Seed Funding

What I learned from 100 Startups that raised seed capital

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  • Why do some startups get funded?
  • What makes for the best pitch?
  • How does the process work?

Benchmarks from 100 Seed Raises:

Starting a company is difficult. Raising capital is a necessary step for many startups. It can be a frustrating process for first-timers. In this guide, you will learn more about the process and what a successful seed raise looks like.

Takeaways from these findings

  • Raising seed funding will take longer than you think. Don’t start to despair until you’ve been at it for a few months.
  • First reach out to seed firms before you go to angels. Firms will give you more capital in less time with fewer meetings.
  • More Meetings does not mean more capital. Focus on getting quality introductions to investors who are likely to be a fit. Quality first.
  • You will likely need 30–40 investors connections. You will likely need to reach out to many in order to secure interest and move into deeper discussions.

Creating a successful pitch,

by the numbers

Examining 100 pitches to over 3,000 investors, we categorized them and tracked time spent on the various content. In our research, time spent indicated slides with the greatest amount of interest.

How long the process takes

Companies that fail to successfully raise funds typically give up after 6 weeks. These companies fail simply due to lack of patience. The companies that had successfully raise their rounds reported that it took longer than expected.

We recommend creating a list of 200 investors based on a wider-criteria match. It’s important to note that most of the startups that raised capital in our research had meetings with 20–30 investors.

If after having spoken to that number of investors, if none of them agree to invest, something may be wrong with how you are pitching or what you are pitching. Take investor feedback seriously and adjust your pitch accordingly before contacting more investors. If you still haven’t closed after contacting 200 investors, you should rethink your timing, pitch, and market.

Recommended Strategy

  • Sequence emails and do follow-ups
  • Write proper intros and humanize the process
  • Reach out to ~200 investors and target ~20 meetings

Who to raise from and

how much to expect

The average seed round from the companies in our data set was $1.3 million. The total amount and process varied depending on whether the company was raising from angels or firms.

Angel Investors

Wealthy individuals who give their personal capital to a company typically between $25k-$100k.

Seed Firms

Small venture capital firms that usually invest between $250k — $1 million in a project.

I hope this helps you to avoid making the same mistakes I did, and remember to keep shipping!

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