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The Amount of funding a startup gets depends on its Value and the percentage of stake it wants to sell. For example if a startup is valued at $100 million, a 20% stake sale will fetch it $20 million.Thus Funding = Value of Start-up * Percentage of stake sold.How is a startup valued?A startup is valued on its ability to generate Cash Flows in the Future. Cash Flows means Profits after Taxation. Future cash flows are discounted to arrive at their present Value.Thus Value= Sum of Discounted Cash Flows.So, when you evaluate Start-ups, evaluate it on their Future and NOT present or past. If a start-up has the ability to generate Cash Flows in the Future, it will have Value.Now to answer about specific Start-ups you have asked about: -Ola/Uber: - The inherent question Investors ask while Funding a start-up is:-Does it have Mass Appeal? What happens if everyone starts using the Product? Also, when a start-up makes things convenient for you, it tries to make itself your habit.When there was no Ola/Uber, we used to go down, ask several cabs/rickshaws, get rejected by quite a lot of them (I guess convincing Rickshaws in the suburbs of Mumbai is more difficult than convincing your crush for a date with you). But enter Ola, we can now book a Cab sitting at home or office and then only get down when they arrive. Thus it makes it convenient for us to do so plus the added advantage is that they are Cashless and they are Air-conditioned. So, we tend to form a habit of them, which is exactly what they want.What did Investors think for the First time while Investing in Uber?What if everyone starts using this Product? What if it expands to cities all over the World?Fast forward to Today and it operates in 68 Countries! and probably 500 cities!Link: https://www.uber.com/citiesI hope now you do understand why Uber and Ola get Funded. But, this answers only the question of the First funding.Why is there a Follow up funding?The answer is simple. Follow up funding is done when you want to expand to new horizons/cities or when you still want Cash to acquire customers and fund your SHORT-TERM losses.Imagine being Travis Kalanick (CEO of Uber). You see a lot of Potential in India. So what do you do? Arrange for a follow up funding round to enter India (Remember Rs 600/- worth of a ride when you sign up for the First time and also when you recommend it to a friend.)Zomato:-Zomato's revenues and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) for the Last 4 years.Revenue has grown 216% from Last year and Losses have also increased by 229%. But if you see the bigger picture Zomato has its presence in 22 countries including India! Also, in India it has a monopoly in Restaurant Search although there are others like Tinyowl, Foodpanda thus making it more probable for it to succeed. Further, it earns from Advertisements, Listings, Online Ordering, Consultancy (Advising Restaurants where to open their new branch through Data Analysis)I ll like to again stress on the point that don't see a Losses as a Determining factor to Funding instead see Value.Flipkart:-0This is by far the most-complicated start-up to analyse but the Fundamentals remain the same. Flipkart is trying to build a habit of buying Online into Indians. Investors too are funding this. Online retail sales today accounts to only 1% of the Entire retail sales in India. If it were to increase to even 7-8% (which is present in USA) then it would mean a jump of 800% in the revenues of E-tailers in India. This is what investors are hoping of.Make my trip:I recently spoke to a person having his own Tours and Travelling Business in Jaipur. I asked him about the competition from sites like makemytrip Yatra etc. He said that people in India are still reluctant to use Credit cards online and thus quite a few just use these websites as bargaining tools but eventually book the tickets via a Travel agent or a Tour operator. Slowly, this mentality is changing and more and more people are using their credit cards online.Infact, make my trip has been reducing its Losses in the past five years.Link: MakeMyTrip Annual Income Statement 2015, 2014Bonus-QuoraAs a Bonus, I d like to add the Example of Quora. Quora founded in June 2009 and made available to the public in 21st, June 2010. Quora has raised $141 million till date and is valued at $900 million as on April 2014. An you know how much Revenue is makes? Zero! Quora does not earn a single $ and it has a near $ 1 bn valuation.So coming back to my point, A startup is valued on its ability to generate Cash Flows in the Future. Try to see potential and not Losses when valuing or understanding start-ups.I hope this helps. You could comment if you need further clarifications. Happy to help.Disclaimer:-I am no expert in Start-up valuations

Indians are traditionally conservative investors and are known to invest a big chunk of savings in fixed deposits. Bank fixed deposit (FD) is a relatively safe, low risk investment option. While bank FDs offer a pre-specified interest rate and are fixed for the entire tenure, the returns on mutual funds vary based on the market volatility. Here are some of the reasons why majority of Indians prefer the safety of bank deposits and assets like gold or real estate over market-linked instruments-i. Safety first: Any form of equity investing involves risk no matter how experienced and learned you are in the domain. Most of the conservative Indians are not willing to take a risk on their hard-earned money and consider 4-5% return from the savings account as safe. They will only invest if they are assured that their investment is 100% risk-free, which is never the case with stock market. The risks involved in the market stops these people from investing in stocks or related instruments.ii. Lack of financial knowledge: This is one of the major reasons why Indians do not prefer investing in equities. Having a little or no knowledge about the workings of stocks keeps them away from the stock markets.iii. Preference for tangible assets: While Indians perceive banks and insurance companies as safe due to the implicit guarantee of the government of India. Even gold and real estate are important because of the social and cultural needs and aspirations. And most of these investments are physical assets, which are perceived as safe as opposed to intangible financial assets like shares, mutual funds, etc.iv. Fear of making a loss: Losses are part and parcel of equity investments. Many a times, investors have adequate knowledge about a stock, have analyzed it very well. However, they are unwilling to invest in the stock markets due to fear of making a loss. Equity investments are long term, with volatility being a recurrent theme. Thus, you may lose some amount of capital or returns earned in some periods. Some Indian investors find it too difficult to weather the storm.v. Reluctance to put in time: Investing in stock markets is a skill, that can be enhanced through proper research and analysis. You need to put in the time to understand what to buy, you need to read annual reports, learn basic balance-sheet and cash flow analysis, look into the business, its peers, technical indicators, etc. Many investors are unwilling to put in the time to look at their equity investments. They prefer to make one-time investments in gold, FDs, etc and avoid the hassle of periodic reviews.vi. Assured returns: Investments like FDs give assured returns. At the time of deposit, you will be assured of a fixed rate of return, which one can redeem at the end of maturity period. Such luxury will not be available with stocks.

Thanks for A2A.Cash flow statement is a statement which demonstrates the cash flowing into and out of the business enterprise on account of the varied activities carried on by it as a business concern, during any point of time covered by the period for which the statement is presented.In the context of fund flow statement, fund means 'capital' or 'finance'. Accordingly, fund flow statement is a statement summarizing how and from where finances were arranged i.e sources of funds, and how were they utilized in carrying out operations by the business entity i.e. application of funds, during a particular period depicted in the statement.Having known the meaning of these two statements, let us now figure out the differences between the two:1) Cash flow statement discloses the changes in cash balance available with the business house for the period covered by the statement whereas fund flow statement reveals the changes in working capital and overall financial position of the enterprise, whether the funds are in the form of cash or any other form.2) The preparation of cash flow statement involves use of only single main component i.e cash ( and cash equivalents too) while fund flow statement is based on broader concept and is prepared by taking into consideration all the current assets and current liabilities and not only 'cash'.3) Cash flow statement when analysed can be used for short term planning; fund flow statement analysis is useful in long term planning and strategy formulation.4) As cash flow statement takes into account cash and cash equivalents in its preparation, data to be used in the making of the statement needs to be derived by converting accounts maintained on accrual basis, into cash basis; Preparation of fund flow statement is in alignment with the accrual basis of accounting and hence does not require alteration in the method of keeping of books of accounts.Hope this is helpful.