Definition

Receiving free money from governments or organizations to help your business grow. These funds don’t need to be repaid and can ease early financial pressure.

What to consider

  • Be ready to give up some equity.
  • Plan for subsequent funding rounds.
  • Use funds strategically to reach key milestones.

Real world scenarios

  • A startup in San Francisco raises seed money from angel investors to develop its prototype.
  • An entrepreneur secures seed funding through a pitch competition.
  • A small business obtains seed capital to hire its first employees.

Related terms

Entrepreneurial Finances