Fundraising Tips For Startup Founders: From Pre-Seed to Series A
You may have a groundbreaking idea for a startup, and you might also have a detailed, 20-page business plan that lays out your business’s steps from its first sale to its 1,000th employee. Odds are, however, you don’t currently have the capital to actually move your startup into the deeper stages of that business plan. No matter how good your idea is, you’ll likely need a little help from fundraising.
The first few fundraising rounds a startup typically goes through are their pre-seed, their seed round, and their Series A. Your pre-seed and your seed round may not immediately propel rapid growth, but they should at least allow you to prove your product or service works and that people want it.
Navigating the waters of startup fundraising can be tricky, especially if you don’t already have professional connections to investors or industry veterans. We wrote this article to help founders understand what different startup fundraising rounds are, what the best fundraising steps are, and how to tell when you're ready to move on to a Series A. We’ll also examine Slash, a business banking platform that can help new founders raise money early on with flexible working capital, a high-yield treasury account, and more.¹,⁵,⁶
The standard in finance
Slash goes above with better controls, better rewards, and better support for your business.
Key Takeaways
- It’s best to start raising your Series A with six to nine months of runway left, since fundraising often takes longer than planned and it’s not a good idea to negotiate while you’re desperate.
- A seed round is the first proper round of institutional fundraising a startup receives. It comes after whatever you scraped together from your savings, friends, or a pre-seed, and before the larger rounds that fund actual scaling.
- Most seed rounds are done on SAFEs rather than priced equity, because agreeing upon a valuation is slow and convertible instruments can let you close faster.
- Investors want usage from a rough product more than they want polish from an unused one. It’s best to ship an early minimum viable product that people can get their hands on, even if you know it has flaws.
Understanding Startup Fundraising Rounds
Seed funding is a term for the capital a startup raises to turn an idea into an operating business. It can come from angel investors, seed-stage venture firms, accelerators, and sometimes friends and family. In exchange for the risk of investing in a business that isn’t yet making money, they almost always receive equity or convertible securities in that business.
The money that comes from a seed round isn’t meant for aggressive scaling. Seed capital typically funds building a minimum viable product (MVP), making the first few hires, setting up basic operations, researching your market, and getting early customers through the door. Per AlleyWatch, the median seed round in 2025 was between $2 and $3 million. Meanwhile, the median Series A funding round, which comes later on, was $12 million. In short, a seed round is supposed to give you the gas to leave the driveway, while following funding rounds get you onto the highway. You may also raise pre-seed funding, which can help you buy the metaphorical car in the first place.
While the progression from pre-seed to seed round to Series A isn’t mandatory, it’s the path the majority of startups take. Very few businesses reach a Series A without seeding from early investors, who often see the first stages of your startup as high-risk, high-reward. That said, if you’re able to bootstrap your startup with a healthy amount of personal savings, you may be able to bypass the pre-seed stage in some cases.
Early fundraising isn’t as simple as a cash investment and an IOU. Most seed rounds are financed on convertible instruments, which are investments that start as a loan or a contract and later change into company stock. These often come in the form of SAFEs (Simple Agreement for Future Equity), which turn into stock at a future priced round. Either way, these are often faster and simpler than negotiating a valuation. Convertible notes work similarly, but are structured as debt. A priced round, where you sell preferred stock at a set price per share, generally comes later down the line.
Different Startup Fundraising Rounds Compared
Pre-seeds, seed rounds, and Series A’s have less in common than you might think. Beyond their monetary value, they come with different investors, structures, and proofs of concept/success. Let’s take a closer look:
When you should consider each stage
Pre-seed makes sense when you have an idea and a team, but nothing actually built yet. Ultimately, you're funding the work of finding out whether the concept holds up. Investors at this stage are largely backing you and your potential rather than your metrics, since there aren't any metrics to back.
You can move on to your seed round once you have something to demonstrate. It doesn’t have to be a completely finished product, nor does it have to generate active revenue, but it should be close enough for investors to get an accurate picture of what your business should look like when it’s fully running. You want to be able to show an investor the product/service working and point to some signal that people want it, such as early users or a waitlist.
When you’re an active business with a finished product and relatively consistent revenue, it’s time for Series A. There’s a solid foundation and room for growth, so investors and venture capital firms will usually be ready to offer a lot more than you received in your seed round. Series A rounds are almost always priced, meaning you negotiate a valuation and sell preferred stock rather than deferring the question with a SAFE. In return, investors often expect board involvement and information rights.
Fundraising Steps for Seed Rounds
Raising your first seed round isn’t nearly as simple as going to your bank and applying for a loan. There are several steps involved that can make or break the future of your startup, regardless of how promising the product itself is. These steps include:
Preparing Your Pitch
Nowadays, an effective pitch will often be a Powerpoint-style slideshow, but the format can vary depending on your or your investors’ preferences. Either way, you’ll want to explain the problem, why it matters, your solution, the market, the team, the business model, your progress, what you're raising, and what it will pay for. Just as your written business plan may be around 15 pages, this slideshow should be around 15 slides.
It’s important not to underrate the actual request you’re making. Be specific about how much you're raising, what milestones it funds, and how long it lasts. You should also think ahead to your dilution before you find yourself in a negotiation. Once you understand how a given round size and valuation affects your ownership, and how outstanding SAFEs convert, you’ll be prepared to tackle discussions about equity.
Developing Your Minimum Viable Product
A minimum viable product (MVP) is the earliest version of your product that delivers real value to a real user. In order to accurately assess whether people want what you’re offering, you have to give them something to try out rather than a description of something they can someday have.
You don’t need to over-build here, especially if you don’t have the liquidity to do so. Not only can a rough draft get your product to more people for a lower price, but it can also lead to feedback that allows you to make quick pivots. If you’ve spent time “perfecting” your product, but your first customers suggest a lot of changes, you may be less likely to implement them.
Investors don’t expect polish from your MVP, nor do they necessarily want it. They want evidence that people engage with it, that they come back, and that some of them would pay the estimated price. If the MVP gets some negative feedback, they’ll also be watching to see how you react and what changes you make in response.
Identifying Potential Investors
Not every investor is a fit, even if they have the money and experience to help. To start, build a target list of firms and investors that consistently fund seed rounds within your startup’s sector. Check what they've already funded, both to evaluate their expertise and to see what they already have stakes in. An investor with a portfolio company that competes directly with you is unlikely to invest, and may not be someone you want reading your metrics. If they have portfolio companies in the same ballpark that don’t represent direct competition, on the other hand, they’ll understand the market already.
Money isn’t the only thing you’re looking for at this stage. Some investors are useful for introductions, hiring, and follow-on rounds, while others write a check and basically disappear. While money is the most important piece of the puzzle, professional guidance and connections are almost as valuable.
Networking and Building Relationships
Building connections can be one of the hardest parts of breaking into the world of business. If you begin your journey with one or two relationships, that may be all you need, as shrewd networking can get you from place to place and person to person off of a single professional recommendation. It’s not easy, though, and it takes a combination of warm outreach and some luck.
For many startups, modern programs like accelerators and demo days can help skip traditional networking steps. In accelerators, you can get intensive mentorship, educational workshops, and seed funding in exchange for a small equity stake. All you have to do is apply, and if you get accepted, you can be on the way to your seed round without having given your business card to 200 people.
The standard in finance
Slash goes above with better controls, better rewards, and better support for your business.
Transitioning from Seed Round to Series A
Some founders rush from their seed round to their Series A too quickly, and others don’t realize they’ve been ready for it for months. In a nutshell, you’ll know you’re ready for your Series A when you’ve stopped making rough estimates. Your seed round bought you the chance to tweak your product and find its market fit, and your Series A allows you to expand on what you’ve learned. So, if you feel like you’ve learned a lot, it may be time to accelerate it.
Series A investors look for steady revenue growth over several months, retention numbers that show your customers want more, and a reasonable average cost of acquiring those customers. The more predictable and consistent these metrics are, the better. If you can accurately explain what happens when you put money into sales or marketing, you have a startup that’s running smoothly and may be worth funding. If progress is sporadic and centered around a few founder relationships, you probably aren’t there yet.
Common challenges in transitioning
Generating revenue isn’t the only hard part of transitioning from your seed round to your Series A. Here are a few more challenges that you may run into, even when you’re already confident you’re ready for the next step:
- Running out of runway mid-process: From your first outreaches to the money hitting your account, your Series A can take six months or more. If you run out of runway during the process, your startup will be in trouble and you may get desperate while negotiating. Make sure you have a cushion of liquidity as you begin your next round.
- The bar has risen: Over the last few years, median seed round and Series A fundraising amounts have grown, and expectations have grown along with them. If you’ve been following the path of an industry competitor that got their funding 5-10 years ago, you may need to be a little further along at each stage than they were.
- Growth without retention: You may think you’re ready to rock once you see consistent revenue and growth, but poor retention numbers can tell the opposite story. When investors see consistent customer churn, they’ll take it as a sign that your product or service isn’t ready to grow beyond its current size.
- A messy cap table: Entering your Series A with accumulated SAFEs with different caps, undocumented agreements, and unclear ownership can slow due diligence and frustrate investors.
Get Ready For Your Startup Fundraising Rounds With Slash
Your early rounds are meant to get your product from today’s proven potential to the future’s consistent profit. The hard part is making it that far on the money you received from those early rounds. Countless startups peter out and fold before making it to their Series A because they run out of liquidity trying to establish consistent revenue.
Slash is a business banking platform that can help you bridge that exact gap. We offer transparent, collateral-free working capital lines of credit with 30, 60, and 90 day repayment terms meant to match your cash flow cycle. Users can apply by presenting an estimate of their annual revenue. Eligibility is solely determined by Slope, and may be determined based on factors such as business requirements, revenue thresholds, and a soft credit check that doesn’t affect your credit score. With Slash Capital, you won’t have to worry about high APR rates. Slash charges a fixed financing fee based on the total term and underwriting factors, which is added up front to the amount financed instead of accruing daily like a revolving loan.
Our platform also offers a couple more ways to earn money as you suit up for your Series A. Slash Treasury allows startups to earn up to 3.85% annualized yield on idle cash through money market funds from BlackRock and Morgan Stanley. Additionally, as you spend money on the Slash Visa® Platinum Card, you can earn up to 2% cash back on eligible business purchases.
New founders can also take advantage of the following Slash features:
- Agentic AI-powered finance: Our platform comes with Twin, a built-in AI agent that can be prompted with natural language to complete complex tasks. Users can ask it to create cards, pay invoices, review your cash flow, and much more.
- Accounting & ERP integrations: Sync transaction data with QuickBooks Online, Xero, NetSuite, or Sage Intacct to streamline reconciliation, reporting, and month-end close.
- Native cryptocurrency support: Send and receive USD-pegged stablecoins USDC and USDT across eight supported blockchains for faster, lower-cost global payments.⁴
- Diverse payment rails: Slash supports a wide range of payment methods, including card spend, global ACH, international wire transfers to over 180 countries via SWIFT, and real-time domestic payments through RTP and FedNow.
- Global USD: The Slash Global USD Account is designed as an alternative for foreign founders who want access to USD without forming a US entity.³ Balances are backed by Slash’s USDSL stablecoin, which is designed to maintain a one-to-one value with the US dollar.
With unlimited virtual Slash Cards and FDIC insurance up to $150M through Column N.A.'s insured cash sweep network, Slash is built to scale as you travel from Series A to C and beyond.² If you want to learn more, reach out today.
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Frequently Asked Questions
How long does it take to raise a seed round?
It’s smart to plan for three to six months from starting conversations to money in the bank, though it varies widely with market conditions and your current relationships. Founders who have been sending investor updates for a while often move faster because a lot of the explanation work is already done.
How to Start a Startup: How to Get from Idea to Series A Funding
How much equity do you give up in a seed round?
Usually somewhere between 10% and 25%, depending on how much you raise and at what valuation. If you're raising on SAFEs, the dilution isn't fixed until they convert at your next priced round. That’s why it’s important to model conversion scenarios beforehand.
What should I have before I reach out to investors?
You should at least have a working MVP and early evidence of demand. Investors prefer real use, even from a rough product, over a polished build that hasn’t captured any users. Along with these, be ready with a clear pitch that explains the problem, solution (product), market, team, requested amount, runway, and expected dilution.
Do you need revenue to raise a seed round?
Not always, but it’s helpful. Some seed rounds close on a working product with strong engagement and no revenue at all, particularly in categories with long-term contracts where monetization comes later. Overall, you want to be able to show an investor proof that demand exists, and existing purchases are nice pieces of evidence.
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