Figuring out the best way to fund your company is always an interesting issue. Do you self-fund? Do you woo investors into backing your concept? Do you hit up your parents and ask them to put their retirement on the line? There are pros and cons to each and every option.
Not all gender and age inequities are due to overt discrimination, however, I’m also constantly appalled at how often discrimination against women, and more mature business participants, is still taking place. Maura McAdam give a UK perspective on this issue for The Conversation.com.
Research shows women lack access to capital much more so than men. In fact, even though women launch nearly half of new businesses, they receive less than 10 per cent of venture capital or angel funding.
Even if you work every day in the world of new-venture funding, as I do, the options are confusing, and their meanings seem to change on a regular basis. I challenge any entrepreneur, for example, to define the difference between “seed-stage” and “early-stage” financing.
As the startup grows, it will usually require additional funding and accordingly seeks larger investments through a seed financing round with angel investors or startup incubator programs.
There are many funding options for entrepreneurs, from government grants and funds to competitions, angel investors and VCs. As a founder it is your duty to understand them all as well as the advantages and disadvantages of each.
Raising money for your startup is never fun, but it might be the only way to get your business off the ground. It is a time-consuming, and often humbling experience.
Bill Reichert has his top 10 rules list for web companies wanting seed money: he co-founded his venture company with Guy Kawasaki. This list outlines the things Web 2.0 start-ups should be doing when pitching for venture capital from companies like Garage Ventures – in other words it’s also what venture capital companies (or angel investors) are looking for in a start-up.
Are investors behiving badly with extra large funding rounds?
Women are starting businesses at one and a half times the national average. Yet female founders receive just 25 percent of angel investments in the U.S., and companies with a woman CEO get just 3 percent of venture capital.
If you’re in decent financial shape with no debt or very little beyond a mortgage, you have myriad options for funding your startup.
In a new series from This Week in Startups, Entrepreneur Jason Calacanis tackles some of the questions about raising capital for startups.
Marc Averitt at Startup Grind Orange County
Orange County Startup Map