Entrepreneurial Resources: Fueling Your Startup Journey¶
Starting and growing a business requires more than just a great idea. It demands access to various resources that provide the necessary support, knowledge, and tools. Mainly Financial Resources, the lifeblood of business. Entrepreneurship involves pursuing opportunities despite limited resources. Resources can include equity, bootstrapping techniques, debt, and venture capital etc. Following are the Entrepreneurial Resources:
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Bootstrapping: Defined as using existing resources to grow a business. Such as using personal savings, revenue from initial sales, and other internal resources to fund the early stages of the business. Growing using the resources one has. It is a technique that you use to bring the slack resources, customers, money into your venture to play your game. Example of a young girl selling traditional food products to fund her education, she expanded her offerings based on customer demand, showcasing resourcefulness.
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Debt as a resource: Entrepreneurs can seek loans from family or banks to fund ventures. Loans provided by banks, credit unions, and other financial institutions specifically designed for small businesses. These loans often require collateral and a solid business plan. Example of a successful venture that started with a loan from parents.
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Government Grants: Various grants and subsidies are available for startups. Non-repayable funds provided by government agencies, foundations, and other organizations to support specific projects or initiatives. Grants are often competitive and require meeting specific criteria. Entrepreneurs should explore government programs like Karnataka's Elevate 100 for funding opportunities.
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Corporate Social Responsibility: It is the center for social entrepreneurship and plays a vital role on how an enterprise conducts itself. It improves public image of the enterprise.
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Venture Capital (VC): Investment firms that pool money from various sources (e.g., pension funds, endowments) to invest in high-growth potential startups. VC funding typically comes in later stages and involves larger sums of money. Expectations for high returns necessitate rapid scaling of the business. Venture Capitalists are very careful in choosing the kind of ventures they would like to put in.
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Equity Financing : One of the resources you can cleverly use, is the Equity of the venture. This strategy enhances credibility, making it easier to attract investors.
Example: Licious
Founders aimed to disrupt the meat industry but lacked industry experience. They offered equity (one-third) to a renowned chef to attract talent.
Case Study: Mango Technology and Qualcomm
Sunil and Lake initiated a venture without funds but leveraged connections to secure resources. Ram provided office space and engineers in exchange for a small equity stake (2%). The venture gained credibility by being associated with IIMB, attracting talented engineers.
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