The Finance Guru is back with yet another informative video that will solve all your queries about basic Finance Non-Finance that should be keep in mind. Today’s topic of discussion is the stages of funding.
Welcome to finance tube ladies and gentlemen today’s topic of discussion is stages or rounds of funding that a company may have before it hits the ipo so let’s discuss what are the seven key stages of funding before your company goes public we start with what we called as seed funding seed funding is usually provided by friends relatives or self many-a-times there
Are professional investors or seed investors who may look at your business if it is really a brilliant idea and a scalable model once you have your seed funding in place and you start your operation is when you get an angel now of course here the term angel does not mean an angel sent from the sky but an angel who can help you to stick your neck out and showcase your
Business out to the world so your product development your process development and system development will happen with engine once you have a professional angel on board the next round of funding that you would want to look at would be an early stage funding now an early stage funding is a big big round in terms of its time may vary from anywhere between nine months
To three years after you have finished your angel round once you have your early stage funding in place you come across as a proper established company which team of people having systems processes working and you are out in the market once you have your early-stage funding clear and you have enough traction and track record to prove to the investors what you do
Is round a or round one as you popularly call it anywhere from two years to four years is what your round one may last then depending on the need and expansion requirements and stuff like that you may go from round one or round a to round two or round b and then from round two or b to round three or round c once you have your round c of funding which is done by a
Sizeable big private equity fund and they are all gung-ho about your business you are operating either nationally or internationally you are ready for an ipo however market conditions competition other funding partners top-line bottom-line assets there are ten thousand issues before you hit the market so in between for you to sustain or show some traction on the
Mega project that you are banking on on your ipo you may look at mezzanine funding which is like just six to nine months before you are hitting the market so once you have your draft prospectus in place and you have investors ready to look up to your company and subscribe to your shares when you hit the market is where a bank or a financial institution or even a
Bigger private equity player may come in and pump in some money as mezzanine funding which is pre ipo so these are in short very very briefly the seven stages or seven rounds of funding that you may have before you hit the market let’s have a very very quick recap we start with seed funding which is mostly self or relatives then have an angel from angel we move to
Early stage from early stage we have round one two and three or what we call as round abc or popularly called as series a series b series c before we are finally ready to hit the ipo market and between the series c an ipo there is one small short stopgap funding provided by a bank or financial institution which would be called as mezzanine funding so here you go
You have these seven stages before you go for an ipo so for more tips on stages or rounds of investing common mistakes to avoid and get your company funded subscribe to our channel financed you a home loan is the cheapest loan that you can take on this planet earth let’s talk about situation in our country india
Transcribed from video
Stages of Funding | 7 Keys of Funding | Vishal Thakkar By Finance Tube
