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Startup funding sources: Best ways to raise funds for your startup

Every startup needs funding in its initial stage to build the product at a scale to cater to the expansive market while generating revenue. It is the success mantra in the startup ecosystem for a startup to quickly scale & grow.

But many young Indian startups, without realising the abundance of startup funding options available in India, miss out on the opportunity to build to be the next market disruptor.

Believe it or not, in India, there are 8 startup funding sources available for Indian startups to raise seed capital.

Seed capital is the initial financial support a business needs to get off the ground. It's the first investment a startup receives to build the product and expand on its operations. Seed capital comes from professional investors and institutions looking to back a new revolutionary idea/market disruptor financially.


8 Startup Funding Sources To Raise Seed Capital

Angel Investor

Angel investors are high net-worth individuals (HNI) who are constantly looking to back the next 'big idea' at the earliest stage with their time, money, and expertise.

Angel investors work independently and thoroughly vet the startup before investing.

These accredited investors (with a net worth of Rs. 2 crores and above) identify promising startups at the earliest stage and invest in the equity stake in the startup.

Benefit of raising seed capital through Angel Investors–

  • High net-worth individuals (lead investor)
  • Risk-takers looking to financially back early-stage startups & passionate entrepreneur
  • Adorn advisor role to help the startup streamline their operation
  • Endorse startup ideas among their investor network to invite future funding

(In recent research conducted by Harvard Business School, startups backed by angel investors are more likely to remain in business longer, induce substantial growth, and reward a more significant return rate to their investors.)


Angel Syndicate

Angel syndicate is an investment group that enables investors to co-invest with accredited angel investors in promising startups.

Each syndicate is led by a prominent angel investor with vast experience identifying, vetting, and investing in promising startups.

Example – Angelist is the prime example of an angel syndicate where various angel investors co-invest with a prominent angel investor – Kunal Shah.

Benefit of raising seed capital from Angel Syndicate–

  • Invests collectively to cover a significant chunk of ‘Funding in Ask’
  • Both accredited & non-accredited investors can invest in the startup
  • Industry leader with comprehensive knowledge


Angel Investment Platform

The introduction of angel investment platforms is a boon for startups that want to raise seed capital easily and securely. Angel investment platforms like POD introduces promising startups to its network of 2000+ accredited and retail investors to raise funds.

POD is built to enable startups to submit pitch deck to 2000+ investors.

Benefit of raising seed capital from Angel Investment Platform–

  • Both accredited and retail investors can invest in startups
  • Financing mode available – equity and debt.
  • Fully secure fundraising environment
  • High success rate of the fundraising campaign
  • Total number of investors on the platform – 2000+


Venture Capital Fund

Venture Capital Funds are pooled investment funds of high net-worth investors who seek to invest in startups with some traction or revenue at the seed round. A Fund Manager manages this fund pool and decides on the startups to invest in.

Benefit of raising seed capital through Venture Capital Funds–

  • Usually invests in startups with traction and revenue
  • Invests heavy sums in startups
  • Lead by one decision-maker (Fund Manager), who will seek a seat on the board



Crowdfunding is a creative way for startups to raise seed capital for their revolutionary idea. A startup can raise capital in exchange for equity, rewards, debt, or nothing at all.

Benefit of raising seed capital through Crowdfunding–

  • Easier access to capital
  • Startup gains early adopters and loyal advocates
  • Doubles media exposure

If you’re keen to explore this option, here are the top crowdfunding sites in India for startups to raise funds.



Incubators are organizations designed to launch and nurture early-stage startups by providing seed capital, mentorship, etc., in return for an equity stake in the company. In addition to that, they offer a wide range of support, including "accelerator" programs to accelerate the startup's growth by linking founders with experienced mentors and investors.

Benefit of raising seed capital through Incubators–

  • Mentorship
  • Exposure to industry leaders
  • Access to professional resources

Here's the list of 10 Startup Incubation Centre in India.


Government Grant

"It is an award of financial assistance in the form of money by the government to an eligible grantee with no expectation that the funds will be paid back."

Benefit of Government Grant–

  • Easy access to funds
  • Tax holiday for 3 years

Here's the extensive list of Government Grant Programs –

Check the eligibility criteria for the Government Grant available for Indian startups.


Bank Loan

Entrepreneurs usually don’t knock on the door of a bank for a startup loan before exploring other funding opportunities. Getting the funding when the business is in its early stage is a challenge. Still, if a startup can demonstrate the ability to repay, they can avail 'Startup Business Loan' from SIDBI (Small Industries Development Bank of India).

"More than 39,000 startups in India have access to private equity and debt funding options."



Irrespective of how exciting your startup looks on paper, it is imperative to decide the suitable method to raise seed capital. From the number of startup funding options listed above, weighing the pros and finding the right option for your startup is important.

Once you have chosen a funding option, create professional pitch deck to present before investors.


POD is owned by Crowdpouch Ventures Services Private Limited and reserves all rights to the assets, content, services, information, and products and graphics in the website but third party content. Crowdpouch does not solicit, advertise, market any of the users registered with POD, neither does it solicit investors by offering leagues/schemes/competitions etc. related to securities markets. POD hereby clarifies that it does not carry any resemblance to the stock exchange nor does it facilitate trading of securities nor does it act like a broker/agent/media for raising funds. Investment through POD does not carry rights of renunciation. Investors are cautioned that POD operates in an unregulated space hence, investment through POD is subject to investment risk. Investments in startups are highly illiquid.