Tag: Funding

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Startup

What is the Difference Between a Startup And Small Business Venture? Here Are 3 Key Differences

Startup Vs Small Business Venture
Representational Image (Photo Credits: Pixabay)

Bangalore, November 5: Startup is a company or project undertaken by an entrepreneur to seek, develop, and validate a scalable economic model. A startup is often confused with a small business, however, there are key differences which one needs to understand in how they function.

Amid the tough market conditions, it is difficult to run a small business and more difficult is to see a startup grow.

Growth Plans

Startups are different from small ventures mainly because they are designed to grow fast on limited resources internally. Startups have an essential need for rapid growth.

Small businesses also seek growth, but more conservative growth which includes creating reliable, long-term income streams.

Funding:

Apart from having different growth strategies, startups seek financial investment differently than most small businesses. Startups rely on capital that comes by means of angel investors or venture capital firms. On the other hand, small business ventures may tend to rely on loans and grants from financial institutions.

A startup requires constant investment at every stage of their growth, which will help them to reach the next level. This is the reason, why user number metrics are so important to startups as they indicate what percentage of their target market has been achieved.

Risk-Taking Capability

Compared to small business ventures, startups have an aggressive risk-taking capability. A startup undertakes several risks like- product risk, market risk and financial risk. For a startup, it is also very important to know their customer and why, how and where they buy related products is arguably the most important risk factor to assess before launching the product. For startups, the risk is mainly tougher because the product is new and it will be a different experience for the public.

Small businesses also take risks, but they are usually of a different nature. The time to prove their success in the market is usually more.

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Startup

COVID-19 Impact on Women-Founded Startups: Funding Drops 24% in H1 2020

Startup
Startup (Photo Credits: Pixabay)

Bengaluru, October 29: The coronavirus pandemic has affected everyone, from businesses being shut to people being offered pink slips. It has not been a great time for women-founded and co-founded startups. According to an IANS report, funding fell 24 percent to $280 million in the first half of this year, compared to $369 million in the same period last year.

It was witnessed that finding declined across all the three stages- early, growth, and late — compared to H1 2019, said the report by MAKERS India. The report titled “State of Women in Tech Entrepreneurship in India 2020” shared that many women-led startups in order to stay afloat in the middle of the pandemic scaled down their operations or pivoted their business models

There were a few women, who infact branched out to different operations. Like women behind some apparel startups branched out to manufacturing protective face masks and PPE kits.

The positive news was that despite Covid-19, startups with at least one woman founder were able to secure 71 funding deals in H1 2020, at par with H1 2019 (70 deals) and H1 2018 (70 deals).

The study highlighted an interesting trend that between 1990 and 2010, only 26 startups had at least one woman founder. However, 75 startups added at least one woman founder by 2014 and 184 more by 2019. Female-founded and co-founded tech startups in India currently stand at 285.

 

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Startup

India to Have Around 62,000 Startups, Including 100 Unicorns by 2025, Despite COVID-19 Blow, Says Report

Startup
Startup

Bangalore, October 15: Businesses have been hugely hit by the coronavirus pandemic. However, here comes a piece of positive news where it is expected that India is expected to be home to 60,000-62,000 startups, including 100 unicorns, by 2025, despite the COVID-19 blow, according to a report jointly prepared by TiE- Delhi, a not-for-profit promoting entrepreneurship, and Zinnov, a global management and strategy consultancy.

The report mentions that there has been a dip in overall funding by 50 percent during the lockdown, compared to pre-covid levels, while around 40 percent startups were negatively impacted. Four Indian startups- Nykaa, Unacademy, Postman and Razorpay-emerged as unicorns while the pandemic was at its peak. The report predicts that India is on track to having at least eight new unicorns in 2020, on a par with the 2019 numbers, taking the total number of Indian unicorns to 33.

Accoridng to another report conducted by the same group, it was found out that due to the pandemic, 15 percent of the startups have already halted their operations. In addition to this, 44 per cent of start-ups have cash runway for less than 6 months, 41 per cent of startups have been impacted negatively while 52 per cent are struggling to raise capital.

 

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Finance

Amazon to Invest $18 Billion This Year to Help SMBs in US to Scale Their Operations and Grow

Amazon (Photo Credits: Amazon, Facebook Page)

Seattle, September 2: E-commerce giant Amazon on Wednesday announced that it will invest $18 billion this year to help small and medium businesses (SMBs) scale their operations and grow. The firm stated that in the next 12 months, it will provide more than 5,00,000 SMBs in the US currently selling on Amazon, with online selling guidance, education, and support. Moreover, the company plans to onboard an additional 1,00,000 US businesses as new sellers in its store. Jeff Wilke, CEO Worldwide Consumer at Amazon, said that at Amazon, the mission is to be Earth’s most customer-centric company, and part of fulfilling that mission is connecting small businesses with customers.

Wilke made the statement during Amazon Accelerate, a three-day virtual summit for SMBs in the US that was kicked-off on Tuesday. Wilke further said that Amazon’s success is directly tied to the success of independent businesses across the US. “We are passionate about supporting small businesses, investing and inventing on their behalf to help them be resilient through COVID-19 and beyond,” Wilke added.

Despite the impact of COVID-19 has had on small businesses, many American SMBs selling through Amazon have experienced continued growth. The e-commerce behemoth has launched more than 135 new tools and services this year to help sellers manage and grow their businesses, including new ways to connect brands with customers.

According to a report by IANS, the company said it will spend an additional $100 million this year to promote small businesses during Prime Day and through the holiday season. Last year during Prime Day, third-party sellers – mostly SMBs – exceeded $2 billion in global sales. The report added that the third-party sellers continue to account for more than half of all units sold in Amazon’s store, and even during the pandemic, third-party sales continued to grow faster than Amazon’s first-party sales.