Interpretation, what does the angel round of investment, round A, round B and round C mean?
In the investment process, how is the angel round, round a, and round b divided? What is the investment situation?
Everyone knows that investment is divided into angels and round a, round b, round c, and even round D.
Let me first talk about why investment should be divided into different categories. Each round is at a different stage and the risks are different. Therefore, after the money invested in the investment process is put in, the ratio of getting and paying is different.
One is investment angels, with a high proportion, high risk, and low investment funds, but the returns will be high. Angel round, you want to do a project, have an idea, and an idea. At this time, if you have an idea, find someone to invest and tell the investor what the money is used for. It is renting an office, what to do, and what can be achieved. effect. This is an angel wheel. In China's angel wheel, only those with a vision dare to vote for the angel wheel, because the failure rate of ideas is relatively high. Li Kaifu, Xu Xiaoping, these are all angel masters. They are often panning for gold in the sand. As long as a project is completed, they will win. But Xu Xiaoping has a higher failure rate. The angel wheel can be financed from 1 million to 10 million, and the equity ratio is 10 to 40%.
Second, round A. When you already have a product, you need to open up the market at this time, and you need to raise funds at this time. The A round is often risky, which tests market capabilities and team capabilities. For example, when Lei Jun launched Xiaomi, he won 40 million A rounds. Many people voted for him. For example, Ant Financial's A round of financing of 1.8 billion, now Ant Financial has a problem. Now A round is often more certain than angels, because there are already concrete visible things. For example, physical products. Raise 10 million to 100 million, the ratio is 10-20%.
Third, round B. The B round is that the business model has matured and can reach 100 million to 2 billion. As mentioned earlier, round a can melt 10 million to 100 million, and angels generally can melt 1 million to 10 million.
Generally speaking, the B round requires a well-designed equity. Many people in the Angel and A rounds did not involve equity. To solve the problem in round B. Because it enters the development period after the B round.
It is now more popular to vote, the distinction between voting rights and equity. The right to vote means that I can have less shares, but my control over the company will not be bad. In the equity design process, Wang Zhidong of Sina was the most tragic, because he failed to design the equity, which led to the dilution of equity and was driven away.
Fourth, the C round, mainly because the business model has already existed and is already profitable. Series C financing tends to be relatively large. The equity ratio is relatively low. But the risk is relatively small. This is the situation of the angel round, round A, round B, and round C. Some also have D rounds for further financing.
If each stage develops quickly, you can proceed with A+, B+, C+.
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To sum up, the angel wheel is an early idea, usually 1 million to 10 million, at this time the investment ratio is 2%, 30% or higher. In the A round, there is generally a product with a financing amount of 10 million to 100 million. The ratio at this time may be about 10%. The C round already has a business model. Know what to do. At this time, the success rate is relatively high. At this time, the financing ratio may be less than 10%, and generally higher than 5%. Raise between one billion and one billion. He has already started to make a profit this round, and at this time he is basically doing scale. The amount of funds is difficult to determine, depending on the specific situation. The goal is to continue to scale up.
This is the financing situation in the investment process with everyone today.