Types of investors
- Angel investor = An investor who provides financial backing for small startups or entrepreneurs.
- Venture Capital Investor = An investor who either provides capital to startup ventures or supports small companies that wish to expand but do not have access to public funding.
Types of investment
- Bootstrapping = A situation in which an entrepreneur starts a company with little capital (using personal finance or operating revenues of the new company)
- Crowdfunding = The use of small amounts of capital from a large number of individuals to finance a new business venture (the funding amount varies by case)
- Angel Investment - Investment is on average around €50,000 and have a multiple of 2.5X
- Seed funding - The initial capital used to start a business (the source varies: it may be in form of bootstrapping, angel investment or even Round A Venture Capital investment)
- VC Rounds = The early rounds of funding for a startup company, which get their name because the first is known as Series A financing, followed by Series B financing, and so on
Venture Capital Investment
Series A Financing
The first round of financing undergone for a new business venture after seed capital. Generally, this is the first time that company ownership is offered to external investors.
(for series A) is on average around €1.5m and have a multiple of 3.5X
Series B, C etc Financing
The second round of financing for a business by private equity investors or venture capitalists. Successive rounds of financing or funding a business are termed Series A, Series B (and so on) financing. The Series B round will generally take place when the company has accomplished certain milestones in developing its business.
IPO - Initial Public Offering (moving to the stock exchange!)
The first sale of stock by a private company to the public. IPOs are often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately owned companies looking to become publicly traded.