The Evolution of Indian Entrepreneurship: License Raj to the Modern Era

Explore how Indian entrepreneurship has transformed from navigating License Raj to today’s startup-friendly ecosystem. Learn about key challenges, cultural shifts, and success stories shaping Indian entrepreneurs.

Let’s rewind time for a minute. You’re an entrepreneur in the 80s, looking to make your next big move in manufacturing. You have a solid plan, an execution strategy, and the drive to succeed. But the first hurdle you encounter is acquiring a license—a bureaucratic gauntlet that was the hallmark of India’s tightly regulated economy.

We’ve obviously come a long way since then. India’s holding its ground on the global stage vis-a-vis entrepreneurship. At WeWork Labs, we thought it would be the perfect time to look deeper into what it means to be an Indian entrepreneur.

The entrepreneurs of the License Raj 

If the 1950-1970 were a period categorised by Indian socialism, so did it shape our understanding of entrepreneurship. Being rich and affluent was scoffed upon, entrepreneurship was considered dirty, and a risky endeavour. Think about Amitabh Bachchan’s character in 1979’s Manzil. In an attempt to evade his unemployment, he attempts to set up a galvanometer business—only to be met with tough regulations and eventually ends up neck deep in debt. Every step, from starting operations to producing new products or expanding capacities, required navigating a labyrinth of approvals—all during a time when India was still working through the overhang of colonial rule, with limited resources and restricted opportunities.

Narayan Murthy, co-Founder of Infosys, has spoken about how he was offered INR 2 crore to give up his company, but remained steadfast in his decision to keep Infosys going. He describes the complexity of Indian entrepreneurship in great detail: “Here [India] had no mechanism like the US-style roadshow, there were very few institutional investors in India. We did not have one-on-one meetings with knowledgeable institutional investors. We could not collect data for demand from investors.” At the time, given the several levels of bureaucratic red-tape and license-era related decisions, large corporations often thrived due to their ability to navigate bureaucratic hurdles more effectively than smaller firms. This led to a concentration of economic power among a few large entities and stifled competition from smaller businesses.

Let me break that down for you: if you were an entrepreneur trying to manufacture your product and sell it—you’d have to get at least 80 licenses along the way. The system’s complexity forced entrepreneurs to focus more on compliance than innovation, shaping a generation of businesses that were reactive rather than proactive. The industries available for entrepreneurial forays were equally constrained, further narrowing the scope for creative disruption.

That being said, some household brands like Tata, did not take the license raj regulations as a roadblock. Tata for instance, used the time to double-down on their customer loyalty and build a formidable recall—thus bringing them as forerunners while entering the new phase of entrepreneurship post-1991. Resilience is what best defined the entrepreneurs of the License Raj.

With that being said, what sets up and defines the entrepreneurs of today?

The modern-day entrepreneurs

Unlike the past where entrepreneurship was shaped in pop culture media as an undesirable career route, the modern day entrepreneur is celebrated. Shows like Shark Tank India, celebrate the average Indian’s ability to stand up on their own two feet and build a business.

This era has also turned businessmen into cultural icons, like Elon Musk, Steve Jobs, all of whom find great favour among Indians. At their disposal today, Indians have greater access to global pop culture than ever before, driven by technological advancements, increasing disposable incomes. The fundamental resetting of ambitions has also led to Indians now seeing entrepreneurship as a desirable, glamorous profession with shows like Succession and Silicon Valley, finding favour among young Indians. For instance, 31.4% of students plan to become entrepreneurs within five years of graduation, surpassing the global average of 30%, according to a study by GUESSS India.

This is also the era of hustle culture—where entrepreneurs grind for long hours in hopes that it will pay off massively in the future. The pathway to build a company of their dreams is also much more open now. Initiatives like Startup India which offer a slew of incentives, loan opportunities and more, have made it easier for entrepreneurs to access the resources they need.

There is no dearth of knowledge either. Platforms like Reddit and Indie Hackers create spaces for founders to share advice and connect, while podcasts hosted by seasoned entrepreneurs offer candid stories about wins, losses, and lessons learned. We try to capture this through our series Upstart as well, you should consider taking a look at some of the work we have done here.

Of course, entrepreneurship is hardly as rosy as it seems. Peel back the layers, and the path reveals itself to be fraught with challenges that entrepreneurs must navigate with grit and resilience—just as much as the predecessors who came before them. Indian entrepreneurs have to be more resilient now than ever before given the amount of regulatory challenges that lie before them. Complex tax structures, frequent policy changes, and lengthy compliance procedures can bog down even the most well-intentioned ventures. The introduction of GST was a step forward, but inconsistencies and frequent updates often leave entrepreneurs scrambling to stay compliant.

Also read : Decoding premiumisation wave in India

The role of grassroots movements and events in shaping the Indian entrepreneur

That being said, grassroots movements—organic movements without any official backing— have been essential to keeping Indian entrepreneurs on their path. For instance, tech groups along with other larger groups were able to join forces to move telecom operators against licensing regimes for OTTs, a feat that would have been nearly impossible a year ago.

Another avenue is also events. Events like founder meetups provide a platform for entrepreneurs to connect with peers, potential investors, and industry experts. This networking can lead to partnerships, collaborations, and funding opportunities that are essential for growth early on. It is also an opportunity for those in other cities outside of Delhi, Mumbai, and Bengaluru, to promote their local ecosystems and invite entrepreneurs. Founder meetups play a crucial role in fostering entrepreneurship in India by enabling networking, knowledge exchange, and community building while driving regional growth. These gatherings empower entrepreneurs individually and fuel the expansion of the nation's startup ecosystem. We typically organise several founder meetups in key startup ecosystems, you can score an invite to the next one by subscribing to our events calendar here.

The WeWork Labs take

Entrepreneurship in India has transformed dramatically from the days of the License Raj to the modern era. In the 80s, entrepreneurs navigated a labyrinth of bureaucracy, with over 80 licenses often required to launch a business. Success was less about innovation and more about resilience and compliance, as exemplified by Narayan Murthy's persistence in building Infosys despite systemic hurdles. Today, entrepreneurship enjoys cultural reverence, bolstered by initiatives like Startup India, global exposure, and platforms that democratize knowledge and resources. At WeWork Labs, we’ve helped enable a number of startups to find Yet, the journey remains challenging, with modern founders facing regulatory complexity and fierce competition—proving that resilience remains the common thread linking India’s entrepreneurial past and present.