🎯 Let's learn the procedure of incorporating your startup, your startup isn't registered, if it doesn’t exist on paper.
🔍 Step-by-Step let's see how to incorporate in India for now :
✅ PRIVATE LIMITED : This is the usually everyone's first choice investors prefer it, scalable.
✅ LIMITED LIABILITY PATNERSHP : This is usually for service providers, consultant, Accountant, freelancers. As this offers more flexibility and it also has its own pros and cons, Less funding / No funding opportunity. ( Seek professionals for help )
✅ ONE PERSON COMPANY : Best for solo founder's, even best for freelancers. It can't be scaled if you wanna scale, it has to be converted into PVT.LTD.
✅ PUBLIC LIMITED COMPANY : As of now let's keep this aside, we are focusing on Start-up and start-up can't usually start a public company. If you are eligible then yea you can still apply for it.
✅ Pro tip: For most tech startups planning to raise capital, go with Private Limited Company
For information about these you can refer to : https://razorpay.com/rize/blogs/private-limited-company-vs-llp-vs-opc
✅ PAN & Aadhaar (of founders)
✅ Digital Signature Certificate (DSC) https://emudhradigital.com/apply-for-digital-certificate
✅ Director Identification Number (DIN) https://www.mca.gov.in/mca/html/mcav2_en/home/mcaservice/dinservices/afd/applyfordin.html
✅ Registered Office Address Proof
If y'all need one stop solution you can use (personally used) : https://razorpay.com/rize/company-registration
✅ Choose a unique name ✅ Check availability on MCA portal ✅ Avoid trademarked / Licenced names
Check it here : https://www.mca.gov.in/content/mca/global/en/mca/fo-llp-services/company-llp-name-search.html
File SPICe+ Form online Includes: ✅ Company Name Approval ✅ Director Appointment ✅ PAN & TAN ✅ EPFO, ESIC & GST registrations ( If required )
Can be done on : MCA GOVT PORTAL / RAZORPAY RIZE / VAKIL SEARCH / INDIA FILLING ETC......
MCA : https://www.mca.gov.in/content/mca/global/en/home.html RIZE : https://razorpay.com/rize/company-registration
Once you corporate and get your Certificate of Incorporation ( CoI ), you can open a current account under your company name.
Things to keep in mind while opening a startup account, look for possible benefits such as :
✅ Zero maintenance charges for not maintaining average balance / Zero AMB for atleast 1 year. ✅ Free Cash transaction, Free or low charges for NEFT / RTGS ✅ Forex transaction enabled ✅ E-Banking ✅ Check if they issue OD / CC ( OVERDRAFT / Cash credit ) ✅ Good relationship is maintained ( Relationship banking is provided or no ) ✅ Tax payments enabled ✅ Sweep facility
Recommendation : ☄️IDFC start-up account: https://www.idfcfirstbank.com/startup-banking/startup-current-account
☄️Indusind Start-up account: https://www.indusind.com/content/indusind-corporate/en/business/accounts/current-account/indus-startup-current-account.html
☄️ You can even check out other banks too.
✅ Apply for DPIIT / START-UP India recognition. Perks :- Tax benefited, DPIIT perks, Easy access to government grants.
Visit : https://www.startupindia.gov.in for more details
✅ Apply for GST if applicable.
✅ Create a founder's agreement which will mention everything ( roles, equity etc.. )
Agreements can be validated by lawyers.
⚠️ Mistakes to Avoid:
🫸 Don't register as OPC if you plan to raise funds and OPC is not preferred for startups.
🫸 Try to create a founder's agreement, don't skip or don't forget to mention all details. Update it accordingly.
🫸 Don't skip / forget applying GST if it is applicable / if you are gonna sell something or charge for something online.
💸 Cost of Incorporation ( depends )
If you do it yourself throught MCA : ₹2,000–3,000 DSC : 1500-2000 ( Depends on how many people )
☄️ If you do it via Razorpay or any other agency : ₹5,000 to anywhere between ₹20,000 ( including government fee ) Use only trusted agency / personally known people.
🧠 Tip: Incorporate only when you are ready to go live and you are ready to charge money. For raising funds it isn't a big probelm but after getting term sheet it is so it's advisable to incorporate it if you are gonna raise funds.