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    What Is Seed and Angel Funding

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    Queen Valle
    Series A funding is the first round of financing from venture capital firms, where company ownership is offered in exchange for preferred stock. Valuation is based on proof of concept, progress from seed funding, team quality, market size, and risk. The goals are to cover salaries, additional research, and finalizing products/services. Series B funding occurs after products/services are selling. The goals are to scale up, face competitors, gain market share, and achieve profitability. Valuation is based on performance compared to industry and revenue forecasts. Series C funding happens when the company has proven successful. It aims to gain greater market share, pursue acquisitions, and develop more products/services. Valuation relies

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    What Is Seed and Angel Funding

    Uploaded by

    Queen Valle
    66 views2 pages
    Series A funding is the first round of financing from venture capital firms, where company ownership is offered in exchange for preferred stock. Valuation is based on proof of concept, progress from seed funding, team quality, market size, and risk. The goals are to cover salaries, additional research, and finalizing products/services. Series B funding occurs after products/services are selling. The goals are to scale up, face competitors, gain market share, and achieve profitability. Valuation is based on performance compared to industry and revenue forecasts. Series C funding happens when the company has proven successful. It aims to gain greater market share, pursue acquisitions, and develop more products/services. Valuation relies

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    What is Seed and Angel Funding

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    Series A funding is the first round of financing from venture capital firms, where company ownership is offered in exchange for preferred stock. Valuation is based on proof of concept, progress from seed funding, team quality, market size, and risk. The goals are to cover salaries, additional research, and finalizing products/services. Series B funding occurs after products/services are selling. The goals are to scale up, face competitors, gain market share, and achieve profitability. Valuation is based on performance compared to industry and revenue forecasts. Series C funding happens when the company has proven successful. It aims to gain greater market share, pursue acquisitions, and develop more products/services. Valuation relies

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    66 views2 pages

    What Is Seed and Angel Funding

    Uploaded by

    Queen Valle
    Series A funding is the first round of financing from venture capital firms, where company ownership is offered in exchange for preferred stock. Valuation is based on proof of concept, progress from seed funding, team quality, market size, and risk. The goals are to cover salaries, additional research, and finalizing products/services. Series B funding occurs after products/services are selling. The goals are to scale up, face competitors, gain market share, and achieve profitability. Valuation is based on performance compared to industry and revenue forecasts. Series C funding happens when the company has proven successful. It aims to gain greater market share, pursue acquisitions, and develop more products/services. Valuation relies

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    of 2

    What is Seed and Angel Funding

    If you are in an early stage/Idea Stage in your Business Plan and have utilized your saving and built a product
    which is already selling.., you may expect some Angel Investors to be really interested in your startup, or if you
    have an excellent idea and a really good team then investors may be willing to help you build the product too.
    Read more About Angel Investors

    A. What is Series A Round of Funding?

    Series A round of financing is the first round of financing that a startup receives from a venture capital
    firm i.e. the first time when company ownership is offered to external investors. This is generally done
    by allotting preferred stock.

    Valuation of the startup in this round is done on the basis of:


    o proof of concept
    o progress made with seed capital
    o quality of the executive team
    o market size
    o risk involved
    The goal of Series A round of financing is:
    o To cover up salaries of people involved
    o Additional market research
    o Finalization of product/service to be introduced into the market

    Series A round of financing is generally done when a company is generating some revenue, though it
    might not be net profit. The risk involved is at the highest in this round of funding.

    B. What is Series B Round of Funding


    At this stage, the product/ service is already being sold in the market. Series B round of funding is
    required by the company to scale up, to face competitors and have a market share. The goal of this
    round of funding is not only to break-even but to also have the net profit. At this stage, investment risk is
    lower and the amount of funding is more than Series A round of funding.

    Valuation of the company is done on basis of:


    o Performance of the company in comparison to the industry
    o Revenue forecasts
    o Assets like Intellectual Property, etc.

    C. What is Series C Round of Funding


    A venture capital firm goes for this round of funding when the company has proved its mettle and is a
    success in the market. The company goes for Series C round of funding when it looks for greater
    market share, acquisitions, or to develop more products and services. Series C round of funding can
    also take place to prepare the company for an acquisition. It is the last stage in a company’s growth
    cycle before an Initial Public offer (IPO). Valuation of the company at this juncture is done on the basis
    of hard data points. This round of funding is more of an exit strategy of the venture capital fir

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