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Who to contact for financial support for a startup?

In recent years, the venture capital market has been developing rapidly. Investors are increasingly interested in ideas that can bring great returns if they come to fruition.
At the moment, the most popular startups in the IT field, however, any idea can attract attention if it is well thought out and reasoned.
By increasing the flow of investment, aspiring startups gain access to a multitude of opportunities. They can find a mentor, an investor, and make a loan. The most convenient and generally accepted at the moment are business angels and venture capital funds.

Angels and foundations

The choice of the source of investment depends on the stage in which your project is.
If you only have an idea and no MVP, you can only turn to a business angel. This is an investor who will provide not only financial, but also mentoring support. The angel will determine the path of development and help attract the first customers. At the same time, the angels do not invest large sums. Usually such investments do not exceed $ 100,000. This issue can be resolved by involving more than one angel. Or you can use a single investment to take the project to the next stage by getting the main work done. The advantage of angels is also that you can conclude an agreement with them rather quickly: it will take several weeks.
You also have the option to take a convertible loan. With successful development, it can turn, at the request of the investor, into a share in the company.
If you have an MVP, but still have no access to the client base, but only an idea of how to do this, you go to the pre-seed stage. Venture funds prefer more mature projects, but there are special pre-seed funds that can invest in a company, while obtaining the rights to a share in it. The share depends on the amount of investment and is usually 14% -49%, but it can be lower if the fund doubts the success of the project.
Finding a market for a product, you reach the seed stage and in the future you need mainly to expand the business, and not to establish it. This is where you can turn to venture funds. They take longer than angels to consider applications. Your startup is thoroughly vetted for 3 to 6 months.
Funds prefer large projects with a high risk index, in which you can invest from 1 to 5 million dollars and get huge revenue, offsetting losses from failed projects. But there are also seed funds that are ready to work with small projects.

Accelerators

Business accelerators are gaining more and more scale. This is a program to support and develop startups, often short-term. Why is it a good idea to use an accelerator?
Unlike foundations, which are very formal in choosing startups for investment, and therefore require exceptionally developed projects, accelerators are ready to engage in an idea. Experts help to check the work of a business on a real client base, find the first sales markets and establish an organization. Accelerators attract investors or act in this role themselves. The participant either pays for promotion, or provides a small share in the form of 4% - 10% in the company. Less often, the promotion takes place free of charge.
In a few months in the accelerator, the project manages to get back on its feet, after which it is possible to attract larger investors.

7 reasons to contact an accelerator:

- The largest number of transactions in recent years have been concluded within the framework of accelerators;
- Open competitive recruitment;
- Rapid and intensive development: from several months to six months;
- Strong expert support;
- Almost instant transition to hypothesis testing and real income;
- Opportunity to receive investments promptly;
- Forms of participation in the accelerator: from a small share of the accelerator to a simple payment for participation in the program.

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