Do you know that about 90% of startups get failed
within the first 5 years of starting? There may be multiple reasons responsible for
failing any startups, as like manpower, management, products, marketing, and
the fund. The biggest problem of these is the fund problem which is responsible
for the failure of a startup.
In such a situation, when you start a startup, you should make proper arrangements for the fund. But whenever you start a startup
you do not have enough funds for which you have to find investors. Although there
are many ways to raise funds through which you can get funds. Here we are
giving some special fundraising tips through which you can raise funds for your
startup.
Create a Detailed Business Plan
Any investor will see and understand your
business plane before funding your startup and will be ready to fund you only
if they understand your business plan. So, it is very important to create an
impressive business plan to rais funds from investors. To create a good
business plan you should keep in mind some things that affect the investors
most. Here are some points to keep in mind-
●
The objective of your startup should
be very clear
●
You have done market research very
well
●
Analyze your competition very well
●
You have analyzed the budget you
are using
●
Complete marketing plan
●
How do you make your startup
profitable?
And most importantly, your business plane should
not be too big and it should be made in a professional manner.
Venture Capitalists (VCs)
Venture Capitalists are primarily investors who
are part of the private business sector and provide funding to new startups.
They mostly provide funding to those startups who are growing or can grow very
fast. They get some equity in the company in exchange for funding, due to which
they also take part in the company's action. And in a way, it is beneficial for
your company because VC has a lot of experience which can be very helpful in
the development of your startup. This type of funding can also have some limitations. Such as venture capitalists can also decide whether they will fund
for a certain period of time or how much fund they will invest within a certain
time. So you should take care of these things before raising such a fund.
Angel Investors
Angel investors are small and private sector
individuals who fund new startups. Since they are individuals, they mostly fund
small startups like the finding of
$20k to $100k. Like venture capitalists, angel investors do not take
part in the actions of your company but only give you money. They mostly give
funds to startups that can provide high returns at low investment. In many
countries, there is also a member-based group of Angel Investors, which funds
the startups.
Crowdfunding
The crowdfunding fund is a new way to rais funds
and is becoming quite popular. The most important thing about crowdfunding is
that it can fund more than one person at the same time. To raise such funding,
you take your business plan to the crowdfunding giver. They see and understand
your business plan and if they like your business plan, then they give you
funds. In this, you have to do very little legal work but there may be some
risk of security. Wishberry, Kickstarter, GoFundMe, Indiegogo, Ketto, Catapooolt, etc. are
some famous crowdfunding sites. Kickstarter and GoFundMe are some of the popular international crowdfunding platforms.
Through Your Friends & Family
Most startups take funds initially from their
friends and family. And this is also an easy way because if you take funds from your
family, then you do not have to pay interest on it, even special conditions are
not there. But if you take money from your family and friends,
sometimes it becomes a cause of stress because the people of the family are
very eager to see your growth and returns, due to which you have a lot of
pressure. And, people of your family Can't even take part much part in the
company's actions. This also increases the workload on you.
Online Platforms
There are many online fundraising platforms that
can help you to rais funds for your startup. In the past few years, online
funding platforms become more popular and they also funded many startups. The
best way to raise funds online is you should look around your niche related
market. With this method, you can easily find the right investor who can understand
your business idea well. There are many investors in the market but
AngelList, StartEngine, SeedInvest, Wefunder, Kickstarter, are some popular
resources that give funds to new startups. You can also rais funds from
multiple online resources too. Nowadays online communities like Quora,
WPBeginners, etc are also giving funds to newbies who have a realistic business
plan.
Conclusion
You can raise funds for your startup using the
tips we have mentioned here, but one thing you should keep in mind that
whenever you fund your startup, you should take special care of legal works and security. If
you have any questions related to funding for your startup or have advice, then
let us know in the comments.
