Concept stage of company development
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STAGE 1: Concept stage
At this stage, you have an idea and are exploring the feasibility of building a technology product or service based on that idea. You’re working to determine how you will build the product or deliver the service, and to identify the target customers, partners, distributors and competitors in your market.
Funding sources:
- In Ontario, development costs for technology concepts may be funded through grants and other programs.
- Market research, product design, and other early-development costs are usually funded by the entrepreneur or their family and friends.
Risks:
The risk at this point of a venture is generally considered high. While investment capital requirements are relatively modest (<$250,000), the business usually has no revenue.
Expectations:
The funding received in the concept stage will be used to:
- develop a technology proof of concept
- establish the business model
- generate the financial plan
- build the pitch presentation
- generally launch the venture
Learn more about the other stages of company development:
Start-up phase of company development
Growth or expansion stage of company development
Later stage of company development
References
Canada’s Venture Capital& Private Equity Association. Retrieved April 19, 2009, from www.cvca.ca.
National Venture Capital Association. Retrieved April 19, 2009, from www.nvca.org/def.html.
National Angel Organization. Retrieved April 19, 2009, from www.angelinvestor.ca.
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Debt financing for early-stage companies Determining the amount of debt you take on to finance your business is a balancing act.
Your financing options Once you’ve got a great technology idea, to take it to the next level, you’ll need money to develop it. Here is an overview of how you can finance your idea.
Start-up phase of company development Depending on your company’s stage of development, different types of investors might see your business as an investment opportunity.
Common shares Common share investments are most often used in early rounds of investing.
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