Capital raised by different startups helps them fulfill their professional goals. While businesspeople show vigor and passion, a large portion of the entrepreneurs lacks the knowledge of how to raise funds for their startup. Good ideas can be sustained as long as they are supported by a stable venture. An entrepreneur should be well aware of the different ways to raise funds for their startup at the idea stage.
5 Different Ways to Raise Capital for your Startup at the Idea Stage
In the event that you are battling to raise capital, follow the five demonstrated approaches to raise funds for your startup at the idea stage:
Seek Grants
You shouldn’t hope to cut a major check, different grants are available which are offered by both government and private bodies for promoting the idea of entrepreneurship, boosting the economy, generating employment opportunities. These monetary infusions can assist you in setting up the operations, buy manufacturing equipment, and give salaries to the employees. However, winning grants can be a monotonous, tedious, and complex process. In India, the government offers startup grants as a component of its Startup India’s FFS (Funds of Funds) activity.
Pursue Venture Capital Firms
On the off chance that your startup is at the idea stage, then capital funds are your best bet. When limited toward the Western world, VCs or capital funds has become an essential aspect of India’s startup ecosystem. Involving a broad network of angel investors, HNIs, and corporates. VCs provide funding along with mentorship and networking opportunities to rising organizations. While moving towards seasoned speculators and convincing them about the scalability of your startup can be precarious, you can get huge funding not at all like from VCs, in comparison to grants.
Opt for Crowdfunding
The idea of crowdfunding began from the West, yet India has begun getting used to it. With many crowdfunding stages available today, it is one of the fastest ways to raise funds for your startup. All you need is a convincing pitch that reflects your startup’s scalability and development potential. The biggest advantage is that you don’t have to repay the capital and furthermore give you a stage to make a buzz about your business even before it is built up. The principle challenge, obviously, is the competitiveness of such crowdfunding campaigns.
Reach out to an Angel Investor
Angel Investors in India has picked up recently, yet is currently creating enthusiasm across different divisions. HNIs (high net worth individuals), but corporate employees and high-salaried professionals additionally qualify as Angel Investors. Keep a check on Angel Investors who’ve had a background backing startup, and search for the person who will teach you about the basics of the Funding Industry and as well as Mentorship. You can connect with Angel Investors through investor meets, social media platforms, and personal connections. The main drawback is that the Angel Investors regularly offer less capital than banks or VCs.
Take help from Family and Friends
Self-made entrepreneurs regularly decline to take help from their family or friends. However, a lot of the world’s top business tycoons have as a matter of fact acquired cash from their family or friends right off the bat in their journey of becoming an entrepreneur. Thus, you shouldn’t hesitate for a second to do the same. Borrowing money for a short duration or long duration from family or friends doesn’t as a rule expect you to pay included interests. Now and again, you don’t have to take care of them. Simultaneously, it is advisable that you only take a part of the required financing from your loved ones so as to decrease the burden.
