What do you need to raise pre-seed funding
Pre-seed investors are looking for a proof of concept of your product or service idea, a clear plan to monetize the business, and references from potential customers that this is something they’d be willing to pay for at all.
💡 The most important one: proof of concept. For software products, this proof of concept might be a simple Testflight version of your app. For physical products, it might be a rough prototype with visible wires and circuit boards.
If you lack the technical skills to build a proof of concept of the idea on your own, that’s a good signal to find and add a technical co-founder to the team. Some investors prefer founding teams of 2-3, as they’re seen as less risky than solo founders
📝 What else should you have. Besides the proof of concept, here’s some information that’s useful having when pitching your startup to pre-seed investors:
— A description of the large problem you’re solving
— An explanation about how your product or service solves this problem
— A deep dive into the features your product or service has
— Some bottom-up estimates of the total addressable market
— A market map of competitors and how your product is differentiated feature-wise to their solutions
— Your current financial model and revenue
— A financial model containing 5 years of revenue predictions alongside customer acquisition
— A description of your team and what unique insights and skills it has that makes it the perfect team to solve the problem
— Some of the key past milestones in product and company developments
— The ask of how much pre-seed funding you need to hit future milestones and plans for how funds will be used to hit those milestones
🎬 Prepare a pitch deck. It’s a great idea to deliver all this information wrapped in a compelling story through a pitch deck, which should hold investors’ attention for about 3 and a half minutes.
The goal of this deck is to spark the investor's interest enough to merit a more formal in-person or virtual 1:1 meeting which will last anywhere from 30-45 mins.
❔ Be ready to answer questions. As you progress through an investor's specific diligence process, be prepared to answer some tough questions, deliver whatever specific data is required to validate your assumptions, and give the investor enough conviction to invest.
🧠 Take care of your intellectual property. Assume anything you share while raising a pre-seed will not be kept confidential. If there is proprietary information that isn’t protected by existing intellectual property law, you’re better off keeping the cards close to your chest, and consulting with an attorney on specifics on what's safe to disclose.
Share @Business_Idea4
Pre-seed investors are looking for a proof of concept of your product or service idea, a clear plan to monetize the business, and references from potential customers that this is something they’d be willing to pay for at all.
💡 The most important one: proof of concept. For software products, this proof of concept might be a simple Testflight version of your app. For physical products, it might be a rough prototype with visible wires and circuit boards.
If you lack the technical skills to build a proof of concept of the idea on your own, that’s a good signal to find and add a technical co-founder to the team. Some investors prefer founding teams of 2-3, as they’re seen as less risky than solo founders
📝 What else should you have. Besides the proof of concept, here’s some information that’s useful having when pitching your startup to pre-seed investors:
— A description of the large problem you’re solving
— An explanation about how your product or service solves this problem
— A deep dive into the features your product or service has
— Some bottom-up estimates of the total addressable market
— A market map of competitors and how your product is differentiated feature-wise to their solutions
— Your current financial model and revenue
— A financial model containing 5 years of revenue predictions alongside customer acquisition
— A description of your team and what unique insights and skills it has that makes it the perfect team to solve the problem
— Some of the key past milestones in product and company developments
— The ask of how much pre-seed funding you need to hit future milestones and plans for how funds will be used to hit those milestones
🎬 Prepare a pitch deck. It’s a great idea to deliver all this information wrapped in a compelling story through a pitch deck, which should hold investors’ attention for about 3 and a half minutes.
The goal of this deck is to spark the investor's interest enough to merit a more formal in-person or virtual 1:1 meeting which will last anywhere from 30-45 mins.
❔ Be ready to answer questions. As you progress through an investor's specific diligence process, be prepared to answer some tough questions, deliver whatever specific data is required to validate your assumptions, and give the investor enough conviction to invest.
🧠 Take care of your intellectual property. Assume anything you share while raising a pre-seed will not be kept confidential. If there is proprietary information that isn’t protected by existing intellectual property law, you’re better off keeping the cards close to your chest, and consulting with an attorney on specifics on what's safe to disclose.
Share @Business_Idea4