Articles on Startup Finance

Seed Funding – Introduction

Creating a successful startup business can be a daunting task. This is because a startup business needs a viable idea...

Why is it Difficult to Raise Seed Funding?

In the previous article, we have already learned what seed funding is and the various sources from which it can...

Documents Required for Startup Financing

Setting up a startup company can require a lot of paperwork. It is common for startup founders to spend a...

How Co-Founders Split Their Equity?

Beginning a startup can be quite an overwhelming process. This is because of the fact that founders need to make...

Proof of Concept

In the previous articles, we have already read about why entrepreneurs require seed funding and how they obtain this seed...

Minimum Viable Product

We have already learned about the technique of proof of concept in the previous article. However, proof of concept isn’t...

What is Prototyping?

In the previous articles, we have already studied about the proof of concept as well as the minimum viable product...

What is Asset Light Business Model, Its Advantages and Disadvantages

It is common knowledge that the world’s largest cab service Uber does not own any vehicles. Similarly, one of the...

Cash Burn Rate: The Basics

The startup and entrepreneurship game has undergone a lot of changes in the recent past. Earlier, having a free cash...

Managing the Cash Burn Rate

The concepts of cash burn and cash burn rate are relatively new to the investor as well as to the...

Key Terms and Conditions in a Term Sheet of Startup Funding

In the previous article, we have already learned that term sheets are the basis on which the entire relationship between...

Red Flags that Investors Need to Look out for in Term Sheet

First-time investors are quite anxious to raise funding for their projects. The fact that professional investors are looking to invest...

The True Cost of Raising Funds

A startup is considered to be successful when it is able to raise money. The fact that a startup was...

Valuation of Early-Stage Startups: The Mindset of Investors

The valuation of early-stage startups is a controversial topic. There is no widely agreed-upon valuation methodology that can be used...

Pre Money and Post Money Valuation

Startup valuation is one of the most important issues faced by startup companies in their earlier years. On the one...

Start-Up Valuation: Advanced Concepts

In the previous articles, we have already studied the basics of start-up valuation. We are also aware of the basic...

How Pre-Revenue Companies are Valued?

Valuation of any company can be a very complex task. However, when it comes to pre-revenue companies, this complexity is...

Valuation Divergence – Meaning and its Importance

For any startup financing to be successful, the startup company and the investors need to be on the same page...

How Do Option Pools Work?

Option pools are synonymous with startups. Founders, investors, and employees expect the company to have some sort of option pool...

What are Capitalization Tables?

The capitalization table is a very important record for any startup company. These tables provide a clear and unambiguous report...

Financial Models for Startups

Planning is an essential function that the founder of a startup company needs to perform. However, this planning is often...

Key Performance Indicators for Startups

Entrepreneurs as well as people in the general market are often left perplexed about how investors decide to value any...

Restricted Stock Options (RSU’s)

In the previous article, we have already studied about option pools. We now know the various advantages that they offer...

Veto Rights – Meaning and its Importance

The process of negotiations between startup companies and investors is often hotly debated and contested. There are several points of...

Financial Benefits of Incubators

The use of incubators is fairly common in startup companies. Entrepreneurs across the world use the services offered by incubators....

What are Unicorns?

In our day-to-day life, we often use the term unicorn to refer to a mythical horse-like creature. In the year...

Why Startup Companies are Staying Private?

Once upon a time, a successful IPO was considered to be a transition point for a startup company to be...

Why Unicorn Companies Fail?

Startup companies typically have a high failure rate. It is said that 90% of all startup companies fail. The percentage...

Building a Startup Team

When people think about how startup founders invest their time, most of them think about dealing with investors or managing...

Bootstrapping: Meaning and its Advantages

Modern startup enterprises seem to be focused on the media hype. The focus of the entrepreneurs is to raise enough...

Disadvantages of Bootstrapping

In the previous article, we have learned about what self-financing i.e. bootstrapping is. We have also learned about what are...

Revenue Based Financing

The manner in which startup companies obtain their financing can have a very large impact on the future of their...

Convertible Notes and Startup Funding

Startup firms usually receive their funding in the form of debt or equity. Some newer ways of providing funding to...

Pros and Cons of Convertible Notes

In the previous article, we studied what convertible notes are and how they are used in the context of financing...

Simple Agreement for Future Equity (SAFE)

In the previous articles, we have discussed the concept of convertible notes. We have also seen the various pros and...

Keep It Simple Securities (KISS)

In the previous article, we have studied about the concept of Simple Agreement for Future Equities (SAFE). However, it is...

Series A Funding

Startup funding is not a one-time activity. Instead, it is a long-drawn process that encompasses many years in the initial...

Series B Funding

In the previous articles, we have already learned about the seed funding stage as well as the series A funding...

Series C Financing

In the previous articles, we have already learned that businesses do not raise all the funds that they need to...

Venture Debt in Startup Funding

Whenever the subject of startup funding is mentioned, the audience automatically assumes that equity investments are being discussed. This is...

Pros and Cons of Venture Debt

In the previous article, we have already studied about the concept of venture debt. We know that venture debt can...

What is Venture Leasing? – Advantages and Disadvantages

In the previous few articles, we have already learned about how venture capital and venture debt work. We now also...

The Freemium Model – Different Types of Freemium Models

In the modern world, more and more start-ups are selling products and services related to information technology. These companies either...

Pros and Cons of Freemium Model

In the previous article, we have already learned what a freemium business model is. We now know that this model...

Scalability and Startups

Scalability is considered to be a very important factor in any start-up company. Investors all over the world are highly...

Pros and Cons of Scalable Business Models

Scalable business models are the latest buzzword in entrepreneurial circles all across the world. Most new-age founders aspire to make...

Why Do Start-ups Fail After Receiving Funding?

It is common knowledge in the investing world that almost 90% of the start-up companies which come into existence shut...

Start-ups and Arbitration

Entrepreneurs who start up new companies have to deal with a lot of different types of stakeholders. As a result,...

What is a Revenue Model?

Modern-day start-ups can be of many different types. They can be differentiated on the basis of several parameters. One of...

Understanding Investor Focus on Burn Rate

Burn rate is a metric that is specific to the start-up world. On the one hand, most of the financial...

How Investors Evaluate Start-up Ideas?

A lot of people are of the opinion that obtaining venture funding can be very difficult for a startup business....

Government Regulations Which Impact Start-Ups

Start-ups are private entities. It is true that start-ups thrive because of the resourcefulness and innovation of the people behind...

What is a Start-up Accelerator?

The past decade has seen a rapid increase in the number of start-ups. There are more companies which start up...

Managing the Operational Metrics of a Startup

Founders spend a lot of their time trying to understand how to deal with potential investors. They try to understand...

Different Types of Investors

We all know that investors are a very important part of the entire start-up ecosystem. However, up until now, we...

The Founder’s Dilemma – Startup Finance

Entrepreneurship is all about making decisions in the face of uncertainty. Entrepreneurship involves beginning a journey that the founder does...

Role of Social Media In Start-Up Funding

In the past couple of decades, social media has literally dominated the world of business. It has touched almost every...

Start-Ups and Public Relations

Almost every start-up firm tries to increase its sales. However, convincing more customers can be a very difficult task. It...

IPO: An Exit Route for Start-Ups

The typical successful start-up obtains funding from various private investors at the earlier stages of the business. Now, these investors...

What is Acqui-Hire?

Acqui-hire is a different type of acquisition strategy which has come into existence with the emergence of technology-based start-ups. For...

How Reverse Pitching Works? – Its Advantages & Disadvantages

Start-ups connect with large corporations in many ways. The most common way for start-ups to connect with their larger counterparts...

What is an Aggregator Business Model and How does it Works?

A lot of new-age start-ups are very innovative in their business models. However, a lot of these start-ups also follow...

What is Marketplace Business Model and How Does it Work?

In the previous article, we have studied about how modern start-ups have created a new form of a business model...

Difference between Aggregator and Marketplace Business Models

In the previous articles, we have already studied the aggregator as well as the marketplace business models. These two types...

Product as a Service (PaaS)

Whenever we talk about modern start-up corporations, we assume that the company is engaged in some kind of an online...

Benefits of Product as a Service (PaaS) Model

The Product as a Service (PaaS) business model is poised to change the business world in a big way. There...

Disadvantages of Product as a Service (PaaS) Model

There is no doubt about the fact that the Product as a Service (PaaS) model is being adopted by companies...

The Co-Working Business Model – How Co-Working Spaces Make Money

The sharing economy has been one of the major themes when it comes to start-up investing in the past decade....

Peer to Peer (P2P) Business Model

The internet has enabled the functioning of various new types of business models. The peer-to-peer business model is one such...

The Instacart Business Model

In the past few years, the online grocery shopping space has grown by leaps and bounds. Customers have generally been...

The Goodleap Business Model

When investors look at the list of companies that have become unicorns in the recent past, Goodleap tends to stand...

The Twitter Story

The mega-success of social media sites is not news for anyone. Social media companies such as Facebook and Instagram have...

How Tesla Reinvented the Automobile Industry?

The growth story of Tesla is no ordinary story. It is a testimony to what a start-up can achieve if...

How Epic Games Changed the Gaming Industry?

The gaming industry is notorious for being full of fads. Games tend to become popular very soon. However, their popularity...

The SpaceX Success Story

The world has seen many unconventional start-ups. However, almost all start-up companies derive their revenue from the earth. It is...

The Stripe Business Model

Stripe is one of the most prominent start-ups in the world. It does not have the fame or popularity of...

The TikTok Business Model

When we talk about social media, we often refer to companies like Facebook, Instagram, Twitter, and LinkedIn. However, in the...

Zillow Story – The Real Estate Marketplace

The real estate market tends to be a highly fragmented market in most parts of the world. Since the product...

How Business Cycles Affect Start-Up Companies

Start-up businesses are affected by a wide variety of factors. Macroeconomic factors such as business cycles affect start-up organizations as...

Managing Start-ups During an Economic Downturn

Economic cycles are a reality of life. Founders need to be aware of the fact that their start-up company could...

Courses

Links

Subscribe

Articles on Startup Finance