For the innovative entrepreneur, a way to a successful startup often begins with searching for funding. Seed funding is that first capital fueling the early growth of a startup, and there are many ways that seed funding can come about from different sources that have unique characteristics and benefits.
All of these funding channels are quite significant for an entrepreneur when making the right decision to raise resources that could put it in a better position to thrive. Beginning with bootstrapping and angel investors, the entire range, venture capitalists to government grants, is made available through seed funding. This blog aims at the explanation of seed funding.
Ways to Get Seed Funding
Seed funding in India is the first investment round provided to a start-up in its most preliminary operation phase. Most seed funds are made for product development, market study, and other forms of preliminary marketing activities. These may come through angel investors, venture capitals, incubators, accelerators, crowdfunding sites, and so much more government funding. This becomes the lifeline for the startups and empowers them with the ability to make validation of concepts, to build and create an MVP besides gaining popularity in a given market. Types of seed funding Start-ups can explore any of the mentioned avenues to ensure seed funding for themselves:
Personal Investment:
The entrepreneur could begin starting his venture by using his own savings or borrowing from friends and family. This also ensures commitment and, hence, is one of the better sources of seed capital.
Angel Investors:
Angel investor are high-net-worth individuals who invest their personal capital in early-stage promising startups. They not only invest financially but also provide much Needed expertise and mentorship. Angel networks and platforms make these connections for startups with potential investors.
Venture Capitalists:
Venture capitalists are the investors for start-ups who have high growth potential. The amount of capital they invest is generally more than that of the angel investor. They mainly deal with later stages of seed Money or Series A funding. Apart from the value of the capital, venture capitalists generally offer strategic input and access to networks with a startup.
Incubators and accelerators:
provide startups with direct access to available resources, mentoring, and the networks. Among those other resources the incubators/accelerators are associated, there is seed fundings that help the starters fine-tune their business model, develop its product, as well as prepare its subsequent funding.
Crowdfunding:
Startups can raise capital from a massive number of people through crowdfunding platforms. This is best suited for startups which are more community-oriented or have social impacts because that’s basically raising capital through the online platform.
Government Grants:
A lot of governments give grants and seed fundings programs to a certain portion or incite those who do work on some social issues. In India, one such scheme is the startup India seed fund scheme that gives financial assistant to early start-ups.
StartupFlora Working as The Seed Funding Companion
Seed funding market is complex and labyrinthine. It is one of the specializations of the greatest startup consultancies, which can take you through StartupFlora.
- Fully prepare your funding strategy from the needs of your start-up from our financing strategy.
- Reproduce and perfect your business plan to ensure you effectively bring out a value proposition to your investors.
- Connect to investors. It has a system that we will use to avail of connecting you with angel investors or venture capitalists/government agencies.
- Leading through negotiation process and due diligence: We lead you through your negotiation process plus the process with due diligence on experts.
Indeed seed funding is just a stepping block for any new start-up towards potential as well as great prosperity assurance of any given economy. In respect of knowing how their business has gotten its funds source and through having a strategic plan entrepreneurs can achieve good amount of required funds that facilitate development which ensures them being superior in comparison with others. Therefore, accompanied with the aid provided by StartupFlora for Startup India Registration & Startup India Seed Funding Scheme entrepreneurial beginners would learn to find themselves out from seed funding complexities.