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Series Seed or Convertible Note? Which one is more founder friendly? Which one do investors prefer?

Gust

Assuming the company is able to make effective use of the seed money to greatly increase the value of the enterprise, all of that value therefore accrues to the founder, rather than the investor. That is a swing of 15x from the investor’s point of view!

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A conversation with Scott Kupor of Andreessen Horowitz, author and speaker at Lean Startup Conference 2019

Startup Lessons Learned

First, the introduction of seed money as an institutional form of capital. Before the mid-2000s, we mostly had individual angels writing small checks from their personal capital, but over the last 10-15 years we’ve seen hundreds of new institutional seed funds formed.

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How to Fund a Startup

www.paulgraham.com

It wasnt because they werent accredited investors that I didntask my parents for seed money, though. When we were starting Viaweb,I didnt know about the concept of an accredited investor, anddidnt stop to think about the value of investors connections.The reason I didnt take money from my parents was that I didntwant them to lose it.

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From Nothing To Something. How To Get There.

techcrunch.com

One of the things I do as a founder of a later stage startup is to meet with early stage entrepreneurs to help them get their companies going. The project was so low cost they did not even want to bother with it. Thus why I decided to wait until the market allowed for low cost investment.

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The Series A crunch is hitting now. Have we even noticed?

pandodaily.com

But at a macro level, widespread failure this early is far less painful than if it came at later stages. If you are raising a seed round now, there are a few things you can do to protect yourself. There are still the same debates on whether or not you should take seed money from VCs.