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In this chapter, we explore the fundamental sources of capital essential for budding entrepreneurs. By the end of this session, participants will understand different avenues such as personal savings, equity, debt, convertible notes, and grants/start-up competitions. We discuss strategies for leveraging your own financial resources, raising equity through shares, obtaining loans, and the benefits of winning start-up competitions. This comprehensive guide aims to equip your start-up with the varied financial options needed for effective growth and sustainability.
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MAGIC TOUCH CONFERENCE Raising Start-up Capital The Different AvenuesChapter 2
Learning Objectives At the completion of this session, you should be able to: • Positively exploit the different sources of capital available to you.
Definitions • What is a Start-up Capital? • also known as seen money, it is money required to start up a new business.
The Different Sources of Capital • Your Own/Company’s cash • Equity • Debts • Convertible Notes • Grants /Start-up Competitions
Your Own/Company’s cash • Savings, Salary, positive cash flow • Minimizing Salary Expenses • Keeping your day job • Positive Chas flow form an existing company.
Equity • This involves exchanging shares for money. • Equity capital is typically raised via numerous rounds of financing based on the company’s development stage and needs.
Debt • This involves receiving a loan that must be paid back with a specific period of time. • It could sometimes attract interest. • And could be very attractive for founders who wish to maintain ownership of their companies
Convertible Notes • investors loan money to a startup and instead of expecting the money back with interest, they receive shares in the company at a discounted rate..
Grants & Start-up Competitions • This is usually a great way to raise start-up capital since money is provided free of charge. • Winning a startup competition not only enhances a company’s credentials and publicity, but also provides a decent source of capital
Other Sources of capital • Open discussion
The End Thank You for your time