All terms
Fundraising
Seed round
The first significant institutional round after pre-seed, typically $1-5M, raised once a company has early traction.
In plain English
The round where you're proving the business model, not just the idea. Usually $5-50k MRR and a clear acquisition channel.
Example
A SaaS at $25k MRR with one repeatable acquisition channel raises $3M at $12M pre-money seed.
Why it matters
Seed is where business model conviction shows up. Investors expect to see retention, a working channel, and a team beyond just the founders.
Common mistakes
- Raising seed with weak retention metrics (Series A will require them)
- Raising seed without a team plan — investors expect 5-15 person growth