If money is stopping you from pursuing your dreams, there’s no reason to worry. There are many ways to create a successful company. While creating and running your own business in India may be challenging, it’s also immensely fulfilling and rewarding. You’ll get to explore numerous things along the way. Managing a startup can help you learn and grow more than anything else.
However, you’ll need to have money to create a sustainable and profitable startup. If you have no idea about where to start, we have listed the six most reliable ways to fund your startup. Read on and turn your dreams into a thriving business.
How to Get Your Startup Funded in India?
Bootstrapping refers to using your own money (from sales or other means) to fund your startup. Borrowing money from your friends and family also comes under Bootstrapping. Bootstrapping is a good way to get your startup off the ground without losing any control of it.
However, bootstrapping is not as easy as it sounds. Since most entrepreneurs use their hard-earned savings for funding, the risk in bootstrapping is way more than most other funding options. Though you have total control of your business, there’s a limit to how much and how fast you grow with your bootstrapped money. In some cases, it may also wipe out your savings.
On the brighter side, you can focus more on your products and funding it through sales rather than fulfilling the requirements of some external funding agencies. Secondly, you can make quite a bit of saving as you won’t have to deal with massive interest rates. There are a lot of Indian companies that have attained tremendous success with bootstrapping. Some of the successful bootstrapped startups in India include Zoho, Thinkpot, Happy Fox, GrabOn, and social pilot, among others.
Social media has played a very significant in influencing people to invest in promising startups and products. There are several crowdfunding platforms you can use to get the job done for a small fee.
- Fund Dreams India
- Fuel a dream
By combining social media with crowdfunding opportunities, you can attract a lot of individual investors to your startup even if you’re relatively unknown in the market. The key is to develop a killer product that can influence and convince people to invest in it.
3. Angel funding
If you have a viable business idea and successfully developed a prototype of your product, you may be eligible for the seed round of funding. Seed funding is utilized to hire some talented professionals, build the product, and find a way to generate revenue.
During the seed funding stage, investors carefully examine the product and see if it’s fit for the market. Angle investors or seed investors are high net worth individuals who provide funding for small startups and entrepreneurs. They look for promising ideas and validate only those that have the potential to scale. Once onboard, angel investors also act as mentors for the budding entrepreneurs. Some of the most active angel investors are : Binny Bansal, Sachin Tagra, Sharan Aggarwal, Siddharth Ladsariya, and Sanjay Mehta.
Below are the leading angle investment groups in India are:
- Indian Angel Network
- Venture Catalysts
- Chennai Angels
- Mumbai Angels
- Calcutta Angels
- Hyderabad Angels
- Lead Angels Networks
4. Incubators and Accelerators
Incubators and Accelerators are a great way to fund a startup in India. However, they are quite different from each other. While incubators provide basic essentials, including tools, training, and network needed to start a business, accelerators are designed for more developed companies. Accelerators programs give startups access to investors, mentors, funding opportunities, and a range of support services.
Below is a list of some of the leading incubators and accelerators in India:
- TLabs (Location – Noida)
- GSF Accelerator (Location – Gurugram)
- Cisco Launchpad (Location – Bengaluru)
- Microsoft Accelerator (Location – Bengaluru)
- Indian Angel Network (Location – New Delhi)
- Google Launchpad (Location – New Bengaluru)
- Amity Technology Incubator (Location – Noida)
5. Venture Capital
Venture capitalists invest in emerging, early-stage startups that have shown significant growth in terms of annual revenue or number of employees. They can invest in your startup in exchange for equity. However, venture capital firms carefully analyze market conditions, business risks, and associated trends before investing in a company. They also thoroughly assess your business plan, growth strategy, and products to estimate revenue and profitability.
Here’s a list of some of the leading VC firms in India:
- Sequoia Capital India
- Helion Venture Partners
- Accel Partners
- Nexus Venture Partners
- IDG India Ventures
- Inventus Capital Partners
6. Initial Public Offering (IPO)
Initial public offering or IPO is when you allow the public to buy and sell your shares. The price usually depends on the supply and demand of your shares in the market. IPO is somewhat complicated for inexperienced business owners. It requires a lot of documentation, and you need to follow many regulations while filing for an IPO.
Secondly, there are instances when Investors choose to exit as soon as the company goes public. Investors can gain some exponential returns quickly by selling the shares of the company.
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