The Art of Startup Funding – Where, And How To Get Startup Money

Hunting for funding is challenging, especially if you are not familiar with all the terms, concepts, and heavy business jargon tossed at you by people wearing suits, ties, and briefcases. This course will cover all the basics and teach you the ABCs of startup funding.

May 17, 2021 · Jacques Nørbo

When you're bringing a startup to life, you will inevitably conclude that it requires many resources to do so. The truth is, you must burn before you can earn. In rare cases, founders will have the ability to bootstrap their company to the top of the valley, but over 60% of startup owners will need external investments to finance their venture.

Developing a digital platform will, on average, set you back $75.000, which is quite a heavy load for most people – especially aspiring entrepreneurs. Even building a lemonade stand will require some cash up front, and unless you have the money stashed under your pillow, you'll need to find it from other sources. But that is not necessarily a bad thing. Why is that? Funding is also a tool for growth and can be precisely what you need to sky-rocket your startup.

The wicked world of funding can be confusing, overwhelming, and at times scary. Claiming that it isn't complicated to raise capital is a falsehood. There are many stories of startup founders who took money from the wrong place and lost control over their companies. Yikes. As a founder, you can make some stupid funding mistakes that are harmful to your startup's success. But fear not. This course will break down every concept you need to understand the world of startup funding and teach you how to navigate those muddy waters. Hang on tight. You're about to get fully equipped to attract investors and fuel the engines on your startup rocket 🚀

When you've finished reading, no investor will be questioning your funding know-how. All they are going to say is:


When You're Done Reading, You'll Know

  1. How to approach startup funding
  2. What equity funding is
  3. How startup funding works
  4. What the different funding rounds and lifecycles are

    .... And everything in between ☄️

How to Approach Startup Funding

'Funding' refers to the money needed to start and run a business. It is a financial investment in a startup for product development, manufacturing, expansion, sales, marketing, office space, Colombian coffee beans, foosball tables, and whatever a company needs to function properly in the modern world.

Why is getting funded needed? In short: it's not. Many entrepreneurs measure success in their ability to raise impressive funding pools as quickly as possible. And while it may get you some attention in the startup communities, getting funded is not always hog heaven, or on the road to riches. It also implies giving up some of your company, both in terms of ownership and control.

Funding is a tool for growth, and like any other great tool, it has a particular- but limited function where it excels. We don't measure a carpenter's quality on how big his hammer is; we estimate his level of mastery on what he builds with it – and the same principle applies with funding. It's more impressive to be creative and innovative with scarce resources than plowing through more than you need. Why? Because it's not just money you waste, it's your own damn company that you are diluting – and that is a statement about you, as a startup founder. Don't just raise funds or take in money because you can, do it because you can use it on something specific that will grow your company and better your startup trajectory. Having a lean approach will also force you to make more considered decisions and focus on what matters; growing your company.

🥾 Bootstrapping

You could, in fact, bootstrap your company instead of raising funds. Bootstrapping a startup means starting a new business using your own pocket change, and then putting every penny the company generates back into the development of the company. It's kind of the old-school way of doing business, where you don't depend on external capital.

Using your own money to fund your entrepreneurial adventure means that you keep maximum control over your business. As a rule of thumb, it's a good initial strategy, when you are still in the validating phase of a company. That way, you are the one calling the shots, and when the concept is mature, it's easier to attract the right investor, get a better deal, and preserve more equity for later funding rounds.

But to be completely honest, bootstrapping is a challenging way to go. It puts all the financial pressure on you, the founder, and having limited resources can slow down business development and compromise the quality of your products or services. It can be very smart to bootstrap, but it can simultaneously be the thing that is keeping your startup from reaching its true potential. Often great startup ideas arise from trends and currents in society that make sudden problems very prevalent and thereby calls for entrepreneurial solutions. The point? Other entrepreneurs might be working on the same idea as you! If you don't have the funds necessary to conquer a  piece of the market, there is a chance that one of your funded deep-pocket competitors will snatch the entire market up before you get the opportunity to get a piece 🍰

Entrepreneurship is in many ways a race, and funding will inevitably make you go faster!

The million-dollar question is: How confident are you in your startup idea and your own execution skills? How much are you willing to gamble and what are you willing to sacrifice? There is no "one-size-fits-all" solution when it comes to building a business. Every startup is unique in its crooked ways, and it's your job (and responsibility) as a founder to figure out what kind of rocket fuel your startup engines run smoothly on. Read about different ways to bootstrap your startup here.

🎶 'Cause When a Startup Breaks, No it Don't Breakeven 🎶

When you build a business, you can't expect to make money or be profitable at the very beginning. You'll need to do a lot of hard work and go through many stages before you hit the critical milestone all startups are chasing: The magical moment when they reach breakeven. That is, as the name suggests, the point at which company costs and company revenue are equal, and there is neither profit- nor loss. From that moment, the company can, in theory, sustain itself and is not dependent on external funding for survival. Many companies choose to continue getting funding after this point as a part of their strategy, to grow faster and conquer market shares. But technically, they don't need to. 

Screenshot 2021-05-10 at 10.45.45

The timeframe before a company is profitable varies significantly in duration. It depends on a range of factors such as industry, management team, strategy, overall quality of the concept/product/service, etc. Recent research shows that startups who bring a new product to market, on average, take three years before they hit breakeven. Three long years before they can celebrate that they are no longer losing money by the minute 🎊

A startup needs to develop a plan to have the capital required to reach that point, and that is where funding can come in handy. You'll need money to steer the company to a place where it is profitable. Sadly, almost 90 % of startups fail before reaching the three years of operation mark and, as a result, will never reach profitability. Every dollar that was ever sunk into those ventures will be forever lost. Read an interesting study case about startup failure here 🤓

That is an important point- and the reason why It's not always the best idea to blow all your Bar Mitzvah money on your new grand plan for pizza-delivery robots. Why not? Because even though it's a solid idea, there is a good chance that it won't work out. Maybe you can't validate the concept, a competitor beats you to market, or a worldwide pandemic breaks loose. I know that sounds preposterous, but the fact is, there are a million things that can happen which you cannot control. That is the underlying premise of entrepreneurship and a reason why it is wise to find a third party (or multiple third parties) that are willing to split the risk with you.

It's not sexy to dwell on the things that can go wrong, but as a responsible startup founder, you'll have to. Because success in entrepreneurship is far from a given, your approach to funding is very important. It's all about the risk you're willing to take. Risk and reward are tightly correlated, and you'll need to figure out what suits your company and your specific situation best. The cliché that you should always go all in and be 100 % invested yourself, and make whatever sacrifice to be a "real entrepreneur" is just that – a cliché. There is nothing courageous about stupidity.

When you play poker, ideally you don't just go all in every time you're dealt a hand (unless you're not interested in winning long term). You'll play the hand according to its strengths, weaknesses, and the information you've gathered from the table. The same applies to a business idea: you'll have to evaluate how good it is and what potential it can have, then play it accordingly. Side note: an idea is not good just because you think it is. The fact that you need the product yourself is an indicator of its potential – but nothing more than that. Always try to validate your idea before you fall in love with it. 

not sure if brave or just stupid meme

🚀 Equity Funding

To understand equity funding, we need to start somewhere else: What is a company? In short, it's a legal entity that at some level is created to protect its owners. You heard that right: It's a construct that makes sure that you (the founder) don't have total liability if a business venture goes south.

Think about how insanely profound that concept actually is? 🤯

You can fail without it having catastrophic consequences for you- or your family. If people had total liability over their business ventures, no one would dare to pursue one, and ordinary humans wouldn't be able to participate in the art of innovation. The concept is created so everyone, practically speaking, can roll the dice and attempt to build something that will improve the human condition and contribute to the advancement of our species. If it doesn't work out, the company will be absolved and disappear back to the underworld. No person- or living creature is personally responsible, and no one has to lose their house, go to jail, or be chased out of town by an angry mob if their business goes bankrupt.

The individuals who failed can even utilize the hard-earned lessons and experiences they've gained and try once again. Research shows that founders that have previously failed with a company are 2% more likely to succeed next time they try. That's damn cool and in the core of the human spirit.

Side note: Any country has different rules and restrictions about the degree of liability. Always make sure that you're on top of the regulations in the country you're operating in.

But a company is in itself worth nothing. It's just a name on a piece of paper. The value of a company is rooted in its intellectual property and various assets. The business idea and the game plan to execute and build it is somewhat where the substance lies, and the better the two components are, the more valuable the company is. The company's total value can be sub-divided into pieces, and the pieces can be sold to a third party to finance the further development of the company. In other words, you can sell the current + the expected future value of the company in exchange for cash upfront to manifest that same value. Whom the heck came up with that?! 🤷🏼‍♂️ This is known as equity funding which is the most common way to raise funds.

⛵️OwnerSHIP

This is where funding becomes tricky and where you have to be able to make razor-sharp decisions. Every time you give up equity, you are diluting your position in the company, and that should ALWAYS come from a considered place. Remember, there is only one cake!

But as the famous line goes: "It's better to own 1 % of a billion-dollar company than owning 100 % of a million-dollar company"—math. Diluting your position is not necessarily a negative thing; it also implies that you'll make room in the company for other resources/talent/opportunities/opinions that can provide the unicorn dust needed to take your startup to the major leagues.

Equity is a measurement of ownership, and to be able to control a company independently, you'll need to own at least 51 % of it. Suppose you dilute yourself to a position where you are no longer a majority owner; in that case, your shareholders (if they together represent 51 % of the company - or more) can go in and take control over the company. They can even fire you if they so, please. They can't take your existing shares, but they can decide that you are not a good fit for running (or even being involved in) the business's operations.

Always advise yourself with a neutral lawyer before giving up/selling chunks of your company.  Find one that you can be sure has no economic incentive to be ambiguous or complicate things with you.

The world of business can be ruthless, and if you put yourself in a vulnerable situation, don't expect that some people won't take advantage of that. Business ethics are a weird concept, and way too many people have been burnt because they lost the ability to distinguish personal relationships from business relationships. A startup often begins as a fun hobby project, driven by passion, altruism, and camaraderie. But eventually, when big money enters the arena and stakes are high, most shareholders will want to protect their investment. It will change the company's dynamics and decision-making ability because shareholders (especially professional investors and VCs) probably have different economic incentives than you have. Let's say you would like to save the planet and build something people love, and the investors would like to make 10 fold on their investment in five years. The overall strategy for accomplishing the two things will inevitably be different, and that conflict of interest can lead to some serious friction.

 

Money is necessary to grow a startup, but make sure that the money you take in doesn't represent another vision separate from the one you are trying to manifest. The investor's interests should be aligned with yours; otherwise, it can quickly evolve into a mess. We can't stress this enough: always seek appropriate legal counseling! Make sure that you are entirely aware of what you're doing and what the potential consequences can be. To protect yourself, you can come a long way by creating good shareholder agreements, make thorough due diligence, and in general, be very considerate about whom you take money from 🚨 

At Cuttles, we often make comparisons to how the business world mimics the natural world: remember, no lion ever felt bad for eating a gazelle, and even though you'll feel empathy when you see the gazelle being eaten on Animal Planet, it is difficult to feel any animosity towards the lion. Even though you've been played or deceived by your business partners, shareholders, lawyers, (and yes, even business friends), as long as nothing illegal has happened, it's hard to feel any animosity towards them – and it's close to impossible to reverse the actions. Please make it a priority to always protect yourself. As long as you don't go swimming with open flesh wounds, the sharks won't smell any blood.  

How Does Startup Funding Work

But how does funding work? To explain how the process could look like, let's work through a fictitious startup scenario explaining the steps and thought processes. Keep reading, and the whole puzzle will come together 🧩

📱The Startup Idea

This is Karen 👉🏻 🙍‍♀️ She currently works in a SaaS startup and has a profound appreciation for dogs. She is the proud owner of a brown Grand Danois called Brian. Karen has experienced a recurrent problem in her life: it's almost impossible to find appropriate playdates for Brian. He's a large, 300-pound giant and doesn't play well with small dogs. He can't be bothered by them actually. He also doesn't get along with other male dogs; he prefers being the only male around. Because of the difficulty with finding friends, Brian is starting to get lonely, and Karen knows that if she doesn't find him some dog companionship, he will eventually get depressed.

Karen has been thinking about an app idea, a concept that potentially could solve her problem. Maybe even solve a problem that many dog owners have. Who knows how many others there are that experience the same pain as she does? She wants to take the jump, start a business venture, and become an entrepreneur that improves the lives of dogs (and dog owners) worldwide 🚀

🐶 Tinder – but for Dogs 

Her idea is a dating app for dogs. Original, right? The app should make it possible to create a profile of your dog(s) and showcase all their best features (puppy eyes, beautiful fur, or a long-tail – you name it). Think about Tinder – but for dogs. You should then be able to localize other dogs nearby to arrange a dog date. You should have the ability to filter for size, race, gender and make sure your dog can find a compatible playmate and synchronize walks.

Name-wise, Karen is considering the name "Dogster." But that is a working title... 

She has been out validating the problem and performed some market research. She is pretty confident that she is on to something. Now she needs some capital to take it to the next level. To get the company off the ground, she'll need to create an MVP (minimum viable product). That is the prototype of a product that you can present to your potential customers to see if they like it – and determine if there is a market for the product. To make that happen, she calculates that she will need $20K. She needs to perform some market research, hire a developer to build the MVP of the app, get herself a small office space from where she can operate, and provide herself with 12 months of runway to get everything done ✅

... Runway?

Imagine your startup is a plane on a runway. Each round of funding you raise extends the runway to give you more time to take off. If you're about to hit the end of your current runway and haven't taken off yet, you need to raise another round to extend the runway. Or else what? Or else your startup will crash and burn. One of the biggest reasons why startups fail is because they run out of money. The most important job a CEO has in every startup company is to ensure that the company always has capital: because without jet fuel, there's no trip.

Screenshot 2021-04-19 at 17.42.52

The FFF Round

Unfortunately, Karen doesn't have a penny 🤷🏼‍♂️ , So what are her options? She can borrow money from friends and family. That is quite a typical way to finance a startup idea and is called the FFF-round. It stands for friends, family, and fools.

It's kind of a joke, but it has a basis in reality. This round is in the very early stages of a startup's fundraising life-cycle. And without it, many startups that we know as big corporations today would have never made it. Friends and family are the most likely source of financing for an early-stage startup because they don't require as much proof; they just want to help out their relatives. Fools are a metaphor for people without much experience - they are not actually fools. Most investors or incubators (with much experience) wish to have some traction/proof before investing their funds in a startup. The further down the funding cycle you go, the more evidence/validation is required that your business is a success and has the potential you are claiming it does.

 .... But her cousin Tommy. This guy 👉🏻 👲🏻 borrowed $15K last year from their family to fund his idea of a board game-themed brewery. He then ran off to Thailand and partied for a year, so the family fund is closed for further business ventures for now. Her friends? They are just as broke as she is. So none of them are viable options. She could also go to the bank and ask if she could borrow the money, but as a life-long student who recently entered the job market, her credit score is the only thing that is lower than the grades she received. Going to school wasn't exactly her passion. 

The Angel Investor

Karen decides that she will try to find an angel investor who wants to get behind her idea. She has some great contacts in the tech scene and maybe knows some people interested in investing. She initially focuses on developing the theoretical elements of Dogster, which is called business planning. To get angel investors, venture capitalists– or anyone, for that matter, interested in a company, you'll need a bulletproof business plan that showcases your strategy, how you'll execute your idea and how your concept fits together. You'll need an excellent pitch that you can present to potential investors, and an economic overview of how much money you'll need, how you will spend it, and when it will run out. That is the fishing rod and bait to catch the perfect investor!

If by this stage you are not quite aware, this is what we, at Cuttles, are helping dreamers and entrepreneurs with. Not to blow our own horn, but we're kind of experts in this domain. If you have problems developing this kind of stuff, we can recommend trying our startup builder web app. We're pretty sure you'll find it useful. Sign up for Cuttles 👋

But what is an angel investor? It's an individual who provides capital for a business startup, usually in exchange for convertible debt or equity. Angel investors typically support startups at the initial moments (where risks of the startups failing are relatively high) and when most investors are not prepared to back them.

We should however mention, angel investors are not always angels. It's not necessarily altruism that is steering the ship, it is an investment strategy. They take a considerable risk, but can potentially win big. When an angel investor is putting money into a venture, they are basically stating: "even though it's unlikely you'll succeed, I think that there is a reasonable chance that you'll make it big and secure my investment 10 fold". They are willing to split some of the capital risks and finance your startup journey.

But make no mistakes about it. They're not doing it for you, solely – they are also doing it for themself. It's an investment opportunity and they evaluate whether you, over time, can make them some money. The strategy is that they will buy a piece of your company today, and when you are entering a later funding stage (typically series A or B), they will then sell their part of the company and cash out.

Finding the RIGHT Investor

Karen is cruising around town and pitching Dogster to every investor that glances her way. Finding the right investor fit for the company is challenging – but crucial to get right. It needs to be a person with the following attributes: 

  • Experience and expertise in the industry, extensive network, etc. 
  • Strong belief in the business case, the overall vision, and in you as a startup founder. 
  • Money to deploy: Deep bucket investors are great for the company's trajectory because they potentially can reinvest at a later stage – if needed. (It's not a "must-have" but a "nice-to-have.")

.... If you don't have contacts with any investors yourself, luckily, there are many great resources online where you can hunt them down. We have collected a bunch of them for you here. 

After Karen has pitched five times to different angels, one investor shows interest in Dogster: his name is Anders.

This is Anders, the Angel 👉🏻 👨‍🦰  He has a background in the tech industry and is already an investor in three other tech companies. He has a lot of know-how regarding developing apps and has many contacts in the tech industry. He even knows some good developers that can create the MVP of the platform for a very reasonable price. Karen knows that he is a perfect fit for her company and that Anders can assist her with a lot of stuff that she desperately needs help with. He is bringing smart money and is willing to put some sweat equity in, which at this point in time when she is without a team, is a necessity. 

... Smart Money and Sweat Equity?

Anders' capital injection would represent what is referred to as 'smart money´, that is, money coming in with additional value. In a startup, you'll need a lot of different resources and know-how to succeed. If an investor brings extra resources, in addition to the money bag, the money is considered 'smart.' Remember: dumb money, make none! If the investor is also willing to knuckle down and do some work themselves (or have a contact that will), that would be categorized as sweat equity. Anders knows a developer that has worked on one of his previous projects. He has offered to spend some time with Karen to estimate the cost of the total project. He'll do that free of charge because he wants to help Anders and maybe get hired for a future project. That is an example of sweat equity.  

... Traction?

Traction = results. Under normal circumstances, you'll need some kind of traction to attract investors. Traction is the validation of a business case. It's proof that people are interested in the product or services you provide. When you have sufficient traction (it could be sales- or letters of interest from potential clients), you slowly begin developing what is called proof-of-concept.

🥊 Investment Negotiations

The negotiations start, and Karen finds herself in a very vulnerable situation. She has never negotiated a business deal before, and because Dogster still needs traction, she knows that she doesn't have much leverage, and is negotiating from a somewhat weak position. Her game plan is that she doesn't want to give up more than 20 % in the pre-seed round because she wants to preserve enough equity to go through the next seed round and still be a 51 % majority owner. After that, she would like to bootstrap the company until she can potentially sell the company to a venture capital company and make her exit. That is the strategy – the master plan.

Valuation

Before Karen can initiate a negotiation with an investor, she will need to estimate what the company is worth. This is called a company valuation. Typically, a valuation is based on the company's current assets, traction, brand value, execution plan- and execution abilities. Her accountant is advising Karen that she should go for a valuation of $100.000, which is extremely high based on her current results. Under normal circumstances, a company that has not shown promising results wouldn't get funded at that lofty valuation. But because Karen is very skillful, and has a well-organized plan for how she will build her startup – and a brilliant idea to top it off, she is going to go for it nonetheless.

If Anders the investor accepts the premise that the company is worth $100.000, that will mean that 1 % of the company would be worth $1000. If he made a proposition to buy 10% of the company, the price would be $10.000. If he evaluates the company only has a valuation of $50.000, he could state that he wanted 20% of the company for the same $10.000.

Anders decides to offer $20.000 on a valuation of $50.000. That will imply that he would get 40 % ownership of the company. That is very far from what Karen expected, and she puts her foot down. Anders is stumped (but also impressed) by Karen's negotiation skills, making him more interested in joining as a shareholder. After two weeks of hard negotiations, they close the deal: Anders puts in $25.000 on a valuation of $100.000. Karen is relieved.

Deal Closed ✅

Anders has just acquired 25% for $25.000. Anders got a little more equity in the company than Karen was initially willing to give, but instead, Karen got a little more cash which she will allocate to her marketing budget. Both parties are satisfied with the deal and are confident that they can make Dogster a world-class startup.

Karen has now completed her first funding round and has the runway needed to develop an MVP for Dogster. The next stop is the seed-funding round in 12 months, where Karen will try to raise funds to hire the right team and build a scalable product 🚀

... What if You Don't Want to Give Up Equity?

👉🏻 Public Grants- and Accelerators

There are some exceptions. It is possible to get funded without giving up equity, such as public grants and governmental accelerators that support startups with what is called soft money. Soft money is capital you don't have to pay back- or trade for equity. Many countries have innovation programs that support local entrepreneurs because it drives development. Hugely successful startups are very beneficial on a state level because it creates workplaces and drives further innovation.

It is highly recommended to research any local options in your home country, and If you fulfill the requirements: apply! It's potentially free money and a great stamp of approval that can potentially attract other investors. But it's pretty challenging to receive the grants/funds and be chosen to participate in the accelerators/programs. It requires that the company can showcase what is called high innovation-depth. In other words, your startup should have the ability to have a substantial societal impact. Whatever that means.

Not all accelerators are public or finance startups with soft money. But it's very recommendable for any early-stage startup to find an accelerator that can supercharge their growth. Often they can help with mentorship, product validation and facilitate co-working spaces, where you can work with other startups in your field. There is a wide variety of different options, and you should try to figure out if you can find one that is a perfect fit for your specific startup.

Pssst, 😤 We have collected a list of different accelerators from all over the world. Just hit the blue heart, and it'll appear like magic 👉🏻  💙

👉🏻 Bank Loans

You probably know the concept of banking. The chances are that you already have a mortgage or some kind of loan you have obtained from your bank. They have lent you money for you to buy something upfront, and you're slowly and steadily paying back the money with interest.

You can, in fact, do the same in regards to financing your startup. It's a smart way to preserve equity, which can be the most lucrative solution long-term. The problem is, the bank will often make sure that you will personally have to pay the money back if the company can't. If the company goes bankrupt, you will have total liability.

Sometimes a company can take up loans with collateral in company assets. The founders don't necessarily have personal liability in that case. But that requires that you'll have large enough assets, and most startups don't.

There is no right- or wrong way to fund your startup. But you do need to be very confident in your startup venture before taking up big loans. The chances for startup failure are substantial, and you should not jeopardize your entire future because you have a strong gut feeling for your new startup idea. As the saying goes, don't put all your eggs in one basket 🥚 

Funding Rounds and Lifecycles 💰

A startup's financing journey is sub-divided into various funding stages by raising or passing through different startup funding rounds. Here's a visual explanation of each startup funding round or startup funding stage:

Screenshot 2021-05-05 at 15.17.20

 

Pre-Seed Funding 💡

A pre-seed round is the first funding round that applies to a startup that is in its idea stage and aims to build a prototype or MVP (Minimum Viable Product). By raising a pre-seed investment, a startup gains initial capital to create a proof-of-concept and create a marketable product or service. At the pre-seed stage, it's always advised for startups to join a relevant startup accelerator program. Startup accelerators help startups augment their product or service, provide mentorship, networking opportunities, and provide initial funding to run and scale their business. We have an entire piece about early-stage funding.

Seed Funding 🏗  👉🏻  🚀

A seed round is the first startup funding round that applies to startups with a proof-of-concept and MVP to fulfill a market need. A startup can seek angel investors, angel funds, angel groups, startup accelerators, and early-stage venture capital firms at the seed stage. However, to raise funds from venture capital firms, you need to have a solid revenue record and financial projections. Seed funding for startups, the majority of the time, comes from startup accelerators and angel investors.

Series A Round 🚀  👉🏻  🌱

After the seed funding, the first round of investment is typically from venture capital companies (VCs) that invest from $1 to $10 million in exchange for equity. A startup or company qualifies for Series A round funding once it establishes a substantial user-base and functional business model. Series A funds are usually raised to optimize a startup's offering and speed up product development.

Series B Round 🌳

Once a startup passes through product development, investors contribute money to help the startup conquer market shares before rival competitors. Companies deploy these funds to bringing in world-class talent and better marketing efforts.

Series C Round 🌳

Startups which pass through Seed, Series A, and Series B rounds are successful enough to acquire other businesses, particularly smaller competitors. And for that, they need additional funding, to attain purchasing power. When a startup passes through the Series C round, it can tackle competition, expand its reach, and tap into new markets and products to ultimately establish itself as a market leader in its industry or sector. After raising a Series C round, a startup also gains the potential to develop new subsidiary businesses and headquarters across different geographies. Most startups usually stop raising funds after the Series C rounds to prevent diluting the company further. Still, certain companies go beyond Series C to Series D and even further to Series F. 

The End. Fund-well 🤝

You've now reached the end! We hope that this course has provided you with some insights into the art of funding. Remember, raising funds is a very tricky endeavor and a subject you should keep educating yourself about. We encourage you to use this knowledge as a springboard to learn even more! It's an area that you, as a startup founder, need to familiarize yourself with and hopefully one day master. Making good and considered funding decisions can easily be the difference between startup success- or failure. 

So long, good people! 🌱