Key points on startup funding

Key points on startup funding

1. Reasons you might need money

   • pay core employees
     • pay for licenses to use intellectual property
       • purchase equipment
         • rent office space

2. Angel Investors

   • An affluent individual who provides initial capital for a business start-up.
   • angels are compensated with:
     • ownership equity
     • implies company's value

3. Venture Capital

   • Financial resources given to early-stage companies.
   • stages of VC financing:
     • seed funding
       • start-up
         • growth
           • second round
             • expansion ("mezzanine")
               • exit/bridge

4. Other funding sources

   • friends and family funding ("fff")
   • grants or government funding
   • bank loans
   • public equity
   • crowd funding

5. Startup incubators

   • Program designed to support successful development of startups by providing business resources.
     • Examples:
       • Ycombinator, Techstars

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