May - 2016 - issue > VC Talk
Finding the 'Money'
Harshad Lahoti, Founding Partner & CEO, ah! Ventures
Startup ecosystem in India is proliferating with over $5 billion worth investment in 2015. The funding scenario is on upswing currently as the emerging investors in the arena has flashed a growth of 2.3 leading to a boost in fundings in 2015 by 125 percent over 2014 as per NASSCOM report. However, the organizations might face slowdown in terms of angel funding as the stock market has crashed. This might force startups to reduce their cash burn rate and in re-assessing the business model because most of the funds are getting diverted by stock markets, where the investors are finding value at the moment. But once the stock market regains its composition, the money is expected to find its way into the startup investment as it was.
Three Important Factors that Attract Funding
Startups require venture capital for their growth and sustainability. The primary factor that attracts funds is the quality of the team, which is the startup's linchpin.Absolute clarity regarding the target, immense knowledge about the market and clear-cut idea of growth is the need of the hour, whereas beating around the bush may prove dangerous. Startups should never lose their focus on business objective and have a blueprint of how they intend to eventually go step by step.
The teams' starts flying high once the funds are raised, forgetting the obligation of raising funds. The realization of the fact that raising funds is the first step towards the final goal and not the goal itself will help the team to be grounded. Attracting funds demand core understanding of the investment society and extreme co-operation of the team with the investors.
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