We at YOFFICE understood your challenge in identifying the right investor for your venture during its initial phase. To enable this, we have compiled this Handbook on “Investors in Start-ups” containing relevant info on the investors active in various categories of Venture Capital. The categories include – Angel Networks, Incubators, Accelerators, Social/Impact Funds, Early Stage VCs, Series-A to Growth VCs, and Early to Growth VCs.
What is Venture Capital?
- Venture Capital is a term used for the money, or capital, provided to early-stage, high-potential, high-risk start-ups. The Venture Capital Fund (VCF) gets an equity stake in the start-up, in lieu of the funds it provides. These start-ups, usually own a novel technology or choose to operate in high technology industries, such as biotechnology, IT, mobile, internet and software.
- Venture Capital investment, mostly, takes place after the seed or angel funding. It is considered growth funding because it generates a return, when the start-up goes for an IPO, trade sale, strategic investment etc.
What are the funding options available for Start- Up?
The types of financing options roughly correspond to the stage of a start-ups' development and amount of risk capital required.
- Seed funding : Small funding given to prove a new idea, often provided by angel investors, incubators or accelerators. Crowd funding is also emerging as an option for seed funding.
- Start-up funding: Early-stage ventures need funding for expenses associated with marketing and product development. It is normally provided by early stage venture funds, like YourNest, or angel funds.
- Early Stage (Series A): At this stage some of the risks associated with a start-up have been negated or refuted, the market has validated the concept and its value proposition to some extent. Normally known as Series A funding, it continues to be an early stage funding but for growth. YourNest normally participates in such subsequent round of funding, also.
- Growth Stage funds: These Venture Funds provide growth capital to established businesses who are now ready to scale-up, on the back of significant brand building, or ramping the manufacturing or production capabilities.
- Bridge Round: Working capital for early stage companies that are selling their products or services however, are not showing cash profits, yet. These funds are intended to finance the process to “go public” or a “private equity” round