Seed Funding Consultancy
Seed funding consultancy refers to the seed money that is provided to a startup by an investor or group of investors as a return for equity in the company. Pre Seed-funding consultancy for a startup is normally used to support businesses to start up, validate their business model, and prepare for future rounds of seed fund scheme.
The Startup India Seed Fund Scheme
The Government of India has launched the Startup India Seed Fund Scheme, which is popularly known as SISFS. The scheme was launched in 2021. Under this scheme, seed funding support will be provided to promising startups, and innovative ideas will be converted into thriving businesses.
SISFS has aided early-stage India-based startups to come into the reckoning where the startups have had a deficit of seed funding. Credits could not flow in for ages from banks and from venture capital funding institutions due primarily to the latter's inability to support their traditional credentialed needs typically the least period of the track of operations or of markets and customers.
What is Seed Financing?
Seed finance is the need for a startup company for several reasons:
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Seed capital: It costs money to start a business. There are various expenses that the business needs to incur. Among them are renting, equipment, salaries, and marketing. These will therefore be covered by seed funding.
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Validation and credibility: Seed funding will validate your business idea. This is because seed funding proves that investors believe in your vision and potential. Therefore, it boosts your credibility and attracts further investment.
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Mentorship and Guidance: A good number of seed funding provides mentorship and guidance from experienced entrepreneurs or industry experts. This would make it easy to navigate some very challenging tasks accompanying business start-ups.
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Networking: Seed grants does come with networks of other start-ups, investors, and future partners. The network would create a significant open door into a lot of opportunities about collaboration, learning, and more funding.
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Equity Retention: Seed money often ends up being a relatively smaller investment compared to other rounds of follow-on funding. In that regard, the founders shall have a more significant equity in and more controlling powers over the company.
Types of Seed Funding
There are several ways seed funding can be provided to startups and are classified by specific characteristics and their respective advantages.
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Incubators: Incubators provide young businesses with space, mentorship, training, and sometimes small levels of funding. They help the early-stage ventures grow the idea.
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Crowdfunding: Good crowdfunding sites are where the startups can raise money from many small contributors. That way, a startup will get in touch with the collective power of supporters and could even be used as a good way to validate your idea and gain early traction.
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Angel investors: are those people who find their money in the startups they believe are worthy. Sometimes, apart from investment, they serve as mentors to the startups, guiding and helping them through several steps.
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Corporate Seed Funding: Generally, large corporations invest in the startups that correlate with their specific strategic objectives or innovative in delivering such solutions.
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Accelerators: Accelerator programs do give very robust mentoring to the start-up, learning is quite significant, and the network goes all the way till the culmination on presentation day ahead of investor pitches.
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Debt Capital Financing: Going as far by the debt itself, it basically would be borrowing through banks. With appropriateness in borrowing some situation then indeed would be incurred and cost from debt collection would follow.
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Venture Capital Investment: Venture investors invest in highly high-growth startups with huge returns. They mostly come as a large amount and require equity share.
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Government Grants: The Government of India provides many startups India grants to allow innovation and entrepreneurial activities. These grants are for specific sectoral startups and the ones working on societal impact projects.
Government Grants: Accelerating Startup Growth
Besides, the Indian government encourages the growth of startups through various grant programs. Grants offered by the Indian government for startups are significant seed capital resources that assist new businesses in overcoming financial obstacles. Some of the most popular government grant schemes are highlighted below.
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Start-up India Seed Fund Scheme: This seed fund will grant a maximum amount of ₹ 5 crores for an eligible startup. Below is a mention of the seed grants in terms. Seed for Development-Conceptual development ₹20Lacs Product/service expansion Scaling up 50 L.
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Atal Innovation Mission: Initiative was launched in the year 2016. It encourages health, education, agriculture, and transport sector start-ups. ₹10 crores are granted to every eligible start-up.
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Multiplier Grants Scheme (MGS): This comes under the Department of Electronics & Information Technology. This department of this scheme gives impetus to joint research & development. Up to ₹2 crores grants are sanctioned to the start-ups within two years.
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Dairy Entrepreneurship Development Scheme: Basically, it's a self-employment program via dairy entrepreneurship. DEDS provides backend capital support for all the milk-related startups related to producing, procurement, and marketing businesses.
How Startupflora is gonna help you ?
Getting an understanding of funding a startup requires a lot, but StartupFlora is going to make your way through easy. We may help you by giving an idea about seed funding types, making you aware of some suitable grants by Indian Government for your business, and then preparing pitches for the interest of investors.
StartupFlora is the favorite funding partner to most startups aiming to raise seed capital. We believe in entrepreneurs and their power if given access to resources that help them grow. Let's discuss today how we can help raise seed capital so that your business can get underway.