Reviving Startup Funding: Unleashing innovative strategies to overcome financial constraints

livemint.com:

Indian startups witnessed a significant fall in business funding in the first half of 2023 (January to June) by raising only $3.8 billion during the six-month period, a massive decline of 36% as compared to the fundraising in H1 of 2022. Last year, Indian startups raised $5.9 billion in the first half.  However, Ankita Poddar, Manager of Valuations and Advisory at Aranca said that startups have various alternative financing options at their disposal which range from traditional methods like bridge or mezzanine financing to modern approaches such as crowdfunding and peer-to-peer lending.  She stated that companies can also explore options like factoring or purchase order/supply chain financing to process customer orders and generate immediate cash inflow to support expansion efforts.

“Implementing a lean business model, negotiating with vendors for better terms, and opting for leasing instead of purchasing can significantly reduce operational overhead and free up resources that can be directed towards fueling growth," Poddar added while saying that considering the combination of these strategies can help startups to navigate the fundraising challenges.  Vittal Ramakrishna, CEO and Founder of POD World suggested adopting a lean model that minimizes spending, optimizes resources, and maximizes a startup's runway can help companies to sustain themselves until market conditions stabilize in the funding ecosystem.  According to the POD World's founder, companies should look for funding-raising platforms like angel investors, and take advantage of government schemes under the Startup India Initiative.  “Forming partnerships with other companies or investors can be helpful. Exploring different ways to get money, like