Pre-seed and seed funding are investments that help early-stage startups start a business idea. Think of it like watering a seed for the first time to get it to sprout.
When startups raise pre-seed and seed funding, they often only have an idea they believe will be successful.
This money helps to build a prototype or an MVP and find proof of concept by gaining the first traction from early adopters. Sometimes even to cover living expenses while the founders work on the idea.
Pre-seed and seed funding usually comes from the founder’s savings, friends, family, and crowdfunding platforms. In some cases, from angel investors and venture capitalists (VCs).
In the seed funding round, startups often raise $50,000 to $250,000.