Seed investment is early-stage funding provided to startups in exchange for equity, typically ranging from tens of thousands to a few million in local currency, used to develop products, validate market fit, and achieve initial growth milestones.
Seed investment provides the capital needed to transform your business idea into a viable company.
It typically covers product development, initial team hiring, and market validation activities before you're ready for larger funding rounds.
Seed investment commonly comes from angel investors, seed venture capital funds, accelerators, or sometimes friends and family.
These investors specialise in early-stage companies and understand the higher risks involved.
Seed investment occurs earlier than Series A funding and involves smaller amounts with higher risk tolerance.
Unlike pre-seed funding, seed investment typically requires some proven traction or a developed product rather than just an idea.
Seed investors expect significant equity stakes (often 15-25%) and look for strong founding teams, scalable business models, and clear paths to larger funding rounds.
They typically want to see measurable progress within 12-18 months.
Seed investment usually involves either equity shares or convertible instruments that convert to shares in future funding rounds.
The structure includes shareholder agreements, board positions, and investor protection rights appropriate for early-stage companies.
Startups should pursue seed investment when they've validated their product-market fit, demonstrated some initial traction, and need capital to scale operations.
Having a clear growth plan and experienced founding team strengthens your position significantly.
Post-seed investment, companies focus on achieving growth milestones that prepare them for Series A funding.
This includes scaling revenue, expanding teams, and refining business models whilst maintaining regular investor communication and reporting.
