All terms
Fundraising
Pre-seed
The earliest institutional funding round for a startup, typically $250k-$2M, raised before significant product-market fit.
In plain English
The first 'real' fundraising round. Usually angels and small funds. You have a working v0 and maybe 5-15 paying customers.
Example
A 2-founder SaaS with $3k MRR and a working product raises $1.2M at $6M pre-money pre-seed.
Why it matters
Pre-seed terms set the trajectory for every subsequent round. A clean pre-seed makes later rounds easier; a messy one (uncapped SAFEs, weird founder splits) creates cleanup costs.
Common mistakes
- Optimising for highest valuation at pre-seed (creates an impossible bar for the next round)
- Taking too many uncapped SAFEs (conversion math gets ugly fast)