Also sometimes referred to as a friends and family round, an early round of financing for a startup company, typically conducted not long after the company is formed. Startups may raise debt and equity capital in multiple rounds of seed financing before they successfully complete a Series A financing led by an institutional venture capital (VC) fund.

Seed round structures are intended to enable a company to raise equity or debt capital with reduced transaction costs (such as lower legal fees) and a shorter time-to-close, compared to a traditional VC financing round.

Typical seed round investors include:

Typical seed round investment instruments include:

For a discussion of the advantages and disadvantages of each of the main options for structuring seed-stage investments, see Choosing the Right Seed Financing Instrument for Startups Checklist.

For more information on seed financings generally, see Practice Note, Startup Seed Financings: Overview.