How to Raise a Pre-Seed Round

Y Combinator's guide to seed fundraising says investors write checks when the idea is compelling, when they believe the founders can realize it, and when the opportunity is real and large enough. For most founders that requires an idea, a product and some customer adoption (Y Combinator).

Antler frames readiness as the difference between vision and validation. Vision inspires co-founders and early hires, but investors need evidence. Its checklist of questions is a useful self-test (Antler):

• Why are you the right person to build this?
• If the technology is novel, can you demonstrate it? If not, can you show you can build it?
• Are your first customers the right group, and how do you know?
• Will anyone become a customer, and what evidence do you have, such as a growing waitlist or customer feedback?
• Is the market big enough now or likely to become so?
• How will the business model scale?

Carta's readiness signals point the same way: a compelling story about why you are the right team, and a clear plan for how the money takes you to the next milestones, including headcount (Carta).

If you cannot answer these questions with evidence yet, you are not ready. A few more weeks of customer conversations, a working prototype or a handful of paying users will usually do more for the raise than a better deck.

Start from milestones, not from a number you think investors will accept. Carta recommends listing the milestones that make you fundable at seed, such as a shipped product, early users and key hires, estimating the cost and time to reach them, and adding a buffer for the fundraising process itself (Carta).

A simple worksheet:

Milestones for the next round:
  - product live with paying customers in the first segment
  - a repeatable acquisition channel tested
  - first engineering hire made

Monthly cost to get there:
  people (founders, first hire, contractors)   = P
  tools, hosting, legal, accounting             = T
  sales and marketing tests                     = M
  monthly burn                                  = P + T + M

Months to reach milestones                      = N
Buffer for the next raise (3 to 6 months)       = B
Amount to raise = monthly burn x (N + B)

On runway, Antler's guide, read on 2026-10-17, suggests looking 24 months ahead and says pre-seed companies want at least 12 months of runway, with more as the company matures (Antler). It also warns against asking for the amount you think you can get rather than the amount you need.

For a rough market reference, Carta's guide, read on 2026-10-17, says there is no universal number but most pre-seed rounds land between $150,000 and $1 million (Carta). Your own plan should drive the number, and the market range is a sanity check.

Dilution is the other side of the trade-off. Y Combinator's seed guide, read on 2026-10-17, says that giving up as little as 10 percent in a seed round is wonderful but most rounds require up to 20 percent (Y Combinator). Antler's guide, read the same day, gives a similar expectation of selling 15 to 20 percent in early rounds (Antler). Raising more buys more progress and more safety, at the cost of more ownership.

A SAFE, or simple agreement for future equity, was created at Y Combinator. YC describes it as a short contract in which an investor funds the company now in exchange for the right to shares later; it converts into shares automatically when the company raises a priced round (Y Combinator SAFE). It has no interest rate or maturity date, unlike a convertible note.

The terms to understand, as YC defines them:

• Valuation cap. The highest valuation at which the SAFE converts. With the post-money SAFE, the ownership you sell equals the investment divided by the post-money valuation cap.
• Discount. A percentage reduction on the price the next round's investors pay.
• MFN (most favored nation). No cap or discount; the investor takes the terms of any later SAFE you issue.
• Pro rata right. The right to invest in a future priced round to keep the same ownership share, handled in an optional side letter.

YC's advice is to start from how much you want to raise and how much ownership you are willing to sell, and let the cap follow (Y Combinator SAFE):

Post-money valuation cap = amount raised / ownership sold

Illustrative: raising 500,000 while selling 10 percent
  cap = 500,000 / 0.10 = 5,000,000 post-money

Because each post-money SAFE's dilution is easy to calculate, you can also raise on more than one cap, for example a lower cap for the first checks and a higher one later as momentum builds. Keep a running table of every SAFE, its amount and its cap, so you always know the total ownership you have sold. Carta's guide to SAFEs calls failing to record each SAFE's cap and discount a common mistake, recommends modeling how several SAFEs will convert together, and warns that raising too much on SAFEs can leave too little room for later investors (Carta SAFE guide).

Use the standard documents. YC's seed guide notes that standard documents with consistent terms let a seed round close quickly, with negotiation limited to the cap and possibly a discount (Y Combinator). Have a lawyer review anything non-standard.

You need fewer documents than most founders prepare. YC's guide says not to spend much time on due diligence documents for a seed round, and that an investor asking for too much diligence at this stage is probably one to avoid. It suggests an executive summary of one or two pages, ideally one, covering vision, product, team, traction, market size and minimal financials, plus a deck to walk investors through (Y Combinator).

The deck. DocSend, which analyzes how investors read pitch decks, says the problem slide is the crux of the deck because it sets up everything that follows, and that founders struggle most with explaining why the problem must be solved now. It also notes founders often skimp on the team slide, which should show each founder's experience and why it fits the problem (DocSend). A common order: problem, why now, solution, product, traction, market, business model, competition, team, the ask and use of funds.

A one-pager or memo. Antler encourages founders to stand out with a sharp one-pager or investment memo and a founder story, rather than relying only on a template deck, because templates make every company look the same (Antler).

Everything else ready before the first meeting. The Techstars fundraising toolkit calls this "mise en place", the kitchen practice of preparing every ingredient before cooking. It recommends having materials, the investor list and the introduction plan ready before you start pitching (Techstars). A data folder with your cap table, incorporation documents and a simple financial plan saves days when an investor says yes.

Make a curated list. Antler advises building your own list rather than pulling a generic one, so you research each investor's stage, focus and conflicts, and warns against sending your deck to hundreds of investors at random (Antler). For each investor, record their typical check size, whether they lead rounds, relevant portfolio companies and who can introduce you.

Get warm introductions. The Techstars toolkit recommends a "forwardable email": a short, scannable note your contact can forward without editing, explaining who you are, why this investor and what you are asking for (Techstars).

Batch the first meetings. Momentum matters. Antler suggests packing first meetings into a short window to run a tight process, and expects a raise to take around three to four months from start to close (Antler). YC notes that the hardest money to get is the first check, and that each later commitment comes more easily once the first is in (Y Combinator).

Track every investor by stage. The Techstars toolkit lists pipeline stages running from targeted investors you have not yet contacted, through advancing, soft circled, committed, legal and wired, plus a stage for those who passed. It notes that an early pass can sometimes turn into a yes as the round gains momentum, so keep track of passes too (Techstars).

Always ask for a next step. YC's guide says never to leave an investor meeting without an attempted close or, at minimum, absolute clarity on next steps (Y Combinator). It also reminds founders that investors have many ways of saying no, and that recognizing a no is part of the job.

Once an investor says yes, move fast. YC recommends closing quickly once someone commits and advises against negotiating in real time, since investors usually have more negotiating experience. Take requests away and get advice from mentors or counsel (Y Combinator).

If an investor sends a term sheet rather than a standard SAFE, read every clause. Antler notes that most investors are not trying to trick founders, but some founders discover too late that they gave away control through terms they skimmed, and recommends paying for a lawyer's review (Antler).

Choose investors as long-term partners, not only as money. Antler stresses investor-founder fit, since early investors will be part of the company for years. Ask whether you share values, how they support companies beyond capital and how they behave when things go badly. Reference calls with founders they have backed, including ones whose companies struggled, answer those questions better than the investor's own pitch.

Finally, close the loop with everyone. Send a short update to investors who passed, thank your introducers and start a monthly update to the investors who joined. The founders who keep investors informed find the next round easier to start.