Start-up ecosystems are in the development phase and rapidly growing across the globe and in India. Entrepreneurs with no expertise in the field confront a variety of hurdles and challenges to overcome. Prior studies reveal over 90% start-ups fail within the first year. A number of separate studies show why start-ups fail, their challenges, and their competencies. The main motive of this current research is to estimate the gap between existing challenge factors and vital competence factors by studying them side by side to learn differences, similarities, and their impact on each other. For research, 96 operational start-up firms in India were chosen as the sample for a survey and a questionnaire based on challenge and competence factors formulated through qualitative scientific literature analysis was sent to collect primary data for quantitative analysis. The ANOVA analysis of factors shows that both the challenge and competence factors of the entrepreneurs involved in start-up companies have significant differences. Descriptive statistics show that improper budget plans, unavailability of skilled labour, lack of motivation and confidence, and poor financial management are the top challenges. While competence factors such as identifying customer want, actively looking for products or services that provide real benefit to customers, developing the long-term direction of start-ups, and committing to long-term goals will help start-ups` drive toward success. Regression analysis of factors revealed that competence factors significantly impact the challenge factors in start-ups in India. Therefore, entrepreneurs can overcome the challenges in start-ups if they adapt to the necessary competencies.