If you are wondering how to raise funds for startup business in India, you are not alone. With India’s startup ecosystem booming, getting the right funding can be the game-changer between success and stagnation.
Whether you are launching a tech platform, a D2C brand, or a service-based venture, knowing how to raise funds is critical for startup success in 2025.
This guide explores proven, effective methods to raise funds for startup in India, suitable for early-stage founders and scaling businesses alike.
Start by Bootstrapping Your Business
Many entrepreneurs begin by bootstrapping—using personal savings, freelancing income, or money from friends and family. Its one of the most effective ways to validate your startup idea before seeking external capital.
Why Bootstrapping Works:
- You retain full control and ownership
- Builds investor confidence
- Keeps initial operations lean
- Zero debt or equity dilution
Pro Tip: Bootstrap your Minimum Viable Product (MVP) first, then approach investors once you have proof of concept.
Explore Government Schemes to Raise Funds for New Business in India
If you’re seeking to raise funds for new business in India, take advantage of various government schemes designed to support startups.
Top Government Funding Schemes (2025):
- PMEGP (Prime Minister’s Employment Generation Programme)
- Startup India Seed Fund Scheme
- MUDRA Loans
- SIDBI Assistance for Startups
These programs provide low-interest loans, capital subsidies, and even grants, making them a smart starting point for first-time founders.
Learn more about government support options in our detailed guide to government grants.
Approach Angel Investors for Early-Stage Capital
Angel investors are often the first external funders for startups. They’re typically successful entrepreneurs or professionals looking to back promising ideas with both capital and mentorship.
Benefits of Angel Funding:
- Flexible investment terms
- Access to investor networks
- Mentorship and strategic guidance
- Fast decision-making compared to banks or VCs
Make sure to craft a powerful pitch deck. Egniol offers professional Pitch Deck Services to help you impress investors.
Venture Capital: Scale Faster With Big-Ticket Funding
If you’ve gained traction and now need funds to scale, then venture capital (VC) is the right route to raise funds for startup in India.
What VCs Offer:
- Large capital investments
- Growth-focused mentorship
- Market expansion opportunities
- Potential for global scaling
However, be ready to give up some equity and decision-making control, as VCs expect significant returns.
Crowdfunding: Raise Funds for Business From the Public
Crowdfunding is a great way to validate your idea and generate capital directly from the public. Platforms like Ketto, FuelADream, and Wishberry allow you to raise small contributions from a large number of people.
Ideal For:
- Product-based or creative startups
- Social impact projects
- Early-stage MVP launches
- Pre-order models
It’s a great way to raise funds for business without loans or equity dilution while also building a customer base.
Use Startup Incubators & Accelerators
If you’re looking for both funding and mentorship, then business incubators and accelerators are an ideal choice. They help you raise funds for startup business in India while also refining your business model.
Top Incubators in India:
- T-Hub (Hyderabad)
- 91Springboard
- CIIE (IIM Ahmedabad)
- NASSCOM 10,000 Startups
These programs often include initial seed funding, office space, business coaching, and investor connects.
If you are interested in attending ecosystem-building sessions, check out our MSME workshops.
Raise Funds Through Bank Loans and NBFCs
When your startup is registered and has a basic credit profile, traditional funding via banks or NBFCs becomes accessible.
Loan Types You Can Avail:
- Term loans for capital expenditure
- Working capital loans
- Machinery or equipment financing
Learn more about non-banking finance options through our NBFC loan services.
Many NBFCs offer collateral-free loans under government schemes—perfect for startups with limited assets.
Strategic Partnerships & Joint Ventures
Want to raise funds for startup and grow rapidly? Consider forming strategic alliances with large companies that share your business goals.
These deals can include funding, tech access, or distribution support, in exchange for revenue-sharing or limited equity.
Example: A food-tech startup may partner with a logistics company for funding and delivery support—helping both sides scale faster.
Participate in Startup Competitions & Grant Programs
India’s startup landscape is rich with competitions offering equity-free grants, investor access, and media coverage.
Popular Platforms in 2025:
- TiE Global Summit
- National Startup Awards
- Startup India Yatra
- NASSCOM Events
🏆 Winning these competitions provides validation, funding, and visibility—key ingredients to raise funds for new business in India.
Discover how winning grants transformed startups in our business funding blog.
Prepare These Before You Fundraise
Before approaching any funding source, ensure you have:
- A clear business model and revenue plan
- A compelling investor pitch deck
- Proof of concept or early traction
- Founder KYC, company incorporation docs
- Realistic financial projections
This reduces rejection chances and improves credibility with any funding partner.
Conclusion
Figuring out how to raise funds for startup business in India doesnt come with a one-size-fits-all approach. Your funding path will depend on your stage, industry, and goals.
From bootstrapping to VCs, government schemes to crowdfunding, and incubators to NBFCs, multiple doors are open for Indian founders in 2025.
Choose a strategic combination to raise funds for startup, and ensure your pitch, paperwork, and plans are investor-ready.
FAQs – How to Raise Funds for Startup Business in India
- Q: What is the best way to raise funds for a startup business in India?
A: It depends on your stage. Early startups often bootstrap or use government schemes. Once you gain traction, explore angel investors, VCs, and crowdfunding platforms to raise funds for startup in India.
- Q: Is it possible to raise funds for a startup without collateral?
A: Yes. Many government schemes, VCs, and angel investors do not require collateral but expect solid business planning and documentation.
- Q: How can I raise funds for a new business in India as a student or first-time founder?
A: Start with incubators, innovation contests, and government support platforms like Startup India and Atal Incubation Centres.
- Q: What documents are required to raise funds for startup?
A: Common requirements include a business plan, pitch deck, financial projections, KYC, proof of concept, and incorporation certificates.
- Q: Can I apply for multiple startup funding schemes at once?
A: Yes, but you must meet each programs eligibility and avoid fund duplication. Transparency is key during the application process.
- Q: How long does it take to raise funds for a startup in India?
A: It can take 2–6 months depending on the funding route. Government schemes often take longer than private investors due to verification steps.
Ready to launch your car rental business? Explore our Government Grants Services and Pitch Deck Preparation Servicesto get started on your entrepreneurial journey today!
Disclaimer: The information presented in this blog is sourced from various online platforms and government portals.