Among the top cities in India, Bengaluru and New Delhi are the hubs for startups. But a look at recent additions to the club, a bunch of smaller towns and cities are making their presence felt. Reports from a study show that 20% of startups are from tier 2 and tier 3 cities in India. The brain drain that usually causes students from small towns to leave to bigger cities in search of opportunities, can be overcome if we concentrate on generating jobs or starting businesses in their hometowns instead. What is it about these small towns and cities that lure investors in big numbers for beginning new startups? The answer might surprise us. Though the developments might be slow, we can slowly start looking at the options we have to set up incubators for startups in smaller towns and cities.

Digital Transformation Through Startup Culture

India’s vibrant startup culture, aided by the government, is playing a vital role in the digital transformation of the country. The application of a digital medium in all types of businesses is being embraced, and every day there is a lot of time spent on generating new ideas for the same. The number of startups that are emerging on India’s vast landscape every other day is simply mind-boggling. This is aided by the shift in professional perceptions which is to move away from mundane tasks on a daily basis to something much more innovative. Government incentives for these ventures are also a talking point when it comes to encouraging this culture. There is flexibility in obtaining tax exemption for 3 years at a stretch within 7 years from the start date of the firms. Initiatives by the government to connect citizens to broadband access and the resolve to make more than 400 million people digitally conversant by the next 5 years can prove to be a real turning point. The digital ecosystem is growing at a healthy pace, spurred by government initiatives. Companies like Intel, Google, Cisco and others are also contributing effectively to the startup culture by being mentors, financiers and trainers.

The Startup Attractions In Small Towns

People working in Bangalore and other metropolitan cities often crib about how hard it is for them to get to the office every day and the amount of traffic they have to battle with. Now, these issues have cropped up mainly because the government, as well as all the top MNCs, are targeting only the tier 1 cities to do their business in. There is a constant streaming in of people from all the other smaller towns and cities in India to these cities to look for jobs. The new startup culture, may help in getting people back to their hometowns and work there instead of leaving behind their families to work in a new land. When we explore some reasons why it is a good idea to concentrate on the smaller towns, it is a great way to increase employment opportunities there. Also, there are a lot of professionally qualified people in these towns who can take part in the startup culture by coming up with new ideas. Driven largely by incubators and tech parks, Jaipur, Ahmedabad, Indore and Kochi are some places which are slowly emerging as new hubs for startups. The biggest contributors to this culture are lower manpower cost, cheaper real estate and affordable amenities.

Plug In The Brain Drain

To look at some of the advantages of encouraging smaller towns, the salary required to pay to these workers would be lesser since the cost of living is less, everybody is living a stress-free life and everything, from office rent to labour charges are reduced which increase profits. Some of the myths that come in the way are the feeling that there is a shortage of skilled labour which is untrue since a lot of professionals who work in top cities come from small towns. There is also a misconception that startups work only in tier 1 cities, most companies work because of great concepts and lots of hard work, which can happen anywhere. According to a recent interview with Maury Forman, Senior Manager for Rural Strategies and Entrepreneurship for the Washington State Department of Commerce, he talks about luring the youth in small towns and cities to come up with new ideas to start small companies in their hometowns rather than just going out in search of jobs. It would be a refreshing change to listen to accomplishments in these uncharted areas, which would spur more individuals to think along the same lines. Also, the government has to look at what improvements can be done in small towns and cities to make this happen, rather than only concentrating on the bigger cities. Let us tap into the potential of youth and make change happen in all cities and towns of India, have a widespread development.