PRE-SEED FUNDRAISING GUIDE: PART 2

How Much to Raise for a Pre-Seed Round

Avoid the pitfalls of trying to raise too little — or too much

Photo by Ricardo Arce on Unsplash

Picking the ‘right’ amount to raise is critical. If you pick an awkward amount, you won’t fall into either Angel/Pre-Seed funds or Seed funds. Set yourself up for success by picking an amount that fits well with your progress and the size of investment those investors are looking for.

Risks of trying to raise too little

• The check size will be too small for serious investors and not worth their time.
• You’ll be seen as not having a realistic plan of how to build & grow your business.

Risks of trying to raise too much

• You’ll waste your time talking to Seed funds and larger investors who expect more traction than is reasonable for a pre-seed startup.

What is a Pre-Seed round anyways?

Many new startup founders call what they are raising a “seed” round. This makes sense because, logically, your first round is ‘seeding’ the company.

But in reality, Seed investments now look a lot like what Series A investments used to look like. According to Afore Capital, “In 2011 only 4% of…