Business incubators help new startup companies by providing services such as office space, management training, financing assistance and networking opportunities. They guide startups in areas like management, financing, marketing and product development. This support helps startups save on costs and resources during the early critical stages of development, increasing their chances of survival and growth. Angel investors and venture capital firms also provide early stage funding to startups, helping them commercialize ideas and expand operations.

1. BUSINESS INCUBATORS

2. INTRODUCTION
• A business Incubator is a company that helps new and startup companies to develop bv
providing services like management training and office space.
• It is a company that provides various facilities established to nurture young firms during their
early stages.
• It usually provides Affordable space, shared offices and services hands-on management
training, marketing support and often access to some form of financing.
• In the business world, an incubator refers to an enterprise that is set up to provide office space,
equipment and often monitoring assistance and capital to new business that are just started.
Business incubators are usually set up by universities, non-profit groups, and Increasinglv by
venture capitalists especially for new web business.

3. Various functions performed by business
incubators
1. Finance
2. Management
3. Synergy
4. Economy
5. Services

4. 1. Finance
• Incubators help startup companies in saving on
operating cost.
• The incubators share various facilities with the
business like office equipment rentals and
receptionist services.
• Startups can also give the benefits of lower lease
rates.
• If the incubator is located in lower industrial area,
Incubators provide financial needs by referring them
to angel investors and venture capitalists.
• If incubators approve the new business venture, it
becomes easy for such a start up to secure finance
from various sources.

5. 2. Management
• Apart from financial help new business ventures also
needs guidance and direction on how to compete
successfully with other established players in the
market, Incubators can provide good management
guidance and operational assistance through their
networks.
• Business incubators guide new start ups in
managing their ventures well. For example, business
start ups may take help from retired and
experienced executives associated with the
concerned field high degree of specialisation.

6. 3. Synergy
• The working relationship between an incubator and
startup business create synergies.
• The networks and connections established through
such relationships can continue for a long period of
time Startup businessmen can provide
encouragement to one another and their employees
may share ideas on new outlooks to old problem.
• Startups may go for joint marketing campaigns and
cooperate on initiatives related to product
development.

7. 4. Economy
• Incubators create employment opportunities for their
communities. Start ups guided by incubators have
greater viability and show superior financial
performance over the long-term.
• They are able to create long-lasting jobs for new
graduates, experienced mid-career, personnel and
veteran executives.Thus business incubators provide
benefits to the communities and to the economy.

8. 5. Services
• Most common incubator services include networking
activities, marketing assistance, help with accounting
and financial management.
• Access to bank loans, access to angel investors or
venture capitalists, help with presentation skills, links
to better resources and strategic partners etc.
• Business incubators also help the start ups with
comprehensive business training programmes and
provide commercialization assistance.

9. ANGEL INVESTOR

10. Angel Investor
• Angel investors are those investors who invest in business ventures or
entrepreneurial ventures.
• They usually invest in early stages of business startups.
• Often angel investors are among an entrepreneur's family and friends.
• The capital angel investors provide may be a onetime investment to help
business prosper.
• It can be an ongoing injection of money to support and carry the company
through its difficult early stages.
• Angel investors provide relatively easy terms and condition as compared to
other lenders.They are also known as angel or informal investors.

11. Some of the prominent angel investors in lndia :
• 1. RajanAnandan : He is a managing
director of Google IndiaWho resides in
Bengaluru. He is also the co-founder of Blue
OceanVentures in Sri Lanka. Over the past few
years he has emerged as one Of the most
active angel investors in the Indian start up
ecosystem by investing in more than 80
startups like Druva, Instanojo,TravelKhana,
Burrp, Quench etc.
• 2. Sunil Kolra : Has been investing in
startups since 2002. He has invested in
more than 50 startups including
healthcare, technology. logistics, mobile
and e-commerce sectors.Various
entrepreneurial ventures like Airwoot.
Orangescape,Culture Alley, Wooper.
MyShaadi.in have been funded by him.

12. Some of the prominent angel investors lndia :
• 3. AnupamGopal Mittal : He is known for bringing a revolution in arranged marriage
market through his offering Shaadi.com. He has invested in more than 50 startups. He is
known to support business ideas that have a big market potential. He has shown
preference for sectors like clean technology, consumer internet. mobile healthcare etc, He
has funded various ventures like Makaan.com. Mauj Mobile, Ola Cabs, Fab Hotels.
LetsVenture etc.

13. VENTURE CAPITAL

14. What is venture capital ?
• Venture capital is type of funding for a new or growing business.
• It usually comes from venture capital firms that specialise in building high risk financial portfolios.
• With venture capital, the venture capital firm gives funding to the startup company in exchange for equitv in
start up.
• venture capital is a type of private equity, a form of financing that is provided by firms to small, early stage,
emerging firms that are deemed to have high growth potential or which have demonstrated high growth.
• Venture capitalists take on the risk of financing risky start-ups in the hopes that some of the firms they
support will become successful.
• For startups without access to capital market venture capital acts as an important source of money.
• Venture capital usually comes from welloff investors, investment banks and any other financial Institutions
that pool similar investments or partnerships.
• Venture capital can also take the form of technical or managerial expertise.
• Venture capital investments are capable of giving impressive returns if thev are invested in the right venture.
venture capitalist have the Power to influence major decision of the companies they are investing in as their
money is at stake.Venture capital is also known as risk capital.

15. FEATURES OFVENTURE CAPITAL
• High risk
• Lack of liquidity
• Long term horizon
• Equity participation and capital gains.
• Venture capital investments are
usually made in innovative projects
• Venture capital suppliers participate
in the management of company

16. 1. Early stage financing
• Seed financing : It is defined as a small amount that an
etrepreneur receives for the purpose of being eligible
for a start up loan.
• Start up financing: It is financing that is given to
companies purpose of finishing the development of
products and services.
• First stage financing :These are arranged by
companies that have spent all their starting capital and
need finance for beginning business activities at the
full scale.
Early stage financing can further
classified

17. 2. Expansion financing
• It is further into second-stage financing bridge
financing and third stage financing or mezzanine
financing.
• Second stage financing is provided to companies for
the purpose of beginning their expansion. It is also
known as mezzanine financing. It is provided for the
purpose of assisting a particular company to expand in
a major way. Bridge financing can be provided as a
short-term interest only finance option as well as a
form of monetary assistance to companies that
employ the initial public offers

18. 3. Acquisition or
Buyout financing
• It is further categorised into acquisition finance and
management or levered buyout financing.Acquisition
financing assists a company to acquire certain parts or
an entire company. Management or leveraged buyout
financing helps a particular management group to
obtain a particular product of another company.