Tag: Start-Up Funding

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Startups in India To Get Major Boost As HDFC Bank’s SmartUp Grants Aims To Empower Social Sector Startups; Here’s How To Apply

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Mumbai, February 10: With an aim to help and empowering social sector startups in India, HDFC Bank has launched an initiative and has invited applications for the same. We are aware that India is home to one of the largest startup ecosystems in the world.The HDFC Bank has invited applications from startups across all sectors and solo entrepreneurs for its SmartUp grants.

The SmartUp grants by HDFC Bank under #Parivartan –the bank’s umbrella CSR brand. It is aimed at finding and deploying long-term, sustainable solutions at scale, to address social issues and contribute to the economic and social development of the country, the bank said in a statement.

This year, the HDFC bank informed that it will focus on start-ups creating social impact at scale in sectors such as Education – technology (ed-tech) and skill development, among others. Reports inform that the startups will be evaluated basis their market reach, penetration and scalability of the product, degree of social impact in beneficiaries’ lives and economic viability of product at scale.

The HDFC Bank has partnered with nine start-up incubators registered with Govt of India’s MeitY platform to screen, mentor, and monitor start-ups.  The nine incubators are from premier institutes and include IIT – Delhi, IIT – BHU, AIC BIMTECH Noida, IIM Kashipur, GUSEC Gujarat, C-CAMP Bangalore, Banasthali University – Jaipur, Villgro Incubation – Chennai, and T-HUB Hyderabad.

Here’s how startups can apply for the HDFC Bank’s SmartUp grants:

  1. The startups in India can apply for the HDFC Bank’s SmartUp grants on February 16.
  2. After the application process, the bank and incubators will jointly reach out and engage with them through the SmartUp portal hosted on Ministry of Electronics and Information Technology’s website.
  3. The incubator partners will then screen and shortlist applications and the SmartUp team will select finalists.
  4. Thereafter, finalists will pitch their startups to a jury comprising the senior management of the bank.
  5. It must be noted that the startups will be evaluated basis their market reach, penetration and scalability of the product, degree of social impact in beneficiaries’ lives and economic viability of product at scale.

Smita Bhagat, Country Head – Government, E-commerce and Start-ups, HDFC Bank, said: “Enterprises working in the social sector are doing commendable work in changing the lives of millions of Indians. SmartUp grants is one way of offering our support and encouragement in this journey. We want to be a pillar of support for social entrepreneurs who want to bring a positive change to the society.”

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Startup

Start-Up India Seed Fund: PM Narendra Modi Announces Rs 1,000 Crore Seed Fund to Help Start-Ups With Initial Capital for Growth and Operations

Seed Capital | Representational Image (Photo Credits: Pixabay)
Seed Capital | Representational Image (Photo Credits: Pixabay)

To provide impetus to the start-up ecosystem in the country, the government has announced seed fund for start-ups worth Rs 1,000 Crore. The fund will be set-up under the name  ‘Startup India Seed Fund.’ Seed capital is the investment required by any firm in the beginning of of its business cycle. PM Narendra Modi while addressing the Prarambh Startup India Summit via video conference announced the launch of the fund. It has been initiated to help startups with the initial capital for growth and operations, and help budding entrepreneurs peruse innovative ideas. Prarambha: Everything you must know about the Startup India International Summit!

“Going ahead, the government will provide guarantees to help startups raise debt-capital. We are trying to build a startup ecosystem which functions on the ‘of the youth, by the youth, for the youth’ mantra,” the Prime Minister Narendra Modi said while speaking at the Prarambh Startup India International Summit in an online address. PM Modi also said the target for India’s startups over the next five years should be to become global giants in their respective service areas.Kerala Government’s NORKA-Pravasi Start-Up Scheme Helped 4,179 Expatriates to Establish Business in the State.

The centre has been encouraging the start-ups to seek investment through borrowed funds or debt capital. The government has also been implementing the Fund of Fund Scheme to help startups raise equity capital, added Prime Minister.  11 Indian start-ups have entered the unicorn club- businesses with a valuation of Rs 1 Billion or more- in 2020 itself.  PM Modi also said that the start-up environment is not limited just to big cities, adding that about 40 per cent of entrepreneurs come from tier-II and tier-III cities. There are more than 41,000 start-ups in the country.

The Startup India Seed Fund comes after the Ministry of Electronics and Information Technology had earlier in 2020 had initiated a similar fund to identify startups and give them financial help. In August, the ministry had launched a fund to identify 300 startups which would be provided seed fund of up to Rs 25 Lakh and other facilities as well. A budget of Rs 95.03 crore has been earmarked for the programme named ‘Chunauti’, to be spent over a period of three years.

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Startup

Start-Up Funding: 5 Sources that Provide Quick & Easy Funds

5 Sources that Provide Quick & Easy Funds to Start-Ups| Representational Image (Photo Credits: Pixabay)
Representational Image | (Photo Credits: Pixabay)

Funds are the lifeline of any enterprise. For a firm to start, succeed and sustain, consistent and adequate funding is of utmost importance. Without regular flow of finance, all the other operations of the businesses including production, marketing, and selling among others become stagnant. Especially, in the present business environment which is fast paced, dynamic and highly volatile a secured stream of financial resources is important to defend the start-up against the harsh competition and market shocks. Narendra Modi Govt Clears Payments of Over Rs 6,800 Crore Owed to MSMEs Over Past 3 Months.

As the start-up ecosystem bloomed in India, it has become easier for young entrepreneurs to procure funds on lenient terms of repayment. The central government has also through its Start-Up India initiative, opened funding avenues for start-ups. Here are five options a start-up owner has to avail easy and regular funding –

Venture Capitalists

One readily available option for start-ups to avail funds is through venture capitalists. A venture capitalist is a private equity investor which provides seed capital to start-ups exhibiting potential of high growth in exchange for an equity stake in the firm. It provides funds at early, growth and later stages of business cycles. Apart from the funds, venture capitalists also provide expertise and monitoring of the business operation of the start-ups. Mostly, VCs invest in equity and once the business releases its IPO or is subscribed, they exit.

Angle Investors

An angel investor is an individual with high-net worth and surplus financial resources, who provides funding to small start-ups or entrepreneurs with high-yielding business plans to earn huge revenues from the investment. It is also known as a private investor, seed investor or angel fund. Though angel investors usually have higher return expectations and offer lesser investment amounts, they can prove be highly beneficial of start-ups in their early stages or during expansion. Finance Ministry Sanctions Rs 1.61 Lakh Crore Worth of Bank Loans to MSMEs Under ECLGS to Battle COVID-19 Pandemic.

Business Accelerators and Incubators

Various investment and asset management firms work as business incubators and accelerators for other enterprises. While a start-up looking for seed capital or early stage investment needs to look for a business incubator, they ‘incubate’ potential business plans with a hope of turning them into successful enterprises. A business accelerator comes into picture when an already existing firm looks for expansion or diversification  and need money for the same, it ‘accelerate’ the business.

Banks and NBFCs

Banks and Non-Banking Financial Companies (NBFCs) also provide quick loans to start-up owners at easy terms and conditions. However, these institutes consider more factors other than growth potential before offering the loan. They may even ask for a collateral security or a guarantor. The rates of interest are higher than the other funding alternatives. A start-up owner can apply for a term loan to buy fixed asset or do construction or working capital loans to meet day to day administrative and functioning requirements.

Crowdfunding

Sourcing capital through crowdfunding has garnered lot of attention and popularity in recent times. It does not require any organised institute; the founder raises funds from more than one person at the same time. In crowding funding, more than one investor is involved. These investors offer a fixed amount of funding depending on several factors including his budget, in return of regular and high dividends. One can gather funds from family, friends and co-entrepreneurs that believe in the start-up potential.

It is crucial that the start-up owners are aware about all the funding alternatives available to them. They should carefully analyse all the terms and conditions of procurement of funds and make informed choice. Regular and low cost financial resources keep the start-ups afloat.