Capital Funding – Improve Startups & Scaleups

About the project

Fundraising for a startup requires a lot of time and a good strategy to reach the goal. Understanding each of the rounds will give you an advantage over competitors that simply look for any investment passing by.

It`s all about trust and performance?

First of all, you can’t just get plenty of cash or a business loan and feel set and happy for good, although it sounds attractive, right?

You have to go through a number of funding rounds and prove that your idea deserves the money, meeting different goals and challenges every time. Each round is designed to raise enough capital to grow further and can take as long as a year. However, many entrepreneurs rush things down to a 6 or even 3 months timeframe.

Based on the raising purpose, startup and scaleup funding rounds are divided into the following stages:

pre-seed/seed;
series A, B, & C;
and IPO.

Here are the 6 steps we will help you connect with the right investors.

Seed stage funding

Pre-Seed

Pre-seed funding is when founders are trying to give their idea the initial push and often invest their own money.

Seed

It is followed by the Seed stage, where founders attract so-called angel investors. These people provide funds for further research, testing market needs, hiring a team, and production start.

At the seed stage, tech startups can aim at anywhere between $500K and $2 million investments, depending on their needs and presentation. Investors are ready to take risks, and typically invest in a number of startups. Those that go through then receive additional capital.

Some of the well-known companies considered for this stage are Y Combinator, 500 startups, SV Angel, and Techstars.

Series A

Next comes round A. It is focused mainly on the startups that have a proven business model, decent customer base, and are already generating profit.

The investments at this stage can start from $3 million and require a specific strategy to reach higher ROI. Typical investors here are venture capital firms that ask startups to show real data and progress received from previous investments. They want to see the startup turning into a valuable money-making machine ready to scale and get to the next level.

Series B

Round B helps startups turn into enterprises.

At this point, they’ve already matured, have a large user base, and are looking for VC-level participation. Investments at this stage can range anywhere around $10 million and up (Mixpanel raised $65 million series B). This stage is all about scaling up the team and exploring new markets.

Some of the biggest investors here, especially if you go outside of Norway and the Scandinavian Countries: check out Accel, Insight Venture Capitals, and Sequoia Capital.

Series C

Moving to round C implies an even higher level of expansion.

The companies are already successful, value $100+ million, and are aiming to receive equal funding (again, Magic Leap has raised almost $1 billion). As one of the last funding stages, round C includes not only extending current project capabilities but creating new products. So, prepare to work with the largest VC firms and corporate-level investors that are far more demanding.

Companies at this stage are getting their exit strategies ready to smoothly approach IPO.

IPO

The final stage of a startups’ existence, initial public offering (IPO) is the process of opening a private company’s shares to the public.

This unlocks a vast amount of funding available on the public market along with a new level of transparency. However, it also means additional complexity because now you have to deal with shareholders in addition to investors. Such relationships require a lot of effort and you can expect it to be challenging and expensive.

Fundraising for a startup and scaleup company requires a lot of time and a good strategy to reach the goal. Understanding each of the rounds will give you an advantage over competitors that simply look for any investment passing by.

How Funding Works

Improve Startups and Partners works as “Funding Connectors” meaning we do not deal with the actual money transactions but mainly work as advisors and connectors. We focus our work towards analyzing and finding the right Investor Partner for you. Here is how we work:

Description of work

Funding Contract

We agree upon a separate funding contract, discussing and agree upon terms and conditions, roadmap, funding needs, investors etc.

Maturity Profile Analysis

How “mature and Investor Ready” is your company? We will run an assessment with your managers, board, advisory board, shareholders, evaluating, analyzing and stating your company strong and weak areas to be improved. Our 25 pages report tells your investors your corporate situation speeding up the funding process. We also invite stakeholders and investors to join our Performance Management and Training System to follow up your company progress in real time.