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Excelling the Art of Startup Fundraising

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Startups encounter precarious challenges during their initial phases, necessitating steadying influence of visionary mentors. The poor value proposition of product/ service, non-strategic market entry timing, non-relevancy to potential consumers, higher consumer acquisition cost compared to consumer’s lifetime value, imprudent management policies, and failure to raise sufficient funds to sustain a business is a handful of challenges inevitably experienced by startups. Innovative entrepreneurs inevitably need robust financial underpinning to keep their startups from floundering.

Fundraising breakthroughs

To curb high startup mortality rate in Indian perspective, the government in collaboration with leading financial institutions have initiated exemplary steps to alleviate the fundraising problem of startups. Tax exemptions have been proposed by important ministries on stock options extended by startups to their employees (ESOPs). Capital gains derived from investments in new enterprises would also be tax-free. The opaque regulations that are stifling the free flight of start-ups are being relaxed to a great extent under ‘Digital India’ initiative of GOI.  Alignment of startup ESOP rules with stock market would relieve the angel investors from paying 33% capital gains tax in the short haul and 20% in the long haul. The financial technology (Fintech) ecosystem is getting strengthened as start-up incubators and accelerators are growing at a rapid pace.  It is imperative that entrepreneurs and industry leaders should stay well-informed of contemporary happenings so as to monetize the most on breakthroughs in fundraising initiatives fuelled by changing governmental perspective and expanding Fintech ecosystem.

Role of Financial Institutions

Financial institutions have unleashed awareness campaigns under which they are apprising entrepreneurs of the various alternative credit models available. This would help blossoming entrepreneurs secure funds easily by getting paired up with interested lenders. Bottlenecks in inbound and outbound remittance transactions are being plugged aggressively for disrupting the monopoly of conventional financial firms.

KMBL (Kotak Mahindra Bank Limited), the trailblazer in Fintech ecosystem, is convening a seminal ‘Insight Session’ wherein ground-breaking insights would be offered to entrepreneurs to stabilise their startups and surmount fund related roadblocks. Industry experts would offer incisive insights on optimising the utilisation of contemporary fundraising mechanism. Juris Corp. and Kochhar & Co. are co-hosting the interactive session. If you are steering a start-up and would like to be a part of the session, register through the link below.

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