CC BY
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Taspanchik O. T. master student 1st year
International financial faculty Financial University under the Government of Russian Federation
Russia, Moscow
THE OVERVIEW OF KEY SUCCESSFUL FUNDRAISING ELEMENTS AND START-UPS
Abstract. The relevance of this article due to the dynamic conjuncture of the modern world of business where optimization of the system offinancing projects is a key factor in launching profitable start-ups. At the moment, the creation of favourable conditions for launching projects is one of the most important ideas of the early 21st century, where business incubators and crowdfunding platforms has brought a fresh look to run and create new business projects. This article will briefly describe the main elements of crowdfunding and highlight the working details of the famous platforms in this area.
Key words: funding, fundraising, finances, crowdfunding, crowdfunding platform, seed accelerator, entrepreneurship, start-ups, venture capitalist, investment,
Technology startups can be financed in various ways. They include self-financing using own funds of the founders, Bank loans or other sources, government support through subsidies and entrepreneurship program, venture capital (VC) investors and angel investors. In this article, we will explore new alternatives of investments, which are designed to help entrepreneurs to overcome initial investment problems and to prepare them for subsequent financing and strengthening of positions.
With the advent of crowdfunding, a new form of funding startups that can turn seed companies into successful enterprises. In this article it is proposed that through the use business communities you can create a reliable environment in which startups will be able to access funding to grow quickly and make a profit.
Today the wide availability of affordable technology solutions has made it easier to turn ideas into well-developed concepts. These technologies include free open source and hardware tools for remote commands, affordable hosting and cloud services. As a result, early stage technology companies need only small amount of investment to create the first version of the product, or to create early prototypes in order to attract more investors or subsequent rounds of funding.
Although VC money may become available in the early stages of the company life, it usually comes into play when a company is growing and ready to expand its activities. Moreover, VC investment is used more often to Finance the production and commercialization of products or is used for achieving an initial public offering (IPO) in which shares can be sold to the public.
In the current environment it has become very difficult for venture capitalists to find companies in which to invest. Since 1997, the number of transactions
decreased significantly to reach a low point in 2010 . Venture capital firms are unable to adapt their businesses and their value to investors and entrepreneurs, is significantly reduced. Investors, even venture capital firms expect a high return, but unfortunately, these firms cannot provide the expected income, because there is less promising start-UPS and reaching the IPO stage takes more time. This increases the risk of illiquidity, investors may shift to other types of alternative investments that provide better risk. For entrepreneurs, the VC value proposition is weak. Venture capitalists are trying to attract promising companies to improve their financial proposals, but in the end, a technology start-up in need of guidance and mentoring, not a big investment to get your business going .
To ease the process of startup funding, some companies offer a combination of mentorship and seed capital that allows entrepreneurs to develop and Refine their ideas before presenting them to potential investors such as Angels and venture capital. This model is based on a lean approach to product development that is more flexible in nature and features reduced development cycles and frequent releases.
Y Combinator is one example of an accelerator company that provides a simpler process than direct VC or angel financing. Initially, the business plan is not required; applicants need only describe the business opportunity. Applications are reviewed and promising candidates are selected to present their ideas in person.
In addition to seed accelerators, further innovative solutions are required for technology startups to overcome the funding problems they were facing. Crowdfunding space is a good place to search for inspiration. Crowdfunding is a fairly new concept that stems from crowd sourcing, which is the process of delegating tasks or problems to a group of people through an open competition. Crowdfunding covers the same Concept and puts a call for the public to invest in the idea, in the form of intellectual or financial support.
Example initiatives of crowdfunding platform Kickstarter, which provides funding to projects "from the worlds of music, film, art, technology, design, food, publishing and other creative fields". It is based on "all or nothing" funding model; the funds will be released to the Creator only after a certain threshold. If the Creator will not be able to attract sufficient investment interest to achieve a threshold value, the funds will be returned to investors. This ensures that authors have the necessary funds to develop their projects.
Another example is GrowVC, which relies on a community of startups, investors and experts to provide investments for startups. The company charges their members a fee, subscription fee, 75% of which is used to create General Fund and the remaining 25% compensated operating expenses of the company. The community fund is managed by GrowVC, but the community decides which startups receive investment. If there is a return on equity, the profits are divided between the "most successful decision makers" and GrowVC.
The successful decisions makers are the ones that have first chosen to invest in a successful startup and have allocated a significant portion of their community
fund to those startups. Furthermore sophisticated investors have the option of investing directly in the startups of their choice.
The startup funding and fundraising have reshaped comprehension of successful project among business community all around the world. Currently, the very ideas can capture the attention of future customers and receive an enormous surge of investments to establish flourishing business on this fundraising system. In this article the major concepts of successful funding are highlighted and the examples of projects showcase primary details of their success.
References
1.Business News Daily http://www.businessnewsdaily.com/4847-crowdfunding-small-business.html
2.Crowdfuding platform https://www.kickstarter.com/
3.Harvard Business review https://hbr.org/2013/05/six-myths-about-venture-capitalists
УДК 001.201
Taspanchik O. T. master student 1st year, International financial faculty Financial University under the Government of Russian Federation
Russia, Moscow
THE MAJOR CYBER SECURITY TRENDS FOR THE FINANCIAL AND COMMERCIAL INSTITUTIONS Abstract. The relevance of this article due to the urgent need to identify the main trends in solving the problems of cybersecurity and identify key components for successful functioning of security systems offinancial institutions. The number of cybercrimes committed against financial institutions is increasing every year, and the total damage exceeds billions of dollars, which undermines the national security of many states. In this article, the common issues and recommendations for improving the functioning of the systems of cybersecurity will be provided.
Key words: cyber security, financial institutions, financial services, national security, cyber attack, cybercrime, cyber resilence, defensive system, threat detection, technologies, cyber security breaches
The financial services sector has become vulnerable to cyber attacks and data breaches since the advent of the computer and the connected systems. Whether it's craving for an access to your account information, steal money or a nation station top secret information. Today, not only are cyber attacks becoming more frequent, they become more persistent, focused and sometimes difficult, often causing a wide resonance. While the majority of the members of the boards of Directors and managers of financial institutions have placed cyber security one of the risks, still often lack a common strategy and concept for improving cyber resilience in the long term.
"Экономика и социум" №3(34) 2017
www.iupr.ru
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