Some of the most highly valued companies in the world are startups. Uber ($68 billion), Airbnb ($31 billion), and aerospace startup, SpaceX ($21.1 billion) have spearheaded the sharp rise in startup success stories and as a result, investing in early-stage companies is becoming more popular than ever. Easy access to global markets, the emergence of new technologies, and low operating costs have resulted in the number of small fast-growing companies being higher than ever before. Because of this influx, the need for adequate funding is crucial to fuel this growth and innovation.
The Widening Gap
Unfortunately, the traditional world of financing has failed to keep up with the innovation curve. The funding market today is centralized, fragmented, inaccessible to retail investors, and lacks the sufficient level of capital needed to support the startup ecosystem. This has led to a worldwide early-growth capital gap of $100 billion, a number that continues to grow year after year.
Existing Investment Options Are Inadequate
Although 98% of the total funding market is companies operating with less than 20 employees, this group has the most challenging time raising capital. Traditional investment options include equity via venture capitalists, angel investors, or debt instrument offered through banks. However, such options are inadequate for both entrepreneurs and investors due to:
- Lengthy fundraising timelines
- Lofty eligibility criteria
- Inflated cost of capital
- Misalignment of investor-entrepreneur incentives
- Lack of investor liquidity
- Dilution of founder influence and control
- High capital hurdles, long-term commitments
- Unstable investment pipeline or deal flow to manage diversification
- Restrictive regulatory requirements
Despite these faults, only 11% of the small business funding market has considered non-traditional sources of funding.
Closing the Gap with Corl
Corl, a startup itself, is on a mission to minimize the $100 billion early-growth capital gap. Through the use of data and artificial intelligence, Corl is able to expedite the funding process down to 2 weeks and finance pre-approved applicants through revenue sharing agreements. With a shared objective of maximizing revenue, Corl also provides businesses exclusive access to their network of experienced advisors, partners, and service providers.
With expedited fundraising timelines, flexible capital, and aligned interests, Corl hopes to revolutionize startup financing by addressing the inadequacies traditional methods of investing have that block the growth of entrepreneurs and their businesses.
Read Next: 3 Ways Startups Can Benefit From Corl
Startups Infographic Source: Daily Infographic