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April 26, 2022
Automation is the bridge to enable startups embrace a ‘culture of compliance’, uphold high standards of governance, and fulfill the obligations that come with it. Every stakeholder of a start-up is now looking at Compliance Culture as a measure of success.
The year 2021 witnessed a whirlwind of investments in the Indian start-up landscape with Venture Capital funding reaching a staggering $38.8 B and 44 start-ups joining India’s Unicorn club. On top of this, some high-profile listings, funding closures, and exits added to the energy and hope of the starry-eyed founders and their leadership team.
The proverbial wet blanket came via a few key misses in governance related activities – a potential domino effect that could affect the entire entrepreneurial ecosystem. Governance related mishaps affect not just the company and their founders, but all their key holders including vendors, clients, and even the investors themselves.
Honestly, if you are a start-up looking to expand, this might come as stressful news. Already, there are innumerable factors that are challenging your start-up, and this clarion call to establish a ‘culture of compliance’ that will tie down your people, processes, and systems might look like an additional burden.
The parochial view of compliance limits itself to certain regulatory checklists that need to be ticked. Additionally, compliance is also looked upon as a barrier to innovation, stopping young and dynamic start-ups from breaking all the barriers and establishing a trailblazing way of operating. Let’s take a deliberate pause and look at it from a different angle, from the angle of stakeholders. If a stakeholder wants to invest hard-earned capital into something, then one will always look for a safe avenue where the investment would bring returns along with a good name. Here ‘name’ is synonymous with reputation. Once this reputation is tarnished, an organization can no longer regain the trust it had achieved in the market. So, why would someone invest in an organization that looks lucrative but is mired in compliance inefficiencies?
In a business ecosystem that is constantly in flux, start-ups wage a phenomenal battle every day. Navigating through the challenges pertaining to product fitment to growth, it must meticulously allocate a considerable amount of its budget to building its digital capabilities- all targeted to driving agility and efficiency through automation. The saddest part is compliance doesn’t feature in the list. It’s time that perceptions change. Compliance automation is no longer a highly time-consuming and expensive affair. There are phenomenal automation solutions that can usher in a 360-degree transformation in the organization.
In fact, when your start-up can stand tall with its claim of having a well-established compliance foundation, it will easily attract all the funds needed to drive innovation. On top of it, a compliance culture within your organization ensures that all the necessary updates on relevant regulations reach your team at the right time and enables them to tailor strategies accordingly. This not only builds a sense of trust, both internal and external, in your organization but also drive operational efficiencies and accountability. So, at the end of the day, the ‘compliance-first attitude’ is the key to driving trust, efficiency, and innovation.
So, it’s time to move a step ahead in your GRC strategy and be visible to the investors for all the right reasons.
Dhruv Nagarkatti
CEO, Quant LegalTech
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