Four ways to raise funds

Four ways to raise funds

As a business takes shape from an idea to a venture, entrepreneurs face the biggest hurdle to growth – finance!

1. How much money does a business need? You can determine this based on the business plan. Money could be needed for creating a prototype, market expansion, team hiring, capital expenses or working capital — and the time period varies accordingly. Based on your growth plans, some money may come from profits of the company, and the rest of the gap has to be filled by external investments. So when you approach investors, ensure that you know how much you need, for what and for how long.

2. Various ways to raise investments: Primarily through debt/loan and equity/shares. Debt funding comes with additional burden of interest, while equity funding requires sharing of some percentage in the company, along with board participation and other terms. Other ways like customer advance, revenue sharing, credit card, overdraft facility from banks, vendor financing, etc, can also fill cash needs. Do basic research of the drawbacks and benefits of each kind and then decide.

3. Stages of investments: Early stages require seed investments. As the venture grows, angel investors can come in and invest money to fuel growth. Incubators can also provide some space and initial funding. Venture capitalists (VC) come in at the growth stage and Initial Public Offering (IPO)

happens at a mature stage of

a business.

4. Types of investors: Investors who can provide funds include angel investors, venture capitalists, private equity, IPO, banks, incubators etc. Angel investors are those who invest between `50 lakh-two crore in the early stage of a venture. Venture capitalists invest over `5 crore in a growth stage venture. Private equity investors do higher investments (whether as debt or equity) ranging from `50-500 crore. IPO is well suited while raising investments on the stock exchange and can be over `50 crore. Banks can also provide funding as debt — the norms will vary depending on collateral or it may be without

security like Credit Guarantee Trust for Micro and Small Enterprises scheme n

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100 days test for your business idea

What is an entrepreneur without his or her idea? Among the several issues that an entrepreneur faces, the biggest challenge is to bring the idea to shape. So what does a person do once he has got an idea?

1. Write it down:
An idea in your mind is a baby inside the mother’s womb. Nobody can touch it and understand its beauty unless it comes out. You need to nurture the idea like your baby — give it time and care to let it take a good shape. Make sure you write it down, and limit the document to one-two pages instead of 100 pages of detailed business plans.

2. Meet the customers: Spending time with customers, observing their lifestyles, and generating insights from that is a key entrepreneurial trait. Once you get an idea, take it out in whatever shape and size to potential customers — let them play around with the prototype, give their feedback, speak good or bad things about what you are showcasing.

3. Take it to competitors: The best people to tell you if things work or not, are your competitors and you will be surprised to know how open people are to share their insights. Whether it is ego or humility, people are happy to treat newcomers with respect and share important inputs.

4. Find a team member: If you can get one-two people to partner with you in your venture for taking your idea forward, you can beat the world. The first few partners and team members make a company great. Examples of Google, Facebook and Microsoft — all of them had great co-founders who came together and stuck around.

5. Look for a mentor: Mentoring is like a Krishna-Arjun relationship — Krishna mentors Arjun in Mahabharata and we all know what the results were. It will be good for you to take your idea to mentors and seek their guidance. They will also help you expand or modify ideas based on market requirements, without changing the core offering.

So if you have an idea, which you have been nurturing about for the last few years, take the 100-day test and bring it to life.

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Nurture Talent Academy partners with BITS Pilani Conquest 2011

With increased enthusiasm and interest among young Indians to take up entrepreneurship, Nurture Talent Academy and BITS Pilani’s Center for Entrepreneurial Leadership have come together to guide, mentor and train startups during Conquest 2011. Conquest 2011, an international business challenge and entrepreneurship conclave brings together members of the startup ecosystem together including venture capitalists, media, angel investors, successful entrepreneurs and mentors.

While there are several business plan competitions that take place round the year for students, Conquest 2011 has build a unique positioning by focusing on the entrepreneur and his venture, rather than the merely judging the idea. As a part of the selection process, over 500 entries were screened. Out of these, 38 were mentored by seasoned entrepreneurs all over the country, by listening to their problems and giving them one to one guidance. As next step in the process, each selected finalist team will go through an extensive training session by Amit Grover, CEO and Founder, Nurture Talent Academy. The startups will be going through exercises on marketing, business models, scaling up, mistakes in current business setup and raising venture capital as a part of the training session.

“We at BITS Pilani have been pioneers in fostering entrepreneurship. This year we decided to give more value and exposure to our participating startups by not focusing on redundant business plans but on developing startups through extensive face-to-face mentoring sessions all over the country and Nurture Talent Academy was a natural fit as they have shown the commitment towards young ventures right from the start.”, said Saurabh Gupta, Coordinator for Conquest 2011.

“It is a great way for us to connect and support the young startups. Platform like BITS Pilani’s Conquest give great exposure to entrepreneurs, and helps them build and scale their ventures faster with expert support. I am sure this will add to the entrepreneurial energy of India.” adds Amit Grover, Founder of Nurture Talent Academy and himself an IIT IIM alumnus.

The grand finale for the Business Challenge will happen at a live presentation and judging session at BITS Pilani campus itself on 21st August. It will not be a surprise if one or all of the startups go on to build the next Onida or Hotmail!

About Nurture Talent Academy

Nurture Talent Academy ( is India’s 1st institute for training entrepreneurs. Started in January, 2010, it has conducted 87 workshops across 25 cities for 1525 startups, students and professionals. The objective is to enable 1000 ventures to start and generate 20000 jobs in 3-5 years.

About BITS Pilani Conquest 2011

This year’s edition of Conquest has made it the only startup accelerator platform in India to organize regional mentoring sessions for the top 38 teams, which had been shortlisted after the first round of judging. Simultaneous sessions were held in July across India, which gave an opportunity to the teams to interact personally with more than one mentor with varied areas of expertise. For more details, please visit

Entrepreneurial Motivation: 5 Tips To Make It Happen

One out of 7 days in a week, I feel like giving up my entrepreneurial journey! There are challenges, failures and commercial setbacks on one side and then on the other side is the lure of a lucrative job, other people making it big and comfort of spending time with family. Is it now – no, this has been going on from the day I launched my startup, when I was a ‘baby entrepreneur’! So why am I sharing this – I want to discover ways to keep a startup motivated, make a difference to your startup and learn for myself in the process.

1. Keep executing but do not forget to plan

I have come across several startups, which were so bent on execution that they forgot to plan way forward. Somewhere down the line, you have to sit back and take note of what is working (scale up fast) and what is not working (give up fast). Give about 100 days for anything to take shape, and put your soul and heart to it for that time, but after that leave it as if you were a tourist!

2. Spend time in training – yourself as well as your team

At Nurture Talent, we spend a lot of time ‘sharpening the axe’ – collecting information for startups, updating about new schemes/techniques, new venture ideas/opportunities, gaps of aspiring students and professionals and visiting networking events/meets. This may take about 70-80% of our time. But it’s a very important part of our business, so we see it as an investment. Training is not only for team members, it is also for the owner of the venture. So invest some money into yourself – go out and learn new skills of finance, marketing etc.

3. Remember why you started up

If you wanted to be an entrepreneur, stick to it. If your venture is not doing well, try new things. If things do not improve, then become a co-founder of another venture. Always remember why you started up – were you pushed or pulled into entrepreneurship? Once an entrepreneur, always an entrepreneur!

4. Share your experiences with people you trust

If you are not doing well, no point in fooling yourself by writing on Facebook, “had a successful launch of a new product”. Go out and meet your mentors, share your problems and seek solutions. The problem may not get solved asap or you may not work on the advice, but Arjun will never lose by speaking to Krishna. Try someone in your family or your business network, whosoever you trust.

5. 1% extra is all that is required to win

Entrepreneurship is about giving that 1% extra – a little word here, a small effort there! Make a call to your customer you met 1 year back. Make someone awesomely happy with your service or products!

What does not work is reading about others success stories, spending time on Facebook etc.

Please add your views to this list, and make others happy.

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Gaps to fill in while setting up a start-up

have interacted with 5,000 startups, professionals and students, of all ages and if there is one thing that makes a difference between a successful and an average company, it’s the never-say-die attitude of the entrepreneur. So what are the blanks people usually need to fill while beginning a start-up?

1. Money: If I had money, I would have grown much faster, but investors do not support my idea — this has been the most frequent complaint I have come across. Money does not make a business successful, but it definitely plays a very important part. So if you feel the need for money, then reach out to investors, make a good business plan and polish your pitch.

Reach out to people who believe your idea and are willing to back you even with a small amount. Do not forget that the most important source of cash is your customer —make them happy

2. Team: I recently met an excited young man, who was a little disturbed as his venture was going nowhere. I asked him why and this is what he told me, “If only I could clone myself — I need someone as energetic and passionate as myself.” Go out, network, meet people, take part in exhibitions, attend business plan competitions, share your vision with friends and ask for acquaintances, post your requirements on Linkedin, or tie up with someone who can do a part of your job, but keep moving. For them, I advise them to start working on these areas and learn the art of selling.

3. Office, infrastructure and miscellaneous items:
I call these the ‘hygiene factors’— they just add to the comfort level of an entrepreneur in their ventures but do not add any real value to customers. Neither does their absence lead to any real issues. Remember, some of the best companies were started in a garage — Apple, HP and Microsoft.

So keep an eye on the big picture without undue complaints about what you do not have.

It is the pride of creating a solution that the world will use happily that makes a successful entrepreneur so get down and start-up.

Meet Amit Grover Founder of India’s First Institute for Startup

Socialwoot Ask: How the Career Journey Started? Or Who Inspired You to Start Business / Entrepreneurship?

My journey as an entrepreneur started after I met almost a 1000 entrepreneurs. I was in Onida and handling the investment portfolio of my Chairman, Gulu Mirchandani. As a part of that responsibility, I was making decisions whether to invest in early stage startups or not. I was also handling Mumbai Angels (group of angel investors) operations, and it gave me the experience and urge to become an entrepreneur. What I realized that there are lots of people who want to start, but lack the right training on aspects like business plan, finance, marketing, term sheets, legal etc. and I wanted to make a difference to their abilities.

Share Some Info About Your Products and Services Here….

We conduct short duration, practical and hands-on workshops on subjects like business plan, finance, marketing etc. We do this online as well as offline, and also sell DVDs on these subjects for audiences including startups, professionals and students. Since January, 2010, we have conducted 84 workshops across 25 cities, attended by 1485 participants.

What Was the Vision Mission of the Company? What exactly you Want To Do When You Started Your Business?

The objective of Nurture Talent Academy is to enable 1000 ventures to start, and generate 20000 jobs in next 3-5 years. This is exactly what we have aimed for from the beginning and tried to deliver through our various workshop formats.

What Kind of Difficulties You Had Faced While Starting / Doing Business?

There were lots of difficulties, including lack of awareness about entrepreneurship, marketing to aspiring entrepreneurs, society mindset against doing business, competition from low quality free programs and lack of experts in the area of entrepreneurship. We have been able to overcome some of these and trying to work on the others.

Share With Our Readers About Discovery Period When You Were Facing Difficulties in Your Business?

The discovery period started even before starting our venture. I spend almost 100 days trying to refine my ideas, talked to competitors, tried to partner with few, developed relationships, made business plans and shared issues with mentors. Through the support of well-wishers and friends, we could keep our initial costs low – for example, we did our first few workshops in a friends’ office with no AC but with awesome content and experiencing sharing by serial entrepreneurs. So customers got the value, and after that it spread through word of mouth.
Share With Our Readers About Your Experiment Period After Discovery Period?

As we went through the iterations, we did a lot of changes to exactly match customer expectations. Our first program of 1-month was charged at 25000 Rs, and we got exactly 1 customer – I was very disappointed. Then the next workshop I did a 2 hour session, and priced it at Rs 350 (with snacks and tea!) and we had 15 people attend it. Then we changed the topic and priced it at 400 – and 25 people came. In the next workshop, we increased the duration to 3 hours, and made the price Rs 450, and 22 people attended. After that we moved to another city, and made the duration to 4 hours and started giving our content for free to all attendees and this time priced it at 750 – another 20 people turned up! Now we do a 1-day program for Rs 2500, so it has been quite a few experiments along the way.

What are Your Future Plans? Or now what is Your Vision for Next Five Years?

Our future plans are to take the program to colleges all across the country. We have already identified and appointed 200 campus ambassadors who we will train for starting their ventures, and they in turn will spread the word about entrepreneurship in their colleges. We have also signed MoUs with IIT Bombay and BITS Pilani entrepreneurship cells for training and mentoring their students for business plan competitions. Our next five year objective is the same as we started with – to enable the start of 1000 ventures.

What Will be your Advice/Suggestion for New Entrepreneurs For Starting New Business?

My advice to new entrepreneurs is to move quickly, and act fast – time is of essence. They should not spend too much money but do small experiments and reach out to customers as early as possible.