The World Bank’s report on ‘Ease of doing Business’ (2015) ranks India at the 142nd position out of 189 countries. Ironically this, sketches a better picture when compared to the report published in 2013 where India was ranked 179.
Although the present government is still trying to ease out these policies, making it more investor and business friendly, private players have started to recognise the potential of this untapped market.
Bitten by the entrepreneurial bug, Lionel Charles wanted to start his own nutraceutical business. However, it failed due to policy logjam. Besides, he had no training as a nutritionist.
In reality he was a certified Public Accountant from the US. He still wanted to do something which he was trained in and that’s what he did this time around. An opportunity soon presented itself to Lionel when one of his clients, claimed that he had incorporated his business online.
As a result, Lionel co-founded IndiaFilings.com in 2013 with the help of his father L. Charles. Today, IndiaFilings.com is helping new businesses start-up and register, and offers other services like tax filings, etc. A company that started with just 2 individuals now has a team of 110, with the technical team comprising of 15 individuals.
Speaking on the services that IndiaFilings.com offers, Lionel says,
People are of the opinion that they would do better if they seek professional help, to set a guide through the process. Even if the government simplifies the process, one still needs a CA or a company secretary to be there. This is just to see that they aren't making any mistakes.
The co-founder tells us the startup’s differentiation is impinged on deputing technology to create efficiencies. Moreover, technology also helps in reducing errors and oversights on the platform.
IndiaFilings.com did not want the engagement with the customer to stop at assisting them in their incorporation. Rather, they wanted to remain partners throughout the entire lifecycle of the business. Therefore they launched a platform called iCFO.
According to Lionel, startups require documentation continually to support their business operations. iCFO drafts many such documents in real-time; even while the user is answering questions online.
“Startups come back to us asking if we can give them an appointment letter or an employee Non-Disclosure Agreement. We have over fifty such typical documents ready, in what we call, live formats. By asking the entrepreneur a set of questions and based on his answers, the system structures the document in real-time. This is something we got to, first,” says Lionel, with some pride.
The iCFO platform also has a reminder feature on its app. For businesses that do not remember to file their TDS returns, etc., the system sends them reminders 3-4 days before their actual date of filing. Over fifty potential clients visit the iCFO platform every day.
Product Growth & Revenue
Currently the startup is bootstrapped, having made an initial capital investment of approx. 1 Crore. They are seeing a 20 per cent growth in revenue on a month-on-month basis.
On an average their website has over 13,000 visitors every day. IndiaFilings.com is coming up with a newer version of their mobile app which they aim to launch soon.
Another interesting feature that the startup has is called '30 minutes Trademark' – it literally registers an organisation’s trademark in 30 minutes.
Lionel tells us:
Our journey has been smooth and one thing which has been a great accelerator for us is the government being on the same idea, that businesses should have an easier time starting up. The recent launch of the INC 29 (procedure for fast track company registration) is a testimonial of this idea.
IndiaFilings signs up over 500 clients every month - the majority of them are regular businesses like shops, restaurants, etc. Technology startups only comprise about 20 to 30 per cent of the clients. Furthermore, the Metros and Tier 1 cities constitute a significant chunk of the client base. There are also a few foreign clients.
Industry and Competition
With the government launching the LLP (Limited Liability Partnership) wave in 2009 most of the new businesses want to form LLPs, and need to get incorporated. According to the Ministry of Corporate Affairs (MCA), in 2013-14 there were 7174 freshly incorporated LLPs as compared to 4711 in 2012-13, which is more than a 50 per cent increase. At present, there are 30,845 Indian LLPs which are active in the 2014-15 fiscal.
Vakilsearch and Quick Company are their biggest competitors. Judging from MCA data, the market potential is huge. There is enough space for other private players to enter the market.
Winds of Change
On the issues of trust and privacy because of the online processes, Lionel tells us:
We are moving to a culture where people are increasingly trusting online services. The culture of hiring a CA is slowly wiping out. There is a leap of faith, quite similar to the disruption in the healthcare industry. There will be a disruption in this industry, too. The e-commerce boom has helped individuals trust online platforms. Through features like active tracking clients are informed about what’s happening to their forms. We believe engagement is the key to provide that assurance. When you can give them a good platform and tell them what’s happening from time to time, the customer automatically starts trusting you.
(First image credit: Shutterstock)
Tarush is driven towards delivering unbiased and accurate reportage while engaging with as many mediums as possible to narrate a fresh perspective. Working for the past few years in the digital space with YourStory, he has covered the Indian technology ecosystem extensively, focusing on new age Fintech companies, while building strong connects within the industry.