Published: 28th March 2020
Friend of all start-ups: How Rakesh Kumar Gupta is helping other entrepreneurs
Rakesh opines that, "A start-up should plan the business model accordingly and should have the proper knowledge of business scalability, valuation and the equity to be diluted to generate funds"
Who knew that Rakesh Kumar Gupta, who came to Bhubaneswar to start his own CA firm, Rakesh Kumar Gupta & Co, would end up helping others take off as well. Today, Rakesh helps more than 50 start-ups in various ways — statutory laws, financial models, government policies related to start-ups — basically, all the jargon that entrepreneurs would need help wrapping their heads around. He has also provided mentorship to start-ups from KIIT-TBI and Sri Sri University. And if you think it’s additional work for him, it surely isn’t. We chat with the Founder of Taxopliance Advisory to find out how and why he helps young entrepreneurs get a hold of the technical side of things. Excerpts from an interview:
1. Tell us about how you started helping entrepreneurs.
I started my CA career in the year 2012 as an employee in an audit company in Chennai. But to pursue my professional dream, I returned to Bhubaneswar in the year 2013. Initially, I started working with established organisations in association with an existing CA firm in Bhubaneswar. But in 2016, I started my own practice with a team of four people. In 2017, I had the opportunity to mentor some of the start-ups at Sri Sri University with the help of Barada Prasad Panigrahi. I was invited there to give a small lecture on how to form a start-up. This was my first interaction with the start-ups in Odisha.
2. In what aspects do you help start-ups?
Basically, we help the start-ups by getting their organisation and idea properly registered, doing the financial modelling/planning, identifying the commercials in the idea,À helping the start-ups maintain proper statutory books of accounts at a low cost and helping with all the statutory compliances like GST, income tax, Companies Act and so on.
At Sri Sri University | (Pic: Rakesh Kumar Gupta)
3. What kind of knowledge do start-ups usually lack? What are some steps you take to educate them on the matters they have no knowledge of?
Most of the start-ups have the idea and, in most of the cases, they incorporate the company too. But they are unable to figure out how to scale up the business, they don’t have the proper financial model of the business and are ignorant about the statutory compliances to be adhered or otherwise, they could land themselves penalties and fines. We guide start-ups with regards to what are the statutory laws which are applicable to them, prepare the financial models for them, guide them about the government policies related to start-ups, help them with documents preparation for funding/investment, coordinating with the investors and providing other hand-holding support related to finance and tax matters.
4. In your opinion, what is lacking in the whole start-up ecosystem, especially in Odisha? What is it that young and budding start-ups really need?
The Odisha government is taking proactive measures to develop the start-up ecosystem here and the Startup Policy 2016 is also in place. Apart from the government, KIIT-TBI, CV Raman, Sri Sri University, IIT and others are taking active steps to develop a start-up ecosystem in Odisha. But the one thing which is lacking is proper mentoring at each phase of the start-up journey. Start-ups face lots of challenges with regard to finance. New start-ups should always try to develop a self-sustainable model where they can generate the finance at the proper stage of the expansion. Planned expenditure of limited available funds should be made. Basic knowledge of statutory compliances should be known to the start-ups.
5. Tell us about your journey of establishing the CA firm you head.
After I quit my job in Chennai, I returned to Bhubaneswar in 2013. But for the initial three years, I had to struggle to get clients. Hence, I joined as a consultant at a company and worked with a few CA firms in Bhubaneswar where CA HS Das helped me. Later on, in 2016, I fully quit and started my own firm with three team members. It’s a tough journey when you start a new organisation and the same happened to us. Slowly, we started getting clients through some references and our good services, and in about one and a half years, we were self-sustainable. Then, through the opportunity given by Barada Prasad Panigrahi, we started helping start-ups and it has been an exciting journey when you meet with the young and budding entrepreneurs with creative thoughts in their mind, you only have to give them the proper direction so that their thoughts can be converted into a business model. I have been providing mentorship to start-ups at KIIT-TBI, Sri Sri University and many start-ups from Scomm India, a group of more than 80 start-ups at Odisha. We have a team of 12 people who are all well-equipped to handle the day today's statutory requirements of the business needs of the clients.
Rakesh at Centurion University | (Pic: Rakesh Kumar Gupta)
6. How many start-ups would you say you have helped?
I am unsure about the exact number of start-ups whom we have helped. But currently, we are providing audit and non-audit services to more than 50 start-ups. We have to remain updated about various statutory provisions and laws to cater to the needs for our profession and also, through practice, we gain the know-how to help the start-ups.
7. Any message for start-ups?
Every start-up has a lifecycle. Each start-up has to identify at what stage it is and make plans accordingly. At an early stage, start-ups don’t have the funds, but have full equity of the business. But once the funds start coming, the big question each start-up faces is how much equity should it dilute to get the fund. The start-up should plan the business model accordingly and should have the proper knowledge of business scalability, valuation and the equity that should be diluted to generate proper funds for the business.
Two start-ups he has helped:
- LectureNotes Technologies: This start-up provides online classes and notes. Rakesh has helped them with company registration, book-keeping and statutory compliances. Now, the company has grown up and is doing well, he says
- Trag Sales4you: They are in the field of hotel management. Rakesh is looking after the company documentation, compliances, accounting and planning for the scalability of the company in other states