Proceedings of The 6th International Conference on Management, Economics and Finance
Year: 2023
DOI: https://www.doi.org/10.33422/6th.icmef.2023.03.001
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An analysis of the funding challenges that a start-up has to deal with and the impact that it can have on the future of the company
Ph. D. Candidate Junada Sulillari
ABSTRACT:
The aim of this research paper is to make an analysis of the funding options of start-ups. There are many new enterprises that may have brilliant ideas and products that they want to offer, but the process of turning an idea into a product is not easy. There are many challenges that a start-up faces and securing the funds that they need is one of the key challenges. This research paper will focus on how start-ups deal with funding issues, by exploring different funding options that they may choose to use and the ones that they are able to use because of the constraints that may prevent them from choosing the desired funding option. This will also help to see how these financial constraints “force” their decision-making process when it comes to choosing the best funding option. This research is based on secondary research and is exploratory. The research method that is used consists of the exploration of existing information about start-up funding issues and challenges and the interpretation and analysis of the findings generated by it. The results found that start-ups can use different funding options, like angel investors, loans, venture capital, crowdfunding, grants, accelerators, etc. The business idea itself, the competition, the reputation of the founders, and the network of the founder are some key factors that determine the success of the funding process. The funding option that start-ups use can also impact the future of the enterprise, as different funding options can have implications on the capital structure of the company and on the decision-making process.
keywords: accelerator, angel investor, crowdfunding, venture capital