Startup Funding Round Guide
Conceptualization + initial dev. Phase
Early operational Phase
Growth Phase (proven product + initial market traction)
Expansion Phase (established presence and operations)
Late expansion Phase (Maintaining potential and solidifying position)
1 Pre-Seed Funding
Definition Initial fund used to start business + operations.
Fund usage Market research, product dev, building a prototype.
You need to show
- Demonstrable CONCEPT
- SOLID founding team
- Initial customer VALIDATION
2 Seed Funding
Definition Fund used to further validate + begin to grow biz.
Fund usage Product dev, initial MKTG, attracting first customers.
You need to show
- Initial PRODUCT MARKET FIT
- Model SCALABILITY
- Initial CUSTOMER BASE
3 Series A
Definition Scale product & ops after market validation.
Fund usage Expanding ops, hiring engineers, increasing market
You need to show
- Solid REVENUE GROWTH
- Path to PROFITABILITY
- Significant USER BASE
4 Series B
Definition Extensive scaling of established business.
Fund usage Broadening reach, hiring execs, increasing capacity.
You need to show
- Growing MARKET SHARE
- SOLID Financials + profits
- Effective, SCALABLE OPS
5 Series C & Beyond
Definition Prepare for public offering or major acquisition.
Fund usage Diversifying, acquiring companies, new markets.
You need to show
- Market LEADERSHIP
- Sustainable REVENUE
- Clear EXIT STRATEGY
6 Special Cases
Bridge Rounds Interim funds raised to get the company to the next round. Can happen in any of the rounds mentioned above.
Debt Financing Involves loans that must be repaid but do not dilute ownership.
Credit: Majd A. (https://www.linkedin.com/in/majdailaily) Brain Dump #68