Mostly it’s how will the finance be arranged. You have a great idea, you have the plan of how you will change the world with it or make a difference in a lot of lives and you even have a team of people which will help you achieve this, but the reality is all of these activities need money. One of the most popular ways to do this has been Venture Capital or VC money as it's mentioned in normal parlance. While VC funding is not a bad idea per se, there are a lot of options which are available to the founders these days which are somehow better as compared to VC funding. Lets look at a few of them here.
Friends and Family
While this may not be the 1st choice of a lot of people because they would morally feel bad failing and not being able to return money to their loved ones, its something which can work out really well, quickly and easily. The closest people like family and friends would trust your abilities and foresight and it will be much easier for you to get their time to actually discuss with them why they should lend you any kind of financial support or invest in your idea. These people are not that hard to meet or convince and they would trust you more than anyone else because they know you better than most outsiders.
Startup Competitions
Governments, technology blogs, universities, private companies, everyone seems to be conducting some sort of or already has an established startup competition. These competitions give a lot of reach, publicity and of course seed funding for a startup once they win, besides great networking opportunities to its founders. Startup competitions are beneficial for a lot of right reasons and are really popular as one of the ways to raise funding for a few years now.
Incubators
Incubators are a great place for starting up because they take care of the basics. They provide a working space, food and more bare necessities. Its also a place to make great contacts and even meet some amazing mentors. You normally share space with other startups and meet amazing team members, who help you out with little things. You learn a lot from fellow passionate founders. Its a place bustling with energy and passion which is a perfect motivator for putting in all the hard work that is needed and required to make something unique which solves some problem or has a great purpose. Everyone works as hard as they can in an incubator to do something creative and innovate to make a difference.
Crowdfunding
So you have an idea and you think a lot of people around the world would love to buy or subscribe to your service. The easiest way is to list your product/service on websites like Kickstarter, Indiegogo or more crowdfunding websites. The most famous ones like Kickstarter and Indiegogo have kickstarted a lot of successful campaigns and turned them into bigger companies. The idea is simple and really easy, but what makes it amazing is the audience reach the founders get. Literally the whole world is their investor base and this mode of raising finance seems to be the most popular for startups off late. Its rightly preferred by a lot of founders and has been working well too.
From web series to films to actually innovative products like smart watches and more wearables, these websites have helped fund a wide variety of campaigns for the founders.
Angel Investors
Angel investors are rich people who have made money working in technology. They are preferred over Venture capitalists for 2 reasons; they understand the situation of the founders and they are a great source of valuable contacts and advice. A lot of success stories from founders of companies like Google, Microsoft, Apple, Facebook and more are about how they had some people helping them in crunch situations. These people were the ones they got in touch through common connections and they didn’t know these amazing people themselves. So, having an influential network is a great asset which is often overlooked but can prove extremely important at some unknown stage in a startup which can prove to be a turning point for them. Angel investors are a perfect mix of a source of finance with experience and invaluable contacts.
Government funding
Startups become big and successful and generate a lot of income for everyone involved. They even provide a lot of job opportunities and all of this in turn leads to more taxes for the Governments. So it would be not wrong to say that Governments around the world want startups to succeed and become big companies for their own selfish motives. Governments have to spend less money on social security and can get more taxes if startups succeed. As such, realizing these benefits they have started helping startup founders secure loans from banks and more financial institutions at a lot more favorable terms and in an easier and faster manner than it used to be earlier.
All of these options offer the founders of the startup greater freedom and control on their company. They also do not require to have unnecessary outward pressure of complying with some directions coming from someone who may not be aware of the day to day workings of the company. Plus, the bigger risk of losing the stake of the company is not there as well and thus the founders can retain 100% stake in their own company.
With so many options accessible to them, it’s a great time to innovate, to chase your dreams and to turn them into realities for the creative geniuses out there.
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