SOME
COMMON TYPES OF FUNDING FOR STARTUPS:
1. Bootstrapping:
Bootstrapping
is using our own personal savings or revenue generated by the business to fund
its operations and growth which therefore, give Independence and control over
the business.
2. Angel
Investors:
Angel
investors are individuals who provide capital in exchange for equity or
convertible debt and may also provide mentorship, industry expertise, and
networking opportunities.
3. Venture
Capital (VC):
Venture
capitalists are professional groups that manage pooled funds from multiple
investors to invest in startups with high growth potential and also provide
expertise, and extensive networks.
4. Crowdfunding:
Crowdfunding
involves raising small amounts of money from a large number of people, often
through online platforms.
5. Corporate
Venture Capital (CVC):
Corporations
invest in startups as a strategic way to gain access to innovative technologies
or products and also provide strategic partnerships, potential for
acquisitions, industry expertise.
6. Government
Grants and Subsidies:
Government
provide grants, subsidies, or low-interest loans to support startups in
specific industries or regions.
7. Incubators
and Accelerators:
These
are the programs that provide startups with funding, mentorship, and resources
in exchange for equity and further provide guidance, networking opportunities,
and shared resources.
8. Debt
Financing:
Startups
can borrow money through loans or lines of credit however the same lead to debt
repayment obligations and other interest costs.
