The Start-up Eco System - Opportunities & Challenges Date:   Thursday , January 08, 2015 Established in 2007, The Chennai Angels (TCA)-erstwhile Chennai Entrepreneurship Trust Fund-is a firm that helps aspiring entrepreneurs to initiate their ventures through capital, mentorship, network, experience and entrepreneurial wisdom. I have witnessed first-hand, the evolution of entrepreneurial activity and the eco system in India over the last 45 years. There was a time, when it was believed that large scale manufacturing could provide considerable employment in the country and that around each large manufacturing unit could be born a large no of ancillary units, which in turn would supply the large units with much needed inputs. The semi socialist governments of the past also believed that there should be a balance in the number of large manufacturing units that come up and that the state should regulate the inflow of funds into various sectors. Now we know that the state should have allowed self-regulation by creating the right incentives. By stepping in, creating the large manufacturing units (Public sector), and by regulating the funds that go into the manufacturing sector (licensing), we created our own complex distortions in the marketplace. A whole generation or two of Managers have become adept at \"managing\" the environment with scant regard for the consumer. But all that hopefully, is about to change. Create a hotbed of entrepreneurial activity and a huge number of jobs get created. Of course, the customer will be king and will reject substandard goods and unfriendly practices. Initially, only the mighty (those who respect a free market) will survive, but eventually the rewards will be bountiful. Here are some daring thoughts for our new government to consider: -Rapidly dismantle the ridiculous laws that impede the free movement of goods across states through artificial taxes and Octroi charges. -Permit the flow of credit without collateral to flow. For years, this credit has only been going to those who either don\'t need it, or don\'t deserve it. By opening the floodgates, you cannot be worse off. Put into motion a process that enables you \"manage\" the extension of credit. But make sure that entrepreneurs have access to loans and advances. For this, we would need to get over our doubts and suspicions and give our entrepreneurs a fair chance to prove themselves. -Create the conditions for a 1000 Angel investor groups to get created all over the country. A huge talent base of senior executives is now retiring. They are good for at least another decade of productive work, and can be ideal mentors and in fact even investors. -Allow very attractive tax terms for investments made by SEBI approved VCs, made thru NSE-SME approved Angel investor groups, so that more investment comes into start-up entrepreneurial activity. For investments that come within the first 3 years of start-up, make it tax free. -Encourage large Corporates to start seed funds in relevant verticals and permit tax write-offs in the year that the fund is created. Some of these more aggressive initiatives can be for a fixed period of time, until momentum has been gained. The software industry was encouraged for decades with a tax free status on exports. The world economy is very finely balanced for the US to emerge as the strongest currency ever. And the world needs a mascot among the emerging nations that can attract investment. Only sustained entrepreneurial activity can add jobs in hordes. God willing and our Prime Minister willing, India\'s time is nigh.