Fundraising
Seed vs. Series A: a Showdown of Funding Rounds
Written by
Enrico Tan
Published on
November 17, 2023
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Written by
Published on
Seed and Series A are two key startup funding stages but they serve very different purposes. Seed funding gets your startup off the ground, while Series A is about proving traction and scaling. In this article, we break down the differences, how much you can raise, and what investors expect at each stage.
Seed funding is typically provided by angel investors, friends and family, and early-stage venture capital firms. The goal of seed funding is to help startups develop their product or service, build a team, and establish a market presence. Seed funding is usually smaller than Series A funding and ranges from €50,000 to €2 million. In contrast, Series A funding is typically provided by institutional investors, such as venture capital firms, and ranges from €2 million to €15 million or more.
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Seed funding is the first official stage of early-stage funding for startups. It provides the initial capital needed to develop your idea, conduct market research, and build a prototype or MVP.
This seed round is typically raised from friends, family, angel investors, or pre-seed sources. In return, startup investorsusually receive equity—often between 10% and 25% of the company.
Because startups are still validating their ideas, seed funding carries high risk. Still, it’s a critical opportunity for both founders and investors to shape the early direction of the business.
Seed funding helps startups validate their product, attract initial users, and build the foundation for future growth.
Seed funding helps you:
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The Series A round is the first institutional funding stage for startups. At this point, startups are expected to move beyond idea validation and into scaling their business. Funding typically ranges from €2 million to €10 million and comes from venture capital firms in exchange for equity.
The goal? Achieve product-market fit, expand the team, grow revenue, and prepare for larger growth rounds.
Investors in a Series A round look for more than just a good idea. They want:
The venture capital funding decision hinges heavily on traction and the startup’s ability to execute on its vision at scale.
To secure Series A funding, founders need to present a pitch that clearly outlines:
Startups should also have a solid data foundation—metrics, KPIs, and projections—to support their case.
Once Series A capital is secured, the focus shifts to scaling the startup. That includes:
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Transitioning from a seed round to Series A is a critical step. It signals you're moving from validating an idea to building a scalable business. But getting there comes with its own set of challenges from raising a larger round to proving you’re ready to scale.
Below are the key areas that signal to investors you’re Series A-ready.
Before raising Series A, your startup should hit certain milestones to show clear forward momentum.
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These milestones prove your startup isn’t just a good idea it’s an operation capable of scaling.
Traction is what turns investor interest into signed term sheets. That could mean:
Investors want to see that the market wants your product—and that you’re positioned to capture more of it.
Startups that track the right metrics stand out. Whether it’s CAC vs. LTV, activation rates, or retention curves, data-driven decisions show maturity and readiness for growth.
Data helps you craft a compelling narrative backed by proof not just vision.
Having a launched product isn’t enough. You need to demonstrate that it’s solving a real problem for a defined audience.
Series A investors want to see strong product-market fit with clear signs you can replicate success at scale.
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Once you’ve secured your Series A, the next stages of capital Series B and Series C—can help you scale faster, enter new markets, and fuel product expansion. But with each round comes higher expectations, more investor involvement, and ownership dilution.
Series B funding is for startups that have shown consistent growth and want to scale operations. At this point, you likely have:
Funding amounts are larger, and investors will likely want more equity in return. This round often supports team growth, infrastructure, and product iteration at scale.
Series C is about accelerating what’s already working. Startups raising at this stage are often preparing for:
Expect significant due diligence, high valuation expectations, and possible involvement from late-stage investors like private equity firms.
Raising more capital isn’t always the answer. Founders should ask:
Note: Each funding round means dilution. Founders should weigh capital needs against long-term control..
Whether you're raising your first seed round or gearing up for Series A, understanding what each stage demands is key to your success. Seed funding helps you build and validate, while Series A is about scaling with confidence. Stay focused on traction, product-market fit, and investor readiness—and you’ll be better positioned to raise the right capital at the right time.
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What are the differences between seed funding and Series A funding?
Seed funding is the initial stage of fundraising where a startup raises capital from a small group of investors to support early-stage development and market research. On the other hand, Series A funding is the next stage of financing where a startup receives additional capital to grow and scale its business after the seed funding round.
What is the typical funding amount for a Series A round?
The amount of capital raised in a Series A round can vary widely depending on the startup's industry, business model, and growth potential. However, the typical funding amount for a Series A round is between €2 million and €15 million.
How long does it usually take to go from seed funding to Series A funding?
The time it takes to go from seed funding to Series A funding can vary widely depending on the startup's growth and development. On average, it takes between 12 to 18 months to go from seed funding to Series A funding.
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