There is a good momentum across different streams to help startups Where and how to find the funding to start your own business is a challenge for any entrepreneur. It's just that landing funds to fuel your business startup is easier than ever before. If you are confident of the business potential and scalability of your startup enterprise, private funding could be the greatest choice.
Angel investors have a high net worth and invest in start-ups in return for a marginal allocation in the company. “Angel investors invest in start-ups that are not likely to draw the interest of venture capitalists since the size of investment is quite small, depending on the angel approached and the business idea”. In return, they take a 20-30 % stake in your firm.
Venture capital firms invest their shareholders' money in start-ups in return for a marginal allocation in the company. “Venture capital like ventures wherever the product or service is established and the start-up needs financial support and funding for commercialization or scaling up of businesses." Venture capital is ready to put $2-8 million in return for a 10-40 % stake in the start-up.
One must glance at bank funding only after the product has gone through seed or venture sequence and one wishes to commercialize it more." Generally banks and finance companies fund up to 80-90 % of the loan-to-value ratio, based on the credit history of the borrower and the security put up, be it property, machinery or marketable securities”.
In addition to these primary services, there are advantages of getting to work in an academic environment. For example, academic mentors can closely engage with start – ups and share knowledge. This allows the startup team to focus on the product/service and market it quickly. The accessibility of business networks helps to improve business models of companies.