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Ask HN: What are some ways to raise money for a startup?

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Re: Ask HN: What are some ways to raise money for a startup?

#11
I guess it depends on what you are raising the cash for and how much you need to raise. If it is mostly to give you and/or your team a living stipend while you develop the product full-time, there are a number of tech incubators you could choose from or you could try to raise a few months salary from angel investors like me.

If you are using the cash more to buy an asset or equipment ( e.g. a food truck ), then you could try pitching it to a bank. I don't think they would go for it, but at least they would have collateral. If you have a personal car, you could try offering that for collateral as well.

- Part-time consulting. If you are able to consult 20 hours a week, that should be enough cash to cover a modest cost of living and maybe some extra to invest in your start-up. A lot of companies start this way. They build specific products for their clients and eventually develop a product/service of their own. Check out 37Signals story on how Basecamp came along.

- If you are developing an enterprise-level tool, you could try to pre-sell it to a large firm first and have them pay an advance. This is tricky, but possible if you are building a certain type of product and have the right experience/connections.

- Build an MVP in your spare time and start charging for it. You may be able to skip the financing step altogether. Either way, you'll have more luck raising funds if you already have some, but maybe not enough to be profitable, paying customers.

- Personal Savings

Some riskier ways to get cash:

- Cash in a portion of your 401k ( you'll pay a 10% early withdrawal penalty + taxes )

- Home Equity Line if you have enough equity in your home. Careful with this because you are gambling your home. Make sure that if the start-up fails, you'd be able to get a job making enough cash to cover the additional debt service on the equity line.

- Personal line of credit. You pay high interest rates and won't be able to borrow that much ( ~25k or so ). You've probably gotten offers like this in the mail before. Your credit card company sends you a blank check and says 6 months no interest loan. Same as above, if the startup doesn't make it, make sure you'll be able to handle the additional finance charge ( which will be crazy high ). Please don't do this one.

Re: Ask HN: What are some ways to raise money for a startup?

#12

I guess it depends on what you are raising the cash for and how much you need to raise. If it is mostly to give you and/or your team a living stipend while you develop the product full-time, there are a number of tech incubators you could choose from or you could try to raise a few months salary from angel investors like me. If you are using the cash more to buy an asset or equipment ( e.g. a food truck ), then you c…

I am co-founder of a startup that have some products with kinda average traction (but no profit), and not enough money to finish our flagship product (but I think we can make a the rewrite of the demo... the first demo is on Google Play).

How I would convince a angel investor like you to help?

Re: Ask HN: What are some ways to raise money for a startup?

#13
I find none of the answers here will work for me. I'm looking to make a small product, which I believe is a great idea. I need to hire designers and developers every now and then.

Borrowing money from people is not an option, and neither is will banks help me in any way — I'm a student,and 17 years old.

I have little or no savings. So yea...

Re: Ask HN: What are some ways to raise money for a startup?

#14
post #9
post #4

Have you looked into angel.co?

Alright, a person create a profile there, that get no views, no references, and then so what?

There is going to be work involved somewhere. It's not going to just fall on your lap.

Re: Ask HN: What are some ways to raise money for a startup?

#15

I find none of the answers here will work for me. I'm looking to make a small product, which I believe is a great idea. I need to hire designers and developers every now and then. Borrowing money from people is not an option, and neither is will banks help me in any way — I'm a student,and 17 years old. I have little or no savings. So yea...

Sometimes, you need to strike lucky (like me... that a guy with the money and the same idea as me found me and offered me to code)

Or do like I tried to do in the past: work in a normal job, and in your idea on the side. (this resulted into this: http://www.abril.com.br/blog/campus-party/2011/01/19/fanatic... )

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