The First Steps
If you have just established your startup and don’t know where to get started with funding, begin with investigating the market. There is a very famous reality TV series called Shark Tank running on ABC where entrepreneurs make presentations for the potential investors (‘sharks’) and they decide whether they want to contribute to the presenter’s company or product.
You will understand how to speak to investors, what they pay attention to, and what questions they ask.
The next great resource is Startup Grind, a startup community where experienced entrepreneurs share their stories during meetups. There are tons of videos from those sessions on their YouTube channel. These meetings are taking place openly in different cities around the world, and everyone can buy a ticket to attend the event.
Also Read: 10 Crucial Steps to Startup Success
If you are over the research phase and you feel that it’s time to act, you can apply to the Founders Institute program, designed for idea-stage entrepreneurs to develop and shape their thoughts into a real company.
There are also startup accelerators, which are fixed-term schools where students get mentorship on various topics. The application process is open yet very competitive. Such accelerator programs provide young ventures with a starting capital in exchange for a share in the company or a revenue percentage.
Startup accelerator schools are often operated by large companies, universities, or private investors. Some focus on their local market, while others accept applications from all over the world.
Here are some of the well-known startup accelerator programs are:
- Y Combinator – Probably the most famous accelerator. Мany well-known companies (Airbnb, DropBox, Quora, Reddit) are graduates of this school. According to their site, they have two batches per year, while the program lasts three months. You just need to fill out a form to apply.
- Techstars – Like Y Combinator, this program is also three months long. However, it only accepts applications six times a year. Several unicorn startups (a startup company valued over $1 billion) have passed their programs, such as DigitalOcean, ClassPass, and SendGrid. Techstars’ application process is described here.
- 500 Startups – This accelerator has different programs with varying durations. Their flagship location is in San Francisco. If you don’t have money to cover travel expenses, just use the services of Payday Depot. Popular unicorns from this school are Udemy, TalkDesk, and Gitlab.
Venture Capital (VC) Firms
VC is a type of financing where private equity owners invest in startup companies that have high growth potential. Startups usually apply to VC funds after the seed funding stage (investments received from angel investors, startup accelerators, crowdfunding). Some famous VC firms are:
- Sequoia Capital
- New Enterprise Associates
- Kleiner Perkins
- Intel Capital
- Khosla Ventures
- Bessemer Venture
This is a very risky type of investment, and sometimes startup founders should put extreme effort to receive this kind of support. Of course, this involves large-scale investments, which can reach up to tens of millions of dollars. Most of the portfolio companies of VC funds are related to the tech industry.