The Three Phases
Pre-funding: The Jungle rule!
Survival of the Fittest
Pre-funding: How to survive?
If you survive, then only you will thrive?
• Asset Light/Little Liabilities
• Strict financial discipline: Personal & Company
• Factoring/Line of Credit
• On-cloud services
• Free: Hangout, Asana, Teamviewer
• Resource sharing: Co-working space, lawyers,
• If your father is poor, its your fate..if your father-in-
law is poor, its your stupidity...
– Real estate players
– Customer as partner (for initial funding)
– Customer as partner (for building a new product) –
• Personal Reputation
• People believe in you
• Small Capital
• Mentoring & Support
• Belief in your idea
• Initial Traction
• First Institutional Investor
• Traction & Revenues
• Large deal size
• Typically established businessesPEs
• Microsoft/Google Ventures
• Corporate Incubators: Target, TechM
• CIIE, IIMA
• 5ideas, Pearl Uppal
• Government Incubators: In about 34 cities across
– JFDI.Asia; Israel
– 500startups: Dave Mcclure
– Y Combinator; RocketInternet; Startup Chile
• Nexus Ventures
• Yournest venture fund
• Blume ventures
• India Internet Fund
Other Funding Sources
• Government Grants
– Department of Science & Technology (DST)
– Technology Development Board
– National Skill Development Corporation (NSDC)
• SIDBI Startup Assistance Scheme
• Venture Debt: SVB India
• Cash credit & bank overdraft
• The Pixar Pitch: Where the Pitch starts from a
Once Upon A Time kind of story. (Eg: Toy Story).
The audience can easily visualise your words and
relate to them
• E-mailers Pitch: Which incites curiosity in the
audience and investors. Starts with a
communicative tone. Personal, WIIFH, PoC
• Questions Pitch: Where the Pitch starts with a
pointed question. Eg: How many of you have ever
got stuck in traffic…
Most asked questions
• What is the problem the startup is addressing?
• What is your solution to the problem?
• How are you going to acquire customers?
• What is the cost of acquisition?
• What is the life-time value of a customer?
• What's your plan to beat the competition ? What's
the USP of the company?
• What's your vision for the business?
• How to multiple their money 5 times in 3-4 years?
• Your start-up definition
• What’s your story?
• Can they feel the pain? Can they be your
• Investors are sensible people too!
• Top-down vs bottom-up approach?
• Divided focus?
• Sell dreams but don’t be in dreams!
• Don’t believe that excel is reality!
• The Asked investment
• Product / Service Pricing
• Time to Break-even
• The graph of declining costs
• The time the amount will last
• Build a relationship with investors
• Speak to Alumni/Friends/Linkedin
• Don’t lose focus from business: Keep bootstrapping
• Valuation: A perspective and the stories!
• We look for strong founding team, key
differentiator, and a fundamentally large
addressable market in any elevator pitch, Accel
• OnlinePrasad, raised Rs 50 lakh from serial
entrepreneur Krishnan Ganesh over a 10-minute
• IIT-Kanpur alumni Sahil Baghla raised Rs 1.5 crore
for his gifting portal BlueGape from 12 global
investors, without even meeting them from Lets
• Bakshi, 30, whose company makes laptop bags
that can charge phones and tablets, when kept in
the sunlight. "Lumos solved a need that I have"