When someone mentions “seed capital,” they can be referring to raising startup money from friends and family, crowdfunding, angel investors, or other sources.
Seed funding is often given to startups to help them to make it to the point of being self-sustaining. The seed money is intended for research and development, covering operating expenses, gaining traction, and ultimately attracting other investors. During this time, a startup is usually in full bootstrap mode.
Seed funding is considered a very high-risk investment because it is in the pre-revenue stage that a business is most likely to fail. How well a company manages its limited funds and how quickly it gains traction can make or break it in the seed stage.
When raising money, many entrepreneurs see it as another full-time job. Simply attending a pitch night every few weeks will not get you any funding. The process involves writing killer pitch decks, confidence when pitching to investors, and extensive networking.