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Start-Up Funding Rounds

Start-up Funding Rounds Startup Funding Journey: From Inception to IPO Discover the roadmap to startup success with our concise guide through the funding stages. From planting the seed of an idea to going public, explore the key milestones in startup fundraising. The investment amounts, traction indicators, and potential investors can vary widely based on the specific industry, geographic location, and individual startup characteristics.

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363 views13 pages

Start-Up Funding Rounds

Start-up Funding Rounds Startup Funding Journey: From Inception to IPO Discover the roadmap to startup success with our concise guide through the funding stages. From planting the seed of an idea to going public, explore the key milestones in startup fundraising. The investment amounts, traction indicators, and potential investors can vary widely based on the specific industry, geographic location, and individual startup characteristics.

Uploaded by

Ewinetim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Start-up

Funding
Stages
Angel - IPO
Early Stage
Investment Source - Angel Investors | Owner/Founder | Friends and Family

Investment
Amounts
$100k to $1MM
Angel Funding

This is often the first external funding a startup receives. It typically comes
from individual investors, known as angel investors, who have a high net
worth. These investors provide capital in exchange for equity, helping
startups transform their business ideas into tangible prototypes.
Early Stage
Investment Source - Angle Investors | Owner/Founder | Friends and Family

Investment
Amounts
$500k to $2MM
Pre-seed Funding

This funding round is aimed at helping a startup build its initial team,
further develop its business plan, and conduct market research. It typically
involves small investments from angel investors or early-stage venture
capitalists. The primary objective of pre-seed funding is to prepare the
startup for the larger seed funding round that usually follows.
Early Stage
Investment Source - Angle investors | Seed-stage VC (Micro VC) firms | Crowdfunding

Investment
Amounts
$2.5MM to $10MM
Seed Funding

Seed funding is a significant step in a startup’s growth journey. This funding


round typically involves larger investments from external investors, such as
venture capital firms or angel investors. The primary goal is to support early
operations and product development, laying the groundwork for future
growth.
Growth Stage
Investment Source - Venture capital | Accelerators

Investment
Amounts
$3MM to $25MM
Series A Funding
The Series A funding round represents a milestone where startups are expected to
present a clear business model, a validated product or service, and initial customer
acquisition. Investment at this stage is used to fuel growth, often through expanding
the team, scaling operations, and enhancing the product or service. This funding is
usually sourced from venture capital firms and can range from a few million to tens of
millions.
Growth Stage
Investment Source - Growth equity firms | Large VC funds

Investment
Amounts
$5MM to $50MM
Series B Funding
Series B funding kicks in once a startup has achieved significant milestones and
demonstrated progress. The capital is typically utilized for expanding into new
markets, bolstering sales and marketing efforts, and building infrastructure to meet
increased demand. Companies seeking Series B funding are usually expected to show
consistent revenue growth, a scalable business model, and a competitive edge in
their industry.
Late Stage
Investment Source - Institutional investors | Private equity firms

Investment
Amounts
$10MM to $100MM
Series C Funding
This stage involves larger investments typically coming from venture capital firms,
private equity firms, and sometimes corporate investors. The main focus of Series C
funding is to accelerate growth, solidify market leadership, and explore international
expansion. The financial injection at this stage often runs into hundreds of millions,
and even billions, allowing startups to execute ambitious plans and strengthen their
market position.
Late Stage
Investment Source - Hedge funds - Sovereign wealth funds

Investment
Amounts

Series D $50MM to $200MM


Funding/Mezzanine
These funding rounds usually occur when a startup is preparing for an exit, such as a
merger, acquisition, or initial public offering (IPO), or when it needs substantial capital
to continue rapid growth. Often, these funding stages aim to increase the company’s
valuation before an exit or enable it to remain private while growing quickly.
Investments at this stage typically come from a mix of venture capital firms, private
equity firms, and corporate investors.
Exit Stage
Investment Source - Investment banks | Institutional investors to Public

Investment
Amounts

Initial Public Offerings $1Bn +


(IPOs)
In this exit strategy, the startup goes public by listing its shares on a stock exchange.
This allows the general public to invest in the company, providing it with substantial
capital for further growth, while also allowing early investors and employees to cash
in their investments.
Exit Stage
Investment Source - Growth equity firms | Large VC funds

Investment
Amounts

Mergers and $500MM to $1Bn


Acquisitions (M&A)
In this scenario, established companies may acquire startups to leverage their
technology, talent, or market share. Such transactions can offer significant returns on
investments for the acquired startups’ founders and investors.
Exit Stage
Investment Source - Growth equity firms | Large VC funds

Investment
Amounts

Continued Operations $500MM to $1Bn

Some companies choose to continue operating privately while generating returns for
shareholders. Private equity firms might buy out the venture capital investment, or
the venture capital firm may sell their stake in a secondary sale. The VC may also
distribute the shares to the limited partners. These strategies allow the company to
stay private while providing returns to its stakeholders.
This presentation illustrates the Finding Stage of a StartUp From Angel
Funding to IPO.

The investment amounts, traction indicators, and potential investors can


vary widely based on the specific industry, geographic location, and
individual startup characteristics.

Startups need to conduct thorough research and due diligence when


raising funds.
Industry and regional fundraising dynamics can significantly impact the
fundraising process.
Startups should seek guidance from experienced advisors, network with
potential investors, and stay informed about market trends and investor
preferences.
Ewintim Awoke
Business Advisor, Mentor, and Trainer

Connect with me on LinkedIn


@Ewintim Awoke

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