Question

In: Finance

How can a new start-up company obtain the necessary funds for growth?

How can a new start-up company obtain the necessary funds for growth?

Solutions

Expert Solution

A new start up company can obtain necessary funds for grow by first developing a full business plan of their company about what they basically do, what is their business plan, business model, current revenues, forecasted revenues, cash flows, current investors, capital structure etc and then further pitching the same to the following :-

1. Venture capital firms - Venture capital firms do invest in early stage seed development companies on the basis of criteria like their enterprise value, structure etc. They Invest in series like $100,000 per early round of financing.

2. Crowd funding startups - There are various websites which croud fund capital and provide it to startup companies on the basis of certain eligibility criteria

3. Angel investors - these are high networth individuals and prefer to invest in early stage companies and incubators if they like their business plan

4. Friends and family - You can approach your friends and families too in the same way Aliababa grew up in the pre ipo stage

5. Banks and financial institutions - banks and financial institutions provide capital to early stage startups .

I hope this helps too

Please press the like button

Took real efforts

thanks & Regards

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

propose a plan for how a start -up company can use IoT device data to make...
propose a plan for how a start -up company can use IoT device data to make better business decisions. 2.Argue for or against the following statement the internet of things is just a passing fad and will be gone within a decade
Your Company needs $10,000,000 for a plant expansion. You can obtain the funds by either issuing...
Your Company needs $10,000,000 for a plant expansion. You can obtain the funds by either issuing common stock or issuing bonds. Common stock is currently trading at $100 per share and the effective rate for bonds is 5%. What factors should be considered in making this decision? What decision will you make? Does your response change if stock is trading at $10,000 per share and interest rates are 15%? Your response must be a minimum of 50 words.
Ameristar, Inc. can obtain funds for future investments through retained earnings, new issues of common stock,...
Ameristar, Inc. can obtain funds for future investments through retained earnings, new issues of common stock, issuance of debt, and issuance of preferred stock. The Board of Directors believe an appropriate capital structure is one where funds are acquired in the following mix: 30% debt, 10% preferred stock, and 60% common stock. New issuance or flotation costs for the issuance of new securities amount to 3% for debt, 5% for preferred stock, and 10% for common stock. Ameristar has $180...
Ameristar, Inc. can obtain funds for future investments through retained earnings, new issues of common stock,...
Ameristar, Inc. can obtain funds for future investments through retained earnings, new issues of common stock, issuance of debt, and issuance of preferred stock. The Board of Directors believe an appropriate capital structure is one where funds are acquired in the following mix: 30% debt, 10% preferred stock, and 60% common stock. New issuance or flotation costs for the issuance of new securities amount to 3% for debt, 5% for preferred stock, and 10% for common stock. Ameristar has $180...
Ameristar, Inc. can obtain funds for future investments through retained earnings, new issues of common stock,...
Ameristar, Inc. can obtain funds for future investments through retained earnings, new issues of common stock, issuance of debt, and issuance of preferred stock. The Board of Directors believe an appropriate capital structure is one where funds are acquired in the following mix: 30% debt, 10% preferred stock, and 60% common stock. New issuance or flotation costs for the issuance of new securities amount to 3% for debt, 5% for preferred stock, and 10% for common stock. Ameristar has $180...
The client was a young IT professional who wanted to start-up a new company. The idea...
The client was a young IT professional who wanted to start-up a new company. The idea was to combine virtual reality developments with online education which was getting quite popular after coronavirus pandemic in 2020. Furthermore, the client was getting ready to launch virtual offices as well. Test runs have shown a strong interest from many companies as this would allow to save a lot of money on office spaces, utilities and supplies. you have also asked the client which...
You have a new start-up firm. You think that the value of your start-up is around...
You have a new start-up firm. You think that the value of your start-up is around $60 million, but you will need to do a serious NPV analysis before you know the precise value. You are planning to have a 50% debt-to-value ratio, and that you will continuously rebalance to maintain this leverage. You have information on two other companies. The names of these companies are “Comp A” and “Comp B”. Comp A has the same business risk as your...
How can you obtain coefficient of permeability? Classify and define briefly. Please use sketches when necessary.
How can you obtain coefficient of permeability? Classify and define briefly. Please use sketches when necessary.
?Staton-Smith Software is a new? start-up company and will not pay dividends for the first five...
?Staton-Smith Software is a new? start-up company and will not pay dividends for the first five years of operation. It will then institute an annual cash dividend policy of ?$4.75 with a constant growth rate of 4?%, with the first dividend at the end of year six. The company will be in business for 25 years total. What is the? stock's price if an investor wants a. a return of 12?%? b. a return of 13?%? c. a return of...
Staton-Smith Software is a new​ start-up company and will not pay dividends for the first five...
Staton-Smith Software is a new​ start-up company and will not pay dividends for the first five years of operation. It will then institute an annual cash dividend policy of $3.75 with a constant growth rate of 6​%, with the first dividend at the end of year six. The company will be in business for 25 years total. What is the​ stock's price if an investor wants a.  a return of 10​%? b.  a return of 15​%? c.  a return of...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT