What is pre-seed?
Pre-seed is the earliest institutional funding stage: the round (or sequence of small rounds) raised before a company has the metrics required for a traditional seed round. The pre-seed designation emerged as seed-round sizes grew over the 2010s, leaving a gap for very early-stage companies that still needed institutional capital to reach the new seed bar.
What pre-seed funds finance
- Idea-to-prototype: a founding team with a sharp thesis and a working prototype, before paying customers.
- Pre-revenue companies: teams with strong founder-market fit who need 6–12 months of runway to build the first product.
- Repeat founders: experienced founders raising on track record before product is shipped.
- Deep-tech with longer timelines: R&D-heavy ideas where the technical path itself is the first risk to retire.
What pre-seed capital is spent on
- Product: creating an initial version of the product or service: an MVP or prototype that can be tested and refined.
- Market research: validating the market need and demand for the offering with potential customers.
- Operations: setting up basic business operations and infrastructure.
- Talent: hiring the key team members who drive development and growth.
Pre-seed mechanics
- Round size: typically USD 250k–1.5M; some pre-seed rounds reach USD 2–3M for hot teams.
- Valuation: USD 3–12M post-money is typical; SAFE caps in this range.
- Instruments: SAFEs and convertible notes dominate; priced equity is rare at this stage given the level of uncertainty.
- Investors: pre-seed funds (specialised funds like Hustle Fund, Bee Partners), angel investors, accelerator demo days, friends and family rounds in some geographies.
- Discounts and priced exceptions: convertible instruments usually pair the cap with a discount; a minority of pre-seed deals are priced rounds for sophisticated investors who want full preferred stock terms.
Pre-seed vs. adjacent stages
- Pre-seed vs. friends-and-family: F&F is informal; pre-seed is institutional with experienced investors who track the company and follow on.
- Pre-seed vs. seed: pre-seed funds the team to build to seed milestones (product in market, early customers); seed funds the path to Series A milestones.
- Pre-seed vs. accelerator: accelerators provide small cheque + programme; pre-seed funds give larger cheques without the programme.
Common pre-seed challenges
- High risk: pre-seed investments are highly speculative: the business model is usually unproven and there is no revenue.
- Limited resources: the amount raised is small, so it has to be managed carefully.
- Investor reluctance: securing pre-seed funding is difficult precisely because of that risk and uncertainty.
- Proof of concept: founders must provide a convincing proof of concept at a stage where evidence is thin.
What pre-seed investors look for
At pre-seed there is little revenue or product data, so investors weigh: (a) founder quality and founder-market fit; (b) the size and timing of the market opportunity; (c) the team’s plan to retire the first key risk inside 12 months; (d) capital efficiency of the plan to reach seed-stage milestones.
Do: raise the smallest pre-seed round that buys you 12–18 months to hit clear seed milestones; spend on team and product, not premature go-to-market.
Don’t: over-raise at pre-seed thinking it removes pressure: large pre-seed rounds at high valuations make the seed round harder, not easier, because the next round needs a markup.
In practice
Transactions Vircon Legal has announced with this structure (17 in total, most recent shown): Upsonic (2025), Compuvi (2025), Remedi Finance (2025), İno Cosmetics (2025), Nuvolog (2025), Goart Metaverse (2024).
Each was led by Managing Partner Erdem Mümtaz Hacıpaşaoğlu. All transactions →