Venture Capital & Crowd Funding: What You Need To Know

Owning a business requires more than a quality formal education that will empower you with knowledge and an understanding of the working of a business. But for your business to start you will require capital to help it take off and grow. There are various methods you can adopt to acquire the capital. You should research your options thoroughly before drawing a conclusion, and here are some options to get you started.

Venture Capital is one of the options that you can go for. When startup companies having high growth potential need a certain amount of investment, wealthy investors invest with a long-term growth perspective. This investment is dubbed as Venture Capital and the investors are Venture Capitalists. It is a kind of private equity. Such a venture is risky, but the returns and benefits are equally impressive.

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In general, there are three kinds of venture capital. One is Seed Capital that is invested at the startup stage. Seeding capital also is a small amount that an entrepreneur receives for the purpose of being eligible for a start up loan. After this, we have early-stage capital, which includes capital for business in their first or second stages of growth. After this comes expansion-stage capital and this is for companies that are experiencing rapid growth.

Another option that can be useful to you is Crowd Funding. This is a practice of funding a project or venture by raising financial contributions from a large number of people. It is generally described by experts as “the practice of raising funds from two or more people over the internet towards a common service, project, product, investment, or cause.”

There are three parties involved in Crowding Funding. First, we have the initiator of the project. Second of all, we have the group/individual supporting the idea and lastly a moderating organization that brings all the parties together.

Crowd funding has two kinds, one of which is Reward Crowd Funding. In this investors pre-sell a product/service to launch a business while avoiding debt or risking equity/shares. The other kind is Equity Crowd Funding, in this kind of funding a share of the company is given to the backer.

This kind of funding has been proven to be beneficial. The Crowd funding industry saw a substantial growth of over $5.1 billion worldwide in 2013. The most recently successful crowd funding story was from November 2014, where Star Citizen, an online space trading, and combat video game, was stated to have raised USD $61,000,000 through Crowd Funding.

A startup can end up using a combination of the above depending on its stage of growth and capital needs. There is no single optimal type of startup capital and it is crucial that entrepreneurs analyze the distinguishing factors of each of these capital routes and determine what’s most beneficial for their needs.  Raising capital is a critical component of the startup life and requires a certain level of preparation and rigor for it to be successful.

Rise of E-commerce

E-commerce has grown over the years and made some ground-breaking progress in the world of business. It has brought about a remarkable transformation in the way Indians shopped and traded. Not just that, it has taken over the imagination of emerging entrepreneurs who are shaping the future of business. Technological advancements and easy access to the internet has given it a boost. It has exploded further in the last couple of years and the entire segment has turned into a million dollar sector and this is just the beginning! There is speculation that e-commerce will grow will reach a value of around USD $ 30 billion by 2016.

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Every small or big business has established themselves in the e-commerce space. This has liberated consumers from the limitations of time and place. Now, you can buy anything, anytime from anywhere with just a couple of clicks. There are ups and downs while establishing yourself on e-commerce, but it is a real achievement when you manage to survive the harsh and the competitive environment of the e-commerce scenario.

E-commerce is a tough playground for businesses and like every other field, believes in the notion of survival of the strongest. The smartest ones have survived and build their brands on the e-commerce platform, but with a strong educational background there is a good chance to not only survive, but lead a successful venture. Therefore, here are some handy pointers that will help you build your e-business.

Optimization of SEO

In the virtual world, visibility plays a humongous role in achieving success and here is where SEO steps in. Search Engine Optimization, if used strategically, can contribute to overall success. After all, SEO gives you a platform to make yourself visible on the internet world. Here, your attention should be on adding value to the content you are putting out. Quality content will give the users a positive experience. One of the best ways to provide content is through a blog. You can put forth a blog that is rich in content and helps you fulfill the purpose of SEO effectively.

Smartphones can be smarter

The mobile revolution has opened the doors of opportunities that can prove beneficial for an e-commerce business. We are almost never without our smartphones. In fact, we depend on this little device for our social, professional and entertainment needs. We chat, shop, and browse the internet through our smartphones.  This gives the e-commerce sector more space to expand so do take advantage of this. Create apps through which you can be easily accessible to the consumers.

Data is your friend

Using data smartly for an e-commerce venture is very critical. Are you taking full advantage of the possibilities that your data has to offer? The ability to collect more data and, more importantly, data of greater relevance is an ever going challenge. In that case, hire someone who has the expertise in handling data and mining it for insights. With time, you will be able to watch your e-commerce venture soaring.

Other things that you can work on are to offer your consumer transparency and security along with better services. E-commerce has reached heights and keeps expanding with each passing day and these are just the early days. Therefore, grab your chance be a part of this ever-growing space today!