How to Finance Your Startup: Types Options
What is Start-Up Financing?
Every business, especially in the startup phase will need financial backup. Early stage businesses need startup financing to meet administration expenses, acquire machinery and raw materials, fund product development, etc.
Startup financing is the process of a newly established business acquiring funding through debt or equity. Startup founders usually have multiple sources of financing like banks, investors or the public.
Start-up financing helps growing businesses get the financial support they need to ensure profits. The mode of financing ranges from venture capital rounds, grants, and credit cards to business loans.
Start-Up Financing Vs Start-Up Funding
Though many choose financing and funding interchangeably there is a difference between the two. While start-up financing is the process of getting capital through equity or debt financing, start-up funding refers to the capital a business receives from its equity holder or lender. In other words, the first is the method while the second is the outcome.