{"id":4,"date":"2015-09-11T18:05:37","date_gmt":"2015-09-11T18:05:37","guid":{"rendered":"http:\/\/ventureasy.com\/blog\/?p=4"},"modified":"2019-05-11T07:44:09","modified_gmt":"2019-05-11T07:44:09","slug":"how-startup-funding-works","status":"publish","type":"post","link":"https:\/\/ventureasy.com\/blog\/how-startup-funding-works\/","title":{"rendered":"How Startup Funding Works"},"content":{"rendered":"

Today, startups are on a boom. There are ideas and there are people who want to convert such ideas into flourishing businesses prospects. What is required to evolve a business is \u201cMoney\u201d. The question is that from where do you get this investment for your business. The easiest option, either you put money from your own savings or you borrow from your friends and relatives.<\/p>\n

As your requirement increases, you either approach lending institutions (for which you need to have a repaying capacity) or approach people, who having faith in the future prospects of your business are ready to put their money into it. However, nothing comes for free. In exchange of the investment, you need to share a pie of your stake in the business which means a pie of your profits (as well as losses) or more technically, a share of your equity.<\/p>\n

Finally, when you feel its time that private investments are less and your business needs to expand more, you reach out to the public at large to raise funds from what you call \u00cfnitial Public Offering\u201d (IPO).<\/p>\n

Having explained the journey from savings to public offering, let us have a sneak into the most common funding options for early stage startups. Funding is the lifeline of any business and availing the right sources at the right time of your business journey is the key to success.<\/p>\n