Fundraising platforms for individuals

Fundraising platforms for individuals Funds are the lifeline of every business organization. It is important to have adequate funds in hand for the smooth functioning of the business. Every organization raises funds in one way or the other to carrying out their business operations.

Similarly startups are also required to raise funds to carrying out their business activities. At times being new in the acumen, startups find it difficult to raise the funds for their venture. Various fundraising platforms for startups help them to raise funds for their venture.

Here are some of the fundraising platforms for startups.

1. Banks and Non- banking financial organizations (NBFCs): Banks are the first option for raising funds by the startups. Nationalized banks offer loans to the startup owner at the low rate of interests. They also provide them non collateral loans at low interest rates. The startup owner has to prepare the blueprint of their business project and present it to the bank. Banks will go through the report and allocate funds for your startup venture.

If the CIBIL of the startup owner is not good then the banks will be reluctant to give funds. NBFCs come to help by offering loans. However, the rate of interest charged by NBFCs are high as compared to the banks and it is required that some security is to be pledged for availing the loans from them.

2. Crowd funding: One of the newer ways of funding a startup venture is crowd funding. It is like taking a loan, pre-order, contribution or investments from more than one person at the same time. The startup owner will put up a detailed description of his business on a crowd funding platform, showcasing their goals, profit plans, funds required etc. Those giving money will make online pledges with the promise of pre-buying the product or some other favors.

3. Angel investment: The most favored fundraising platform for startups is Angel investment. They are the individuals with surplus cash and take a keen interest to invest in upcoming startups. They are group of people who screen the proposals before investing and also help the startups with expert advice and mentoring besides capital.

4. Venture capital: Venture capitalists are the professionally managed funds who invest in companies that have a huge potential. They usually invest in a business against equity and exit when there is an acquisition or IPO. They provide expertise and mentorship to the startup enterprise.

5. Incubators and Accelerators: Accelerators tend to provide mentorship, resources and advice to help startups succeed in their business. Incubators are like a parent to the child, who nurtures the business by providing shelter tools and training and network to the business. The main difference between the two is that incubators help and assists the startup enterprises to walk, while the accelerator helps them to take a giant leap.

6. Self- financing: Startup venture can raise the funds by self-financing. First time entrepreneurs often have trouble in getting funds and so they can do bootstrapping by investing their own savings or taking help from friends and relatives. This method helps in easy fund-raising due to less formalities and complexities.