Seed Round

A financing round in which a company raises capital at a lower valuation than its previous round. Down rounds signal reduced confidence in the company's prospects and typically trigger anti-dilution protections that further dilute founders and earlier investors.

Contractual mechanisms that protect existing investors from the dilutive effects of a subsequent financing round at a lower valuation than the round in which they invested. Common forms include full ratchet anti-dilution (which adjusts the conversion price to the new lower price) and weighted average anti-dilution (which adjusts based on the relative size of the new round).

Sequential rounds of venture capital financing that follow the seed stage. Series A typically funds scaling after product-market fit; Series B accelerates growth and market expansion; Series C and beyond fund further scaling, internationalisation, or pre-IPO preparation.

A form of private equity financing provided to early-stage, high-growth potential companies in exchange for equity. VC firms typically invest across multiple rounds (seed through Series C+), provide strategic guidance, and target returns through exits within 5-10 years.

The valuation of a company immediately before a new funding round. Pre-money valuation is negotiated between the company and investors and, combined with the amount raised, determines how much equity is issued to new shareholders.

The valuation of a company immediately after a new funding round, calculated as the pre-money valuation plus the capital raised. Post-money valuation determines the ownership percentage that new investors receive for their investment.

A formal demand made by a private equity or venture capital fund's general partner requiring limited partners to transfer a portion of their committed capital to fund investments, management fees, or fund expenses. Capital calls are issued as investment opportunities arise rather than collecting all committed capital upfront, and the pace of capital calls relative to distributions is a key measure of fund performance.

A short-term financing facility designed to provide temporary capital to a company or fund until permanent financing or the next funding round is secured. In the startup context, bridge loans often carry convertible terms that allow the lender to convert the outstanding balance into equity at a discount to the next round's price, compensating for the higher risk of interim financing.

What is fundraising and what are the core stages?

Fundraising is the process of raising capital from investors in discrete rounds (seed, Series A/B/C, growth). Each round has distinct investor profiles, valuation expectations, and use of proceeds.

How do you value intangible assets in a pre-seed or seed stage startup?

Pre-seed intangible assets are valued using the Cost Approach (replacement cost of development), qualitative scoring frameworks, or benchmark-based methods since income approaches require revenue history that does not yet exist.