In addition, for a startup to be recognized as one,
- It must be an entity registered/incorporated as a:
Private Limited Company under the Companies Act, 2013; or
b. Registered Partnership firm under the Indian Partnership Act, 1932; or
c. Limited Liability Partnership under the Limited Liability Partnership Act, 2008.
- Five years must not have elapsed from the date of incorporation/registration.
- Annual turnover (as defined in the Companies Act, 2013) in any preceding financial year must not exceed Rs. 25 crore.
- Startup must be working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.
- The Startup must aim to develop and commercialize:
a) a new product or service or process; or
b) a significantly improved existing product or service or process that will create or add value for customers or workflow.
- The Startup must not merely be engaged in:
developing products or services or processes which do not have potential for commercialization; or
b. undifferentiated products or services or processes; or
c. products or services or processes with no or limited incremental value for customers or workflow
- The Startup must not be formed by splitting up, or reconstruction, of a business already in existence.
- The Startup has obtained certification from the Inter-Ministerial Board, setup by DIPP to validate the innovative nature of the business, and
a. be supported by a recommendation (with regard to innovative nature of business), in a format specified by DIPP, from an incubator established in a post-graduate college in India; or
b. be supported by an incubator which is funded (in relation to the project) from GoI as part of any specified scheme to promote innovation; or
c. be supported by a recommendation (with regard to innovative nature of business), in a format specified by DIPP, from an incubator recognized by GoI; or
d. be funded by an Incubation Fund/Angel Fund/Private Equity Fund/Accelerator/Angel Network duly registered with SEBI* that endorses innovative nature of the business; or
e. be funded by the Government of India as part of any specified scheme to promote innovation; or
f. have a patent granted by the Indian Patent and Trademark Office in areas affiliated with the nature of business being promoted.
* DIPP may publish a ‘negative’ list of funds which are not eligible for this initiative.