Alternative Funding Options For Startups Besides Venture Capital
VCs are continuing to move up the stack, favoring larger and later rounds. Union Square Ventures partner Fred Wilson wrote in late 2017 that the “seed and early-stage investing market has cooled substantially.” Additionally, as PitchBook data reveals, seed deal count in the US is dropping while Series A deal sizes are rapidly increasing.
Investment in early-stage startups (pre-seed, seed) is declining, leaving founders to look for other means of being funded and surviving the funding drought. It’s important to realize that not everyone has to raise VC and in some cases not everyone should raise VC. Below are several alternatives for funding that your startup should consider when VC and angel investment aren’t options:
Bootstrap
Bootstrapping is minimalism applied to business. It takes doing something hard on your own without the help from venture capital firms or angel investors. This path is chosen because you want to demonstrate a working idea, test with limited resources, unable to devote yourself full-time or you want to preserve your equity. The reality is that outside investor funding is not a realistic option…
