Fundraising Basics

In the previous sections, we have been talking about skills that are required to run businesses in general. However, in the 21st century and with the advancement of technology, ‘Startups’ have become more popular for young entrepreneurs.

So what separates a ‘startup’ from a regular business?

• Startups, by design, are ‘disruptive’, meaning that they are new ideas and designs that try to rapidly address a growing problem in society.
  • In today’s world, disruption normally comes from the use of technology. Take Uber for example, it tried to address the problem of cab hailing using technology which has made life a lot easier for people all over the globe.

In addition, startups have taken away the need for a physical place of business and have reduced the costs and barriers of entry into business, which is why so many young people around the world are slowly entering the world of startups with their own unique ideas.

For a startup to be able to solve a problem quickly, it must grow rapidly and as such, they require a lot of money to be able to tap into new markets and continuously work on innovating their products/services.

• Startup funding is the money a business uses to start or support a new business. These funds are used to cover marketing, growth and operating expenses to launch the business.
  • Startup funding is crucial for launching and growing the business from idea stage to optimal capability.

Knowing how fundraising works and how to effectively plan out a startup's fundraising is important for anyone hoping to delve into this world of startups. This section will provide information on fundraising stages and how you can begin to start raising money/funds.