Ideation: Pre-seed Stage
All startups begin with an idea or a concept. The lifecycle begins when the founder, or founders, start to bring that into reality.
At this early stage, development is typically self-funded, although businesses with high development costs may be able to secure some funding to build, based on the strength of the idea. Some pre-accelerator programs also offer pre-seed funding, allowing founders to focus on the business full-time.
One key early decision (to put it bluntly) is whether this is truly something you want to pursue. Assess the market, understand your growth potential, and listen carefully to the feedback you’re getting. The road ahead will be tough. If you don’t back yourself 100%, it will be even tougher.
Launch: Seed stage
At this point, you will have validated your idea and likely built a minimum viable product (MVP), ready to test with a broader audience.
Here, seed funding can help you start to grow. This stage is all about acquiring early customers, building relationships and seeking genuine feedback from users. Now is a good time to consider the different types of funding available to you, and how they might be suited to your short- and long-term growth plans. You might also seek out an accelerator program suited to you and your business, or proactively look for a mentor.
Growth: Series A
Once you’ve validated your idea and secured some customers, the growth stage is about building on momentum.
Often, this is funded through a more substantial venture capital (VC) round. You’ll be hiring a small team, expanding your market reach, and refining your business model to drive revenue.
Key decisions include finding the right investors for the business, to help you achieve your goals. It’s also critical to get hiring right. LaunchVic’s Basecamp program helps growing businesses build strong recruitment strategies to build high-performing teams.
Scale: Series B, C and beyond
Continued growth often requires more capital to sustain it. From Series B onwards, funding rounds usually grow incrementally larger, fuelling exponential growth into new markets or sectors.
This stage is about building sustainable revenue and moving towards profitability. Scaling means thinking about where the next opportunities lie and what to tackle first.
As your valuation increases, you may also be having conversations with early investors around how to release their equity and realise their returns. LaunchVic’s 30X30 program offers coaching and peer connection for founders, helping them manage the unique challenges at the stage.
Exit
An exit is how founders and investors reap the financial returns of what they’ve built. This could be through a public listing or IPO, whereby shares of the company are made available for public trading on a stock exchange.
A public listing can raise significant capital, while providing both founders and investors a route to sell their equity; however, it also comes with significant legal and regulatory considerations, depending on the jurisdiction of listing.
An exit could also come through a merger or acquisition, with the startup joining forces with another company, or selling a majority stake.
By this point, founders and the broader leadership team should be thinking about how to maximise returns for investors, while maintaining growth and customer satisfaction. They should also create a plan for leadership succession in the long term.
