When we talk about startups, the first thing that strikes our mind is, ‘From where will we get funding?’ This thought is the foundation by which we judge that the driving force for any startup is funding. We fail to acknowledge that the seed for any startup is the Idea behind it.
The essential nature of startups is that many ideas get funded, a few ideas succeed and some have to be revisited or pivoted as this is the nature of the whole venture economy. Most entrepreneurs come up with an idea, put together a business plan, raise the requisite capital (funding), then bring it to market and hope to survive. The bitter truth is most will not.
There have been entrepreneurs who rose from rags to riches were all sparked by the hint of a powerful idea. There is a deluge of ideas in front of venture capital firms and to convince them to fund your idea should be done taking highly calculated risks.
The entrepreneur must have a deep-rooted knowledge of its target market. The offering must remain relevant, authentic and meaningful to the user. The product being economical is one of the most important factors for your ship to sail.
Looking at the heading of the article, clearly, even if your idea gets funding, it is no guarantee that shortly your startup will do good business. The primary utility of financing is to let you start your business and pioneer in a particular field of your choice. Once, it has begun, no one can foresee how it will perform in the market.
To be able to get funding at the right time from the right investor pushes forward the startup on to the growth stream. Not only does it shoot up polishing and conditioning the product but also helps with the flow of cash and working capital requirement.
The other thing that comes into the picture is the success element. In the startup business, some companies succeed while some start with an idea, then pivot a couple of times before they stabilise in a sustainable area. To remain a participant in the run, the startup owner must make sure it does not treat the funding as a lot of spare money to be burnt frivolously.
Money is an essential element when it comes to developing the startup. However, it can only bring the startup on the road to success and can be called the wheels. For a startup to be successful, it should be based on a strategic business model with plans for funding, growth and expansion shall give your aspiring project the real boost it needs.
Thus, funding is the wheel that makes your startup stay on the road to success and idea is the driver that decides where the startup will go.
This article has been contributed by Pulkit Jain, founder of LegalRaasta.com – online portal for company registration, trademark registration, ITR filing and TDS filing.
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