Most people would say, Steve Jobs. For those of you who might not know, there were two other dudes named Ronald Wayne and Steve Wozniak that started Apple. Let's pick on Mr. Wayne for a bit- it's all for the sake of knowledge guys. I promise :)The guy apparently sold his stake for $800 back in the days. This guy could have been stupid rich now, considering Apple's worth of around $750 billion. I mean this guy could have been sitting in a room with people fanning him, women feeding him grapes, and 3 gold chains dangling from his neck. - Like in the movies. The man claims he does not regret the decision though. The lesson here is that the journey to nurture a start-up is not for everyone. It's lined with stress, major disagreements, separation of beautiful friendships and a big load of disappointments. However, if you insist, sure. Let's see how we can get some money and get this thing off the basement floor because you will need money...lots of money.
(1) Pre-Seed
This is where you look in your phone book and see which of your friends or family you can call/text to ask for money. Oh, also includes your own bank accounts too. The easiest way to get money from your family and friends is using the principle of reciprocity: It basically says, people you help feel indebted to you and have to help you back when you need help. You can send Christmas gifts to their children, call often to see how they are doing etc. that way when you ask for money in the next few months, they will be like " uncle Mayard bought toys for Sandy so we should help him out!
(2) Crowd Funding
You've heard of Gofundme, Indiegogo etc. Those are sweet ones. You basically, tell the world what you are working on people who believe in your project fund you. If you are in the updated fintech world, you would have heard of crypto-currencies. (That stuff is deep- you can do a quick youtube search) With cryptocurrencies, you can set up your company and have people fund you through ICOs. It's like getting one of those Mr. Wayne opportunities. I believe it's the easiest and fastest way to obtain funding for an idea. For example, BRAVE, a browser that promises to keep advertisement and privacy control in the hands of the people raised 35 million in 30 seconds!! I normally use https://tokenmarket.net/ico-calendarto see what's coming my way. Certainly, there are others.
(3) Grants
This is free money. Free people. Where is the money from? The government gives free money to start-up. For example: https://www.sbir.gov/about/about-sttr and https://grants.nih.gov/grants/oer.htm. There are also accommodations available from individual states. You also get money back if you state it on your taxes. Grants are not only excellence because they are free money but also because they are free money that is not equity diluting. Getting a grant gives you bragging rights and validates your product to other investors. As you know, there is nothing free on planet earth! You have to submit regular progress reports though.
(4) Contests
If you are adept at presenting your ideas, you will always get these ones. 43North, Rise of Rest, High tech Rochester give you free money if your business plan makes sense. You want jobs, this is a secret place to find jobs that a lot of people are not applying for simply because they don't know about it. If you are like Mr. Wayne, you can come here and apply for a second chance.
(5) The actual Seed.
The first source of "outside" funding. This means money is not from your friends, family or grants. We are taking the order of magnitude in the $100,000–$250,000+ range. If you have a very rich aunt, why not. Take the money and sign a contract.
(6) Angel Investors
Anyone with a net worth of $1million not including their house can throw money your way. These guys are not even playing. They would give you $25,000 or more but they expect a fat profit.
(7) Venture Capitalists- Series A,B,C
This involves different series of funding (Series A, B, C etc.) This is mostly done by companies who may have begun selling products and need to scale up or just to offset their initial losses as they may not have been profitable. Investors at this stage usually fund $1- 3million. The downside of this is that these big valuations being taken by companies are very equity diluting.
-The Golden Rule- Ethics
Don't get ahead of yourself. Employ basic ethics in all processes.You all heard of Theranos, the company that attempted to perform blood test at a fraction, time, cost and blood sample. The company once worth 9 billion now worth $0 according. Elizabeth Holm's story is one EVERY aspiring entrepreneur should know. Let the curiosity begin. Check it out on Forbes
Stay tuned for more informative content on how to navigate the complicated laws of the FDA, US Patent office and just general sweet talk on life!