Finances

Startup - what is it: definition, stages of development + 10 ideas for startups

May 2, 2020

Hi, Dear readers of the business magazine "RichPro.ru"! In this article we want to tell, what is a startup (Startup) in simple words, how to create it and where to find sources of funding for the creation and development of projects.

How often do you hear the word startup nowadays? But it has become almost colloquial and occurs in everyday life constantly. Some call a startup exclusively an online business, others believe, that a startup is any business project.

If there are entrepreneurs among the readers, novice investors or at least financiers-theorists, then this post will be useful to read. Because the story will be about the most basic concepts, related to the term "startup», The history of its origin, stages of creation and development of startup projects and sources of their financing.

so, from this article you will learn:

  • What is a startup really - the main features and characteristics;
  • How to create a successful startup project on your own;
  • Where and how to find funding for startup projects;
  • Who is a startup.

And the article is intended for those, who knows about financial endeavors of this kind only by hearsay and wants to find out the truth.

In the article we described what a startup is, gave a complete definition of the term "startup" in simple words, gave the main stages and key points in the creation and development of projects, and also brought relevant and interesting startup projects for small businesses

1. What is a startup - the history of origin and definition in simple words

In the distance 1939 year in the United States, near San Francisco, which was a center in the development of new technologies, graduates of Stanford University, David Packard and William Hewlett, developed an idea, tested in practice and called their project a startup (From English startup - run, start).

Today this project is known as a huge company, which produces computers, laptops, office equipment and related software under the logo HP, or Hewlett-Packard.

Later, v 90-and years, Many financiers and entrepreneurs have debated the definition of the term startup, calling the main feature is the short period of active activity of the company, then rapid growth is a must, then the production of goods or services in high risk.

The classic definition of a startup is considered to be that, which was formulated by the successful American startup Stephen Blank, namely:

«startup Is a temporary structure, aimed at finding and implementing a scaled business idea ".

Simply put, startup Is a new financial project, whose goal is rapid development and profit.

But is everything so simple? After all, if you rely on this short definition, then absolutely every newly created business can be proudly called a startup project.

No wonder the story of the history of Hewlett-Packard mentioned new technologies. After all, the first product, released by HP, became an ordinary generator, where a simple incandescent lamp was used as a resistor.

This is an innovation (the very innovation!) It made the operation of the generator more stable, and at the same time reduce its cost. So the project became competitive and profitable.

So, The main characteristic of startups is the use of any new technology as the basis of their activities, not yet tested by anyone.

For example, the opening of a traditional cafe Is a normal business project, but if the service in this cafe is carried out in some completely innovative way, which is ideologically sound and financially justified, then this is a startup project.

others erroneous thought is belief, that a startup is definitely a project, created on the Internet. For such a statement there is, Of course, their grounds: now the sphere of Internet business is developing so actively, that almost all innovations are connected to the World Wide Web. That's why most people, who do not understand deeply the intricacies of business and new technologies, any Internet project is called a startup at the same time.

What other distinctive features of startups exist?

  • Product development and development, services, ideas, offered by a newly established young firm (the project requires the creation of a legal entity), there is always a team of like-minded people.

Everyone has responsibilities in this team, but their belief in it unites them, that the result of the common cause is necessary for people and will be able to improve life in general.

As pathetic as it may sound, but practice shows, that only those startup projects, which began with the formation of such a global idea, were able to overcome all the difficulties of growth and development and turn into a long-term profitable business.

  • Startup project, like any other endeavor, needs cash infusions.

But it happened, that startups are almost always young people, students and even schoolchildren, who do not have enough funds to develop their project, and their task is different: they have to work on the idea, product, services, which is offered.

Therefore, an important part of working on the project is finding sources of funding. And the further the project moves, the more funding he needs. About that, who usually funds such projects and where to find these sources, will be described in detail in the continuation of the article.

startup - absolutely young project, which is based on some completely new idea, not used by anyone before;

The project can be created in any sphere of life: medicine, trade, transport, services and so on;

A successful team of developers and assistants is required for the successful development of a startup project, as well as sufficient funding until then, when the project does not become self-sustaining and profitable.

The main problems of startups and features in their creation

2. Features of Russian startups

It is worth mentioning the specifics of the creation and development of startup projects in Russia.

Everyone knows, that in shaping the business sphere, Russia lags far behind the West. That's why, that in the United States and Europe has long ceased to be a novelty and acquired established forms, we are just going through a stage of rapid growth and formation. In particular, this statement applies to startups.

Russia has never lacked good brains and bright ideas. To date, there are also conditions for the implementation of interesting ideas. But as you know, every barrel of honey has its own spoon of tar.

The main problems of startups in Russia

Analysts point out 3 (three) problems, faced by Russian startups:

Problem 1. Financial support

The problem arises almost immediately, when the project begins to need financial support.

Finding sources of funding is not easy even for serious adult entrepreneurs, who have a well-established profitable business and a good reputation. What to say about young people, who do not yet have a reputation, no revenue from your project.

banks ask for a high interest rate on the loan, which in any case will have to return.

crowdfunding in the Russian segment is not so developed, and appealing to the western markets is associated with the difficulty of converting and withdrawing money. Learn more about crowdfunding - what it is, what Russian sites exist and so on we wrote in previous issues.

venture funds put forward a lot of conditions before, than to provide material support to the young team.

It remains to rely on personal funds, help from family and friends, or try to search business angel, who will believe in the project and finance its development.

Overcoming this difficulty, apparently, primarily determines the success of the project as a whole.

Problem 2. Startup development time

Another problem is ignorance of the theory of startups. In itself, such a project is characterized not just by development, and rapid development. And is assigned at this stage from 6 (six) to 8 (eight) months. And they gave, if the project does not start to make a profit and pay for itself, it is closed.

In Russia unsuccessful startup projects last for years, sucking money out of startups and investors themselves and turning into unprofitable hopeless companies.

Problem 3. Project implementation

There is another very serious problem in Russia in the field of startups.

It consists in the absence of large manufacturing companies' interest in the acquisition and further development of successful innovative developments.

Is it related to the general policy of the state, which does not pay any attention to creating conditions for the emergence of this type of entrepreneurship, or just the startup industry is still at a low level - it's hard to say.

it remains to be hoped, that over time, Russian startups will have strong support in the form of government agencies, interested in the development of innovative technologies in practice and their implementation in existing industrial production.

There are serious difficulties at almost all stages of development of a startup project in Russia, related to the still imperfect ecosystem for such projects and the uncertainty of its continued existence.

Stages of business project development + ??comparison table

3. Key stages of development of startup projects

Like any project, the startup overcomes several major stages on the path to its formation.

It is worth making a reservation at once, that such a division is approximate and depends on the purpose and direction of the project, from the scope of its activities and other criteria, which will affect the speed of development, and the amount and level of investment in the project, and the result of the start-up company.

Such a division is based on the development of the same Stephen Blanc, the author of the book "Four steps to enlightenment», Where he described the model of gradual development of the startup and careful spending of investment funds. This model later formed the basis of the philosophy of thrifty startup Eric Reese.

Stage №1. The birth of a startup (pre-seed, or pre-sowing)

This is the stage of the idea. The same exceptional idea, which is based on an innovative product, service, technology, capable improve and facilitate life, modify an existing product, enhance the effect of the drug and so on, depending on the sphere of activity of the creator of the idea.

At this stage a team of like-minded people is formed, assistants, who believe in the effectiveness of the intended case, an approximate plan for the development of the idea is being developed, options for finding investors are considered, and a product prototype is tested, services, technology, if it is already created.

Funding is needed at this stage, even minimal. The personal funds of developers are most often used here, their families and friends.

If necessary and the ability of startups makes sense to contact a business incubator, where he can be provided with office space with connected communications and various types of services, from secretarial to legal and consulting.

It is very difficult to find an investor at this stage, as the project has not yet made any progress, which can be judged on its effectiveness.

However, it is worth a try, since there are investment companies, specializing in investing in startups in the early stages of development.

Such organizations do not have much capital, but at the same time have a strong analytical apparatus, to conduct an examination and calculate the prospects of the investment.

Stage №2. Becoming a startup (seed, or sowing)

At the sowing stage of the startup's development, a working model already exists, coordinated team created, where the functions of each of its members are clearly distributed, a detailed strategy for promoting the project on the market or in a user environment, issued a legal entity, the first steps have been taken in advertising and finding investors.

The task of startups at this stage - set up a product promotion system and look for sources of funding.

So, it is these elements that are more important, than proving the product itself, services, technology to the ideal.

Because attracting investors - it's hard work, takes time to directly search, talks, decision-making and conclusion of the agreement. Sometimes it can take a month or two, or even more.

During this time, it is possible to bring to mind the product and even make some profit, which will probably have a positive effect on the investor's decision to invest their money in such a promising business.

Funding at this stage is more serious, because you need to pay for the work of team members, office rental and maintenance, if necessary, overhead.

Finding an investor at this stage - The task is not easy either. More investments are needed, than at the initial stage, and there is no profit yet or it does not cover current expenses. On the other hand, and the risks are less.

And here the ideal option would be to find business angel, man, who calculates the prospects of the project and wishes to invest in it a certain part of its own funds.

Another source of funding at this time is crowdfunding (Public funding) - receiving funds from the community of people, ready to raise money to help, in this case, in the development of a promising startup project.

Stage №3. Early project development (Alpha version)

The stage of early development is characterized by the presence of an existing company, which is profitable, occupies a prominent place in the market or in another consumer environment and is popular among product users.

The task of startups at this stage becomes the final formation of the product, services, technology, correction of detected defects, inaccuracies, that is, bringing it to perfect condition.

At the same time, the promotion of goods on the market continues, massive advertising to increase revenue or expand the consumer circle.

The need for additional funding still remains, as the costs of maintaining the company and implementing marketing plans increase, and the profit though is, but does not cover all costs.

To attract investors, the stage of early development — Golden time: They themselves find startups at this stage of formation. This is understandable, after all, the effectiveness of the idea itself is already visible, and profitability of the company, and other characteristics, indicating the prospects for further cooperation.

Here you can connect investment venture funds and business accelerators - organizations, specializing in professional assistance to developed startups, ready to grow into a big business.

Stage №4. Startup expansion (closed Veta version)

expansion Is a stage, when the company has a completed functional product, which brings the most constant income. The marketing strategy at this stage has been worked out to the smallest detail, and the company is ready to scale, ie increase sales, dissemination in related fields or attracting a mass of consumers.

Contracts are concluded at the expansion stage for the sale of goods, services, technology, new stores open, increasing the number and quality of advertising to attract users on the Internet.

An important task at this time, experts believe the correct construction of the company itself, and its investor relations. Implied? The owners of the company must decide on its future and, accordingly, distribute shares among themselves and formalize relations with investors legally..

If the founders intend to develop the business, especially when one of them is also a product developer, it is more logical to focus on high profits.

in addition, desirable to limit amount of investment from venture funds and bet on business partners.

If the company is to be sold or the project can function perfectly without the direct participation of the founder, then the work should be aimed at finding a suitable investor, who wants to buy a controlling stake at a similar price.

Retaining a small share, the startup gets the opportunity to do other projects.

Stage №4. Project maturity (Beta is open)

In principle, the stage of maturity speaks for itself, that the startup project has become a serious business, when the company occupies a leading or close position in the market, has a high payback, the company's staff consists of a team of highly qualified specialists, and their work is well established.

Most often at this stage the company begins to issue shares, which bring income to its founders.

In other cases, the company is sold as a ready-made business.

Undoubtedly, that in the development of each project may be a different number of stages. It depends on the purpose, set by the startup developer, areas of activity and the overall development strategy of the company. And only one item remains required for any startup project: each of them needs an investor!

The main sources of funding will be discussed in the next part of the article.

We suggest to study the table, which describes what is needed for each stage of startup development, as well as where and what funding is needed:

stage What is available? What is needed? financing
Origin (presowing /pre-seed) The idea is formulated, developers, team of like-minded people. Drawing up a development plan, product testing, search for investors. Minimum level, use of personal finances, family involvement, friends; business incubator.
Becoming (sowing /seed) Working version (prototype) product, acting team, detailed marketing development plan. Product introduction to the market / engaging users, advertising, search for large investors. Average, third-party investors, business angels, crowdfunding.
Early development (A-version) Operating company, profit, prominent place in the market / popularity among users. Finalization of the working version, defect correction, product promotion on the market. High level: venture funds, investment companies, private investors, business accelerator.
Expansion (closed By version) Finished functional product, stable financial result, serious management, advertising. Concluding long-term agreements with partners, network expansion, increase the number of users. Distribution of shares between founders and investors, search for a large investor.
Maturity (open Po-version) Leading place in the market, well-established work, high profitability. Issue of shares, search for a buyer of a ready-made business. Complete self-sufficiency of the company.

4. How to attract investment in startups - TOP-7 sources of funding for the Startup project

How often in life does the situation happen, when “the idea is there, and there is no money "! And most often it happens with startup projects, which, as mentioned above, are created by young people, who do not have sufficient funds to finance their project.

Fortunately, the opposite is also often the case: "There is money, and no idea ". There are always people, who can't come up with an idea themselves, but have the gift to recognize promising projects, they know how to develop them and are not afraid to invest in them.

We are talking about investors and investment organizations, specializing in investing in startups.

But really, sources of funding are much more. Each of them has its own distinctive features and capabilities at some one or two stages of project development.

Investing in startups - finding an investor for a startup: main sources of project funding

This section of the article is devoted to a detailed analysis 7 (seven) main species, or sources, financing of startup projects.

1) Personal savings of startups

Used at the stages of origin and formation, when a product idea, services, technology, as well as the business plan of the startup itself are under development, and offer to outside investors so far just nothing. By the way, how to make a business plan we told in the last issue.

In addition, often the creator of the idea does not want to share all the details and subtleties of the model developed by him for fear of losing authorship and control over the development of the project.

Attracting foreign investment in this case is impossible, except those, which are ready to make friends and close relatives.

2) Means of relatives and friends

Used in the early stages of project development, when the costs are already there, and there is no profit yet. At this point, friends and relatives can act not only as financial helpers, but also as the first users of a product or service.

By the way, analysts say, that this source of investment for startups in Russia is very common and ranks second in terms of investment.

3) crowdfunding

The so-called public funding can be used by startups in the early stages of project development.

What is crowdfunding? This is a voluntary fundraiser, and not only material, to hold events or create social facilities and values, public, political, cultural, scientific orientation.

Crowdfunding is most often done online, and it is characterized by a clear goal setting, announcement of the required amount, budgeting, or costing, and be sure to keep the participants informed.

This type of financing is popular in the West with 2000 year and with 2007 year developing in Russia. Internet platforms (kickstarter.com in Europe and the United States, boomstarter.ru and planeta.ru in the Russian-speaking part of the Internet), through which you can apply for your project and ask for financial assistance, be sure to invite the organizers to establish an award for participants.

Participation in the meeting is rewarded 3 (three) ways:

  1. Gifts or prizes;
  2. Getting a small share in a business project, for which money is collected;
  3. Receiving a share of future profits or return on investment.

Who mainly enjoys fundraising through crowdfunding?

Most often, Of course, money is being raised to create music albums, filming, book publishing, social and charitable projects.

But here, example, v 2008 year, the well-known Barack Obama gathered only for the first stage of his election campaign through crowdfunding more 250 000 $.

4) Credit

As mentioned above, credit - one of the most undesirable types of funding for a new project.

This is due to obvious reasons, namely: startup - enterprise with high risks, which are often difficult to calculate, it is also difficult to determine the level of profitability of the project.

Therefore, it is more logical to take a loan for the development of such a business at a later stage, when these risks have already decreased, and profitability has risen.

5) Business angel (obsolete Russian "patron")

So-called independent investors, who invest their own funds in the earliest stages of startup development and on this basis sometimes participate in project management.

in general, business angel - the dream of every startup. In addition to money, they also have professional experience in marketing and finance, and because of their interest in the successful progress of the project can provide professional assistance at the stages of formation and early development.

But we must be aware of that, that attracting a business angel at first, The most high-risk stages of project development require the transfer of a large share of business in its possession.

If the ultimate goal of a startup is to sell a ready-made business, then no problem will arise. And here in case the startup intends to be engaged in the enterprise and further, then the relationship with the business angel and the share of his participation in the company must be legalized at the very beginning of cooperation.

Learn more about investing in business, what ways of investing exist, we wrote in a separate article.

6) State

Usually, thinking about finding a source of funding for your project, the entrepreneur last mentions the state and that support, which it can provide in the development of his business.

Of course, there are grounds for this: state, Unfortunately, does not respect small entrepreneurs and startups with his attention, and to receive material assistance from him, it takes a lot of effort.

But that's why the team is formed at the very beginning, in which everyone is doing their job: someone is developing a product, someone is engaged in advertising and market research, and someone is concerned about the legal side of the case and the issue of seeking financial support. Therefore, it is not necessary to refuse the opportunity to receive a legal subsidy.

so, what the state can offer to help a young business project?

  • First, every citizen of Russia has the right to a free subsidy to create and develop their own business. Undoubtedly, that in order to receive a subsidy you need to provide a large number of documents, and after receiving the money - reports on their use. But if you take it seriously and believe in the result, then all these issues can be solved;
  • secondly, each region of the country develops its own programs, or grants, assistance to small and medium business, including specifically for startups, especially if the project areas meet the needs of local residents. You can get information about support programs for each region, example, on the website of the Federal portal of small and medium business (smb.gov.ru);
  • Third, state support includes the creation of investment funds, technology parks, scientific city of Skolkovo, and what is most interesting in this article, a state initiative to create incubators and accelerators for start-ups.

7) Venture fund

Venture (from English, venture - a risky business), that is, such funds specialize in investing in high-risk projects, which are startups.

Venture funds invest the money of their investors and partners. But, given the risks of these investments, instead, they are often put forward very much unfavorable conditions for startups.

Involving a venture fund can help an emerging startup in its expansion and maturity stages, when you need a lot of investment, but there is already a profit and risks for investors have decreased significantly.

In this case, you can agree on the terms, which will satisfy the managers of the fund, and the founders of the startup project.

There are at least 7 sources of funding for startup projects. Each of these sources has its nuances and is used only at certain stages of startup development.

Business angels and venture funds are optimal in terms of invested funds. At the conclusion of the contract with them careful drawing up of the legal contract is required.

Tips for beginners, how to create your own startup project

5. How to create a startup - TOP-5 best tips for beginners

What to do to an active person, in which no no big money, no good idea, and energy, experience and knowledge require a way out?

Practices (experts) claim, what, even if a person does not have the natural gift to give birth to ideas at every step, then this ability can be nurtured, to train.

And in fact, there is even a special theory of solving research problems, abbreviated TRIZ, allowing you to control the process of the invention.

so, advice from practitioners on creating startup projects:

Advice № 1. Plan and forecast

All new products, services and technology were once all only fantasy. And they became a reality thanks to the courage of their creators.

Therefore, it is important to be aware of new products, appearing regularly, especially in the field of information technology, and look ahead, tomorrow.

Perhaps, this is the direction of thought will help to find a suitable idea, which will be the basis for a future startup.

Council №2. Become a professional

Entrepreneurs, who have gone from the beginning of a startup to maturity, talk about it, what is better to come into business, having experience in the chosen field, even an employee.

Insider - the best way to gain experience and professional skills in a field. And then apply this knowledge and skills in practice, developing your own business.

Especially since there are such areas of activity, about the specifics of which you can not just read on the Internet or acquire knowledge about them in books.

And vice versa, having experience in any narrow company (example, medicine, sports, Customs), you can create a completely unique product or service, doomed to success.

Council №3. Solve problems in a new way

Often a new look at an old problem or some imperfection helps to find an unexpected solution, which will turn into a successful startup.

example

Google was not the first search engine on the Internet at the time of its creation. But getting rid of advertising on the site and adding some useful features, the creators received the product, which is now number one in the world among search engines.

Council №4. Improve service and product quality / services

Trying to improve services or products, which already exist, you will not only find an idea for your own business, but also help others, users of this service or product. Actually, this is what is really important!

Council №5. Explore new markets and implement them in your project

Large corporations, developing, along the way create new markets, advanced businessmen pay attention to their development.

A striking example of such a business - Microsoft Corporation, which began with the creation and sale of home computer software, created by MITS.

Find an idea to start your own startup project not so easy, but possible.

Audit of own knowledge, skills, experience and a bold look into the future are the main helpers in this matter!

The best startup ideas in Russia

6. Top 7 best ideas for startups with minimal investment

The reader is offered some relevant ideas for creating your startup from scratch or a low investment threshold. so, how to make money, not having a large initial capital.

Idea 1. Creating a channel on Youtube

You have a lot of imagination and a good camcorder? Then you have the opportunity to build your business, creating your own channel on Youtube and filling it with interesting video content.

The focus of the videos can be any (socially acceptable, Of course), main condition - high-quality interesting video and constant control over the number of channel visits.

Additional income will be brought by advertising and affiliate program of the site. Read more in the article - "How to make money on YouTube from scratch", where we explained in detail how to create a channel, promote it and what ways to earn on YouTube there are.

This idea also includes creation:

  • Master classes;
  • webinars;
  • Video courses;
  • and so on.

It is important to offer to users (customers) that content, which is in demand and needed.

Idea 2. Internet-shop

The idea of ​​reselling goods over the Internet has long been old. And with the increase in computer literacy of the population, especially in large cities, it became difficult to find a buyer for consumer goods.

So now, to make money, you need to find and resell such goods, which is hard to find, but there is a demand for it. By the way, how to open an online store we wrote in our last issue.

The idea of ​​doing business with China is especially relevant, where the idea is to resell Chinese goods through web resources with a high markup on goods.

This also includes the idea of ​​creating an online store on the Dropshipping system. What is dropshipping, which suppliers on this system exist and how to build a business under this scheme, we have already written in the article.

Idea 3. Environmentally friendly products

Find quality products in the big city, not stuffed with GMOs, flavorings and palm oil, - the task is impossible. And delivery of products from environmentally friendly areas, from the manufacturer, increasing demand for service.

Find manufacturers, enter into contracts and consider product delivery - not difficult, but not so simple.

But with careful planning and consistent development, you can create a successful long-term project, since the demand for quality food will always exist!

Idea 4. Vending machines

Vending machines for beverages, boot covers and other relevant trifles continue to be in demand to this day.

Given the difference in the cost of the same drink in a cafe and vending machine, there is an opportunity to make a good profit. Provided, Of course, maintaining product quality. More about the vending business and types of vending machines, we wrote in one of our past publications.

Idea 5. Creating mobile applications

Using this idea as a basis for a startup requires the entrepreneur to have special skills.

But having these skills, a startup can sell them profitably, creating applications for smartphones. No investments, in addition to their own time, diligence and taste.

Idea 6. Creating legal advice online

The essence of a startup is to provide legal services on the Internet (online) through various software (Skype and others.). Lawyers and attorneys conduct remote consultations and give advice and recommendations in accordance with the country's legislation.

Idea 7. Creation and resale of sites

The idea of ​​this startup project is to create a site yourself or buy it on specialized exchanges (example, through the exchange telderi.ru). Then the site is tested, edited according to all the necessary SEO parameters and sold to the customer-buyer (through the stock exchange, through other web resources, in personal meetings, etc.)

Idea 8. Online translation agency

Experienced and competent translators of all major languages ​​of the world are selected for this project (English, Spanish, etc.), who in a short period of time will be able to remotely translate texts and information from Internet resources.

Idea 9. Advertising agency

The idea of ​​the startup is to provide advertising services on the Internet. We have already written in more detail about advertising on the Internet in previous publications.

Idea 10. Online trading platform

The meaning of such a startup project is to create a trading platform (bulletin boards) in Internet. It is possible to create a local web resource (example, localization by district, the city), where customers (users) will place their services and goods, and the startup company to receive a certain percentage of paid placement (by analogy with the resource Avito.ru, auto.ru, etc.)

Other questionable ideas for business

Everything is a bad idea for a startup, which appeared in the life of society due to fashion trends, does not matter, they came from the East or from the West.

example, Hookahs have become very popular establishments due to their low maintenance costs: you don't need a kitchen and a cook, it is enough to make tea and smoke a hookah. But the fashion for them has passed, and the business proved unclaimed.

Another example from the same series - shop selling electronic cigarettes and related products. Becoming fashionable very quickly, e-cigarettes have also rapidly lost their popularity due to harm, which they cause to health.

And finally, coaching… The fashion for coaching has also begun to pass, especially since there are so many of them, and they say the same thing.

Ideas ??to create a startup can be found in any field of life.

The main thing, don't go on a leash in wind fashion, a to be based on the fundamental needs of the people.

7. Frequently asked questions

Let's answer the question, which are asked by many entrepreneurs and Internet users.

Question 1. Startup - who is it and what are its functions?

Startups are called each member of the team, engaged in the creation and development of a startup project, regardless, what function he performs in the team.

Question 2. How to start looking for an investor and how to find it quickly?

As described in this article, the search for an investor must begin at the very beginning of the startup project, because this is not an easy task and can be delayed.

Where to start the search?

Here are some key points, which need to be taken into account:

Moment 1. Investor choice

First of all, the startup must understand, which investor he needs: he, who will simply invest money to make a profit, or that, who will be able to help not only financially, but also take part in project management?

To deal with this issue, the owner of the startup project must present the final result: or it is the sale of a ready-made business, or continuation of work in the created enterprise. The choice of the type of investor and the conditions of cooperation with him depend on this result.

Moment 2. The originality of the idea

Offering the investor to invest in the project, the startup must present it at its best, that is, a potential investor must see the originality of the idea and a well-designed business plan to promote the product, services, technology to market.

And the second is even more important, because no matter how original the idea, without a detailed action plan, money for its development will not be received. After all, any investor aims to make a profit, fast or long-term.

Moment 3. Making a presentation

Well, the presentation will help to present the idea correctly and beautifully to the future investor. The goal is to infect the investor with his belief in the need and prospects of the business.

How to find an investor for a startup - 3 ways

Where and how to find an investor?

possible 3 way to find an investor to start a business:

  • First, if the startup is fresh and of social interest, scientific and social plan, then you can turn to crowdfunding platforms, which have already been mentioned here.
  • Secondly, if the startup project has a serious scientific, information, production or technological orientation, it makes sense to turn to specialized sites and forums, where not only general business issues are discussed, but also potential investors are present. They are also interested in finding lucrative projects.
  • Third, you can contact directly through the sites and offices of investment and venture companies. Usually, implementing government programs to support private business, these companies hold seminars, conference, competitions and exhibitions, where, in addition to informational and advisory support, you can find future partners, and investors.

Question 3. How to come up with a good idea for a startup project and put it into practice?

That's a good idea, which is the beginning of any successful startup. There are people, what similar ideas are generated with enviable consistency.

But what to do, who, having and desire, and opportunities to start your own business, can't decide on an idea?

Experienced startups advise the following:

  • An innovative idea must lie on the surface. That is, it must be something ordinary, but imperfect. So imperfect or inconvenient, that you want to fix and thus help all people, how this imperfection interferes. So take a look at the daily life around you and notice, all, which needs improvement and correction.
  • Don't be afraid to fantasize! All the latest achievements were once fiction, fiction and seemed an impossible dream. But it happened, because someone was not afraid to turn a dream into reality.
  • Write down any ideas and interesting thoughts, does not matter, you came up with them yourself or heard from someone. And then try to try them on in real life. Perhaps, that's exactly what a unique niche will be, where you can apply your talents.
  • If you feel, that felt something interesting, investigate the need for your idea. Forums on the Internet, specialized sites on the problem, talking to potential consumers will help determine the relevance of the idea, the scope of its application and direction of development.
  • If an idea is found, and you are confident in its prospects, then start acting: Make a plan, look for helpers and like-minded people and run project in life. If you do not have enough money, even in the initial stages, try to save on everything, on what it is possible, and look for investors for further development.
  • Be confident in yourself and your abilities, optimistic and successful. There will be many difficulties along the way, but the result is worth it, to overcome them.

8. Conclusion + video on the topic

Modern life is developing rapidly, so, there will always be more and more ideas, worthy of attention and development. And once there are ideas, means, there are also opportunities to program your abilities and talents.

In conclusion, we suggest you watch the video - "STARTUP SHOW by Dmitry POTAPENKO", where young entrepreneurs present their start-up small business projects.