Congrats, your startup is taking off! 🚀

But to keep growing, you're going to need some serious cash…

That's where growth capital comes in! 📈

Growth capital is the money that startups raise to fuel their expansion 🌍

It's used to scale the business, hire more employees, and acquire new customers 👨‍👩‍👧‍👦

Startups raise growth capital because growing a business is expensive! 💸

They need to invest in marketing, product development, and infrastructure to keep up with demand 📣

Growth rounds are larger than seed rounds, ranging from a few million to hundreds of millions of dollars 💰

Growth capital investors are looking for startups with proven traction and a clear path to profitability 📊

Some common sources of growth capital include:

1️⃣ VC firms: professional investors who specialize in funding high-growth startups 🏦

For example, VC firm Benchmark Capital famously invested $12 million into Uber in a growth round in 2011, a stake which became worth over $7 BILLION after Uber’s 2019 IPO!

2️⃣ Private equity firms: investment firms that buy equity stakes in private companies 🏰

PE firms typically invest right before a company will go public 📈

3️⃣ Strategic investors: large companies that invest in startups for strategic reasons, like access to new technology or markets – or to acquire them later on 🤝

In exchange for their investment, growth investors usually receive a large equity stake in the company, and often a seat on the board of directors to help guide the company's strategy 👨‍💼👩‍💼