Ways to Secure Funding for a New Business

Building a business is one of the most exciting yet demanding steps for any founder. Great ideas alone are not enough. A startup needs solid financial backing to get off the ground. Across the globe, from Silicon Valley to Berlin and Singapore, competition for capital grows stronger as the landscape of savings, investment, and regulation shifts. So how can a young company make sure it has the means to stay in the game?

Early Funding: Why It Matters

In the first year, funding typically supports research, product development, intellectual property registration, and building a team. Skimping on these essentials can leave a startup behind. In 2024, global venture capital investment reached $368 billion. Despite regional slowdowns in Asia and persistent challenges in the IPO space, interest remains strong in technologies like artificial intelligence and clean energy. Startups that show a clear path to revenue still attract serious attention.

Types of Capital Sources Around the World

Angel investors. These are often the first to take a chance. In the U.S., angel syndicates invest between $25,000 to $250,000 per deal. In Europe, similar amounts are invested, often with greater focus on social impact.

Venture capital firms. Once your concept is proven, VCs may enter. Although deal activity dipped in 2023, it picked up again in 2024, especially in North and Latin America, where investments rose by 50% and 12%, respectively, according to the World Intellectual Property Organization.

Private equity and family offices. For larger checks needed during scaling, funds come from wealthy families and PE firms seeking long-term returns. In the Middle East, more family offices are investing in climate-tech as part of their diversification strategies.

Crowdfunding. If you want capital and market feedback at the same time, reward-based or equity crowdfunding is an option. The global crowdfunding market is projected to reach $5.4 billion by 2032, growing at an average of 15.4% per year.

How to Prepare a Compelling Pitch and Documents

Before you meet any investor, your story must be sharp. Use a short pitch deck to explain the problem, your solution, market size, and why you’re the right person to lead this business. Show traction with data—user growth, early sales, or even letters of intent from future clients. Your goal is to show real demand and opportunity.

Investors around the world seek realistic projections, especially regarding currency, compliance, and supply chain risk. European funds often prioritize ESG standards more than North American ones. Adjust your pitch based on the region. If presenting online, record your pitch and review it to identify where to add energy or clarify your message.

The Value of Building Relationships

Raising capital is still rooted in relationships. Attend conferences, join accelerators, and participate in online communities—especially on platforms like LinkedIn or Mastodon. At Berlin Tech Week, many early-stage founders secure invites to private pitch sessions by simply engaging with panelists. In São Paulo, coworking spaces run mentoring programs that connect founders to international fund managers.

You don’t have to be the loudest voice in the room. Just be consistent. Contribute to discussions, offer help when you can, and ask thoughtful questions. Over time, people will recognize you as someone serious and approachable.

Funding Through Online Platforms

Crowdfunding started with musicians and indie creators seeking donations. Today, tech and climate startups use it to raise capital while building their first user base. Platforms like EquityNet, Seedrs, and StartEngine support international campaigns. Each country has unique rules—especially around fundraising limits and investor eligibility—but the central rule remains: show how investors earn returns.

A successful campaign needs careful planning. Many reach their goals quickly in the first 48 hours thanks to strong pre-launch outreach. Make it easy for supporters to contribute. Be clear about rewards or equity shares to prevent confusion.

Public Sector Grants and Government Support

Many governments offer grants or soft loans to stimulate innovation. Germany has the High-Tech Gründerfonds. In Canada, the Industrial Research Assistance Program provides up to $3 billion in support. South Korea’s TIPS Program works with incubators to back startups. These programs aim to drive employment and social-benefit technologies, with a focus on biotech, green energy, and advanced manufacturing.

Though the application process may take 3–6 months, these funds don’t require giving away much equity. While waiting for your next round, a grant can keep your R&D moving without immediate payback.

Evaluating Options: Pros and Cons

Choosing the right funding source requires balance. Here’s a quick breakdown:

• Angel Investor: Fast and low-pressure. Checks are smaller, so you lose less control, but risk appetite may also be limited.
• Venture Capital: Larger investments and strong network support, but often comes with board seats and fixed timelines for exit.
• Crowdfunding: Builds a community and raises money at once, but demands intensive communication and legal prep.
• Loan or Grant: No immediate equity loss. You’ll need to report on use and meet conditions, and sometimes co-fund depending on the program.

Maintaining Good Investor Relations

Closing the deal is just the beginning. Set up a routine for updates. Use a simple format that includes metrics, milestones, next steps, and areas where the investor can assist. Be honest about challenges—whether delays in delivery or drop in engagement. Transparency protects your reputation.

In Europe, investors expect ESG reports. In the U.S., performance numbers take center stage. In Japan, risk management is a priority. Tailor your communication style to suit the business culture of your investors for lasting relationships.

Planning Ahead: From Seed to Series A and Beyond

Funding doesn’t end at the seed round. Once demand rises, more capital is needed for hiring, marketing, and global reach. Start preparing for the next raise at least six months before your current runway ends. Build a forecast with cautious expenses and bold growth goals.

In cities like Hong Kong and London, Series A investors track the “rule of 40” in SaaS businesses—your combined growth rate and profit margin should hit 40%. In Latin America, logistics costs are high, so investors focus more on unit economics. Align your metrics with the benchmarks favored in the region where you’re raising funds.

Raising capital calls for strategy, clarity, and trust. When your materials, connections, and values line up, the right investors will find you. Stay focused, keep improving, and be flexible when plans need adjusting. That’s how a new venture grows into a global contender.