How to secure seed funding for your start up and grow into a unicorn

Every startup needs three critical things: 1) Business idea, 2) Human capital, and 3) Financial capital. Financial capital is crucial at every stage of the startup’s journey.

Below are the different stages of funding in a startups journey:

For a new startup, the most significant disadvantage is competing with established brands. With appropriate funds, it becomes easy to construct the company’s foundation. Full product development for prototyping should also be the priority at this stage. Hiring staff members, office space, and other essential departments like marketing to new customers are some tedious tasks. Without these steps, you’ll strive hard to make the business work.

Seed funding has provided new startups a great deal of help, external or funds from family and friends. But one thing to consider is at what stage the founder should look to raise seed money. Once founders have a concrete plan for the business and maybe a business model, it is the right time to start raising seed capital. This will have a massive impact on the outcome. But before deciding on seed funding, the founder needs to be prepared with a strong business plan, and market research needs to be done to convince the investors to invest. 

Also, before going ahead with this process, the prototype should be ready to break into the market. During this stage, the founder needs to be confident about the plan. This will ensure the investors of the capability and possibility of the business working. 

There are various startup options to raise business funds, like family and friends, venture capitalists, angel investors, crowdfunding, incubators, and accelerators. It cannot be easy to gain funds at the initial stage.

Here are some tips to secure seed funding for your startup:

1.Build a pitch for your business: This pitch tells the investors about your business or product, everything that will convince them that this will be worth it. They need to know about the market, financial projections, and short- and long-term plans. It can be a presentation or an email but ensure you include sufficient data. Think about the future of your business and be ambitious but do not set unrealistic goals. 

2.Make a list of potential investors: Not every investor will be interested in your business. Not every investor will be ideal or relevant for you. This task requires research. Consider the type of investor, their experience, and the amount they will be ready to invest. 

3.Presentation for investors: Investors will require a presentation that includes all the details and research about your startup. It is an opportunity to show off your preparedness to face whatever is ahead and build your business. Keep it realistic and simple, and demonstrate your passion through it.

4.Learn to negotiate with them: Negotiation is a task full of hassles. It is the last step to secure the fund that you need. Refrain from taking the first offer and negotiate over the one you proposed. When they agree, make sure you get it in writing. Avoid accepting vague pledges and anything that would lead to misunderstandings or disputes in the future. 

This task of gaining a seed fund might be daunting, but don’t get overwhelmed. There are organizations around that help to find the right fund-raiser or investor for businesses. These organizations help startups grow and provide the necessary guidance to make them flourish. BCOC is one such organization that provides all the support that a growing startup needs. BCOC has organized a free exhibition cum investor pitch session in Mumbai called The Big Idea Summit. It is a community platform to promote innovations, startups, and entrepreneurship. To register for this free event and claim prizes/funding support, one can register on www.bcoc.in