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Seed Stage Funding 101: What it Is & How it Works

The Startup Magazine

I will tell you brief details about seed stage funding, and deal sourcing on this page, so read the conclusion until the end. The following is a condensed explanation of seed funding: Seed money is a form of early-stage financing that new businesses receive from investors in exchange for a share of ownership in the company.

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Why Early-Stage VCs Should Be Careful About Intros from Bankers

Both Sides of the Table

There is one source I never liked and no early-stage VC should – investment bankers. But as a source of deal flow it is last on my list and both entrepreneurs and VCs should be careful about working with bankers on an early-stage (seed, a-round) deal. [no, They are venture bankers not investment bankers.

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The Importance of Proprietary Deal Flow in Early-Stage VC

Both Sides of the Table

When you are raising a large, later-stage round given by this time you’ve likely got a fairly large business to run. I have always advised startup companies against letting valuations get massively ahead of market norms. International money. Same as strategic – hard to reach, hard to get to know easily.

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Want to Know How VC’s Calculate Valuation Differently from Founders?

Both Sides of the Table

Other founders, “as a privately held company we don’t disclose our valuation.&# Me, “dude, I’m not a journalist. I just want to figure out what a fair valuation is.&# I figured all the VC’s talked so we should. This starts with understanding how VCs and entrepreneurs often see valuation differently.

Valuation 405
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How Much Should You Raise in Your VC Round? And What is a VC Looking at in Your Model?

Both Sides of the Table

There’s a quick litmus-test conversation any early-stage VC will have with the founder and it’s one that you should be as prepared for as your elevator pitch. It’s true that some later-stage private equity firms like to fund “roll ups” (a company that acquires many related companies in it sector), but this is seldom the domain of VCs.

Burn Rate 247
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The Authoritative Guide to Prorata Rights

Both Sides of the Table

They often create the biggest tensions between investors who are investing at different stages in the business. These tensions seep out in some angels or seed funds publicly or semi-privately deriding later-stage VCs for their “bad” behavior. I have seen bad behavior from later-stage VCs, believe me.

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How to Talk About Valuation When a VC Asks

Both Sides of the Table

I thought I’d write a post about how to talk about valuation at a startup and give you some sense of what might be on the mind of the person considering funding you. It’s not uncommon for a VC to ask you how much capital you’ve raised and what the post-money valuation was on your last round. is to start with just the data.

Valuation 324