Start-up Business Model: From Funding To Becoming A Brand

. 6 min read
Start-up Business Model: From Funding To Becoming A Brand


We come across several business ideas, but we fail to execute them in the existing marketplace. Implementing any idea into a feasible business could be challenging. Businesses now focus on innovation and technology. The key to launching a successful start-up is noting down all the ideas on paper and investing adequate time in research for the same. But this may not be sufficient enough. Many times, a long business plan may not attract investors for your start-ups. The decision to focus on most aspects of your business idea needs to be prioritised. There are several other factors and parameters which need to be studied properly before moving ahead with the business plan.

A start-up hence is a new company whose operations are at the initial stage of the business and receives funding from external sources. The more innovative and legitimate the idea is the more chances of receiving a high amount of funding exists. Thus, this article will focus on how the start-up business model works right from funding to becoming a brand.

Types of Business Models

Before digging deeper into the start-up business model, the prerequisite for any entrepreneur would be familiarity with the types of business models for start-ups. This helps them decide how the business plan should be framed and how to go ahead with a viable business option. The different types of models existing in the current competitive environment are as follows:

Hook and Bait

This is a standard model for any start-up business. When you have any unique product or service to offer to your prospective customers, this model is selected. You create a product or service and then market it.


Commonly known as the magic model, you can act as a middleman. You can purchase any product, add some feature or customise it and then sell it to the customers. The retailer is the reseller in simpler terms.

You can generate revenue from advertisements. One can either provide advertising services, display ads on their websites, generate revenue from clicks and views, etc.

Subscription-based model

This is one of the rising business models in the world of start-ups. You can charge every month or a pre-decided period for the service you offer. The benefit of this model is the low initial cost, and you receive fixed charges and recurring revenue from your subscribers.

Service on demand

To save upon different costs, you may establish a business where you provide any type of service whenever demanded by the customers. You can build a network of freelancers from every field and provide services.

Marketplace or Intermediator

One model can be the middleman model. You can create a common platform for the buyers and sellers. Such a start-up idea can prove to be convenient and connect customers all across the country.


This business model focuses on revenue creation from leasing arrangements. The buyer or the lessee contracts with the lessor(financer) for the use of any product or item in exchange for a periodic fee.

Cutting Middleman

When you start a manufacturing unit, factory of your own or create a product, you can directly sell to the customers instead of hiring any retailer or middleman for the same. Economical products to customers can be offered.

Private label

Many businesses are running under this business model. They acquire the product from the producer directly and sell them under their brand name. Most of the clothing and apparel businesses adopt this business model.

From Funding to Becoming a Brand

Venturing a start-up may be easy to think of but difficult to implement. The journey from funding to becoming a brand takes time and effort in the right direction. Even before funding, the actual journey of a start-up becoming a brand commences. Let us focus on the important steps which are crucial for any start-up and how the framework will be profitable:

1. Selection of the right business model

Once you are well acquainted with the different types of business models, in brief, you need to decide which model to select for your start-up business idea. You have to be sure that it is well suited to the idea that you have for your business. Analyse the various business models and then select the right fit. You can then design your business plan.

2. Devising the business plan

The business plan should be structured properly. All the important points should be mentioned clearly. The goals and objectives of the business must be stated distinctly. You should also state the description of your business comprehensively along with the products and services that are being offered.

The business plan should include the vision and mission of your start-up. Market research should be disclosed. The management structure and milestones should be well-defined. The strategies for operations, marketing, finance, etc., should be a part of your business plan. A properly designed business plan helps in raising capital for your start-up and growth shortly.

3. Framework

The framework for your business should be distinctive. All the business activities, resources needed should be listed beforehand, and they should be made available whenever required. The business name should be decided, and a website should be created.

It should focus on the infrastructure and various facilities to be provided by the business. The tax and legal requirements should be studied. Hence, a framework provides a sense of direction for the tasks to be undertaken for the business to establish.

4. Target market

Selecting the right target market involves research, helps in saving cost, and increases the customers for our business. We can know who can be our probable customers and conduct market research focusing on the 4 Ps of marketing. Classification and segmentation of customers are equally important. The needs and wants of our prospective customers should be known, and necessary changes can be made in the product and services offered. Various offers and discounts may be given at the initial stage of business.

5. Analysing competition

The analysis of competition is an important step if you want your business to be a successful brand. What value you are going to create for your customers can be known at this stage. One needs to focus on providing quality service, something extra to offer to your customers, unique products, and services. Also, innovation and creativity should be at the centre. Your business model needs to be cost-effective, and you should take all the steps to build your customer base.

6. Funding

This is the most crucial step for your start-up. Acquiring funding can be very difficult at times when you want investors to invest in your start-up. If your business plan and research are impressive, then you may acquire many investors and get funding more than you estimate. Raise adequate capital and select the right source for funding. The various sources available for funding are loans, friends and family, venture capitalists, angel investors, personal savings, crowdfunding, partnership, etc.

7. Marketing strategy

The marketing strategy should focus on how to acquire the customers for your business and be aligned with the objectives of the business. It should be cost-effective, balanced, and dynamic. Create an attractive website for your business and use the various social media marketing tools and techniques. Get in touch with prospective customers through different sources and focus on the retention of customers. Good content helps create a good image of your start-up. If traditional methods of marketing can be used, then they can serve as a good option too.

8. Budgeting and financial strategy

Estimate all the expenses that you are going to incur. List down all your costs such as equipment, assets, property, legal, registration, insurance, raw materials, stocks, employee, etc., and utilise your funds optimally. Once you have raised funds, calculate the start-up cost. Prepare a monthly budget and initial balance sheet. Project the income and cash flows for your business. BEP Analysis needs to be undertaken. All financial information must be disclosed and known. Preparing financial models may help in pitching our business model pleasingly.


Thus, to conclude, we can say that once you choose the right business model, it becomes easy to establish your start-up. Weightage should be given to the above aspects to establish your brand in the market. Proper planning and research before executing your idea is the key to a successful and profitable business.

Also read:

Should you hire a consultant for your business?
20 Things Entrepreneurs Should Never Do in Their Life
Which affordable digital marketing course is best for a startup and small business owners?

What are the best businesses in India to start from home?


Q. How to keep your customers happy?

Ans: You can keep your customers happy through quick response, interaction, feedback, and providing FAQs to them.

Q. How can you fund a small business?

Ans: Small businesses can be funded using seed funding, crowdfunding, small business loans, venture capitalists, etc.

Q. What is the key to customer retention?

Ans: The key to customer retention is by providing quality customer services.

Q. What is the major reason why start-ups fail?

Ans: The main reason why start-ups fail is cash flow problems.

Q. What are the conventional methods for marketing?

Ans: Print media, radio ads, TV ads, billboards, etc. are the conventional methods for marketing methods.