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What Are The Various Stages Of A Startup?

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One of the most fulfilling journeys anyone can undertake is to begin a startup.  There are a lot of stories about how a startup makes it big in the market and reading them can inspire oneself to undertake a similar journey.  However, beginning a startup and scaling it up is easier said than done as there are multiple stages to running a startup.  Identifying a problem and coming up with a solution is not the only thing which matters when it comes to founding a startup but there are multiple other parameters which need to be considered along the journey.  By looking at the multiple startups which succeeded and the big picture, a startup’s journey can be quantified into stages.  Skipping any of these stages and moving on to the next stage would surely be a setup for a failure.

Read along to find out the various stages in the journey of a startup.

1) Problem discovery

Anybody can come up with an idea but the most important thing is to come up with an idea which solves a particular problem.  This stage is about discovering bottlenecks and problems faced by customers in a market.  This is the stage where a startup needs to focus on what the customer wants rather than what a startup needs to do.  This is where startups need to interview customers to find out the problems they are facing and come up with a solution.  For example, Uber discovered that customers need a simple way to hail a cab and came up with their platform which connects cabs with customers.

2) Ideating

The next stage is to find a value proposition for customers.  This begins by ideating to find opportunities and create good solutions.  There are high chances for good ideas to come up in the discovery stage during the customer interviews as they might provide their own insights and ideas.  By the end of this stage, a startup should be able to come up with a solution which solves a problem by providing a solution which an existing competitor would not provide.

3) Problem/Solution fit

There is a high likelihood of the first solution not being the right solution.  The initial plans might not work out and therefore Plan A should never be assumed as the right solution.  Sometimes the immediate solution will not nudge a customer to make a purchase.  This stage exists to make multiple iterations and if possible pivots into different product models.  During this stage, a startup needs to introduce a product design, clickable prototypes, or product features which the customers can interact with physically.  The initial problem could be solved if customers show interest and prepay for the product or have taken a certain set of actions that you can define based on your product, target and market.  For instance, in the case of freemium models actionables could mean completing a long survey, joining a waitlist and referring X number of people or applying to become a user.

ALSO READ: What Is Seed Funding And What Are The Sources For Seed Funding For Startups

4) Product/market fit

In order to go for a product/market fit, a startup would need data like customer acquisition costs (CAC) and customer lifetime value.  This could only be done with a launched product which is in use.  One of the best indicators for a good product/market fit is acquiring customers at a lower acquisition cost.  A CAC can be calculated by dividing all the costs spent on acquiring more customers (marketing expenses) by the number of customers acquired in the period the money was spent.  For example, if a company spent INR 100 on marketing in a year and acquired 100 customers in the same year, their CAC is  INR 1.  Net Promoter Score (NPS) is one of the easiest ways to measure product/market fit.  Net Promoter Score is the percentage of customers rating their likelihood to recommend a company, a product, or a service to a friend or colleague on a scale of 1-10 with 10 being highly likely and 1 being highly unlikely.

5) Scaling up

This is the stage where a startup needs to focus on diversifying their product offerings.  This is where a startup needs to iterate what is working and put in processes which make these workflows faster.  This is the stage where a company could think of hiring more resources, opening a larger office space and expanding in different areas.  For example when the hyperlocal delivery startup Dunzo began, it was limited to Bengaluru.  However, Dunzo soon expanded to other metropolitan cities to expand their operations and scale up.  

Many startups and entrepreneurs focus on scaling  up rapidly without going through the proper startup lifecycle and often end up in losses.  Building a startup could be fun but it is important to pay attention to each of these steps throughout its journey.  

 

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Entrepreneur Stories

Tesla Secures Mumbai Facility as Key Step in India Market Entry

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Tesla has ramped up its India expansion by leasing a 24,565 sq ft warehouse at Lodha Logistics Park in Mumbai’s Kurla West. The five-year lease, registered on May 16, 2025, involves a total rent of over ₹24 crore, starting at ₹37.53 lakh per month with a 5% annual escalation. The facility includes two ground-floor units and 20 parking spots, with rent payments commencing June 1, 2025.

This warehouse will function as a key service center and garage for Tesla’s India operations, excluding bodywork and spray painting. The move supports Tesla’s preparations for its official market debut, expected in late 2025 or early 2026.

Tesla’s India rollout includes offices in Pune, flagship showrooms in Mumbai’s Bandra Kurla Complex (BKC) and Delhi-NCR, and co-working spaces in Mumbai. The new warehouse lease highlights Tesla’s commitment to building a robust infrastructure for sales, service, and delivery of electric vehicles and energy products across India.

While manufacturing plans are not yet confirmed, Tesla is reportedly exploring sites in Maharashtra for a potential assembly unit. The Mumbai warehouse lease marks a significant step in Tesla’s strategy to establish a strong presence in one of the world’s fastest-growing EV markets.

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Info Edge Shareholders Approve ₹1,000 Crore Investment in New Venture Fund

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Info Edge

Info Edge (India) Ltd shareholders have overwhelmingly approved an investment of up to ₹1,000 crore in the company’s third venture capital fund, Info Edge Ventures Fund III. The proposal received near-unanimous backing, with 99.9995% of valid votes in favor out of 1,274 participants.

Smartweb Internet Services Ltd, a wholly owned Info Edge subsidiary, will act as sponsor and investment manager for the new fund. This move strengthens Info Edge’s commitment to backing early-stage startups and expanding its footprint in India’s venture capital landscape.

Info Edge has a strong track record as an early investor in leading Indian startups like Zomato and PB Fintech, with combined holdings in these firms valued at ₹31,500 crore ($3.7 billion) as of March 31, 2025.

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Entrepreneur Stories

Razorpay Partners with MeitY Startup Hub to Accelerate Deeptech Innovation in Tier II and III Cities

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Razorpay

MeitY Startup Hub (MSH), under the Ministry of Electronics and Information Technology, has partnered with fintech leader Razorpay to support the growth of deeptech and emerging tech startups across India, with a special focus on those in Tier II and III cities. Through this collaboration, early-stage startups will gain access to Razorpay’s fintech infrastructure, mentorship, and resources via the Razorpay Rize program.

Startups in areas like AI, blockchain, robotics, and IoT will benefit from streamlined company incorporation support, expert mentorship, product credits, and guidance for applying to global accelerators such as Y Combinator. Selected founders will also join the exclusive Rize Community, connecting with peer networks and attending masterclasses.

MSH CEO Panneerselvam Madanagopal emphasized that this partnership will help founders scale faster by providing vital support in mentorship, capital access, and digital infrastructure. As India’s startup ecosystem surpasses 159,000 DPIIT-recognised startups, this initiative aims to give deeptech entrepreneurs the tools and networks needed to innovate for India and expand globally.

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