Various Stages of Funding About Us Home
 
 
Stage 1: Idea
At the very early stage of company (maybe even before company formation), all that is there with an entrepreneur is a team and a dream. The idea itself may be powerful, and serves a customer need, but there may not be anything tangible to show.

Potential Sources of funds
  • The 3Fs: Founder savings, Friends & Family
  • Government bodies and MSME schemes (micro, small and medium enterprise schemes)
  • Incubation centers at IITs, IIMs and other leading institutions (non-financial support mostly like office space, internet, phone, electricity)
 
 
Stage 2: Feasibility
At this stage of the company, there is a physical shape to the entrepreneurs idea. If its a software, then the website will be operational, or the basic codes and executables will be ready. 1-2 early customers (either paying or free is ok) may be there, and the sales team will be slowly learning the art of sales. The company need not be profitable, but they can show that the product works.

Potential Sources of funds
  • Angel Investors
  • Seed Funds
  • High networth individuals
 
 
Stage 3: Development
This is the stage of the company where the only way forward is rollout of products and services on a large scale, whether fast or slow. Technology, marketing and commercial risk will have been taken care of. Customer traction would have started. The company may or may not be earning profits, but the potential is huge. Team is stable, new products may be in pipeline, new offices or geographies are being planned for rollout.

Potential Sources of funds
  • Venture capital investors
  • Large Corporate
 
 
Stage 4: Growth
This is the stage of a company which witnesses rapid changes in scale of business. It can witness growth coming from high growth existing business divisions and new areas of opportunity as well. The company would have established a 3-5 years presence and build some assets in their balance sheet.

Potential Sources of funds
  • Private Equity
  • Bank Loans
 
 
Stage 5: Maturity
This is the stage where the company may be growing at or above the industry growth rates, having competitive pressures, customer retention challenges, HR challenges and would have taken the shape of a medium to large corporate.

Potential Sources of funds
  • IPO (Initial Public Offering)
  • Mergers and Acquisitions
 
 
 
 
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