This is what facilitates a business’ growth.
INR Amount raised
How do we raise funds?
Lakhani Financial Services, with a tremendous success rate, is one of the best Startup consulting Firms in India. We assist budding startups in fundraising by connecting them with the requisite investors as per their needs.
No doubt, Fundraising is always an end goal when it comes to startups. But understanding Fundraising as a process is much more crucial. After the completion of consulting for the startups, founders receive a series of funds or capital to move ahead in the process. Funding rounds vary according to the industry and the growth. Thus, firstly we help startup founders understand the process and get them funded gradually. We are one of the strongest pillars in the bandwagon of Startup Fundraising India.
As I said earlier, Fundraising is surely a process. It’s never a one-time thing. In Lakhani Financial Services, while availing of startup business consulting services, you will see the following 4 steps. But these steps may be different in other startup consulting firms in India.
1. Understand the business
Firstly, we investigate your business with an eagle’s eye. With all the nooks and details, our team assesses all the points from investors’ perspectives. The purpose of this step is to understand what, why, and how of your business and funding goals. Because all these things will go to your business plan and eventually in the pitch deck too. These 2 are the biggest weapons not just for enticing investors to funds but to help you keep on track too.
In this process, you too get a better idea of your vision and a better roadmap towards success is built. A clear picture with perfect distribution of funds, capital, and resources came up. It helps investors comprehend your business and fund diffusion.
2. Build your business plan
The next step is to build a perfectly valuated business plan for your startup.
Because a business plan is not just a document, it’s your vision statement for the next 5 years. Thus, our consultants sit with you and ask numerous questions from an investor’s point of view ranging from revenue models, different cost structures, business models, marketing strategies, lead generation strategies, and so on.
Thus, it’s a long process but it’s for the benefit of startup founders only. Because to reach clean drinking water, you have to dig hard and deep.
Valuation is a part of the business plan but this single thing has the power to decide the fate of fundraising. You may not be aware but investors’ eyes skim valuation on the very first second. Thus, having a rational, logical, and accurate valuation is as crucial for a business plan as water to fish. So, we help you come up with an efficient valuation number that looks reasonable to the investor. Moreover, the biggest setback most startup founders face is the exact figure they should ask the investor. Because it should not be just a vague number. There must be an appropriate reason behind setting this number.
Thus, our experts with their expertise help you come up with that amount. So that it would be easy for you and the investor to grow mutually.
4. Creation of pitch deck
Next comes the process of pitch deck creation. Is it easy? Yes and No.
Because if you just want to tell and go, then the process is easy. But if your goal is to hook the audience and investors to your idea and vision, a bit of hard work is required. With every single element from eye-catchy graphics, relevant infographics, and perfect design, we help you build a business plan that flawlessly showcases your strengths and helps investors to confide in you.
To create a tasty and savory pitch deck, the most significant ingredients called Storytelling should be there. Thus, our team of experts after getting the answered questionnaire from you, create an enticing pitch deck that holds the strength to hold investors to their seats.
5. Pitching to the investors
The last and most critical step of the fundraising process is pitching to the investors. Once all the documents get ready, we start pitching to the relevant investors finally.
Interested investors schedule the call and gradually release the funds if everything goes right. Many rounds of interviews, negotiations, and meetings spike up in between the initial calls and final funding.
Lakhani Financial Services is specialized in early-stage startup fundraising India. We do raise funds by way of angel investors, angel networks, venture capital funds and family office till Pre-Series A round. We are one of the most trusted startup Consulting firms in India.
Valuation is more of an art than a science. Our valuation part is one of the biggest pillars in making us one of the best startup consulting firms in India.
Lakhani Financial Services and the team employ 4 different methods to evaluate a startup in such a way that they are balanced. But we strongly deny the Discounted Cash Flow method. Neither do we support this method and nor do we employ this.
Well, we generally don’t do debt investment. But we do transform the contracts according to deal structure. So, it all depends on the deals and negotiations.
One thing to note here is nonbank loans. We have no ties with any NBFC or banks.
If the deal requires, we can transform it into debt or convertible notes that are excelling in revenue-based financing for companies that are D2C or B2B startups. Thus, the type of financing totally depends on the investors, founders, and their needs.
On average, the time required to get the first series of funds is 2.5 months once the documents are ready. After availing of the startup business consulting services and preparation of the pitch deck and business plan, it takes around 2.5-3 months for fundraising.
There are different ways to raise funds. As per the availability, different startup consulting firms in India implement different methods to raise funds. At Lakhani Financial Services, we employ the following 4 methods for Startup Fundraising:
- Equity: Equity finance is a type of financing that a firm obtains by selling its stock or other equity instruments. This funding can be used to fund a variety of operations, from working capital requirements to fixed asset purchases. When a corporation raises equity funding, it shares a portion of its ownership with the entity that purchases the shares.
- Revenue-based financing: Revenue-based financing, also known as royalty-based financing, is a way of obtaining capital for a company by paying investors a percentage of the company’s continuous gross revenues in exchange for their money. Investors in revenue-based financing receive a regular share of the business’s earnings until a fixed amount is paid. This predetermined sum is usually a multiple of the original investment and ranges from three to five times the original investment.
- Convertible notes: Convertible notes are debt investments that feature a provision that allows the principal plus interest to be converted into an equity investment at a later date. This allows the initial investment to be completed faster and with lesser legal fees for the company at the time, while still providing the investors with the economic exposure of an equity investment.
- SAFE notes: A SAFE note is a convertible security that permits the investor to buy shares in a future pricing round, similar to an option or warrant. It can be a fair alternative for investors and entrepreneurs because it overcomes many of the disadvantages and issues of convertible notes. SAFE notes, unlike convertible notes, are not debt and so do not earn interest, which may appeal to startups.
The word “seed capital” or “seed funding” refers to the type of funding utilised to establish a business. Private investors contribute funding in exchange for an ownership stake in the company or a percentage of the earnings from a product. A large portion of a company’s seed funding may originate from sources close to its creators, such as family, friends, and other acquaintances. Seed money is the first of four investment rounds required for a startup to grow into a successful company. Almost all the startup consulting firms in India are providing seed funding services and acting as a force in the race of Startup Fundraising India.
We take a reasonable success fee on successful funding. There are no other hidden charges to deteriorate your mood. A success fee is charged at the end of the process. Unlike other startup consulting firms in India, we charge a reasonable fee after the successful release of funds from the investor.