According to venture capitalists and angel investors serving the North Bay, entrepreneurs have a number of sources of capital sources to get their companies started.
Credit card or small-business loan: Often the first funding entrepreneurs will seek is a simple credit card or a small line of credit from their financial institution.
Friends and family: The next stage is often seeking funds either by a loan or equity from friends and family. This typically goes from a few thousand dollars to $100,000.
Angel investment: Angel investors often provide roughly $150,000 to $5 million. While there have been changes due to the recent economic strife, such investment tends to be before venture capital funding. Though some angel investors specifically look for companies that will not need a higher level of financing.
Venture capital: Funds can be anywhere from $3-$5 million to north of $1 billion. There are generally a group of investors who raise capital for a number of startups and the startups will have an exit plan in the 10 year range.
Mergers and acquisitions: Often the last step, if a company doesn't go public is for a startup to be bought by a larger company.
Initial public offering: If a company decides to go public, it can raise funds through a public offering.
