What’s the Right Time to Seek funding for Your Startup

The new emerging companies are always eager to seek funding from investors instead of working on their businesses and establishing a name in the market.
  • BY Jaspreet Kaur

    Feature Writer, BusinessEx

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  • May 30,2019
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  • 9 Mins Read

Growing your startup or keeping it diminutive is entirely your decision. However, in the changing times, it is important that a company keeps surging in terms of size as well as profits.

When a startup unleashes in the industry, it is anticipated for the company that it would work proactively so as to avoid flounder and move ahead of the existing players. Apart from a viable business idea, a startup company also requires financial backing which it usually seeks from investors, private equity firms and venture capitalists.

Funding is the Key to the Startup’s Expansion

When a startup wants to grow faster and turn its pea-sized company space into an empire, then funding or investment is the foremost thing that strikes in the mind of the entrepreneur. 

The new emerging companies are always eager to seek funding from investors instead of working on their businesses and establishing a name in the market.

Know the Right Time to Seek Funds

Since startups stagger initially, it is essential for the emerging companies to get the funds; although, the startups should procrastinate funding part until they are able to stand upright in the market. Releasing the actual potential of the company is vital in order to move ahead in the trajectory.

Firstly, the entrepreneur should ensure if the company is market-fit and later, view the product’s performance in the consumer market. If the product is completely market fit then the company can approach to investors for business expansion and in the opposite scenario, the company should work more on the product and try to make the product an ideal consumer good.

Save a Pool for Your Company   

If a startup initially seeks investments, then it can receive positive results momentarily; although it later faces bad consequences for carrying pre-seed funding such as high dependency on investors and less autonomy in the decision-making process.

As a result, the entrepreneur should have finances to shore up business in the beginning and after attaining some success should opt for carrying out Series A funding round.

 It’s the Time to Impress Investors and Seek Funding

After completing 1.5 to 2 years in the industry, the startup gains hands-on experience, learns business tactics and consequently, becomes ready to approach investors.

Originally, investors gain interest in the companies which are consolidated and have created its mark in the market. Besides this, another parameter to check the startup’s background is a financial report which should demonstrate profits throughout the year.

Customer base is yet another element that the investor considers while choosing startups for the investment. So, the startups need to show an average count of customers in order to exhibit that their product is market fit.

The startup owners should adhere to the aforementioned pieces of advice to seek haste-free funding from the investors.  

        

    

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