Startup Funding: Positioning for investments

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Funding can be a gamechanger for startups. The approach to funding a business depends on the business and the business owner.

The Breakfast Chat is a program powered by START2DEV – an initiative by OneNet, and the March edition was held on the 21st of March, 2020, titled The Breakfast Chat with Ololade Olaleye and the theme was ‘Startup Funding: Positioning your Start-up from an Investor’s Perspective’.

The focus of this edition was on equipping startups with the knowledge needed to make critical financial decisions on raising capital, investment avenues, and smart ways to manage funds to ensure business growth. 

6 C

The 6 Cs found to impact startup funding include Competence, Culture, Climate, Connections, Capital, and Coaching. 

INVESTMENT OPTIONS

Several types of investment were discussed such as Angel Investors, Private Equity firm, Venture capitalist, Banks, Government/ NGO initiative, Crowdfunding, and many more. Startup Funding sources were categorized as follows: Equity, Debt- interest payment, hybrid instrument.

STAGES

Businesses typically go through the following stages

  1. Formative stage financing- idea/ seed stage, early stage;
  2. Later stage financing – expansion phase;
  3. Mezzanine funding

Note, it might not be this smooth in practice, this is typically the active process.

Valuation

Valuation is an important factor for a startup while financing the growth of the business. Key questions to be considered are: What is the value of my business? What is the value of the business to an investor? What are the investor’s checklists? Valuation is complicated for startups, particularly at early stages because there’s usually no data to predict how the future will go.

If you missed the event, or you need a refresher, or you are just getting to know about it, you can watch the full video and learn from Ololade Olaleye as she delves deep into raising capital, what to do, and what not to do while finding investors 

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