone or with the support of donor agencies to increase the flow of
financing to SMEs. It has been argued that such programs and schemes have the
capability to ease the access of SMEs to additional credit. However, Riding, Madill and
Haines (2007) maintain that government schemes aim at assisting access to finance for
SMEs can be effective only under well-specified conditions.
1.20.3 VARIABLE:3
[ CITATION McK07 \l 1033 ] said that the phenomena known as funding gap, or
financing gap refers to an issue where startups (and more established firms) experience
difficulties acquiring the necessary capital at various stages in its development. More
specifically, financing gaps tend to occur when approaching the stage involving the
transition from idea to product or business, and the transition from being a newly
established firm to evolving into a rapid growth enterprise. When businesses seek
35
additional financing, one crucial factor for potential investors or banks is the business’
track record. The better a business’ track record is, the greater is the chance of obtaining
further financing, as a track record signals the quality of the firm. The challenge for
startups is that their track record is extremely short, or no existent. Due to this, other
factors become increasingly important for entrepreneurs seeking financing for their
startup. The reputation of the entrepreneur may be essential, and in the instances of not
yet established startups the business plan, or idea, is crucial.
1.20.4 VARIABLE :4
[ CITATION Ney10 \l 1033 ] considered the impact of the duration of alliances on
startups innovation performance. They found that while continuous (i.e. long
duration) alliances with customers, suppliers, and competitors have a positive effect
on startups ability to generate radical innovation, discontinuous (i.e. short duration)
alliances with customer, suppliers, and competitors have a positive effect on
startups ability to generate incremental innovation.
1.20.5 VARIABLE :5
[ CITATION Mol13 \l 1033 ] Crowd funding refers to the efforts by entrepreneurial
individuals and groups to fund their ventures by drawing on relatively small
contributions from a relatively large number of individuals using an Internet-based
platform, without standard financial intermediaries. As such, crowd funding is a highly
democratic tool that creates opportunities to turn larger groups of people, who otherwise
would not have access to traditional channels of finance, into small scale entrepreneurs.
Crowd funding developed primarily in the arts and creativity-based industries (e.g.,
recorded music, film, video games). Nowadays, crowd funding is used as a financing
source for projects and ventures in various industries.
(Ordanini, 2009) said that Crowd-funding is a relatively new phenomenon where the
customers become investors. Several people, or a crowd, fund a new project, and each
investment is normally relatively small, but the sum of the investments from the entire
crowd can constitute a significant source of capital. The incentive to make such
36
investments, other than contributing to realize a project one believes in, is a share of
potential profits proportionate to one’s investment.
1.20.6 VARIABLE :6
[ CITATION Kau08 \l 1033 ] revealed in their analysis the failure of a technology
incubator in Israel in assisting entrepreneurs in forming a strong initial network,
putting evidence on the importance of the networks in the development of
(biotechnology) firms.
Further, in line with Tötterman and Sten (2005) we find that the business incubator has
partnerships with different financial providers, and that it is actively involved in the
negotiations process between start-ups and investors
According to Aernoudt (2004) an incubator’s aim is to create successful companies,

which will become free-standing and viable after leaving the incubator. Moreover, the
same author states that a good incubator has strong connections with the industry,
disposes of research centers and has the capacity to make financial markets more
accessible. It should also provide operational know-how and help start-ups get on new
markets.
1.20.7 VARIABLE :7
[ CITATION Fis75 \l 1033 ] posited that an attitude is a reliable predictor of a future
behaviour. who found the intention to be an entrepreneur was stronger for those with
positive attitudes toward risk or independence. Every entrepreneur will always get
access to talent, resources, and technology for business sustainability and profitability
but what is non-negotiable is the resilient attitude of any entrepreneur. Attitude is a self-
fulfilling prophecy for any business success, especially for entrepreneurs.
1.20.8 VARIABLE :8
[ CITATION Lea121 \l 1033 ] states the option of Venture capital is another
considerable factor in this category. Venture capital is the main source of finance for the
high technology firms (both small and large). Venture capital is a type of financial
37
capital made available by the venture capitalists in the early-stage of the firm that often
involves ample risk of total loss or failure for the startups. Venture Capitalists on the
other hand are individuals that join informal and organized firms (startups) in order to
raise and distribute the venture capital to new and rapidly growing new ventures and
business opportunities. Venture capitalists mostly preferred to invest in the startups in
order to make them compensate for the initial negative cash flows and to finance their
growth ambitions. Since the startup firms require additional finance in the initial stages
of their development with increase in scale of production and turnover. Discussing
about the types of industries in the financing categories of venture capitalists, literature
provides a look at the financing preferences for Venture Capitals. Though venture
capital is available for the startup firms in the form of funds that consist of pension
funds, investments, private investors, joint ventures between small and large firms,
venture capitalists mostly invests in small firms. There are more chances for the startups
to acquire venture capital once they are established as compared to the pre-startup phase
where owner’s capital and banks are the key sources of finance.
(Rakar, 2006) said that Venture Capital investments or risk capital investments can
come from individuals, companies or funds that invest in individual companies in order
to help their development. Venture Capital investments are not the same as bank loans
because after investing Venture funds seek for a corresponding part of the ownership in
the company, while banks enter into a financing for an exactly determined time period
and with precisely defined interest rates. Venture Capital (VC) is not affected by
company`s cash flow and it does not create any costs, while bank loans are always time-
limited and during the entire repayment time they burden the company`s cash flow.
1.20.9 VARIABLE :9
(ROBB & ROBINSON, 2012) said that for the start-up firms in the initial stage,
Owner’s capital is seen as “Seed financing” when the options for external financing
are limited. It is considered to be the primary option as a source of finance for the
startups. Owner capital is a part of insider financing and is the largest sources of
informal finance for the startups including owner’s equity, loans and credit card. Insider
finance channels mostly include finance from the family members, friends and affiliates
of the firm. Insider finance comprises of funds from the startup team that consist of
38
owner’s family, friends, relatives and colleagues. With the startups insider finance is an
important option since these firms have no collateral or track records. Startups have
difficulty in obtaining external finance because of the vague future prospects and find
difficulty in signaling their creditworthiness. The main advantage of owner’s capital in
terms of startup team is that family, friends and colleagues that make the availability of
finance in the early stage of the financing cycle do not get involved in the financial
monitoring, with or without the formal measures and ratios. On the contrary for the
startup team with no controlling over the finance provided, there might be the chance
for the misuse or high risk taking by the owner. Therefore despite of all the fact,
Owner’s capital remains the first primary source of financing option for the startups.
39
2 DATA ANALYSIS
Data analysis is an analysis of inspecting, cleansing, transforming and modeling

data with the goals of discovering the information, and also informing conclusions, and
supporting the decision-making. Data analysis is the process of evaluating and using the
logical techniques to describe and illustrate the data. Data analysis helps to ensure data
integrity in order to find out an appropriate analysis of research findings.
2.1 Analysis of Demographic Factors of sources of finance:-
2.1.1 Figure-1 Gender
Sources: Primary data
In the above given pie-chart we can understand that the 53% of the respondents are
Male and 47% of respondents are Female.
40
2.1.2 Figure: Age
Source: Primary data
In the above given pie-chart we can understand that the 20% of the respondents are at
the age of below-20 years, 78% of the respondent are at the age of 20-30 years, 2% of
the respondents are at the age of 30-40 years, 0% of the respondents are at the age of
40-50 years, 0% of the respondents are at the age of above-50 years.
2.1.3 Figure :3 Profession
41
In the above given pie-chart we can understand that the 48% of the respondents are
below graduate, 46% of the respondents are graduate, 2% of the respondents are post
graduate, 4% of the respondents are others.
1.Would you opt for Bank loan for startup.
Highly Yes 51%

Yes 39%
Cant’t say 5%
No 4%
Highly No 1%
From the above figure, we can found that the majority of the respondents with 51%
says highly yes and they will opt bank loan for startup. 39 % says yes they will opt bank
loan, we can also found that the very less number of respondents with 0.5% of
respondents says highly no.
42
2.Do government policies promotes startup.
Highly Yes 49%
Yes 39%
Cant’t say 9%
No 3%
Highly No 0%
From the above figure, we can found that the majority of the respondents with 49% says
highly yes and think that government policies promotes startup and we can also found
that the very less number of respondents with 3% of respondents says No and think that
government policies promotes startup.
3. Does financial gap plays a crucial role in startup.
Highly Yes 38%

Yes 35%
Can’t Say 24%
No 3%
Highly No 0%
43
highly yes and think that financial gap plays a crucial role in startup, 35% of
respondents says Yes financial gap plays a crucial role in startup and we can also found
that the very less number of respondents with 3% of respondents says No and think that
financial gap plays a crucial role in startup.
4. Innovation is the most important feature of startup.
Strongly Agree 43%

Agree 39%
Neutral 16%
Disagree 2%
Strongly Disagree 0%
44
strongly agree that innovation is the most important feature of startup, 39% of
respondents says agree that innovation is the most important feature of startup, and we
can also found that the very less number of respondents with 2% of respondents says
strongly disagree.
5. Crowdfunding helps in minimizing the financial gap.
Strongly Agree 39%

Agree 29%
Neutral 21%
Disagree 8%
45
sources: primary data
strongly agree that crowdfunding helps in minimizing the financial gap, 29% of
respondents says agree Crowdfunding helps in minimizing the financial gap, and we
can also found that the very less number of respondents with 3% of respondents says
strongly disagree.
6. Incubators is actively involved in the negotiation process between the startup and
investors.
Strongly Agree 37%

Agree 25%
Neutral 24%
Disagree 12%
46
strongly agree that Incubators is actively involved in the negotiation process between
the startup and investors, 25% of respondents says agree Incubators is actively involved
in the negotiation process between the startup and investors, and we can also found that
the very less number of respondents with 2% of respondents says strongly disagree and
12% of respondents says disagree.
7. Does attitude of entrepreneur affect the startup.
Strongly Agree 43%

Agree 36%
Neutral 14%
Disagree 5%
47
highly yes and 36% of respondents say yes attitude of entrepreneur affect the startup
and we can also found that the very less number of respondents with 5% of respondents
says No attitude of entrepreneur affect the startup.
8. Venture capital is the key sources of finance in the startup growth and maturity stage
in firms.
Strongly Agree 33%

Agree 36%
Neutral 21%
Disagree 8%
48
agree that venture capital is the key sources of finance in the startup growth and
maturity stage in firms, 33% of respondents says strongly agree venture capital is the
key sources of finance in the startup growth and maturity stage in firms, and we can
also found that the very less number of respondents with 2% of respondents says
strongly disagree and 8% of respondents says disagree.
2.2 Descriptive Statistic:

A descriptive statistic is a summary of statistics that is quantitatively describes or
summarize as a features of a collection of information while the descriptive statistics are
also defined as the process of using and analyzing the statistics. Descriptive statistics
can also be distinguished as an inferential statistics or an inductive statistics), in that
descriptive statistics aims to summarize a sample. When a data analysis draws its main
conclusions then the inferential statistics or inductive statistics, descriptive statistics are
presented. Measures of central tendency include the mean, median and mode whereas
the Measures of variability include the standard deviation, the minimum and maximum
values of the variables.
 Purpose of the study:-
49
The main purpose of the descriptive statistics is to understand the mean, average,
sample variance, count, etc. Descriptive statistics are used to describe the basic feature
of data in a study. Descriptive statistics provides a simple summary about the sample
and the measure of central tendency and the measure of variability or dispersion.
GENDER AGE PROFESSION VO1 V02 V03 V04 V05 V06 V07 V08
Mean 1.47 4.18 4.34 4.33 4.34 4.08 4.23 3.93 3.83 4.13 3.9
Standard Error 0.05 0.04 0.09 0.09 0.08 0.09 0.08 0.11 0.11 0.10 0.10
Median 1 4 4 5 4 4 4 4 4 4 4
Mode 1 4 5 5 5 5 5 5 5 5 4
Standard Deviation 0.50 0.44 0.87 0.88 0.77 0.86 0.79 1.09 1.12 0.97 1.02
Sample Variance 0.25 0.19 0.75 0.77 0.59 0.74 0.62 1.20 1.25 0.94 1.04
Kurtosis (2.03) 0.79 6.66 2.72 0.87 (0.83) (0.29) (0.11) (0.75) 1.04 (0.04)
Skewness 0.12 0.91 (2.24) (1.62) (1.08) (0.45) (0.69) (0.80) (0.54) (1.14) (0.73)
Range 1 2 4 4 3 3 3 4 4 4 4
Minimum 1 3 1 1 2 2 2 1 1 1 1
Maximum 2 5 5 5 5 5 5 5 5 5 5
Sum 147 418 434 433 434 408 423 393 383 413 390
Count 100 100 100 100 100 100 100 100 100 100 100
Confidence Level(95.0%) 0.10 0.09 0.17 0.17 0.15 0.17 0.16 0.22 0.22 0.19 0.20
 Mean:-
 From the above table we found that:-
 The highest mean was in case of V02 (4.34) followed by V01(4.33).
 The lowest mean was in case of V08 (3.9) followed by V06 (3.83).
 Sample Variance:-
 From the above table we found that:-
50
 The highest sample variance was in case of V06 (1.25) followed by V05
(1.20).
 The lowest sample variance was in case of V04 (0.62) followed by V02
(0.59).
 Implication of the study:-
 From the above table, we can found that the highest mean is V02 (4.34)
and V01 (4.33) and the lowest mean is V06 (3.83).
 We can also found that the highest sample variance is V06 (1.25) and the
lowest sample variance is VO4(0.62) and V02(0.59).
2.3 Percentage Analysis:-

Percentage analysis is the method of representing the raw streams of data as a
percentage (a part in 100-percent) for better understanding of collected data. Percentage
analysis is applied to create a contingency table from the frequency distribution and to
represent the collected data for better understanding.
The main purpose of percentage analysis is to describe the distribution of the

respondents in each classification and it is to be expressed in percentage as it facilitates
the comparison between the variables.
51
Column Labels
Others Post Graduate Graduate below graduate Grand Total
Sum of Bank loan 4.00% 2.00% 46.00% 48.00% 100.00%
Sum of Government policies 4.61% 2.07% 47.00% 46.31% 100.00%
Sum of Financial gap 4.90% 2.45% 47.79% 44.85% 100.00%
Sum of Innovation 4.73% 2.13% 47.52% 45.63% 100.00%
Sum of Crowdfunding 5.09% 2.29% 44.78% 47.84% 100.00%
Sum of Incubators 5.22% 2.09% 48.04% 44.65% 100.00%
Sum of Attitude of entrepreneur 4.84% 2.18% 44.79% 48.18% 100.00%
Sum of Venture capital 5.13% 2.31% 47.44% 45.13% 100.00%
From the above table, we found that V01 (BANK LOAN) has having the highest
percentage of above 48% and the respondents having the qualification of below
graduate, respondents having the qualification of graduate has given 46%, respondents
having the qualification of post graduate has negative percentage of 2%, others has 4%
for bank loan.
we found that V02 (government policies) has having the highest percentage of above
47% and the respondents having the qualification of graduate, respondents having the
qualification of below graduate has given 46.31%, respondents having the qualification
of post graduate has negative percentage of 2.7%, others has given 4.61% for
government policies.
we found that V03 (financial gap) has having the highest percentage of above 47.79%
and the respondents having the qualification of graduate, respondents having the
of post graduate has negative percentage of 2.45%, others has given 4.90% for financial
gap.
we found that V04 (innovation) has having the highest percentage of above 47.52% and
the respondents having the qualification of graduate, respondents having the
52
innovation.
we found that V05 (crowdfunding) has having the highest percentage of above 47.84%
and the respondents having the qualification of below graduate, respondents having the
qualification of graduate has given 44.78%, respondents having the qualification of post
graduate has negative percentage of 2.29%, others has given 5.90% for crowdfunding.
we found that V06 (incubators) has having the highest percentage of above 48.04% and
the respondents having the qualification of graduate, respondents having the
incubators.
we found that V07 (attitude of entrepreneur) has having the highest percentage of above
48.18% and the respondents having the qualification of below graduate, respondents
having the qualification of graduate has given 44.79%, respondents having the
qualification of post graduate has negative percentage of 2.29%, others has given 5.90%
for attitude of entrepreneur.
we found that V08 (venture capital) has having the highest percentage of above 47.44%
and the respondents having the qualification of graduate, respondents having the
of post graduate has negative percentage of 2.31%, others has given 5.13% for venture
capital.
From the above table, we can found that the highest percentage was 48.18% in case of
V08 (attitude of entrepreneur) and the respondents having the qualification of below
graduate.
We can also found that lowest percentage was in case of V01 (bank loan ) and the
respondents having the qualification of post graduate.
53
2.4 Ranking Analysis
Ranking analysis refers to the relationships between the set of items such as
“ranked higher than” or “ranked lower than”. Rank analysis means a position in
a hierarchy or scale.

The main purpose of ranking analysis is to understand the various ranking
items. Through ranking analysis, we can understand that which ranking should
come first and which ranking items should come last.
Column
(Rank 1) (Rank 2) (Rank 3) (Rank 4) (Rank 5) Grand Total
[ Bank Loan ] 56 19 20 2 3 100
[ Venture capital] 18 39 28 11 4 100
[ Crowdfunding ] 19 26 39 13 3 100
[ Equity finance ] 19 42 22 13 4 100
[ Personal fund ] 46 20 20 7 7 100
Source: Primary data.
 From the above table, we can found that the green shades indicate the highest
ranking (i.e.) 5(Rank-1) and 56 respondents given the highest rank to bank loan. So,
the they fill bank loan is the better source of finance and at the same time we can
also found that red shades indicate the lowest ranking (i.e.) 1(Rank-5) and 2
respondents given the lowest rank to bank loan.
ranking (i.e.) 5(Rank-1) 39 respondents given the highest rank to venture capital.
So, they feel venture capital is better source of finance for startup and at the same
54
time we can also found that red shades indicate the lowest ranking (i.e.) 1(Rank-5)
and 4 respondents given the lowest rank to venture capital.
ranking (i.e.) 3(Rank-3), 4(Rank-2) and 39, 26 respondents given the highest rank to
crowdfunding. So, they feel crowdfunding is better source of finance for startup and
at the same time we can also found that red shades indicate the lowest ranking (i.e.)
1(Rank-5) and 3 respondents given the lowest rank to crowdfunding.
ranking (i.e.) 4(Rank-2) 42 respondents given the highest rank to equity financing.
So, they feel equity financing is the better sources of finance for startup and at the
same time we can also found that red shades indicate the lowest ranking (i.e.)
1(Rank-5) and 4 respondents given the lowest rank to equity financing.
ranking (i.e.) 5(Rank-1) 46 respondents given the highest rank to personal fund. So,
they feel personal fund is the better sources of finance for startup and at the same
time we can also found that red shades indicate the lowest ranking(i.e.) 1(Rank-5)
and 7 respondents given the lowest rank to personal fund.
 From the above table, we can found that the highest ranking was given to bank
loan. So, they feel bank loan is the better sources of finance for startup
 We can also found that the lowest ranking was given crowdfunding. So, they
crowdfunding is not a better source of finance for startup.
2.5 Average Analysis:
55
Column Labels
Male Female Grand Total
Average of V01 Bank loan 5 5 5
Average of V02 Government Policies 4.43 4.23 4.34
Average of V03 Financial Gap 4.21 3.94 4.08
Average of V04 Innovation 4.36 4.09 4.23
Average of V05 Crowdfunding 4.00 3.85 3.93
Average of V06 Incubators 3.91 3.74 3.83
Average of V07 Attitude of entrepreneur 4.30 3.94 4.13
Average of V08 Venture Capital 4.04 3.74 3.90
From the above table we found that in V01 (Bank Loan) both male and female
respondents are having highest average. Male respondents are having 5 average and
Female respondents are having 5 average.
In V02 (Government Policies) male respondents are having highest average than female
i.e male respondents are having 4.43 average and female respondents are having 4.23
average.
In V03 (Financial Gap) male respondents are having highest average than female i.e
male respondents are having 4.21 average and female respondents are having 3.94
average.
In V04 (Innovation) male respondents are having highest average than female i.e male
respondents are having 4.36 average and female respondents are having 4.09 average.
In V05 (Crowdfunding) male respondents are having highest average than female i.e
male respondents are having 4.00 average and female respondents are having 3.85
average.
In V06 (Incubators) male respondents are having highest average than female i.e male
respondents are having 3.91 average and female respondents are having 3.74 average.
56
In V07 (attitude of entrepreneur) male respondents are having highest average than
female i.e male respondents are having 4.30 average and female respondents are having
3094 average.
In V08 (Incubators) male respondents are having highest average than female i.e male
respondents are having 4.04average and female respondents are having 3.74 average.
 Implications:
From the above table, we can found that the highest average was in the case of V01
(Bank Loan) (i.e.) 5 average and the lowest average was in the case of V06 (Incubators)
(i.e.) 3.74 average and V07 (Attitude of entrepreneur) (i.e.) 3.74 average.
2.6 ANOVA (Analysis of variance) :-

ANOVA (Analysis of Variance) is a method of assessing the contribution of an
independent variable or the controllable factor of the observed variation in an observed
dependent variable.
The main purpose of ANOVA (Analysis of variance) is to understand the suitable

hypothesis with the relevant interpretations and also know that the p value is significant
or not.
2.6.1 Gender wise one factor ANOVA for variable V01(bank loan).
H0: Gender of the respondents does not influence the perceptions
towards bank loan.
H1: Gender of the respondents influence the perceptions towards
bank loan.
 Findings:-
As the p value found is less than 0.05 we reject the null hypothesis,
hence it is found that the Gender of the respondents is having significance influence on
the V01 (Bank loan).
57
Source: Primary data:- Significant at 5% level (p value<=0.05). Not Significant at 5%
level (p value>=0.05).
2.6.2 Gender wise one factor ANOVA for variable V02(Government policies).
towards government policies.
SUMMARY
Groups Count Sum Average Variance
Column 1 100 147 1.47 0.251616
Column 2 100 434 4.34 0.590303
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 411.845 1 411.845 978.3481 0.00 3.888853
Within Groups 83.35 198 0.42096
Total 495.195 199
 Findings:
the V02 (government policies).
Source: Primary data: Significant at 5% level (p value<=0.05). Not Significant at 5%

58
2.6.3 Gender wise one factor ANOVA for variable V03(Financial gap).
towards financial gap.
financial gap.
SUMMARY
Column 1 100 147 1.47 0.251616
Column 2 100 408 4.08 0.74101
 Findings:
ANOVA
Between Groups 340.605 1 340.605 686.2704 0.00 3.888853
Within Groups 98.27 198 0.496313 As the p value
found is less
Total 438.875 199
than 0.05 we
reject the null
hypothesis, hence it is found that the Gender of the respondents is having significance
influence on the V03 (financial gap).

59
2.6.4 Gender wise one factor ANOVA for variable V04(Innovation).
towards innovation.
innovation.
SUMMARY
Column 1 100 147 1.47 0.251616
Column 2 100 423 4.23 0.623333
ANOVA
Between Groups 380.88 1 380.88 870.6331 0.00 3.888853
Within Groups 86.62 198 0.437475  Findings:
Total 467.5 199
As the p value found is less than 0.05 we reject the null hypothesis, hence it is found
that the Gender of the respondents is having significance influence on the V04
(innovation).

2.6.5 Gender wise one factor ANOVA for variable V05(Crowdfunding).

H0: Gender of the respondents does not influence the perceptions towards
crowdfunding.
H1: Gender of the respondents influence the perceptions towards crowdfunding.
60
SUMMARY
Column 1 100 147 1.47 0.251616
Column 2 100 393 3.93 1.197071
ANOVA
Between Groups 302.58 1 302.58 417.73 0.00 3.888853
Within Groups 143.42 198 0.724343
Total 446 199
 Findings:
the V05 (crowdfunding).

2.6.6 Gender wise one factor ANOVA for variable V06(Incubators).

H0: Gender of respondents does not influence the perception towards incubators.
H1: Gender of respondents influence the perception towards incubators.
61
SUMMARY
Column 1 100 147 1.47 0.251616
Column 2 100 383 3.83 1.253636
ANOVA
Between Groups 278.48 1 278.48 370.011 0.00 3.888853
Within Groups149.02 198 0.752626
Total 427.5 199
 Findings:
the V06 (incubators).

2.6.7 Gender wise one factor ANOVA for variable V07 (attitude of
entrepreneur).
H0: Gender of respondents does not influence the perception towards attitude of
entrepreneur.
H1: Gender of respondents influence the perception towards attitude of entrepreneur.
62
SUMMARY
Column 1 100 147 1.47 0.251616
Column 2 100 413 4.13 0.942525
ANOVA
Between Groups 353.78 1 353.78 592.5261 1.95E-61 3.888853
Within Groups118.22 198 0.597071
Total 472 199
 Findings:
the V07 (attitude of entrepreneur).

2.6.8 Gender wise one factor ANOVA for variable V0 8(venture capital).
H0: Gender of respondents does not influence the perception towards venture capital.
H1: Gender of respondents influence the perception towards venture capital.
63
SUMMARY
Column 1 100 147 1.47 0.251616
Column 2 100 390 3.9 1.040404
ANOVA
Between Groups295.245 1 295.245 457.0285 2.46E-53 3.888853
Within Groups127.91 198 0.64601
Total 423.155 199
 Findings:
the V08 (venture capital).

2.7 Hypothesis testing(z-test):-

A z-test is a statistical teat that is used to determine whether the two population
means are different when the variances are known and the sample size is large.
The main purpose of z-test is to under is to understand the suitable hypothesis

with the relevant interpretations and also know that the p value is significant or not.
 Gender wise study:
2.7.1 Gender wise z-test for variable V01(bank loan).

H0: Gender of the respondents does not influence their perceptions towards bank loan.
H1: Gender of the respondents influence their perceptions towards bank loan.
64
Gender Bank loan
Mean 1.47 4.33
Known Variance 0.251616 0.768788
Observations 100 100
Hypothesized Mean Difference 0
z -28.3126
P(Z<=z) one-tail 0
z Critical one-tail 1.644854
P(Z<=z) two-tail 0
z Critical two-tail 1.959964
 F
indings:-
As the p value found is less than 0.05 we reject the null hypothesis, hence it is
found that the gender of the respondents is having significance influence on the V01
(bank loan).
Source: primary data Significant at 5% level (p value<=0.05). Not Significant at 5%

level (p value>=0.05.
2.7.2 Gender wise z-test for variable V02(government policies).

H0: Gender of the respondents does not influence their perceptions towards government
policies.
H1: Gender of the respondents influence their perception towards government policies.
65
Gender government policies
Mean 1.47 4.34
z -31.2786
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
 Findings:-
(government policies).

2.7.3 Gender wise z-test for variable V03(financial gap).

H0: Gender of the respondents does not influence their perceptions towards financial gap.
H1: Gender of the respondents influence their perceptions towards financial gap.
Gender Financial gap

Mean 1.47 4.08
z -26.1968
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
 Findings:-
66
(Financial gap).

2.7.4 Gender wise z-test for variable V04 (Innovation).

H0: Gender of the respondents does not influence their perceptions towards innovation.
H1: Gender of the respondents influence their perception towards innovation.
Gender Innovation
Mean 1.47 4.23
z -29.5065
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
 Findings:-
(innovation).

2.7.5 Gender wise z-test for variable V05 (Crowdfunding).

H0: Gender of the respondents does not influence their perceptions towards
crowdfunding.
67
H1: Gender of the respondents influence their perceptions towards crowdfunding.
Gender Crowdfunding
Mean 1.47 3.93
Hypothesized Mean Diff erence 0
z -20.4384
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
 Findings:-
(crowdfunding).

2.7.6 Gender wise z-test for variable V06 (Incubators).

H0: Gender of the respondents does not influence their perceptions towards incubators.
H1: Gender of the respondents influence their perceptions towards incubators.
68
Gender Incubators
Mean 1.47 3.83
Hypothesized Mean Diff erence 0
z -19.2357
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
 Findings:-
(incubators).

2.7.7 Gender wise z-test for variable V07 (Attitude of entrepreneur).

H0: Gender of the respondents does not influence their perceptions attitude of
entrepreneur.
H1: Gender of the respondents influence their perceptions towards attitude of
entrepreneur.
Gender Attitude of entrepreneur

Mean 1.47 4.13
z -24.3419
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
69
 Findings:-
(attitude of entrepreneur).

2.7.8 Gender wise z-test for variable V08 (Venture capital).

H0: Gender of the respondents does not influence their perceptions venture capital.
H1: Gender of the respondents influence their perceptions towards venture capital.
Gender Venture capital

Mean 1.47 3.9
z -21.3782
P(Z<=z) one-tail 0
P(Z<=z) two-tail 0
 Findings:-
(venture capital).

 Professional wise z-test:
70
2.7.9 Professional wise z-test for variable V01(bank loan).
H0: professional of the respondents does not influence their perceptions towards bank loan.
H1: professional of the respondents influence their perceptions towards bank loan.
PROFESSIONAL BANK LOAN

Mean 4.34 5
z -6.079874578
P(Z<=z) one-tail 0.00
P(Z<=z) two-tail 0.00
 Findings:-
found that the professional of the respondents is having significance influence on the
V01 (bank loan).

2.7.10 Professional wise z-test for variable V02(government policies).

H0: Professional of the respondents does not influence their perceptions towards
H1: Professional of the respondents does not influence their perceptions towards government
policies.
71
PROFESSIONAL GOVERNMENT POLICIES
Mean 4.34 4.34
z 0
 Findings:-
V02 (government policies).

2.7.11 Professional wise z-test for variable V03 (financial gap).

financial gap.
H1: Professional of the respondents does not influence their perceptions towards financial gap.
PROFESSIONAL FINANCIAL GAP

Mean 4.34 4.08
z 1.922339323
 Findings:-
72
V03 (financial gap).

2.7.12 Professional wise z-test for variable V04 (innovation).

innovation.
H1: Professional of the respondents does not influence their perceptions towards innovation.
PROFESSIONAL INNOVATION
Mean 4.34 4.23
z 0.83748976
 Findings:-
V04 (innovation).

2.7.13 Professional wise z-test for variable V05 (crowdfunding).

crowdfunding.
H1: Professional of the respondents does not influence their perceptions towards crowdfunding.
73
PROFESSIONAL CROWDFUNDING
Mean 4.34 3.93
z 2.72
 Findings:-
V05 (crowdfunding).

2.7.14 Professional wise z-test for variable V06 (incubators).

incubators.
H1: Professional of the respondents does not influence their perceptions towards incubators.
PROFESSIONAL INCUBATORS
Mean 4.34 3.83
z 3.350316161
 Findings:-
74
V06 (incubators).

2.7.15 Professional wise z-test for variable V07 (attitude of entrepreneur).

attitude of entrepreneur.
H1: Professional of the respondents does not influence their perceptions towards attitude of
entrepreneur.
PROFESSIONAL ATTITUDE OF ENTREPRENEUR
Mean 4.34 4.13
Observations 100.00 100.00
Hypothesized Mean Difference -
z 1.47
 Findings:-
found that the professional of the respondents is having significance influence on the V07
(attitude of entrepreneur).
Source: primary data Significant at 5% level (p value<=0.05). Not Significant at 5% level (p

value>=0.05.
2.7.16 Professional wise z-test for variable V07 (venture capital).
75
H0: Professional of the respondents does not influence their perceptions towards venture
capital.
H1: Professional of the respondents influence their perceptions towards venture capital.
 Findings:-
found that the professional of the respondents is having significance influence on the V08
(venture capital).
Source: primary data Significant at 5% level (p value<=0.05). Not Significant at 5% level (p

value>=0.05.
76
2.8 Co-relation:
V01 (Bank loan) V02(Government policies) V03(Financial gap) V04(Innovation) V05( Crowdfunding) V06(Incubators) V07(Attitude of entrepreneur) V08(Venture capital)
V01 1
V02 0.31 1
V03 0.31 0.26 1
V04 0.17 0.24 0.34 1
V05 0.23 0.24 0.33 0.33 1
V06 0.02 0.27 0.29 0.30 0.46 1
V07 0.07 0.25 0.23 0.30 0.36 0.55 1
V08 0.14 0.28 0.30 0.39 0.36 0.54 0.58 1
 From the above given table, we can understand that dark green shades indicates
positively correlated matrix, light orange shades indicates moderately correlated
matrix and red shades indicates negatively correlated matrix.
 From the above table we can found that V01 (bank loan) are positively correlated
with V01 (bank loan) and V01 (bank loan) are positively correlated with
V02(government policies). We can also found that V02 (government policies) are
positively correlated with V08 (venture capital). We can also found that V03
(financial gap) are positively correlated with V04 (innovation) and V04 (innovation)
are positively correlated with V08 (venture capital). We can also found that V05
(crowdfunding) are positively correlated with V06 (incubators) and V06
(incubators) are positively correlated with V07 (attitude of entrepreneur). We can
also found that V07 (attitude of entrepreneur) are positively correlated with V08
(venture capital).
 From the above table we can also found that V01 (bank loan) are negatively
correlated with V06 (incubators) and V02 (government) are negatively correlated
with V04 (innovation). We can also found that V03 (financial gap) are negatively
correlated with V07 (attitude of entrepreneur) and V04 (innovation) are negatively
correlated with V06 (incubators). We can also found that V05 (crowdfunding) are
negatively correlated with V07 (attitude of entrepreneur). We can also found that
V06 (incubators) are negatively correlated with V08 (venture capital). Through
77
Correlation Matrix we found the highest correlation matrix, moderately correlation
matrix and negatively correlation matrix.
 Interpretation of the study:-
From the above table, we can found that number of variables has a positively correlated
and medium number of variables are moderately correlated very less number of
variables are negatively correlated.
2.9 Regression Analysis:

Regression analysis is a set of statistical processes for estimating the relationships
between the variables. Regression analysis includes many techniques for modeling and
analyzing the various variables, when it focuses on the relationships between the
dependent variable and one or more independent variables. Regression analysis helps us
to understand the typical value of the dependent variable changes with independent
variables. Regression analysis estimates the conditional expectations of the dependent
variable given in the independent variable that is the average value of the dependent
variable when the independent variable is fixed. Regression analysis is mainly used for
predicting and forecasting the analysis of the variables like dependent variable and
independent variables.
2.9.1 Gender wise regression analysis for V01 (bank loan).

H0: Gender of the respondents does not influence their perception towards bank loan.
H1: Gender of the respondents influence their perception towards bank loan.
78
Regression Statistics
Multiple R 0.14951104
R Square 0.022353551
Adjusted R Square 0.012377567
Standard Error 0.498499514
Observations 100
ANOVA
df SS MS F Significance F
Regression 1 0.556826961 0.556826961 2.240736437 0.1376308
Residual 98 24.35317304 0.248501766
Total 99 24.91
Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 1.840362633 0.252390215 7.291735279 0.00 1.339502466 2.3412228 1.339502466 2.3412228
Gender -0.085534095 0.057140479 -1.496908961 0.1376308 -0.198927517 0.027859326 -0.198927517 0.027859326
 Finding:
(Bank loan).
Source: primary data Significant at 5% level (p value<=0.05). Not Significant
at 5% level (p value>=0.05).
2.9.2 Gender wise regression analysis for V02 (government policies).

H0: Gender of the respondents does not influence their perception towards government
policies.
H1: Gender of the respondents influence their perception towards government policies.
R Square 0.017036279
Observations 100
ANOVA
Regression 1 0.424373717 0.424373717 1.698491341 0.195539037
Residual 98 24.48562628 0.249853329
Total 99 24.91
Intercept 1.839835729 0.288145658 6.3850892 0.00 1.268020049 2.411651409 1.268020049 2.411651409
Government policies -0.085215606 0.065386406 -1.303261808 0.195539037 -0.2149728 0.044541589 -0.2149728 0.044541589
79
 Finding:
(government).
2.9.3 Gender wise regression analysis for V03 (financial gap).

H0: Gender of the respondents does not influence their perception towards financial
gap.
H1: Gender of the respondents influence their perception towards financial gap.
R Square 0.025006928
Observations 100
ANOVA
Regression 1 0.622922574 0.622922574 2.513534714 0.116094176
Residual 98 24.28707743 0.247827321
Total 99 24.91
Intercept 1.845965104 0.242309151 7.618222827 0.00 1.36511048 2.326819727 1.36511048 2.326819727
Financial gap -0.09214831 0.058122586 -1.585413105 0.116094176 -0.20749069 0.023194071 -0.20749069 0.023194071
 Finding:
(financial gap).
80
2.9.4 Gender wise regression analysis for V04 (innovation).

H0: Gender of the respondents does not influence their perception towards innovation.
H1: Gender of the respondents influence their perception towards innovation.
R Square 0.03016928
Observations 100
ANOVA
Regression 1 0.751516772 0.751516772 3.048562402 0.083942386
Residual 98 24.15848323 0.246515135
Total 99 24.91
Intercept 1.936801167 0.271923806 7.122587739 0.00 1.397177224 2.47642511 1.397177224 2.47642511
Innovation -0.110354886 0.063203921 -1.746013288 0.083942386 -0.23578101 0.015071238 -0.23578101 0.015071238
 Finding:
(innovation)
2.9.5 Gender wise regression analysis for V05 (Crowdfunding).

H0: Gender of the respondents does not influence their perception crowdfunding.
H1: Gender of the respondents influence their perception crowdfunding.
81
R Square 0.004662503
Adjusted R Square -0.005494002
Observations 100
ANOVA
Regression 1 0.116142942 0.116142942 0.459065657 0.499657416
Residual 98 24.79385706 0.252998541
Total 99 24.91
Intercept 1.593030124 0.188420275 8.454664025 0.00 1.21911622 1.966944028 1.21911622 1.966944028
Crowdfunding -0.031305375 0.046204206 -0.677543841 0.499657416 -0.122996118 0.060385368 -0.122996118 0.060385368
 Finding:
(crowdfunding)
2.9.6 Gender wise regression analysis for V06 (Incubators).

H0: Gender of the respondents does not influence their perception incubators.
H1: Gender of the respondents influence their perception incubators.
82
R Square 0.005201256
Observations 100
ANOVA
Regression 1 0.129563291 0.129563291 0.512388165 0.475808996
Residual 98 24.78043671 0.252861599
Total 99 24.91
Intercept 1.593747482 0.180041715 8.852101186 0.00 1.236460557 1.951034407 1.236460557 1.951034407
Incubators -0.032310048 0.045137557 -0.71581294 0.475808996 -0.121884061 0.057263966 -0.121884061 0.057263966
 Finding:
(incubators)
2.9.7 Gender wise regression analysis for V07 (attitude of entrepreneur).

H0: Gender of the respondents does not influence their perception attitude of
entrepreneur.
H1: Gender of the respondents influence their perception attitude of entrepreneur.
83
R Square 0.035705477
Observations 100
ANOVA
Regression 1 0.889423427 0.889423427 3.628701235 0.05972314
Residual 98 24.02057657 0.245107924
Total 99 24.91
Intercept 1.873218305 0.217385295 8.617042402 0.00 1.441824262 2.304612348 1.441824262 2.304612348
Attitude of entrepreneur -0.097631551 0.051252444 -1.90491502 0.05972314 -0.199340358 0.004077257 -0.199340358 0.004077257
 Finding:
(attitude of entrepreneur)
2.9.8 Gender wise regression analysis for V08 (venture capital).

H0: Gender of the respondents does not influence their perception venture capital.
H1: Gender of the respondents influence their perception venture capital.
84
R Square 0.020769917
Observations 100
ANOVA
Regression 1 0.517378641 0.517378641 2.078624763 0.15256274
Residual 98 24.39262136 0.2489043
Total 99 24.91
Intercept 1.746407767 0.198102793 8.81566452 0.00 1.353279221 2.139536313 1.353279221 2.139536313
Venture capital -0.070873786 0.049158383 -1.441743654 0.15256274 -0.168426997 0.026679424 -0.168426997 0.026679424
 Finding:
(venture capital)
2.10 Age wise study:

2.10.1 Age wise regression analysis for V01 (bank loan).
H0: Age of the respondents does not influence their perception towards bank loan.
H1: Age of the respondents influence their perception towards bank loan.
85
R Square 0.001427338
Observations 100
ANOVA
Regression 1 0.02677686 0.02677686 0.140079057 0.709011026
Residual 98 18.73322314 0.191155338
Total 99 18.76
Intercept 4.18 0.043721315 95.60554169 0.00 4.093236473 4.266763527 4.093236473 4.266763527
Bank loan 0 0 65535 0 0 0 0 0
 Finding:
found that the age of the respondents is having significance influence on the V01 (Bank
loan).
2.10.2 Age wise regression analysis for V02 (government policies).

H0: Age of the respondents does not influence their perception towards government
policies.
H1: Age of the respondents influence their perception towards government policies
86
R Square 0.093415294
Observations 100
ANOVA
Regression 1 1.75247091 1.75247091 10.09800708 0.001986
Residual 98 17.00752909 0.173546215
Total 99 18.76
Intercept 4.93155373 0.240146954 20.53556644 0.00 4.454989916 5.408117545 4.454989916 5.408117545
Government policies -0.173169062 0.054494475 -3.177736157 0.001986 -0.281311574 -0.065026551 -0.281311574 -0.065026551
 Finding:
found that the age of the respondents is having significance influence on the V01
(Government policies).
2.10.3 Age wise regression analysis for V03 (financial gap).

H0: Age of the respondents does not influence their perception towards financial gap.
H1: Age of the respondents influence their perception towards financial gap
R Square 0.030135582
Observations 100
ANOVA
Regression 1 0.565343511 0.565343511 3.045051395 0.084118233
Residual 98 18.19465649 0.18565976
Total 99 18.76
Intercept 4.538167939 0.20972689 21.63846484 0.00 4.121971751 4.954364127 4.121971751 4.954364127
Financial Gap -0.08778626 0.050307094 -1.745007563 0.084118233 -0.18761905 0.012046531 -0.18761905 0.012046531
87
 Finding:
found that the Age of the respondents is having significance influence on the V01
(Financial Gap).
2.10.4 Age wise regression analysis for V04 (innovation).

H0: Age of the respondents does not influence their perception towards innovation.
H1: Age of the respondents influence their perception towards innovation.
R Square 0.044036018
Observations 100
ANOVA
Regression 1 0.826115702 0.826115702 4.514322581 0.036127869
Residual 98 17.9338843 0.182998819
Total 99 18.76
Intercept 4.669421488 0.234287749 19.93028446 0.00 4.204485074 5.134357901 4.204485074 5.134357901
Innovation -0.115702479 0.054456079 -2.124693526 0.036127869 -0.223768797 -0.007636162 -0.223768797 -0.007636162
 Finding:
(innovation)
88
2.10.5 Age wise regression analysis for V05 (Crowdfunding).

H0: Age of the respondents does not influence their perception crowdfunding.
H1: Age of the respondents influence their perception crowdfunding
R Square 0.010105757
Adjusted R Square 4.79534E-06
Observations 100
ANOVA
Regression 1 0.189584001 0.189584001 1.000474741 0.319659025
Residual 98 18.570416 0.189494041
Total 99 18.76
Intercept 4.337186735 0.163067121 26.59755508 0.00 4.013585341 4.66078813 4.013585341 4.66078813
Crowdfunding -0.039996625 0.039987134 -1.000237342 0.319659025 -0.119349791 0.039356542 -0.119349791 0.039356542
 Finding:
(crowdfunding)
2.10.6 Age wise regression analysis for V06 (Incubators).

H0: Age of the respondents does not influence their perception incubators.
H1: Age of the respondents influence their perception incubators
89
R Square 0.015154209
Observations 100
ANOVA
Regression 1 0.284292966 0.284292966 1.507964518 0.222391163
Residual 98 18.47570703 0.188527623
Total 99 18.76
Intercept 4.363306744 0.155460191 28.06703574 0.00 4.054801054 4.671812434 4.054801054 4.671812434
Incubators -0.047860769 0.038974819 -1.227992068 0.222391163 -0.125205029 0.029483491 -0.125205029 0.029483491
 Finding:
(incubators)
2.10.7 Age wise regression analysis for V07 (attitude of entrepreneur).

H0: Age of the respondents does not influence their perception attitude of entrepreneur.
H1: Age of the respondents influence their perception attitude of entrepreneur.
90
R Square 6.60384E-05
Observations 100
ANOVA
Regression 1 0.001238881 0.001238881 0.006472195 0.936043464
Residual 98 18.75876112 0.19141593
Total 99 18.76
Intercept 4.195048762 0.192105821 21.83717667 0.00 3.813821012 4.576276513 3.813821012 4.576276513
Attitude of entrepreneur -0.003643768 0.045292359 -0.080449951 0.936043464 -0.093524981 0.086237445 -0.093524981 0.086237445
 Finding:
found that the Age of the respondents is having significance influence on the V07
(attitude of entrepreneur)
2.10.8 Age wise regression analysis for V08 (venture capital).

H0: Age of the respondents does not influence their perception venture capital.
H1: Age of the respondents influence their perception venture capital
91
R Square 0.005299439
Observations 100
ANOVA
Regression 1 0.099417476 0.099417476 0.522111923 0.471663029
Residual 98 18.66058252 0.190414107
Total 99 18.76
Intercept 4.301165049 0.173270234 24.8234504 0.00 3.957315909 4.645014188 3.957315909 4.645014188
Venture capital -0.031067961 0.042996287 -0.722573126 0.471663029 -0.116392692 0.05425677 -0.116392692 0.05425677
 Finding:
(venture capital)
92
5 SUMMARY OF FINDINGS
This chapter has discussed the theoretical foundations used to define startup firms. In
addition, a literature review of common sources of financing for startup firms has been
presented. Financing sources were insider funding (personal fund), which comes from
founders, family and friends; and outsider funding, which comprises grants, public
debts, loans from commercial institutions, business angel financing, and venture capital.
Financial bootstrapping, crowdfunding were also briefly discussed.
From the above study we found that at the early stage of startup personal loan was most
preferable sources of finance for startup. and bank loan is also preferable sources of
finance for start up
93
6. CONCLUSIONS AND SUGGESTIONS
According to this study, different demographic factors such as age, qualification and the
number of respondents do not have a significant impact on the sources of finance for
startup. The different sources of finance that are available to the startup firms. Each
source of finance carries with it some advantages and disadvantages. Financing options
like Owner’s capital have advantage that they are easily available for the startups
followed by the fact that the startup team comprising of the family members, Friends
and colleagues do not demand control over their share of finance. Similarly, Banks are
another source that is at the moment most easily available source of finance for the
startups. venture capital plays an important role in startup. They play the role of
business angels as well. Banks make easy access to finance for the startups along with
reduced costs (interest rate) as the relationship strengthens. The current economic
scenario in India is on expansion mode. The Indian government is increasingly showing
greater enthusiasm to increase the GDP rate of growth from grass root levels with
introduction of liberal policies and initiatives for entrepreneurs like ‘Make in India’,
‘Startup India’, MUDRA etc. ‘Make in India’ is great opportunity for the Indian start-
ups.
94
7.Bibliography
Robb and Robinson. (2014). Bank loan.
Fishbein and Ajzen. (1975). Attitude of entrepreneur.
Gopal das PawanKumar. (2018). Government Policies.
Kaufmann and Schwartz. (2008). Business incubators.
Leach and Melicher. (2012). Attitude of entrepreneur.
Leach and Melicher. (2012). Venture.
McKinsey. (2007). Financial Gap.
Mollick . (2013). crowdfunding.
Neyens et al. (2010). Innovation.
Robb and Robinson. (2014). Bank loan.
https://www.investopedia.com/ask/answers/12/what-is-a-startup.asp
Read more: http://www.businessdictionary.com/definition/startup.html
Read more: http://www.businessdictionary.com/definition/startup-costs.html
https://www.wallstreetmojo.com/debt-vs-equity-financing/
https://thepurposeisprofit.com/2015/04/29/the-advantages-and-disadvantages-of-
friends-family-funding/
https://www.bigcommerce.com/blog/benefits-and-drawbacks-of-crowdfunding/
95
https://www.thehartford.com/business-playbook/in-depth/venture-capital
https://www.ripublication.com/irbf16/irbfv8n1_01.pdf
https://brage.bibsys.no/xmlui/bitstream/handle/11250/2403529/Pendegraft.pdf?
sequence=1&isAllowed=y
https://hrcak.srce.hr/file/196722
https://www.ripublication.com/irbf16/irbfv8n1_01.pdf
http: https://www.bdc.ca/en/articles-tools/start-buy-business/start-business/pages/start-
up-financing-sources.aspx
https://entreprenorskapsforum.se/wp-
content/uploads/2014/05/NaPo_Sourcesofcapital_webb.pdf
//www.fao.org/docrep/w4343e/w4343e08.htm
96
3 Appendix:
3.1 Format of Questionnaire designed:
 Title: SOURCES OF FINANCE FOR STARTUP
 Personal Data:
 Respondent Name:
 Gender: ●Female ●Male
 Age: ● Below-20 ●20-30 ●30-40 ●40-50 ●Above-50
 Professional: ●Below-graduate ●Graduate ●Post-graduate ●Professional
●Others
 Study Factors:
1.Would you opt for Bank loan for startup.
● Highly Yes ●Yes ●Can’t Say ●No ●Highly No
2. Do government policies promotes startup.
3. Does financial gap plays a crucial role in startup.
4. Innovation is the most important feature of startup.
● Strongly Agree ●Agree ● Neutral ●Disagree ● Strongly Agree
5. Crowdfunding helps in minimizing the financial gap.
97
● Strongly Agree ●Agree ● Neutral ●Disagree ●Strongly Disagree
6. Incubators is actively involved in the negotiation process between the startup and
investors.
7. Does attitude of entrepreneur affect the startup.
8. Venture capital is the key sources of finance in the startup growth and maturity stage
in firms.
 Ranking Question:
1.Rank your preferences for better sources of finance.
●Bank Loan ●Venture Capital ●Crowdfunding ●Equity Finance ● Personal

Fund
98

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PROJECT REPORT

A STUDY ON SOURCES OF FINANCE FOR STARTUP

BACHELOR OF MANAGEMENT STUDIES

IN PARTIAL FULFILLMENT OF REQUIREMENT FOR THE

BACHELOR OF MANAGEMENT STUDIES

SONIA SAMPATRAO DHEMARE

ROLL NO. -60

B. K. BIRLA COLLEGE OF ARTS, SCIENCE & COMMERCE

MURBAD ROAD KALYAN (W)

(Conducted by Kalyan Citizens’ Education Society)

BACHELOR OF MANAGEMENT STUDIES

This is to certify that SONIA SAMPATRAO DHEMARE OF T.Y

I, SONIA SAMPATRAO DHEMARE student of T.Y BACHELOR OF

Name: Sonia Sampatrao Dhemare

I hereby express my heartiest thanks to all sources who have contributed to

I am thankful to Mumbai University for giving me such a challenging task

having such a wonderful course.

I am very much grateful to my project guide Dr.(Mrs) Chandra Hariharan

helped in completion of this project.

No. Content Page No.

1.3 Objective of the study:

1.4 Selection of problem :

1.5 Background of the study :

1.6 Stages of the startup lifecycle :

1.7 Advantages of startup :

1.8 Disadvantages of startup:

1.9 Challenges faced by startup:

1.10 Sources of finance:

1.11 Initiatives taken by the government:

2.2 Sample Design: 20

2.2.1 Target population:

2.2.3 Period of study: 20

2.2.4 Sample size: 20

2.5 Statistical Tools used for the study:- 23

2.6 Analytical tools used for the study:-

4. Chapter IV –Data Analysis & Interpretation 32

Department of Industrial Policy and Promotion (DIPP) define a startup as an entity

1.3 Objective of the study:

1. To study the sources of finance for startup.

2. To understand the stages in startup.

3. To study the initiatives taken by Government for startup companies.

4. To know the various sources of finance.

1.4 Selection of problem

1.7 Advantages of startup

1.7.2 Efficiency (Lean and Mean)

1.8.3 Market Access

1.8.4 Team Composition

1.9 Challenges faced by startup

1.9.2 Fierce Competition:

1.9.4 Hiring Suitable Candidates:

1.9.5 Partnership Decision Making:

1.9.6 Financial Management:

1.9.7 Cyber Security:

1.9.9 Lack of planning and visualizing

1.9.10 Time management

1.10 SOURCES OF FINANCE

How it basically works is that an individual makes a business pitch on the

1.10.3 Equity Financing:

1.10.4 Business Incubators:

In India, the business incubators are promoted in a varied fashion: as Technology

1.10.6 Business Angel:

A business angel may be defined as (Mason and Harrison, 2008, p. 309):

1.11 Initiatives taken by the government