Financing your business

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Financing your business

  1. 1. Financing your business Sources of finance for startups
  2. 2. Types of financing Equity Loan Other sources
  3. 3. Equity Capital Ownership Willingness to take risk No interest and repayment Profit at exit – maybe…
  4. 4. Sources of Equity Capital FFF Seed Funds Business Angels – Individuals – Networks Venture Funds Corporate Venture Stock Markets
  5. 5. Loan Capital Low willingness to take risk Interest and repayment starts immediately No ownership
  6. 6. Sources of Loan Capitals Banks Real Estate Funding Guarantee Schemes (through banks) FFF
  7. 7. Other types Grants and Awards Funds Leasing Factoring Negotiate payment terms
  8. 8. Financing & Life Cycle R&D Start up Exploitation & Growth
  9. 9. Expand product to national markets BRIDGE IPO or sale Completing product STAGE 1 development & Preparing startup STAGE 2 Capital to maintain Full scale until pending manufacturing & sales liquidity event or initial expansion SEED STARTUP Product development, market research & Concept building management infrastructure
  10. 10. R & D Financing Seed Capital – Often connected to universities Public Sector – If R&D is in the interest of society Venture Capital – If the potential is really promising Corporate – If it is of strategic interest
  11. 11. Start Up Financing Business Angels – Growth potential necessary Venture Capital + Corporate – High growth potential necessary Public Sector – Grants Bank loans – Typically small – Through Guarantee Schemes
  12. 12. Exploitation & Growth Financing Banks Business Angels Venture Capital
  13. 13. Sources of finance Equity Funds Venture Funds Vækstfonden – Guarantee Schemes and more Business Angels Seed Fund Own money Idea/Pre-seed Seed Startup Initial growth Expansion Re-structuring
  14. 14. R&D/Idea Startup Early growth Marketing Growth Maturity Private Equity 6 IPO Late-stage VC’s Revenue Non-Bank lending Factoring Early-stage VCs PROFITS Corp. Investors 4 INVESTMENT SIZE Seed Capital Founder Founders Grants Business Angels FFF TIME - 2-

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