Startup Fundraising 101
Fundraising is a means, not an end. You raise money to buy time and momentum, and you pay for it with a slice of your company.
The stages
| Stage | Typical raise | Vehicle |
|---|---|---|
| Pre-seed | $250k–$1M | SAFE / convertible note |
| Seed | $1M–$5M | Priced equity |
| Series A | $5M–$15M | Priced equity, lead investor |
| Series B+ | $15M+ | Priced equity, growth funds |
Instruments
- SAFE — a "simple agreement for future equity." You get money now, investors get equity at the next priced round. No valuation negotiation up front.
- Convertible note — like a SAFE but it's debt that converts. Older, still used.
- Priced equity — you set a valuation, sell shares directly.
The key terms that matter
valuation gets the headlines, but the terms that change your future are:
- Liquidation preference — who gets paid first on exit, and how much
- Pro-rata rights — who can keep their stake in later rounds
- Board composition — who controls decisions
A rule of thumb
Raise the least money that gets you to the next meaningful milestone at a fair valuation. Dilution is permanent; progress compounds.