Aug 01, 2022
In Welcome to the Forum
Some founders can finance their business entirely on their own dime or through friends and family, which is called "bootstrapping." This obviously gives the business owners a ton of flexibility for running the business, although it means taking on a larger financial risk and when family's involved, can lead to awkward holiday dinner conversations if things go wrong. Many founders need external start-up capital to get their business off the ground. If that sounds like you, keep on reading to learn about the most common kinds of external capital you can raise. Seed Financing If you're looking for a relatively small amount of money, say, the investigation of a market opportunity or the development of the initial version of a product or service, then Seed financing might be for you. There are many different kinds of seed financing, but the one you've probably heard of most is called Seed-round financing. In this case, someone fax number list will invest in your company in exchange for preferred stock. If your company gets sold or liquidated, then investors who hold preferred stock often have the right to get their investment back and, in most cases, an additional return, called "preferred dividends" or "liquidation preferences before holders of common stock are paid. Accelerator Accelerators are highly competitive programs that typically involve applying and then competing against other startups in a public pitch event or demo day. In addition to winning funding and seed capital, winners of these programs are also rewarded with mentorship and educational programs. Although accelerators were originally mostly tech companies and centered around Silicon Valley, you can now find them all over the country and in all different industries. If this sounds like something you'd be interested in, here's a list of the top accelerators in the United States to get you started.