How to search for and get startup funding in India? (servicebloggers.com)



Starting from scratch is the most difficult part, but is the strongest ever foundation for any company than a taken over company. Entrepreneurship is all about finding solutions and makes life comfortable for humankind, so that it improves the life style of others. And if you think you have a successful idea, there’s no point burying it inside you. Most entrepreneurs always need financial support to power up business. Many startups can’t cop up because of this. All you need is to learn about various sources of startup funding in India and choose the one that suits you. 
In this article, we will be talking about various ways of getting your startup funded. We have also given some interesting ideas for getting your startup financed.


There are 4 sources of startup funding in India
Startups in India had boomed over the last decade, but many of them are no longer in operation. You may avoid this end result by making sure you have sufficiently financed as needed for the business. Here are four possible sources of startup funding in India.
1.    Govt. loan scheme (5 ways available).
2.    Crowdfunding.
3.    Angel investors.
4.    Venture capitalists.

Once you’ve gone through our list, you will walk away with the steps you have to take for improving your chances of getting the fund you wish for.
Funding can make all the difference

Recently, KPMG released a report on the Indian startup ecosystem. It states that since 2008-2009 FYI, the number of startups has gone from 7,000 to 50,000 approx. in 2019-2020 FYI. That is a growth of 7 times.
But did all the startups thrive? No, most didn’t. More than 90% of startups fail within the first five years since inception. One of the most common reasons behind small business failure is lack of funding.
Are you not willing to get into this list? Of course “Yes”. Here are 4 ways to get your startup funded.
  • Govt. Loan schemes

 Government loan schemes can be availed by all.
·     Many big businesses today were once small and ultimately got nurtured into the giant companies that they are today.
·     Government of India (GOI) understands the importance of emerging businesses and their challenges in raising the required finances. Therefore, the GoI is making all efforts to provide hassle-free government loans for small business in India.
·     With a supportive government and so many loan scheme options available, finance should not be a reason for you to stop. These loan schemes are definitely the fuel for vehicle. Explore the best government loan scheme for your business and focus on the growth of your business.

5 government loans for small business in India
Here are the top five government loan schemes offered by Government of India (GoI) for small businesses:
1.   The Credit Guarantee Fund scheme.
2.   Small business loans in 59 minutes.
3.   Micro Units Development and Refinance Agency.
4.   Credit Link Capital Subsidy scheme for technology upgradation.
5.   Stand-Up India scheme.
Whether you’re just starting a business or need funds to grow, consider one of these loans.
  • Crowdfunding

Top on our list of startup funding in India is crowdfunding. In a nutshell, this is a way of collecting funds from a number of investors rather than just one.
There are three types of crowdfunding:
·         Reward crowdfunding. In this category, the investors receive a product sample or gift in return for the investment made.
·         Debt crowdfunding. As the name suggests, you get a loan from investors that you are required to return under a given deadline.
·         Equity crowdfunding. Here you need to hand over some portion of your business to the investors for the investment made by them.
Here are a few crowdfunding platforms to look at:
·         Kickstarter
·         Indiegogo
·         Crowdfunder
·         Patreon
·         GoFundMe
Crowdfunding has gained a lot of popularity in the past few years and the process involved is simple. You need to put forth your startup details, business description and vision in front of potential investors using a crowdfunding platform. The crowd will tell you if your idea is worthy of support.
  • Angel investors

Individuals with surplus money and those who are willing to invest in promising startups are called angel investors. In addition to providing money, they also mentor you for a sustainable future.
Top-tier companies like Google, Alibaba and Yahoo all raised funds through angel investment.
This form of investment typically occurs in the initial stage of a startup’s growth, with investors generally demanding up to 30% equity.
Angel investments have their own disadvantages: in comparison with venture capitalists, angel investors provide less money.
Angel investors back all kinds of startups. All it takes is a terrific idea and a solid plan.
Here is a list of top 45 angel investors in India.
  • Venture capitalists (VC)

Here come the top-tier investors who fund startups that possess the highest growth potential. VCs mostly invest in a startup in exchange for equity when there’s an initial public offering (IPO). They also provide entrepreneurs with:
  1. ·         Mentorship
  2. ·         Connections
  3. ·         Evaluation of the startup’s sustainability and scalability

However, venture capital investment is reserved for startups that have crossed the initial phase and are generating enough revenue. Also, just like angel investors, VCs have their own shortcomings.
Generally, venture capital investment comes with a short-term plan like three to five years. So, if your product needs more time to build a market for itself, VCs might not invest in your startup.
Here is a list of 47 most active venture capital firms in India.

What is Venture capital and angel investment?
Not sure of the difference between venture capitalists and angel investors? Here are the major differences between them:
·         Angel investors just invest in early-stage startups; VCs prefer developed companies.
·         Angel investors are individuals, whereas venture capitalists are part of a company.
·         Venture capitalists invest considerably more than angel investors.
·         Angel investors primarily provide financial support and sometimes even advice. VCs provide every possible help to grow a company.
Now that we are done with types of startup funding sources in India, let’s check out some tips for attracting the right kind of investors for your startup.

How to get funds approved from investors?
Create an appealing business model
The first thing that any investor would expect to see is a business plan, including your target market and the business model you’ve selected. They are interested to invest only when your business model is highly profitable, scalable and sustainable.
Memories the term “APEM”
v Appraisal
v Planning
v Executing
v Monitoring


Build a team
Investors need to feel confident about the brains behind your startup. Build a team of experts who can turn your idea into reality. List their credentials and experience in your business plan.
Make 1st investment your investment
Before looking for investors for your startup, you need to invest at least 20% of the total needed from your own pocket.
Present financial projections
Create a five-year revenue plan that shows the expected profit for your business. You have to do some math on predicting future sale and income.
Latest trend is to do online marketing and brand promotion
By seriously promoting your product or service online, you make investors trust your business even more. Moreover, it also helps you to build an audience, some of whom might become customers.
Gone are the days when great ideas were let down because of the shortfall of capital. It’s the time when investors can easily be approached. The only things that an entrepreneur needs to focus on are preparing a solid business plan and building a team to back it up. Create something that adds value and keep approaching investors with revised ideas until you make it happen.

Tips for attracting the right kind of investors
Your chances of getting funded are better if you’re already selling products or services.
Getting startup funding using one of these options won’t be easy there are thousands of other entrepreneurs who also want to be funded. Here are a few steps you can take to improve your chances.

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