At the early stages of your start-up’s life, you probably don't have many sales figures to prove the success of your idea.
That’s why the people most likely to invest will be those with confidence in you, who are fascinated by what you're working on, and willing to commit the funds.
Here are the types of investors most likely to provide seed funding.
The most common type of seed funders, angel investors are wealthy individuals who invest their own money in projects they believe in. The big advantage for you is that they can typically move quickly with their decision-making.
These programs not only train you in how to run a business, but also give you access to a community full of expertise, plus exposure to high-level venture capitalists for additional funding rounds. They can be a great choice for finding seed investors while gaining essential knowledge about business.
Accelerator programs (such as Y Combinator or Techstars) are another possibility, but they're usually aimed at helping companies scale up, rather than supporting early-stage innovation.
Venture capital groups specializing in pre-seed and seed funding
Venture capital (VC) funds have the ability to make large seed investments, but the decision-making process can be long and drawn out. To find one that may suit you, look at what different VCs have funded in the past, and build a list of those who have previously worked with start-ups similar to yours. It's important to create a tailored campaign for each specific investor, rather than taking a scattershot approach.
Crowdfunding platforms (such as Seedrs or Crowdcube) are growing in popularity, especially among new SaaS startups. In fact, 96% of SaaS companies securing equity via crowdfunding were in seed or venture stage at the time of raising, according to Beauhurst.
The crowdfunding concept is simple: you showcase your business to the public and anyone in the world can support it. To succeed with crowdfunding, you'll need a compelling idea and the ability to weave a resonant story around it.
Corporate seed funds
Large companies like Apple or Google regularly provide seed funding for start-ups. They’re motivated by the potential for new sources of income, intellectual property, or talent later down the line.
Family offices manage wealth and investment strategies on behalf of ultra-high net worth families, with the goal of maintaining and growing generational wealth. For entrepreneurs, family offices are becoming an interesting alternative to venture capital funding. In the past, family offices have typically focused on hedge funds, real estate, and bonds, but many are becoming more open to investing in start-ups.