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2018 was a year of unicorns. India added eight unicorns to its kitty, the highest in a single calendar year. Swiggy, OYO, Paytm Mall, Udaan, Policy Bazaar, Zomato, Freshworks and Byju's were the eight startups that crossed $1 billion in valuation.
In the most recent example, Swiggy executed definitive agreements for a $1 billion funding round led by Naspers and saw new investors -- Tencent, Hillhouse Capital and Wellington Management Company coming on board.
The unicorns are also aiming at expanding footprints in the global market. OYO is currently in over 350 cities with over 12,000 asset partners spread across six countries including India, China, Malaysia, Nepal, the UK and UAE in the Middle East.
The company raised $800 million in its latest funding round led by SoftBank Investment Advisers (SBIA) along with the participation from existing investors - Lightspeed Venture Partners, Sequoia and Greenoaks Capital. The fundraising, the company said, is aimed to "strengthen its market position in its home markets - India and China - and support its international expansion plans".
Here's a quick look at how these companies fared in 2018:
Credit : cnbctv18.com
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Lyft CEO John Zimmer admits that a few years back he got depressed when he realized that Uber had 30 times more cash than his company.
"I didn't know what to do ... I got overwhelmed with the things I couldn't control," Zimmer told CNN's Laurie Segall. During that period, he said, he was "slow to lead."
Zimmer eventually came out of his funk. And Lyft not only survived, it filed plans just last week to go public.
But Zimmer's experience of feeling defeated at a critical stage is far more common than a lot of CEOs are willing to admit.
Whether your competitor gets more funding, captures bigger market share or nabs a choice client, here's what you can do to ensure the success of your own company long-term:
Get right with yourself
Make it a priority to take care of yourself physically and mentally, especially if you are depressed or anxious in the wake of what you perceive to be a defeat.
"Have daily practices that center you," said Peter Bregman, who founded the leadership advisory firm Bregman Partners.
For instance, meditating even for a few minutes in the morning and the afternoon can give you a chance to reset yourself, much the way sleep can, Bregman said.
Reach out to your competitor
In cases where you were directly competing for something (e.g., a big client), consider offering your congratulations to the competitor who won out.
"There is no downside to it," Bregman said. If anything, you distinguish yourself and you plant the seeds for a relationship, which can bear fruit down the line.
Put things in perspective
Setbacks happen, but they're temporary.
And success is never an all-or-nothing proposition.
"There's always room for more than one [successful company] in every market," said Dana Severson, cofounder of Startups Anonymous, a platform for founders to confidentially share their stories and challenges.
Also, just because a competing firm gets a big round of funding doesn't mean there won't be enough for you. "There is so much money out there if your idea is good enough," Bregman said.
Be realistic about what your competition just 'won'
Keep in mind, more funding doesn't guarantee success.
"People often think funding is a victory in and of itself," said Severson, who's founded other startups, including gourmet beef jerky seller Stick in a Box.
What's more, big funding brings big expectations and demands. It may even mean your competitor will need to take on a different kind of client than you'd like, he said.
And while more money means the other company can spend more than you on marketing and hiring, "that doesn't mean those are necessarily good business decisions," said executive coach Jerry Colonna, a founder of Reboot, which provides counseling and boot camps for CEOs, founders and venture capitalists.
Remember, too, Colonna added, companies that gain "first mover advantage" don't necessarily succeed long-term (see Myspace, GeoCities and AOL).
Swim in your own lane
The best thing you can do for your company — and your sanity — is to pay attention to what you can control.
"Stay focused. If you spend the entire time looking left and right when you swim, you'll lose," Colonna said.
Especially focus on the quality of your own work. What does your company offer that distinguishes it from others in the industry? And what can you learn from your competitor to make improvements?
Once you're clear on answers to those questions, and have gotten some perspective on your current situation, you'll be better positioned to motivate and encourage your employees for the challenges ahead.
Credit: cnn.com
Shalini Sinha
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When Jamie Beaton and Sharndre Kushor were seeking investors for their business, the fact that they were teenagers caused some confusion.
"We'd sit down in these boardrooms, and everyone would be triple our age, lots of white hair and beige," says Jamie, now 23.
"We'd turn up and they'd think we were the assistants or the interns."
Thankfully for all concerned, boyfriend and girlfriend Jamie and Sharndre were not there on work experience, or to pour the coffees.
The New Zealand couple are instead the founders and bosses of Crimson Education, which they launched when they were both 18.
Aimed at high school students around the world, it links them with tutors and mentors to help them get into the best universities in the US and the UK.
When the couple started the business in Auckland in 2013 they were finishing their final year at school.
With no money to advertise, they instead reached out to friends and teachers, and put up notices on Facebook, to secure their first students and tutors. A year later Crimson gained its first $1m (£770,000) in funding, and it started to grow steadily.
Fast forward to today, and the company has reportedly secured a total of $37m in investment, which values it at $160m. And it claims that more than 20,000 students around the world now use its network of 2,400 academics and career advisers.
Jamie and Sharndre started dating when they were two of 18 Kiwi students chosen to attend a Model United Nations event in The Hague, Netherlands. Model UN is a global scheme in which children and young adults learn about diplomacy and international relations by role playing as delegates to the United Nations.
"Our first date was at a Starbucks in a train station in Germany, while on the trip," says Sharndre, also now 23. She says she was impressed by Jamie's "do-or-die focus".
At the time Jamie had been accepted by Harvard University in the US to study applied mathematics. Given his academic achievements it is not hard to see why - in his final year at school in Auckland he sat and got top marks in 10 British A-levels (students usually sit only three or four).
He had actually applied to 25 of the world's highest-ranked universities, and all had said yes.
Sharndre, a youth ambassador for the United Nations Children's Fund, was also a high achiever. But she hadn't thought to apply to top-tier universities outside New Zealand.
So chatting about their futures, the new couple came up with the idea for Crimson.
"New Zealand universities are wonderful," says Jamie. "But generally, ranking-wise, the US and UK do a lot better in many areas.
"By the end of the trip [to Europe] we started to conceive some sort of coaching service."
Launching the business, they soon had to juggle running it with keeping up with their university studies - and the fact that they were in different countries. While Jamie was at Harvard, Sharndre did a degree in population health at the University of Auckland.
Today Sharndre spends half the year in Auckland at Crimson's head office, and the other six months visiting its offices in 23 other cities around the world. Meanwhile, Jamie divides his time between Auckland and California, where he is doing a masters in education at Stanford University.
Crimson's mentors and tutors range from teachers and lecturers to former university admissions staff who can advise on the best ways to fill out application forms and how to conduct yourself in interviews.
The company says that students are not randomly connected to a mentor, and instead it uses a compatibility algorithm devised by J Galen Buckwalter, former chief scientist at dating website eHarmony.
Most Crimson students currently come from New Zealand, Australia and countries in Asia - Singapore, China, Thailand, South Korea and Vietnam.
The company now plans to break into the US market, where there is plenty of competition from longer-established tutoring rivals such as Kaplan and Princeton Review.
Peter Zamborsky, a business lecturer at the University of Auckland, cautions that these larger businesses have flexed their muscles to take on Crimson in the online sphere.
"If these bigger firms see the market that Crimson is trying to tap as profitable, they can - and already did - step up their digital efforts," he says.
While Crimson won't reveal an exact annual turnover figure, it says it is now "in the large eight figures".
Jamie, who is chief executive, and Sharndre, who is the chief operating officer, are reported to still own 45% of the business. This makes their stake worth $72m.
Sharndre says that while "the rule book" says you shouldn't be dating your business partner, for them it works well. "It's been the biggest blessing because you're working with someone every day that you really trust."
However, Jamie admits that the couple try to prevent perceptions that they might always agree by "overcompensating" in work meetings.
"Some of the boldest debates fly in the boardrooms between us two," he says.
Credit : bbc.com
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Western cultures place an emphasis on being individualistic rather than collective. As a result, people pride themselves on being original.
But when was the last time that you made something completely original?
Jim Jarmusch, an independent American film maker claims that: “Nothing is original. Steal from anywhere that resonates with inspiration or fuels your imagination.”
Copying is an innate human skill that we need for survival. Albert Bandura, an American psychologist, coined the social learning theory which proposes that new behaviors can be acquired by observing and imitating others. He also claims that people can learn to partake in behaviors that incur a reward and avoid behaviors that incur a punishment just from observing other people receive rewards and punishments for their behavior.
Applied in a commercial context, businesses will copy the things that bring rewards to other businesses in order to succeed. Below you’ll find examples of some things that successful business have copied from others.
Copying business models
Having a business model grounded in reality is key to success so it’s only practical to copy and employ the business model that works within your market. Let’s take a look at the business model around Xerox Model 914, a copy machine, introduced to the public in 1959. Back then, people used something called ‘carbon paper’ to make copies of documents. The way it worked was to sandwich a sheet of carbon paper between the original paper and the second piece of paper to be copied on. When you wrote or typed on the original paper, the carbon paper would bleed dry ink onto the second paper, duplicating the markings of your pen or typewriter onto the second paper.
Since people were used to paying for sheets of carbon paper, they were reluctant to buy an expensive copy machine and pay up front. Haloid, the company behind the Xerox machines, subsequently decided to lease the equipment at a relatively low cost and charge a per copy fee instead. In other words, because Haloid was unsuccessful in introducing a new business model where customers paid for the machine and its parts, they decided to copy the pricing structure of carbon paper.
Similarly, when Gillette first started selling razor blades, consumers thought the product was too expensive. Back then, paying on a per shave basis in barber shops was the norm. Gillette then revised their model to sell the razors cheaply and make a profit on the blades instead, making the consumers pay for the shave instead of the device. One can deduce that this model is the one used today for selling coffee machines, water filters, and printers where the hardware is sold at a relatively cheap price, while profits are made from selling the cartridges.
However, sometimes success comes in employing a new business model to disrupt an industry. Uber’s business model disrupted the taxi industry because they introduced a model where they pair up the drivers and passengers in real-time via an app. This decreased the hassle of hailing a taxi for consumers. By not having drivers on full-time payroll or owning any vehicles, in short cutting out the middleman, they were also able to offer pricing that was significantly lower than the dominant taxi companies. Furthermore, they introduced referral programs where the referrer got credit and referred got the first ride free to gain market share.
Because it proved to be successful in disrupting the taxi industry, this model of providing on-demand service cheaply by cutting out the middleman has been replicated in other industries. For example, Airbnb disrupted the hotel industry by pairing up people who have empty rooms to people looking to visit a place via an app. They also had a referral program where the referrer and referred got free credit towards an Airbnb stay. Similarly, TaskRabbit took on the home maintenance industry by matching homeowners with independent handymen. Various startups are also seeking to disrupt the home cleaning industry by pairing cleaners with home dwellers via an online booking system and also offer referral credit.
Copying operational processes
When a business model works, the tools and tricks around the trade still need to be relevant to the market, therefore it makes sense to copy the operational procedures that others find effective. This is more common in the services industry because the consumer becomes familiar with how one particular service works and the competitors need to keep up to stay relevant.
Back in the 90’s, restaurants used to only take bookings in person or over the phone. As the use of internet services became commonplace, bookings started taking place over restaurant websites. Nowadays, there are restaurant booking apps like OpenTable that allow you to book in a few clicks. One can argue that all the restaurants just copied each other in terms of the booking process, but it’s also in the interest of the consumer that the booking process is similar. As a consumer, it is easier to do something that one is already familiar with than relearn a whole different process.
A similar thing happened in the retail industry, which started out with purely physical stores and then progressed to offer online ordering, in-store collection, and delivery services. Clothing retailers also evolved to offer free returns.
Copying operational processes are so common among retailers that Amazon filed a patent for its 1-click technology which allowed users to buy and pay with one click. The intention behind the patent was to prevent other retailers from imitating them. When Barnes & Nobles launched their own “one click checkout” in 2002, Amazon successfully sued them.
Sure enough, other companies did come up with their own alternatives. Two years ago, PayPal launched their “One Touch” feature which accelerated the checkout process for users. This feature actually requires two clicks – customers need to select PayPal and then click or touch to confirm – which might be why Amazon didn’t bother to take legal action.
Copying a business and launching it in a new market
Business is harder to operate in a competitive and saturated market, so launching a service or product which has proved to be successful in one market to a different geographical market could be a more palatable option. This is the strategy that the Samwer brothers employ in running Rocket Internet, a company that incubates and invests in Internet companies with proven business models.
The Samwer brothers founded Alando in 1999, a German version of eBay that became so successful it was sold to eBay for $43 million just 100 days after going live. They were also behind CityDeal, a German version of Groupon, which also became successful that it was sold to Groupon in 2010. Today, Rocket Internet has launched 30 startups, only 5 of which that have failed.
Although Rocket Internet has found great success copying companies and selling it to the company they copied from, not all businesses are copied with the intention to sell. When Facebook was proven to be successful in the US, Pavel Durov founded VKontakte, which almost exactly resembles Facebook’s design in Russia. Similarly, Renren (formerly Xiaonei) was launched to clone Facebook before Facebook could try to capture the Chinese market. Also in India, OLA is copied exactly like Uber.
All these forms of imitation show that copying isn’t all that bad. In fact, it may be the key to success. So why not make it a crucial feature within your business?
Credit : thenextweb.com
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Is it in your control as a business owner to increase the number of referrals you receive on a monthly basis or is it luck of the draw?
Alignable recently completed a survey of 7,500 small-business owners in North America and asked participants a single question -- what's the best way to acquire local customers?
The results?
85 percent said word-of-mouth referrals.
2 percent said radio ads.
1 percent said newspaper ads.
9 percent said Google/Facebook ads.
2 percent said direct mail.
A whopping 85 percent of business owners said word-of-mouth referrals! Of course everyone loves and wants referrals, but how do you get them? Is it in your control as a business owner to increase the number of referrals you receive on a monthly basis or is it luck of the draw? When business owners ask me this question, I often think about the quote: I'm a great believer in luck. The harder I work, the more luck I have. While working harder will often produce better results, working harder with the right strategy in place ensures success.
Here are three ways small-business owners get more referrals:
1. Perfect your local listing.
When someone refers your business to another person, what's the first thing that's going to happen? Since over 90 percent of consumers depend on online reviews, expect people will first search for your business by name on Google to look specifically at your five-star rating. This is a real opportunity for a number of business owners for two reasons. First, over 50 percent of businesses haven't claimed their Google local listing, so when a user searches for the brand they can't find what they need. Second, having 10 written reviews is the minimum number you should have to make sure people trust your business profile.
Keep in mind your reviews don't have to be perfect, as 94 percent of consumers would use a business with a four-star rating. The importance here is to have more than 10 written reviews. Finally, don't forget that Bing accounts for 22 percent of all search engine queries, and you can set up a local listing there too!
2. Be memorable to every customer.
As a business owner, you (or your employees) interact with your customers each and every day. What memorable experience do you leave with them at the end of your interaction together? Every business owner says they prioritize treating their customers well, and you have to, but what else can you do to not only make them remember you but talk about you with others?
What if you took a picture with every satisfied customer you have and post it to your Facebook business page and tag them? That way, they would share it with their Facebook network every time. Or, what if you give each of your customers a wristband to wear that says "$0.65 vs. $0.35" to represent that $0.65 of every dollar spent on a local business stays in the local community vs. $0.35 with national businesses. Or, what if you send a handwritten card to each of your customers and offer 10 percent off their purchase if they send you a referral in the next week?
Some of these ideas will sound crazy, but the important thing is people remember you so your business is top of mind and they can associate your business with more than just "I treat my customers well."
3. Consistently empower your referral network.
The stronger your referral network is, the more referrals you'll receive. This involves growing your referral network, which you can do by attending networking events, joining referral networks like BNI, or joining online communities Once you've established your referral network, think about growing it by looking for folks in your local area or that share similar customers as you.
Then, empower your referral network on a consistent basis, starting with once a month. What do you want your network to know about your business this month? What are you offering that they can help spread the word about? Have something new and special each month and continue to remind them. It's not you being annoying; it's you staying top of mind. After all, this is your referral network, it serves the purpose of helping you generate referrals!
The most important part of generating more referrals is deciding as a business owner that you're going to spend time every week just focused on it. Start with 20 minutes per week in which you shut off the outside world and focus 100 percent on doing any or all of these three things.
Here's a quick schedule you could follow at the start of a month:
Week 1: Email everyone in your referral network (past customers, contacts, network connections) about what they should know about your business this month and how they can help spread the word. You can even offer a fun reward to the winning referrer each month.
Week 2: Take time to make sure your Google listing is complete with all your info, website, hours and description. Add photos and ask five people to write a written review of your business.
Week 3: Think about one area of your everyday operations where you're not being opportunistic to further get referrals. Go through the lifecycle of prospect to satisfied customer, and ask yourself at every step of the way when you could have been more opportunistic to generate referrals
Week 4: Brainstorm 10 ideas how you can be more memorable to your customers. Involve people in your company in the brainstorm. You could have ways to be memorable each month, or it could be working to better perfect your existing "memorable strategy." The idea here really focuses on how you can get one person to tell others about your business, which can be done both online like on Facebook to their network, as well as offline.
Be opportunistic about getting referrals. It's not something you can turn on overnight, but rather a mindset and commitment. It's about developing a consistent behavior to take a step back and ask yourself what's happening this week or month that you can use to your advantage. What you'll notice is that your referral engine will start to spin on its own, and the more consistent you are with adding value to it, the more it will spin.
Dan Slagen, entrepreneur.com
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The majority of the employees are feeling to quit the job and start a startup. Why?, Let me explain five reasons why employees want to turn as entrepreneurs at 40 age.
Earned enough money:
You might have started your career at 22 (ideal case) worked more than 15 years of experience in the corporate well :). You got own house, car and bank balance, decided that it is the right time to start a startup so you can be on your own, don’t need to work for someone else’s success. It is nice to hear.
Great to have one more entrepreneur on-boarded, I would say Inflation is getting increased year by year, and it became a chronic problem to deal with all countries. Eventually, prices of all goods, groceries will be increased. Are you prepared enough to face this? Does your bank balance vouch overcome this situation? Are you prepared to provide the same lifestyle you have currently to your family? As you may not get profits from the day one of your new ventures, Perhaps, it takes a year or more than that. Are you prepared?.
Exhausted by employment:
Don’t like to work more than 12 hours? Irritating to stay back and work for late nights? No salary hikes? Bored with same presentations, proposals, meeting, and reporting. Exhausted with internal politics and egos? Losing patience to manage the team to get expected productivity? Getting pressurized for the deliverables and business from the senior management?.
Yes, I agree with you. However, you may have to work more than twelve hrs. a day to set the ground for a startup, you don’t get salary by last day of every month, you will end up preparing a lot more than proposals and presentations, setting up a core team is not an easy task, it is not just picking up from the available pool.
You have to search, judge, promise, motivate, convince and deploy. When you are an employee, you are just responsible for the deliverable of a small task, but when you are an entrepreneur you are accountable to get the business, execute, deliver and retain the team.
Outdated with technology trends:
Stopped learning? Didn’t get up to date with current trends? No interest to learn new things? Feeling difficult to learn new things? Feeling like how long I have to learn new things?.
People who have the mindset of evolving new technology, experimenting new things, earning more money, expanding the business are disturbing rest of the world. Eventually, that’s why rest of the world end up learning new things for survival. Please don’t be angry about them. However, new jobs are getting created and new comforts are in use because of those people.
Too much work to handle:
Too much work to handle? Not enough time to spend with family? getting tired so easily because of the age? Many sleepless nights? sometimes working on weekends?.
You will have tons of activities and only work to handle in startups initially; you may end to spending negligible time with family. You will have much more sleepless nights than a job, no weekends to enjoy until you see an abundant amount of growth and success.
Passion to be as an entrepreneur:
Perfect, come on…startup is the right solution to get your dreams fulfilled. This kind of energy is needed to start a startup. You would enjoy the work though work for more than 12hrs. You would be happy as you are working for yourself. you are the king of your kingdom, don’t be scared to take a calculated risk in life. Your passion drives the show as it has much bigger impact than any other reasons above. It won’t let you down though you come across hurdles.
Successful entrepreneurs can rule the world, they can enjoy the real freedom, they can enjoy the status in the society, they only can create employment, I would request come up with right intention to have a successful business.
All the best, you should see the success.
Credit: Narasimha Mohan, saranmok.com
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According to a recent study, over 94% of new businesses fail during first year of operation. Lack of funding turns to be one of the common reasons. Money is the bloodline of any business. The long painstaking yet exciting journey from the idea to revenue generating business needs a fuel named capital. That’s why, at almost every stage of the business, entrepreneurs find themselves asking – How do I finance my startup?
Now, when would you require funding depends largely on the nature and type of the business. But once you have realized the need for fund raising, below are some of the different sources of finance available.
Here is a comprehensive guide that lists 10 funding options for startups that will help you raise capital for your business. Some of these funding options are for Indian business, however, similar alternatives are available in different countries.
1) Bootstrapping your startup business:
Self-funding, also known as bootstrapping, is an effective way of startup financing, specially when you are just starting your business. First-time entrepreneurs often have trouble getting funding without first showing some traction and a plan for potential success. You can invest from your own savings or can get your family and friends to contribute. This will be easy to raise due to less formalities/compliances, plus less costs of raising. In most situations, family and friends are flexible with the interest rate.
Self-funding or bootstrapping should be considered as a first funding option because of its advantages. When you have your own money, you are tied to business. On a later stage, investors consider this as a good point. But this is suitable only if the initial requirement is small. Some businesses need money right from the day-1 and for such businesses, bootstrapping may not be a good option.
2) Crowdfunding As A Funding Option:
Crowdfunding is one of the newer ways of funding a startup that has been gaining lot of popularity lately. It’s like taking a loan, pre-order, contribution or investments from more than one person at the same time.
This is how crowdfunding works – An entrepreneur will put up a detailed description of his business on a crowdfunding platform. He will mention the goals of his business, plans for making a profit, how much funding he needs and for what reasons, etc. and then consumers can read about the business and give money if they like the idea. Those giving money will make online pledges with the promise of pre-buying the product or giving a donation. Anyone can contribute money toward helping a business that they really believe in.
Why you should consider Crowdfunding as a funding option for your business:
The best thing about crowd funding is that it can also generate interest and hence helps in marketing the product alongside financing. It is also a boon if you are not sue if there will be any demand for the product you are working on. This process can cut out professional investors and brokers by putting funding in the hands of common people. It also might attract venture-capital investment down the line if a company has a particularly successful campaign.
Also keep in mind that crowdfunding is a competitive place to earn funding, so unless your business is absolutely rock solid and can gain the attention of the average consumers through just a description and some images online, you may not find crowdfunding to work for you in the end.
Some of the popular crowdfunding sites in India are Indiegogo, Wishberry, Ketto, Fundlined and Catapooolt.
In US, Kickstarter, RocketHub, Dreamfunded, Onevest and GoFundMe are popular crowdfunding platforms.
3) Get Angel Investment In Your Startup:
Angel investors are individuals with surplus cash and a keen interest to invest in upcoming startups. They also work in groups of networks to collectively screen the proposals before investing. They can also offer mentoring or advice alongside capital.
Angel investors have helped to start up many prominent companies, including Google, Yahoo and Alibaba. This alternative form of investing generally occurs in a company’s early stages of growth, with investors expecting a upto 30% equity. They prefer to take more risks in investment for higher returns.
Angel Investment as a funding option has its shortcomings too. Angel investors invest lesser amounts than venture capitalists (covered in next point).
Here is a list of popular Angel Investors in India – Indian Angel Network, Mumbai Angels, Hyderabad Angels.
4) Get Venture Capital For Your Business:
This is where you make the big bets. Venture capitals are professionally managed funds who invest in companies that have huge potential. They usually invest in a business against equity and exit when there is an IPO or an acquisition. VCs provide expertise, mentorship and acts as a litmus test of where the organisation is going, evaluating the business from the sustainability and scalability point of view.
A venture capital investment may be appropriate for small businesses that are beyond the startup phase and already generating revenues. Fast-growth companies like Flipkart, Uber, etc with an exit strategy already in place can gain up to tens of millions of dollars that can be used to invest, network and grow their company quickly.
However, there are a few downsides to Venture Capitalists as a funding option. VCs have a short leash when it comes to company loyalty and often look to recover their investment within a three- to five-year time window. If you have a product that is taking longer than that to get to market, then venture-capital investors may not be very interested in you.
They typically look for larger opportunities that are a little bit more stable, companies having a strong team of people and a good traction. You also have to be flexible with your business and sometimes give up a little bit more control, so if you’re not interested in too much mentorship or compromise, this might not be your best option.
Some of the well known Venture Capitalists in India are – Nexus Venture Partners, Helion Ventures, Kalaari Capital, Accel Partners, Blume Ventures, Canaan, Sequoia Capital and Bessemer Ventures.
5) Get Funding From Business Incubators & Accelerators:
Early stage businesses can consider Incubator and Accelerator programs as a funding option. Found in almost every major city, these programs assist hundreds of startup businesses every year.
Though used interchangeably, there are few fundamental differences between the two terms. Incubators are like a parent to to a child, who nurture the business providing shelter tools and training and network to a business. Accelerators so more or less the same thing, but an incubator helps/assists/nurtures a business to walk, while accelerator helps to run/take a giant leap.
These programs normally run for 4-8 months and require time commitment from the business owners. You will also be able to make good connections with mentors, investors and other fellow startups using this platform.
In US, companies like Dropbox and Airbnb started with an accelerator – Y Combinator.
In India, popular names are Amity Innovation Incubator, AngelPrime, CIIE, IAN Business Incubator, Villgro, Startup Village and TLabs
6) Raise Funds By Winning Contests:
An increase in the number of contests has tremendously helped to maximize the opportunities for fund raising. It encourages entrepreneurs with business ideas to set up their own businesses. In such competitions, you either have to build a product or prepare a business plan.
Winning these competitions can also get you some media coverage.
You need to make your project stand out in order to improve your success in these contests. You can either present your idea in person or pitch it through a business plan. It should be comprehensive enough to convince anyone that your idea is worth investing in.
Some of the popular startups contests in India are NASSCOM’s 10000 startups, Microsoft BizSparks, Conquest, NextBigIdea Contest, and Lets Ignite. Check out the latest startup programs & contests in your area. Here is a calendar of various Business Plan competitions.
7) Raise Money Through Bank Loans:
Normally, banks is the first place that entrepreneurs go when thinking about funding.
The bank provides two kinds of financing for businesses. One is working capital loan, and other is funding. Working Capital loan is the loan required to run one complete cycle of revenue generating operations, and the limit is usually decided by hypothecating stocks and debtors. Funding from bank would involve the usual process of sharing the business plan and the valuation details, along with the project report, based on which the loan is sanctioned.
8) Get Business Loans From Microfinance Providers or NBFCs
What do you do when you can’t qualify for a bank loan? There is still an option. Microfinance is basically access of financial services to those who would not have access to conventional banking services. It is increasingly becoming popular for those whose requirements are limited and credit ratings not favoured by bank.
Similarly, NBFCs are Non Banking Financial Corporations are corporations that provide Banking services without meeting legal requirement/definition of a bank.
9) Govt Programs That Offer Startup Capital:
The Government of India has launched 10,000 Crore Startup Fund in Union budget 2014-15 to improve startup ecosystem in India. In order to boost innovative product companies, Government has launched ‘Bank Of Ideas and Innovations’ program.
Government backed ‘Pradhan Mantri Micro Units Development and Refinance Agency Limited (MUDRA)‘ starts with an initial corpus of Rs. 20,000 crore to extend benefits to around 10 lakhs SMEs. You are supposed to submit your business plan and once approved, the loan gets sanctioned. You get a MUDRA Card, which is like a credit card, which you can use to purchase raw materials, other expenses etc. Shishu, Kishor and Tarun are three categories of loans available under the promising scheme.
If you comply with the eligibility criteria, Government grants as a funding option could be one of the best. You just need to make yourself aware of the various Government initiatives.
10) Quick Ways To Raise Money For Your Business
There are few more ways to raise funds for your business. However, these might not work for everyone. Still, check them out if you need quick funds.
Product Pre-sale: Selling your products before they launch is an often-overlooked and highly effective way to raise the money needed for financing your business. Remember how Apple & Samsung start pre-orders of their products well ahead of the official launch? Its a great way to improve cashflow and prepare yourself for the consumer demand.
Selling Assets: This might sound like a tough step to take but it can help you meet your short term fund requirements. Once you overcome the crisis situation, you can again buy back the assets.
Credit Cards: Business credit cards are among the most readily available ways to finance a startup and can be a quick way to get instant money. If you are a new business and don’t have a tons of expenses, you can use a credit card and keep paying the minimum payment. However, keep in mind that the interest rates and costs on the cards can build very quickly, and carrying that debt can be detrimental to a business owner’s credit.
Conclusion & Next Steps:
If you want to grow really fast, you probably need outside sources of capital. If you bootstrap and remain without external funding for too long, you may be unable to take advantage of market opportunities.
While the plethora of lending options may make it easier than ever to get started, responsible business owners should ask themselves how much financial assistance they really need.
Now the big question is – How do you prepare your business for fund raising? It’s better to start from the beginning with good corporate governance as it might get hard to go back later and try to exert fiscal discipline. To address these concerns, invest in a good accounting software and keep your finances in order.
Credit : profitbooks.net