Start up Funding options by Anand Lunia

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Slide 1:

Office deposit- beg for it to be reduced to 3 or 6 months Pay rent in advance, instead of deposit Furniture- borrow, or buy second hand Hardware, laptops, desktops- lease for 2 or 3 years, convert into a monthly cost The idea should be to convert all expenses into monthly expenses Don’t look at the interest rate of leases- it may be a bit high, but equity is far more expensive Try to not lock in money for deposits and advances Software purchase Costs: Borrow or hire? Managing Capital Costs

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Product Development costs: Develop products from home, while moonlighting Atleast develop prototypes before starting up Time is the biggest cost factor- so don’t underestimate it Hire senior resources part time till your sales start Managing Capital Costs

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Salaries of employees, self- can they be back-ended or to some extent milestone based? Travel and other overheads- lead by example in saving costs here Marketing investments- become speaker at seminars rather than paying for them, for example. Write articles for newspapers rather than advertising Running Costs

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Accountants, Lawyers, service providers can be lenders or may even take equity Landlord taking equity? Or revenue share? Employees – especially part time specialists take equity for their services Exchange Equity for Service

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Best way to generate survival money Gradually build your contact base, client base, knowledge base and reference base Training, consulting, coding assignments to survive and even generate surplus capital Consulting Cash-Flows

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Will a telecom operator fund your great product idea? Will your first customer become your reseller? Can a custom project be graduated into a product? Can the advance money from a sale fund the execution? Will you be willing to give a discount for an advance payment? Will friends and family fund a project execution? Cash flows- Partnering Customers

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Enterprising India 2011, - The largest & most exciting jugaad ( unconference ) by TiE in India scheduled on 4-5 March, 2011 at Mumbai. Visit us at http://summit.enterprising.in/