Sources of Funding part II Flashcards
What happens in the Pre-seed funding stage?
During this stage, bootstrapping transpires. You are the main funder of your company. Friends and family may also be the investors.
During the first stage, you are building an idea and finding a feasible way to market it (market testing)
What happens in the seed funding stage?
With the inclusion of angel investors and VCs, there is much greater valuation, which is key to successfully launching your product.
In this stage, following the hiring of team members, a target demographic is ascertained, and an MVP is developed with your first customers
What happens in Series A Round stage?
In the third stage, more prominent venture capitalists come into the scene and invest in your company. By now, your startup has enough product development taking place for Series A funding.
VC’s are not just looking for a great idea, but a strategy behind it (executed by the right team) that will translate to massive profits down the road.
A growing customer base
What happens in Series B Round stage?
In the fourth stage, the venture capitalists are still sticking around, though new investors, mainly late-stage VCs, are brought in
Your company is scaled up, and market share is increased
In this stage, your company has generated substantial revenue, and is starting to outlive its competitors
What happens in Series C Round stage?
More funding is searched for, but by this point, much of that funding comes from banks, hedge funds, and private equity
Your startup has thrived to the point (enough capital) that you are able to expand your company internationally, with the help of banks, hedge funds, and private equity firms.
You have enough capital to start acquiring other startups (under-preforming ones)
