Startups are typically concerned with one thing – the needed influx of funds to actualize their vision. Financing is often required for hiring, product development, expansion, covering marketing costs and many other necessary expenses. The fact of the matter is that businesses with great potential do not necessarily meet great success in the end. Most of the time, this is due to a lack of capital and resources. According to Jessie Hagen of the U.S. Bank, 82% of new businesses fail due to poor cash flow management and 79% fail for starting out with too little money. Previous generations of entrepreneurs have had to endure seeing their aspirations towards financial stability conclude unattained. \u201cIdeas don\u2019t pay bills,\u201d this statement seems to quite reflect a common reality.<\/p>\n\n\n\n
Traditionally, businesses sought for investors from close relations or bank loans. Investors didn\u2019t have it easy as well, as usually only accredited investors – those who had a net worth of more than $1M or those making over $200K on an annual basis – had the ability to invest in venture funds that invest in startups, or to participate in private equity funds. For this reason for quite some time now, only the wealthy had access to substantial avenues of wealth creation, further amplifying a capitalist culture and leading to a lack of financial inclusion in the economy.<\/p>\n\n\n\n