Here Are A Few Ways That Can Help A Startup Raise Funds


The entire Indian business landscape has seen a massive overhaul with startups growing at an unprecedented rate, largely due to the funding support from investors.

The startup ecosystem in the country got a  lot of encouragement with pro-government policies & support and with a number of startup accelerators, mentors and closed group retail investors mushrooming up and providing advice, network to monetary solutions to the budding entrepreneurs.


Starting off a new venture is a challenging task no doubt and it is even more difficult a task to raise funds from the investors, especially for a person who has never done this before.

One needs to know in depth about the product, product proposition, growth avenues, competition landscape, product extensions, geographical viability across regions and fund requirement for specific departments to bring about growth

The next logical step is to reach out to an investor. It is equally important to find the right investor for your venture.

An investor does not only concern himself with mere investment into the venture.A potential investor might come with a strong network that can help source business, provide guidance across legal framework, mentor about technology hurdles and/or help improve your product/service definition with his experience or through established channels amongst other possibilities.

It is for the entrepreneur to decide how much role the investor is going to play in the enterprise.

An investor’s role in the venture is also dependent upon the value of equity dilution from the founder’s end.

While choosing an investor, three basic facts need to be kept in mind by the founders. They should think about the business proposition, growth possibility, and founder intention.

Listed below are some of the ways through which entrepreneurs can seek investment, as has been pointed out by Namit Jain in a financial daily.


Bootstrapping or self-funding is an early stage phenomenon wherein the entrepreneur brings in his own funds to kick-start his venture.

Family & Friends (F&F)

One of the most sought avenues at the early launch stage of any venture is the Family and Friend’s account. Though the value of funds is small, it has supported numerous successful ventures in their inception days.    


Though not often not a viable option for startups as they provide funding based on collaterals or depending on sales and/or existing profits, many do seek help from banks.

Angel Investors

A boon to the startups, an angel investor comes with various tags like seed investor, business angel, private investor and informal investor. He is an affluent individual who provides capital for a business start-up.

Normally, an angel investor or groups of angel investors might go as high as £1 million investment usually in exchange for convertible debt or ownership equity.

Venture Capitalists

Venture capitalists provide capital to startups that wish to expand but do not have access to equities markets. Venture capitalists are willing to invest in such high-risk companies because they can earn a massive return on their investments if these companies are a success.

Retail Investors

They are individuals with business knowledge and similar industry experience who invest small amounts in startups either alone or through a small closed group for equity ownership. This group is quite helpful as they themselves are a part of the industry and provide all possible support across business requirements.


Crowdfunding is one of the last options that startups consider for their business.Pitching your idea to the public to raise small amounts of funds have been successful in the past. But it is a challenging task as one has to raise small amounts of money from a large number of investors mostly through online platforms.


One of the expensive options, Microfinance companies provide funding requirements when a startup does not qualify for bank loans.     

Government-backed Capital

The Government of India has launched an INR 10,000 crore startup fund to help boost the startup ecosystem of our country. The government of India backed MUDRA policy has INR 20,000 corpus focused on providing benefits to 10 lakh SMEs.

Also Read: Top Things Angel Investors Look For In Startups Before They Decide To Invest