Start-ups Scheme by Different Countries Government- I


What are start-ups?

The word start-up has taken the Google trends by storm and in the past one decade, the global economy has seen a tremendous change towards start-ups. Start-ups signify innovation and motivation. Around the globe, several thousand start-ups are working diligently to solve the challenges that common people face. They have made life easier for people. Countries having stronger start-up presence are observing strong economic growth and moving towards a positive human index. Start-ups not only drive technology in the countries of their operation but also help to solve complex issues which used to restrict free growth of people living in those countries. In addition, one can’t deny the impact start-ups have on the employment rate. Globally, the large number of jobs have increased and not only this, increased use of technology, innovation and creativity in the start-ups have also given way to the skilled workforce.

Start-ups have been defined differently in different countries and definitely, the atmosphere a particular government provides to the flourishing start-ups determines the level of growth of the community in the country. However, with an understanding that start-ups are a way to economic growth, many governments still consider start-ups to be a threat to their economic development. With start-ups, employment structure is quite volatile and it has been proved by thousands of start-ups shutting down every year even after taking a large amount of funding. Another cause of concern is that a large number of youth launch a start-up in order to give wings to their imagination and creativity, however, many of the ideas are not feasible and a large sum of investment is wasted on that. Keeping such matters in mind, different governments have tried to trade off the benefits that these start-ups can gain and the restrictions that they have to face. Technically speaking, a start-up is a young company at its initial stage of development. Start-ups could be run by a group of partners or individuals as per their legal status but they definitely mark an innovative or creative idea that can be commercialised. Many start-ups are bootstrapped, some through NPOs (Non-Profit Organisations), state government, business loans, or loan by the govt-sponsored local banks and aided by their family and friends in terms of a loan or as a gift. In addition, a start-up may raise funds from venture capital funds in exchange of by giving some percentage of share in ownership, control, but for that firstly the start-up has to prove its ability, the potential and its worth to them.

Here, in this first series, we will be discussing two countries namely- USA and UK. These are among the top listed countries with a very strong start-up culture. Undoubtedly, the governments in all these countries are quite active with relaxed policies and opportunities for easy loans which motivate innovators to take the risk and venture into a new field.


US rank first in the global startup hub ranking. The basic reason for the tremendous growth in the number of start-ups is the availability of required technologies at convenience which is a big challenge in other countries. Another reason that actually counts is the availability of financial aid that the government and several other funding institutes are providing to the start-ups. In the United States, The Office of Entrepreneurial Development (OED) is the department which supervises the programs and services of small businesses and provides them with the required training and counselling.

Entrepreneurship Education (OEE) – The Office of Entrepreneurship Education helps the start-ups by providing them with the program and information, education, training and guidance while they manage their small businesses and enter to the journey of making it a success.

State and local government both are providing various opportunities to the start-ups and small businesses in different terms such as- funding, tax benefit, partnership with other firms or in incubator service. A combination of educational, Informative and financial aid is being provided by the government which is resulting with the high success rate and thus high motivation degree among the founders.

State and local bodies provide the assistance and resources provided by the government, government financing department, direct and indirect private investments, R&D credits, SBIR and STTR Grant Program related to the tax rebate for start-ups and various tax exemptions like sales tax and property tax.

US start-ups are mainly based out of technology and they are driving a great force to encourage more of technology-based start-ups. One of the reasons behind this is a strong education structure that is collectively being provided by the Universities, Colleges and the Government department.


UK stands on number second position in the global startup hub ranking.UK base start-ups are very well known for working towards emerging technologies, new mobile applications and in internet based services. London is mainly considered as the financial hub of the world and a large number of finance based technology products have emerged from the city. It is often called the Digital Capital of Europe. The UK government has been highly proactive in supporting the start-ups and providing them funds regularly in the initial stages. Almost all the top Universities have their entrepreneurship and new venture support cells where students are motivated to think innovative and come up with a commercial solution. These solutions are then backed by the Universities, private companies as well as the government for financial assistance, education and mentoring. Apart from University intervention, several schemes have been set up by the government so that start-ups can grow and avail financial aid. Talking about Funding, Networking, Support, Mentoring or about Visas, the UK government has made the rules easier thus providing a great support and assistance to its start-up community. All these efforts are definitely an answer to making the UK as the Silicon Valley of Europe.

For any start-up arranging fund is the most crucial part of it but if we have a look at UK policy in funding, they made fund-easier and loan assistance or grants from institutions accessible, whether it is a government or raising from the private institutions. Some of the government grants for start-ups are “Grant for Business Development” (GBI), “Selective Finance for Investment” (SFI), “National DTI Grant for Research and Development”, “Export Credits Guarantee Department” (ECGD), The Mayor of London and the European Regional Development Fund (ERDF) have also released several development grants aid for different reasons.

Talking about loans and loan assistance schemes are “Small Loans for Business Scheme”, “Enterprise Finance Guarantee” scheme and The East London Small Business Centre (ELSBC) providing ‘Gateway to Finance’ program. The government itself gives the guarantee to lenders on the behalf of start-up enterprise. But the key factor for getting these grants and loan offers is a master plan of business that how all the things will work and highlight all the scalability and efficiency of the start-up to the government.

Addition to these grants the British Government extended the support of more than finance by training schemes for proper assistance and mentoring. In this, the start-up raises its knowledge at a giant level i.e. manufacturing work, legal knowledge, technical work, information and marketing strategies and more. The schemes are “Business Bootcamps” scheme launched by the Mayor of London, the Royal Bank of Scotland, and “Entrepreneur First” scheme program for recent graduates and “Get Mentoring Scheme” offered by Small Firms Enterprise Development Initiative (SFEDI) and many other schemes.

All the efforts of the government are surely not going to be waste since the government’s initiative has resulted in raising its country start-up’s result that the UK stands at 2nd position in the world for start-up country. All continuous effort to emerge the country into a start-up hub, by providing world-class technology to the start-ups.

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