Raising Funding for a Startup

Market volume is measured by the amount of product you can sell or or the amount of money you can receive. Although this is a very approximate indicator, it affects the investor's decision on whether to invest in a project. In this lesson, you will learn how to calculate it yourself. You will also study the types of market volumes: TAM, SAM, and SOM. You will understand what you need to decide before starting calculations, where to get information for calculation, and find out how to calculate market volumes.

In the additional materials, you will discover how to choose the most favourable country for launching your business.

Before spending money on creating a product, you need to make sure that the demand for it really exists. The RAT approach, which is used to test hypotheses, will help you with this. Thanks to it, you will be able to quickly get feedback from potential users and check the viability of the idea before it is implemented. In this lesson, we will teach you what the RAT approach is. You will also learn how RAT differs from MVP, why they do not contradict each other, and how to use RAT. Additionally, you will find out how to test hypotheses through interviews with the target audience. You will receive a Lean Canvas template for analysing product information, as well as templates for designing experiments and evaluating results.

Unit economics is essential for any business. It allows you to understand how much profit you get from each client or user, what budget should be allocated to attract them, and which channel is most effective for this. In this lesson, you will discover how to calculate unit economics, what to do to make the company more profitable, and where you might make a mistake when calculating unit economics. In addition, you will learn what a financial model is, why you need it, and how to build it using unit economics data.

Additionally, you will be able to study examples of unit economics and financial model calculations. You will also get a list of unit economics metrics with various formulas.

So, you have gone to considerable lengths: you determined the market volumes, tested the hypotheses, calculated unit economics, and drawn up a financial model. Now comes the most exciting stage — the search for funds to implement the idea. In this lesson, you will learn what investment rounds are and what funding sources you should consider at different stages of a company's development. You will study and analyse the following investment rounds: Pre-seed, Seed, Round A, Round B, Rounds C, D and IPO. Additionally, you will find out more about the most likely funding sources for each round.

Read the additional materials to discover where to look for investments for your business, and how the dilution of interests in a startup works.

The decision of investors to finance your startup largely depends on how competently and interestingly you present it. By this point, you should already have hard numbers and projections for your project.

How do you turn a set of tables and charts into a compelling and catchy story about your business? How should you structure the report? What should be on the slides?

You will learn about all this in this lesson.

Additionally, you will receive a list with tricky investor questions. Moreover, you will get tips on how to perform in front of an audience and a guide to creating a pitch deck.

An investor is interested in your idea, and it seems that they are not opposed to financing your project. However, no one will invest in a company until they are convinced of its reliability. Are your documents in order? Is your startup in debt? What about intellectual property rights? Is your business a profitable investment, or are the numbers from your financial model fake?

An investor will want answers to these and many other questions before making a deal. The Due Diligence procedure, which you will learn about in this lesson, will help them with this.

Read the additional materials to discover how to check the investor before making a deal. Moreover, you will receive a list of documents for Due Diligence.

After you have presented your project and interested the investor, you sign the "Agreement of Intent", or Term Sheet. Most often, the parties sign this document after Due Diligence, but they may also do it before. In it, they define the structure and basic terms of the deal and formalise the intention to conclude it on the agreed terms. In this lesson, you will study the main sections of the Term Sheet and learn what you need to pay attention to.

For convenience's sake, you can print or open a template of this document in another tab. You will find it in the additional materials. Furthermore, you will receive a checklist which will help you find out how to raise money for the project.