Financing a Successful Startup

Financing a Successful Startup

Times have changed for creating a successful startup. Today, creating a successful startup requires a great idea, solid team, good business plan, a go-to market strategy, a working prototype and (preferably paying) customers..  Where do you get financing?

Entrepreneur

If you have created one or more successful startups in the past 10 years,  you only need an Idea,  Team and (Business) Plan with a well defined and sizable Market.   To secure financing, you still must “shop” for the best possible terms.

Recognized Business and/or Technical Person

If you are an established and recognized business and/or technical person, you will need the idea, team, business plan with a well defined and sizable market AND a working (Product/Service) Prototype  with an initial customer base.  You will need to be self-funded and/or obtain initial financing from friends and family.  Angels, Super-Angels, business partners and seed Venture Capitalists can fund later stages. Depending on your personal network, you might be able to acquire financing with some of these items being incomplete, but you will need a plan for completion.

Recent (Business or Engineering School) Graduate

If you just graduated and have a great idea, consider an incubator.  Incubators have sprung up all around the US (e.g., San Francisco Bay Area, New York, Chicago, …).  These incubators can provide a small amount of financing and work space for those that have an innovative idea.  Most will require an application and have a competitive review/acceptance process.  Many of these incubators provide an environment where you can develop the initial product and acquire initial customers.

Best Terms (Paying Customers)

To get the best possible funding terms, you need paying customers.  The more profitable you are, the better the terms.  Ideally, to keep most/all of your company’s ownership, you need enough paying customers to self-fund your activities, and to “borrow” for growth from other sources.

If you need help with any step, please contact us.  We have helped many start-ups launch with an idea.  We have helped others create business and financial plans.  And for the most promising, identify potential Angels and VCs, and secure financing from one or more of them.

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