angel investment Archives

12 Jan 2021

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Startup Funding Options in India

Planning to launch your own start-up? Now is the time. India is in its best ever phase of startup ecosystem and the economic environment is favoring the aspiring minds. However, careful planning and futuristic approach are imperative to ensure your startup don’t end like the 94% that shut down their shutters within the first year of operation.

Funding is an extremely significant aspect in line with meeting the vision of a business. Funding and fundraising, both are fundamental modern business scenarios that support the growth of a startup. The first round of funding, popularly known as seed funding forms the basis of fundraising. It is followed by series A, B and C rounds of funding. While the seed funding typically refers to the basic, initial round of funding, series A, B, and C differ in the business maturity and the type of investors involved. The series funding helps in the evolvement of a startup to a full-fledged organization by helping it with calculated funds at crucial steps.

Here are a few successful startup funding options in India that will help you support your business with the indispensable finance requirements.

Go for Crowdfunding

The concept of crowdfunding is quite similar to mutual funds on a basic level. In this option, more than one investor is involved and they offer a fixed amount of money based on your business idea, goal, plan of action, and plans of making a profit. All you need to have are people who truly believe in your business idea.

Crowdfunding is gaining popularity as it ascertains the belief that your idea is also believed by other experienced players in the market. Crowdfunding also helps you in getting the crucial funds from the idea stage itself. You can gather crowdfunding from friends, family, and entrepreneurs who believe in your business concept and have the means to come together and fund your aspiration.

Consider Self-funding

Popularly known as bootstrapping, it is an ideal plan of action when it is hard to convince others of your business idea and vision. Often investors ask for traction before making an investment, the initial round of self-funding allows you to prove the feasibility of your idea and build confidence in the investors for a further round of funding.

Bootstrapping is a great idea for startup funding especially if the initial business requirement is small. It also gives you the freedom of being your own boss. You’re not answerable to anyone and it allows you to keep an eye on the revenue earnings as well.

Get in touch with the Venture Capitalists

A sure shot destination for big bets, venture capitalists offer you professionally managed funds who are looking for startups that have success potential. The best part about venture capital investments is the expertise and monitoring that they bring along. Ordinarily, VCs invest in equity and once the business releases its IPO or is acquired, they leave.

Venture Capitalists usually look for startups with a good enough traction and a strong team. But if you’re opting for venture capital funding, be flexible enough to take their inputs and accept the close monitoring.

Try Angel Investment

There are individuals with surplus cash looking for investing in promising startups and earn their share once it grows to its potential. They can either work alone or collectively in a network to screen startups with huge potential. This funding option has business minds looking to earn interest out of your success and they may expect as high as 30% equity as well.

Although angel investment comes with its issues of high-interest expectations and lesser investments as compared to Venture capitalists; it is important to remember that Google, Yahoo, and even Alibaba were a result of Angel investing.

Conclusion

Funding is required to take the best advantage of the existing and upcoming market opportunities. Even if you initially go for bootstrapping, outside funding is required to sustain in the long run.

09 Jun 2020

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70% of Indian startups will run out of money in less than 3 months

70% of Indian new businesses will run out of cash in under 3 months An overabundance to tie down extra capital in the coming a long time to guide through the Covid pandemic, as per an industry report. 70% of new businesses in India, home to one of the world’s biggest startup biological systems, have under a quarter of a year of money runway in the bank, and another 22% have enough to scarcely make it to the furthest limit of the year, as indicated by a review directed by industry body Nasscom. Just 8% of new businesses that took an interest in Nasscom’s review said they had enough cash to make due for over nine months. 90% of new companies said they were confronting a decrease in incomes, while 30 to 40% said they were incidentally stopping their tasks or were currently shutting down. As new businesses stand up to exceptional occasions, many are considering finding a way to remain above water. About 54% of somewhere in the range of 250 respondents said they were hoping to rotate to new business openings, and 40% said they needed to broaden into development verticals, for example, medical care. The money crunch comes as financial specialists on the planet’s second biggest web market become mindful about composing new checks to youthful firms. In an open letter a month ago, a few unmistakable VC reserves cautioned new businesses that they may discover it particularly testing to bring new capital up in the following not many months. For certain new businesses, there are different variables at play, as well. Over 69% of business-to-business new companies, particularly those working in retail and fintech classes, state in the report that they are confronting delays in installments from their customers. This has left the greater part of such new businesses to implement pay cuts, decrease their advertising spends, and a fourth of them to change to a cheaper seller to set aside cash. New companies working in vehicle and travel areas are additionally seriously affected, with 78% of respondents saying they were reevaluating their plans of action and tweaking their items as per the current situation. In a call with correspondents on Tuesday, heads at Oyo disclosed new advances the spending dwelling startup had taken at its inns to guarantee security for administrators and clients. They additionally said they were trusting that New Delhi and state governments would permit more individuals to travel and remain at lodgings once more. More than 66% of new companies additionally said they were searching for arrangements that facilitated guidelines and spike government buys. Numerous likewise mentioned help in assessments for a couple of years. More than 66% of Indian new companies accept the effect of Covid will wait for as long as a year. (Nasscom) Recently, India declared a $266 billion improvement bundle to help resuscitate the slowed down economy. On Saturday, Indian Finance Minister Nirmala Sitharaman said that new businesses excessively will have the option to get to a portion of this help — however subtleties stay meager on how they should go about it. Since 2017, India’s startup environment has developed reliably. A year ago, new companies in the nation raised a record $14.5 billion. “Out of nowhere, this prospering development adventure has abruptly been hit by a barricade… the COVID detour. There is no nation, business or living being that has not been influenced by the COVID pandemic. While governments have been working industriously to secure and spare living souls, organizations have been hit and independent ventures and new companies have been the most influenced,” said Debjani Ghosh, President of Nasscom, in the report.

10 Jan 2020

Business, established business, India, News, startup's admin 0 comment

State of the Global Startup Economy

The global startup economy remains large, creating nearly $3 trillion in value, a figure on par with the GDP of a G7 economy.1 Seven out of the top 10 largest com- panies in the world are in technology — the highest concentration of any industry sector among the top global companies — and 2019 saw close to $300 billion in venture capital investments around the world.2

Nonetheless, even at the end of 2019, not all was well. Inclusion remained a fundamental challenge for tech ecosystems, with only 14.1% of founders globally being female, as our Startup Genome research shows.3 Value creation by ecosystems remains concentrated, with about 74% of all value produced being concentrated in the top 10 performing cities globally. Tech giants like WeWork and the stable of unicorns funded by Softbank began to falter — ranging from major crises, as in the case of WeWork; to a capital crunch for others.4

But despite these challenges, we did not expect the major threat of the COVID-19 crisis to global ecosys- tems. Since the crisis hit:

Layoffs among startups are rampant, with just over a third of startups globally not laying off staff nor cutting hours, and with the typical startup with full- time layoffs letting go an average 33% of the staff; and
- Startups are facing a double whammy with a drop in consumer demand at the same time VC investments are dropping, leading to a crunch for capital. In fact, four out of every 10 startups have 3 months or fewer of capital runway, meaning they will die if they do not raise additional money and their revenue and expenses remain the same.

While we see early signs of a rebound in Asian ecosys- tems — nothing like a return to normal, but a slowdown of the drop — the startup economy is going through a major transition.

In 2020, the State of the Global Startup Economy can be seen through two main angles: the calm before the storm, up to Dec. 2019, and the consequences of the COVID-19-triggered crisis.

Most successful startups of 2020

The Calm Before the Storm

In the lead up to the crisis, the dominating trend for ecosystems globally has been the growing democrati- zation of tech across geographies.

Democratizing the Tech Economy

Despite the concentration of value in tech ecosystems, access to the tech economy is increasingly democra- tized.

In 2013, tech unicorns became a phenomenon, with the term popularized by Aileen Lee from CowboyVC.5 6 The name alludes to the rare and nearly mythical quality

of these companies. But

while still powerful they are not so rare anymore.

When we analyzed com- panies in the billion-dol- lar club — exits or private companies in technology with over $1 billion in val- uation — in 2013-2019 we see that in 2013 only four ecosystems produced unicorns or billion-dollar exits. Today, a cumula- tive 80+ ecosystems have done so, astoundingly.

18 Sep 2019

Business, Dubai, dubai real estate, established business, startup's admin 3 Comments

India start-up scenario.

Why there is no better time than now to invest in startups

Investments in the Indian start-up ecosystem surged 322 per cent in July year-on-year. They rose to $5.61 billion last month, against $1.33 billion in July 2019, according to data from Tracxn, a firm that tracks investments and financials of private companies and start-ups. The funding that went into Jio Platforms’ alone accounted for nearly 87 per cent of the total amount

The number of companies that garnered the investment, though, fell to 82 last month, against 120 in the same period in 2019.

Top-funded sectors

The top-funded sectors include telecom ($4,854 million), enterprise infrastructure ($236.2 million), ed-tech ($164.95 million), real estate- and construction-tech ($78.1 million), retail ($57.42 million) and media and entertainment ($53.90 million). The consumer sector, which encompasses online and technology-enabled consumer-facing companies in the business-to-consumer (B2C) space, raised $183.47 million.

While Jio Platforms, Nxtra Data, Vedantu, Zolo and Toppr were the top five funded companies in July 2020, the most active investors – based on the number of deals in July – included Mumbai Angels, Matrix Partners India, Accel, LetsVenture and Unicorn India Ventures.