Presentation on Seed Funding Capital for the Startups. Consists brief description of the seed fund options available.

1. SEED FUNDING
Prepared By: Aparna Roy
Guided By: Prof. Ashok Dwivedi

2. WHAT IS A STARTUP?
 A startup is started by individual founders or
entrepreneurs to search for a repeatable
and scalable business model.
 A startup is newly emerged business
venture that aims to develop a viable
business model to meet a marketplace need
or problem.
 They have high risks and uncertainties and
also high risks of failures.
 Only minority become successful and grow
into big influencers. Some examples of
successful startups are Ola Cabs, Paytm,
Makemytrip, etc

3. DIFFERENCE BETWEEN A STARTUP &
ENTREPRENEURSHIP
 The concepts of startups and entrepreneurship are
very similar.
 Entrepreneurship refers all new businesses,
including self employment and businesses that
never intend to grow big or become registered.
 While, startups refers to new businesses that intend
to grow beyond solo founders, have employees and
intend to grow large.

4. STAGES OF FUNDING A STARTUP
1. SEED CAPITAL
 The Seed Capital is the initial money required to start a
new business. Simply, the initial funding required to start
the operations of a new business is termed as a seed
capital.
2. VENTURE CAPITAL
 Venture capital (VC) funding is typically used by
companies that are already distributing/selling their
product or service, even though they may not be
profitable yet.
 If the company is not profitable, the venture capital
financing is often used to offset the negative cash flow.
 Some examples of Venture Capital providers are Helion
Venture Partners, Accel Partners, etc.

5. 3. MEZZANINE FINNANCING
 At this point, companies may be eyeing the
following types of opportunities that require
additional funds:
 An IPO (initial public offering)
 An Acquisition of a Competitor
 A Management Buyout
 To do so, they can tap into mezzanine financing or
“bridge” financing.
 Mezzanine financing is often used 6 to 12 months
before an IPO and then the IPO’s proceeds are
used by the company to pay back the mezannine
financing investor.

6. 4. INITIAL PUBLIC OFFERING (IPO)
Finally, companies can raise money through selling
stock to the public in what’s called an Initial Public
Offering (IPO).

7. STAGES OF SEED CAPITAL
1. Bootstrapping
The first stage of funding your startup is
bootstrapping. With bootstrapping, you’re using
existing resources. In the sense of funding a
startup, you take your own funds and abilities and
begin to support what you can of your startup. If
you’re still in the idea stage of your startup, this
could mean that you work more hours or get a
second job to put money into your startup. If your
startup is running and you’re making a little
money, the money is put right back into the
business. Bootstrapping is a great phase because
you learn how to work with what you got. This
is part of pre-seed capital.

8. 2. Crowd funding
The second stage of funding is
crowdfunding. Crowdfunding gives your friends,
family, and social media followers a chance to help
support what it is that your startup does. If you want
people to give you money, you have to show them
what’s in it for them. What are the benefits? Sure,
you probably have some friends and family
members who will donate just because it’s you, but
most people (even in crowdfunding) want
something for their money. Make sure that you use
your crowdfunding money wisely and fulfill any
obligations that you promised in return for the
funds. This is part of seed capital.

9. 3. Angel Investor Funding
 The third stage of funding involves other
sources of seed capital. Since seed capital is
sometimes limited, it is often necessary for an
entrepreneur to tap into wealthy individuals outside
their friends & family — this is often called an
“Angel” investor.
 You can receive money from an angel investor as a
loan that is convertible to preferred stock .
 Friends & Family investors sometimes participate in
this “Angel Round” of financing.
Remember that seed funding refers to equity
funding. This means that people are giving you
money in return to have part of your business. You
must learn to how to manage people and your
relationships with those people in order to
successfully receive seed capital.

10. Some examples of seed funding are:
 Matrix Partners:
They work with a lot of early stage startups and also
have famously invested in OLA and Quikr.
 Kalaari Capital:
They provide early stage funds, seed capital and
venture capital. They have history in funding
Myntra, Snapdeal, Instamojo, etc.

11. THANK YOU!