We believe great companies are built with vision, determination, and the right partnerships.
At Growth91 and Growth Sense , we’re dedicated to being that right partnership for startups, empowering visionary founders with the tools, connections, and funding they need to scale their ideas into transformative businesses.
This month, we’re diving into how startups can navigate the funding landscape, celebrating the successes of innovative portfolio companies, and sharing opportunities to connect with leaders shaping the future of the startup ecosystem.
Here’s what’s inside this month’s newsletter:
Ready to explore what’s shaping the world of startups and beyond? Let’s get started!
How Startup Funding Works: Your guide to seed money, angel investors, and venture capitalists.
So, you’ve got this big idea, right? Maybe it's a game-changing product or a revolutionary service, but you're not quite sure how to turn that idea into a full-fledged company. More importantly, you need money to make it happen. How does startup funding work? What’s the difference between seed money, angel investors, and venture capital? Let’s break it down for you.
Stage 1: The Idea Stage
You’ve been tinkering with an idea for a while. You’ve built a prototype, maybe over a few weekends, and it shows potential. But now, reality hits—you need cash to move forward. This first stage is called the Idea Stage, where your expenses are low, but attracting outside investors is difficult because you have no proven track record.
At this point, your primary funding sources are friends, family, and yourself—the classic bootstrapping scenario. Typically, these early investors won’t expect a huge return on their money, but you still need to be clear about what they’re getting in exchange for their investment. More often than not, you’ll be giving away equity—a percentage of ownership in your company.
Imagine you’ve put together $10,000 from personal savings and contributions from friends or family. You sell 10% of the company in exchange for this funding, meaning your startup is valued at $100,000. That’s your pre-money valuation—the value of your company before the new investment.
Here’s a key term you should know: dilution. Each time you raise more money, you issue new shares and give away a portion of the company. For example, if you own 100% before raising funds and sell 10%, you now own 90%. As you move forward and raise more capital, your ownership will continue to dilute, but ideally, your company’s value grows exponentially, making your remaining share worth more.
Stage 2: Seed Stage
After working hard, your product is gaining some traction, and you realize you need more funding to truly scale. This is where the Seed Stage comes in. This round is meant to fund the next steps in developing your product, expanding your team, or testing out marketing strategies.
During the seed stage, you’ll encounter two primary types of investors: angel investors and seed capital firms. Let’s break these down:
At this stage, your company’s valuation has increased thanks to the progress you've made. Let's say you secure $2.55 million from an angel investor in exchange for 17% of your company, bringing your total valuation to $15 million.
The funding you secure in the seed stage can help you expand your operations, build a stronger product, and prepare your company for the next big step: growth.
Stage 3: Growth Stage
You’ve launched your product, built a user base, and now things are really moving. This is where you enter the Growth Stage, a critical phase where startups aim to scale rapidly. To support this growth, you’ll likely need Venture Capital (VC) funding.
Venture Capitalists (VCs) are institutional investors that pool large amounts of money, looking to invest in high-potential startups that could offer big returns. They don’t just provide money—they bring industry connections, experience, and strategic insight, helping your startup accelerate its growth. However, VCs will expect significant equity in exchange for their investment, and they typically aim for startups with the potential to either go public (IPO) or be acquired by a larger company.
For example, after significant traction, you secure $6 million from a VC firm for 8% equity, pushing your valuation up to $75 million. You now have the capital you need to expand your team, roll out aggressive marketing campaigns, or scale your operations globally.
Stage 4: Series A, B, and Beyond
Once your company has grown and reached profitability, you may enter a phase where larger rounds of investment are needed to take your business to the next level. These rounds are known as Series A, Series B, and so on, depending on how far your company scales.
Series C and beyond often come into play when companies are preparing for international expansion, launching new product lines, or acquiring competitors.
Each successive round tends to bring in larger investments from more prominent institutional investors, such as hedge funds, private equity firms, and sometimes even corporations. However, the more you raise, the more equity you’ll likely have to give up, and your ownership percentage continues to dilute. But by this point, your company's valuation could be in the hundreds of millions, or even billions, so your remaining equity could be worth a fortune.
Common Pitfalls
It’s important to note that while funding is crucial for growth, it’s also a double-edged sword. Raising too much money too quickly without a clear plan can lead to burnout, mismanagement of funds, and loss of control over your own company. Many founders are tempted to give up too much equity early on, only to regret it later when they’re left with little ownership.
Another risk is overvaluing your startup in early rounds. A high valuation can look impressive, but if your company doesn’t live up to expectations, it can be challenging to raise money in future rounds without lowering your valuation—a situation known as a down round, which can scare off investors.
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Portfolio Highlights
Stroom:- Stroom, founded by Darshan Gattani, Shiven Chaturvedi, and Rohan Shah, is an innovative startup dedicated to creating delicious and nutritious snack products in convenient formats. Focused on providing healthier alternatives to conventional snacking options, Stroom is well-positioned to capitalize on the rapidly growing healthy food and beverage industry in India, which is experiencing a CAGR of 20%. This growth is driven by an increasing demand for healthy and convenient food choices among consumers. Stroom's innovative approach, coupled with its in-house manufacturing capabilities, allows it to address the unmet demand for affordable, healthy, and convenient snack options in the Indian market. These factors make Stroom an ideal fit for the Growth Sense portfolio, aligning with our commitment to supporting companies that meet emerging consumer needs with innovative solutions.
Tulua:-Tulua Founded by Richy Dave, Tulua stands as India's premier 100% clean label spice and masala brand, committed to delivering the authentic flavors of India. Offering an extensive range of products, from ready-to-cook pastes to ground spices, whole spices, and blended spices, Tulua is positioned as a trailblazer in the culinary space. This commitment to quality, authenticity, and a diverse product range makes Tulua an ideal fit for the Growth Sense portfolio.
Mindler:- Founded by Prateek Bhargava (Founder and CEO), Eesha Bagga (Director), and Alokik Kumar (Head Product), Mindler is an innovative B2B SaaS EdTech startup transforming the career guidance landscape. With over a decade of experience in fields like strategy consulting, education advisory, career training, and entrepreneurship, the founders have built a comprehensive career guidance platform addressing the diverse needs of students, educators, and career professionals.
This startup is an ideal fit for the Growth Sense portfolio because of its strong market potential in the rapidly evolving career guidance sector. Mindler's innovative use of AI technology through the Mindler Nexus product provides personalized career guidance, setting it apart from competitors. With a first-mover advantage in AI-driven career solutions, Mindler's approach aligns with Growth Sense's focus on investing in scalable and tech-driven startups poised for global expansion.
CUR8:- CUR8 Ventures, founded by Ajay Sethi, Hanit Awal, Prakul Gupta, and Kaushal Das, is a startup that helps sales teams perform better using AI technology. Their platform includes tools like Sales Nudges, an AI Chatbot, and Gamified Training to make sales more efficient and effective. CUR8 focuses on industries like E-commerce and Healthcare and stands out by offering affordable and innovative solutions.
With a strong team of experienced leaders and a growing market for AI-driven sales tools, CUR8 is a great fit for Growth Sense’s portfolio. It has big plans for expansion and is well-positioned for future success.
NymbleUp:- NymbleUp, founded by Manish Thakur, Sanket Kasar, and Yogesh Bhatt, is a startup in the retail technology space. It helps businesses manage their staff more efficiently using AI. NymbleUp predicts how much staff is needed at different times, makes scheduling easier, and helps manage tasks like tracking incidents and restocking products.
The company has grown quickly, expanding from 700 to 2800 locations in just nine months. They’ve also tripled their monthly recurring revenue. Big brands like Starbucks, McDonald's, and KFC use their services. NymbleUp’s strong growth and tech focus make it a great fit for Growth Sense’s portfolio.
Dubai Event Opportunities: Networking with Industry Leaders and Key Influencers
At the Expand North Star event in Dubai, Growth91 and Growth Sense Co-Founders, Jimish Kapadia and Sanjay Sarda, had a unique opportunity to network and represent their ventures on a major global stage for tech startups and investors. They connected with visionary minds and explored potential synergies to further their mission of fostering startup growth and investment.
A notable highlight was their meeting with H.E. Mohamed Abdulla Mohamed Al Marzooqi, Chairman of ALMARZOOQI HOLDING FZC, known for his diverse business interests in real estate, marine, and construction. During this meeting, Sanjay Sarda presented his book, One Minute Wisdom, symbolizing shared values and respect. They discussed collaboration potential to drive mutual growth and innovation. The co-founders also had the pleasure of meeting Sonu Sood, adding to the event's memorable connections.
Member Spotlight: Introducing Sanjay Sarda, the Visionary Behind Growth91 and Growth Sense
Sanjay Sarda, Co-Founder & Director, Growth Sense Group and Growth91
Sanjay Sarda, Co-Founder and Director of the Growth Sense Group, is a distinguished alumnus of IIT Kharagpur and IIM Ahmedabad, with over 27 years of professional experience across India and the USA. His illustrious career spans multiple entrepreneurial ventures and diverse consulting roles, underpinned by his deep expertise in addressing critical business challenges and crafting impactful strategies.
A Certified Corporate Director by IICA and IOD, Sanjay is among the first in India to qualify as an Independent Director. He serves a wide array of businesses and HNIs as a Virtual CEO, offering strategic guidance on decision-making and organisational growth.
His corporate journey includes associations with leading multinationals such as Monsanto, Procter & Gamble, General Electric, Tata Consultancy Services, IBM Global Services, CSX Corporation,Krishidhan Group, and Ernst & Young LLP, where he held diverse leadership roles.
Beyond his professional endeavours, Sanjay actively contributes to the community in leadership capacities with Rotary International and Saturday Club Global Trust, exemplifying his commitment to both business excellence and social impact.
Check out his recent Ceo Insights from the link given below.
Educational Feature: Book of the Month(One Minute Wisdom) - A Must-Read by Sanjay Sarda
This book is a treasure trove of 52 practical and time-tested management lessons, each thoughtfully condensed into a one-minute read for maximum impact and convenience. With insights drawn from over 27 years of hands-on experience in diverse industries and countries, the author presents lessons that have been rigorously tested in real-world environments. The tips span critical business functions, including human resources, finance, general administration, business strategy, productivity, and communication, offering valuable guidance for anyone navigating the complexities of modern business. Whether you are a seasoned business owner, an aspiring entrepreneur, or someone in a leadership role within an organization, these concise yet powerful lessons are designed to equip you with the tools and strategies needed to fast-track your growth and achieve professional success. By blending simplicity with effectiveness, this book serves as a quick reference guide for tackling day-to-day challenges in the corporate world, helping readers develop a sharper understanding of how to manage, lead, and succeed.
?? Grab your copy now! https://amzn.in/d/0uWjlK0
Stay tuned for more updates as we continue to engage and bring fresh opportunities to the startup ecosystem!
Finance Business Consultant
3 个月An excellent breakdown of startup funding stages! It's fascinating how each phase—from bootstrapping to Series C—mirrors the journey of nurturing an idea into a thriving business. Psychology plays a huge role too—whether it's the confidence angel investors have in a founder's vision or VCs looking for the next unicorn. A great read for anyone navigating the startup world or looking to understand the dynamics of building from scratch
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3 个月Very well articulated article. Thanks for sharing