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Investment for startups! How hard is it to get?

You get an idea and start working on it but somehow you don’t get it implemented due to lack of finance and that’s how you get your idea into vain. But it all takes just one step to go and that is working on your ideas.

If you are running a bootstrapped startup then wealth is a great concern. But in case you don’t know, Investors are damn serious about a good idea and they are ready to invest their money into it.

Why do you need investors?

For one, a few, or all of the following purposes, a startup may require financing. As an entrepreneur, you must know why you raise funds. Before approaching investors, you should have a detailed financial and business plan.

  • Prototype creation, product development, website/app development
  • Team hiring
  • Legal and consulting services for your startup
  • Raw materials and equipment
  • Licenses and certifications
  • Working capital
  • Marketing and Sales
  • Office space and other admin expenses

Now the most important thing which you might be thinking about is  “How to get investors for your startup?”

  • Bootstrapping

Bootstrapping, as it is commonly known, is an excellent strategy for persuading others to believe in your business idea and vision. Investors frequently require traction before making an investment; the initial round of self-financing helps you to demonstrate the viability of your idea and gain investor trust in a subsequent round of funding.

  • CrowdFunding
    On a basic level, the concept of crowdfunding is comparable to that of mutual funds. More than one investor is participating in this choice, and they each contribute a predetermined amount of money based on your business idea, goal, plan of action, and profit-making ambitions. All you need are people who are passionate about your business idea.

  • Reach out to your Family or Relatives
    This can be the easiest and most affordble way for your startup to raise money. Discuss the needs of your business with your family and friends. An investment would involve family or friends and you can share your risks with them.

  • How's about Private Investors

Now there are two of this kind one is "Angel Investor" and another one is "Venture capitalists".

  • Angel Investors An angel investor has the money, resources, and background to succeed in a company and is a high-net-worth individual. Angel investors nevertheless always expect a high return on their investment. The business case must be air-tight, as they don't just invest in anything easily.
  • Venture Capitalists Venture capitalists do not use their own money, but that of investors (they set up a fund that is used for others to buy shares in the company).

Typically, the sums needed by risk capitals are far higher than the amounts required by angel investors, which can reach millions. But investment returns are also expected to be very high.

Things you should do before raising funds!

Let's keep it very simple and closely look into the initials. You should be doing the mentioned things before you get investment.

  • Build a Team You should not just focus on marketing alone, things will be better if your team is crazy enough about their ideas. So focus on making a team that supports the idea not just any random startup.
  • Optimizing your product Love your product? Make it even better. You should love your product yourself so that investors too will have an interest in your product.
  • Build a network among investors Build a network around and not only among investors but among new startups too. Bind people with your engagement skills.

Final Thoughts

Getting investment is not that easy as the flix has shown to us. If you have a great idea for which can be considered as an innovation then it going to help a lot in every scenario.

In nutshell, build a great idea and strategies for your startup + reach to the people + Create a massive network + Be consistent = Get successfully funded.

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  1. 1

    Thank you for your tips. I've found them very helpful. I am actually working on my start-up right now. It all started when I spoke with a friend of mine that works for https://www.mcgeewm.com/wealth-management-portland-financial-advisor. After that, I realized that I have to do something productive in my life, bringing me pleasure and money. So my wife and I are trying right now to open our own bakery in our hometown. I think this will gain popularity because my wife is the best baker that I know. Still, there is a lot of work before opening it. However, my business will be opened sooner than planned with the pieces of advice you gave me.

  2. 1

    Thanks for this Yellow Uncle :D

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