How to Raise Funds for Startups in 2021

 How to Raise Funds for Startups in 2021

“Chase the vision not the money, the money will end up following you”. This quote is an important lesson for all the young minds who want to become an entrepreneur and begin with some fresh and new ideas to change the world. Startup is the exact word for the process that is carried out. People with same or different backgrounds collaborate to provide products or services to the clients. This complete operation requires immense strategizing of ideas, working on products and services for optimum yield and many other vital points which makes the startup unique and the most reached company in the market. The individuals have to invest a certain amount for the basic necessities and operation of the company which if turned successful, provides them with maximum profit.

Often, individuals have great ideas to put forward but do not have ample amount of resources for the same. This creates a barrier in the further processes and the idea could not be put to test. Hence, it is important to analyse the issue and find a solution for the same so that new ideas can get a platform to prove their efficiency and best results.

Here are some answers and solutions as to HOW TO RAISE FUNDS FOR STARTUPS IN 2021

  • CROWDFUNDING

CROWDFUNDING is a process through which people contribute small amount of money to an individual or organisation for any purpose. If done extensively, a really small amount of money from all the contributors can add up to give an immensely huge amount. An entrepreneur can go for this option if he or she requires funds for the startup that they have begun with. They need to put forward their agenda and motive in front of many groups of people who are either interested or want to be a part of the same. Through this method, one can also come across many new people who might want to join in the venture. If people find the agenda or the motive worthy enough, they will gradually start contributing. So, it is important to let people know about all the facts and figures that are involved in the purpose. More will be the transparency; more will people understand the logic; more will be the contributions.

  • BOOTSTRAPPING

BOOTSTRAPPING is one of those methods which comes to an individual’s mind when he or she has to get into their startup. It basically means to grow a company or an organisation through one’s own savings and the money that is generated through initial sales. Everyone saves a certain amount of money and when it comes to entrepreneurs, they definitely save some amount of money for the purpose of growing their company. The amount might be small at the very beginning but later on, when the products and services start giving major profits, the money can be invested to improve the facilities and functions. The start may be small but if the individual puts in the required effort and strategises accordingly, the yield can prove to be the best. The outputs received can also be saved for any other further specifications which may enhance the complete functioning of the system.

  • VENTURE CAPITAL

VENTURE CAPITAL is a form of support that is provided by investors to small companies which have latent potential in them to emerge as a competitor for all the major companies in the long run. They provide the group or organisation with proper funding or sometimes, support in the form of technical or managerial expertise. This might prove to be risky for the investors if the company does not function according to the set expectations. But investors conduct detailed analysis of the company’s motive and agenda along with the potential of it expanding in future. While investing, they keep in mind about the security and monitors the functioning as well. If the company yields best results from their performance, the investors also get shares for the same.

  • ANGEL INVESTORS

ANGEL INVESTORS are those individuals who own a high amount of money which they invest in certain startups or small businesses and they provide the owners the necessary funds. Though being a risky process, this method has widened its pace in the past few years. Entrepreneurs have started opting for this means to generate funds for the company or organisation. This can be considered as a sub part of Venture Capital to some extent but not totally. This not only supports the entrepreneur but also the investor in the long run. Security checking should be mandatory so that no fraud operations are carried out in the process. Proper legal work should be done and records should be maintained for no discrepancy.

  • BANK

Banks are an ultimate place for any funding solutions. They can provide the entrepreneurs with the amount of money they need by performing some proper paper works. Once it is done, the individuals get the money in their bank accounts which they have to pay back within the stipulated time. Sometimes, people also keep houses or jewellery as mortgage to get the amount of loan they need.

Chetna Singh

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