With capital contributions that rarely exceed €50,000, these investors usually become involved in the project at other levels, contributing with their experience, connections or customers. These angels are people that decide to back the project and invest their own money to get involved in a new business. These are people that are close to the entrepreneur, that contribute with a limited amount of capital at the beginning when the idea is not developed enough to convince anybody else to invest. Given that initial development costs are much more modest than the ones traditional businesses require, funding needs are also going to be lower.Īlthough these companies attract a broader variety of investors, these are some of the typical players that startups tap to fund their projects:Īlthough some don’t see them as actual investors, they play a key role in the earliest stages of a company. Types of fundingĬompared to other types of more traditional companies, startups also represent a big change in terms of the economic component linked to the creation of a new company. Given the increasing relevance of this type of emerging businesses, which has spawned some of the titans that now dominate the market ( Facebook, Amazon or Google, for instance), it is not surprising that the startup phenomenon is drawing more and more attention and that the number of entrepreneurs willing to take a chance and venture outside their comfort zone to try their luck with an innovative business model is growing. Generally, these companies champion an innovative idea that stands out in the general line of the market. These can be currency exchange, platform changes, new settlement rules, or more.Ī startup can be defined as an emerging company, normally with a core technological component and high growth potential. Every time a transaction must cross a border, it encounters a number of points of friction that slow it down. One of the clearest – yet invisible – obstructions to money movement is a national border. When it comes to moving money, speed is of the essence.
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