In simple words ‘Startup Funding’ refers to the money required to start a new business venture also known as startup capital. If you’re here then you probably want to start a startup or you’re thinking about it. Firstly, congratulations and welcome to entrepreneurism. It’s a little tough out here but you’re gonna love it. Secondly, you’re at the right place to learn 5 ways to funding for startups.

This article is all about how to get a startup funded. It is not intended as financial advice, so please don’t take the information contained herein as such. It is intended to provide a framework for you to develop a plan of action based on your needs and goals, and to assist you in learning what steps you need to take to achieve that end.

So without wasting time let’s just dive right into it and get your startup started & running. Excited, are you?


Podcast: “5 ways you can get at least $50000 funding for startups”

1) The most valuable source according to me: ANGEL INVESTORS

An Angel Investor is an investor who provides financial support to small startups and entrepreneurs. The capital they provide can be a one-time injection of seed money or ongoing support to carry the company through tough times. Most of the time they do it in exchange for ownership equity in the company. 

Why are they so important?

Angel investors are the lifeblood of startups. Without a stable of these high-net-worth individuals willing to pour their money into young startups, the future of tech would look much different. Many startups fail without capital, which is why angel investors are so crucial to the success of a startup.

Benefits of having ANGEL INVESTORS

  • They are super quick with their investment-related decisions.
  • Angel investors are usually high-profile people that have a lot of experience in the market.
  • Apart from the money you get from the angel investor, they will also give you lots of advice.
  • Usually, there is no requirement for repayment or interest on the money.
  • They have a lot of connections and can help you to grow professionally.
  • They are not that hard to find, you can easily find them within your friends and family too.
  • Angel investors are usually a lot more flexible than traditional investors.
  • Increases your business’s credibility.
  • They see the bigger picture and are willing to take the risk.

A few Angel Investors in Australia

2) Second Most Valuable Source: Strategic Partners

  • A collaborative agreement between two or more parties in which all involved agree to work together to achieve a common goal. Here, partners share risks, responsibilities, resources, and resulting benefits mutually. 

    Tyes of strategic partners

    • Horizontal partnership: Businesses within the same niche like Facebook & Instagram.
    • Vertical partnership: Within the same chain of suppliers, distributors & retailers.
    • Equity partnership.
    • Merger.
    • Joint Venture.
    • Acquisition.

    Having the right strategic partner can mean the world to a small company. For an entrepreneur, it is critical to have a partner with whom you can share ideas, challenge each other, and support each other. Having a great strategic partnership can open doors for you that you can never open yourself. For a larger company, a strategic partner can also help them develop new products and get access to new markets.

3) Government Grants And Contracts

Federal grants and contracts for startups are the main driving force behind the high startup rates in many cities.  For example, the US Department of Labor gave over 7 billion in grants and loans to support over 11,000 startups between 2008 and 2013.  But the benefits of government grants and contracts for startups are not only limited to startups.  Attracting government grants and contracts for startups can help any company grow and mature in its business.
Although they can be time-consuming and hard to get.

Here’s what you need to ask and know before applying for the grant.

  • If you are eligible or not for the grant.
  • Where to look for grants.
  • Which grant is for you and which is not.
  • How are you going to differentiate your application and make it look the best.

4) Crowdfunding

Crowdfunding is used by artists and entrepreneurs to find money from a large group of people for one-off projects

It was introduced in Australia with the objective to provide financial funding for startups and small and medium-sized businesses from the public. Here’s a fun fact: Did you know you can raise up to $5 Million with crowdfunding? Yes. You heard that right. $5 million. Each contributor can contribute $10000 in exchange for shares.

Things you need to figure out for crowdfunding.

  • Crowdfunding laws of course.
  • Creating a budget.
  • Knowing your offer and public well.
  • Tax Implications.
  • If the money is for donation.
  • Whether you’re asking for a loan or equity.
  • Improving your marketing.

5) Business Plan Contests

Business plan contests are a great way to help college students and entrepreneurs in their businesses start out right and find a way to put their ideas into action. After all, life comes with ups and downs, and even the best businesses can have rough patches and need to keep adapting and improving. There is, however, one problem with business plan contests: most of the time they are too focused on the business side of things and give contestants very little practice on the financial side of things. Typically the amount of prize is under $50000 but really great contests can even get you $100000. Isn’t it amazing?

Do you want to know more ways to funding for startups? Book a free consultation with us today. 

Carol Chin Accounting Services is a full-service accounting and bookkeeping firm serving businesses and individuals.