How funding works? What about the series A, B, and C rounds?
How does one round of funding work? Before explaining how a round of funding works (for Hong Kong companies), it is necessary to identify the different participants. First of all, there are the individuals who want to get funding for their startups. As the business becomes more and more mature, it would get readywith the funding rounds.It is very common practicethat a company begins with a seed round, and thenfurther down the line would go for theseries A, B, and C funding rounds.
Nearly most or all investments made during one stage or more stages of funding is arranged so that the investors or investing companies can retain partial ownership of the business. The reason is simple. When an investor put money into a business, he/she would trust the founder (and/or the founding members) of the startup, and therefore he/she would hope to make some monetary gain from his/her investment. This is absolutely normal and legitimate.
TVP for Hong Kong businesses – How does it work?
Before a round of funding can begin, valuation of the business is performed by analysts. The valuation process would involve different factors including management, proven track record, market size, and risk.With the Technology Voucher Programme (TVP) that are made available by the Innovation and Technology Commission of Hong Kong, the process for startup founders to actually get the funding is similar. There would always be a vetting procedure in which business founders must go through.
The upside of the application of the Technology Voucher Programme is based on per project. For example, if you have a project that upgrades your old website to a newly designed website, that would be one application to the TVP. When you are to develop a CRM for your company’s local sales and marketing teams that would be a different application.
Ultimately when the project is complete and your new product has been successfully developed and is in use (i.e. your new CRM), you will have to write a report stating the successful completion of your project along with the proof of all the deliverables (from the project). All the expenditure must also be submitted for the application of TVP, because that is how your business can reclaim the imvestment fund of your project.