Definition by the book

Seed funding is the first official equity funding stage. It typically represents the first formal capital that a business venture or enterprise raises.

Seed rounds are among the first rounds of funding a company receives, generally while the company is in an early stage and working to gain traction. Round sizes range between €50K–€2M, though larger seed rounds have become more common in recent years. A seed round typically comes after an angel round (if applicable) and before a company’s Series A round.

What it really means

Early-stage companies need to purchase equipment, rent offices, and hire staff. More importantly, they need to grow. In almost every case they will require outside capital to do these things.

The initial capital raised by a company is typically called “seed” capital. You can think of the "seed" funding as part of an analogy for planting a tree. This early financial support is ideally the "seed" which will help to grow the business into a "tree." 

There are many potential investors in a seed funding situation: founders, friends, family, incubators, venture capital companies, crowdfunding or crowd equity campaigns and so-called "angel investors." You can have a look at our investors' list here.

Learn more

• https://www.ycombinator.com/library/4A-a-guide-to-seed-fundraising
• https://thepathforward.io/raising-vc-investment-odds-and-how-improve-them/