The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
20VC: The Three Types of Seed Round Today, Why Seed Has Never Been More Competitive, Why Pricing Has Never Been Higher, Why Boards at Pre-Seed Can Be Helpful & How Too Much Cash Too Soon Can Harm Companies with Ed Sim, Founder @ Boldstart
Oct 27, 2023
Ed Sim, Founder and Managing Partner at Boldstart Ventures, dives into the competitive seed funding landscape, identifying three distinct types of seed rounds. He argues that too much early capital can hinder startups, urging founders to be cautious of high valuation offers. Sim also disagrees with the notion that growth is dead, outlining evolving expectations from multi-stage funds. Lastly, he discusses the future of IPOs, the AI investment craze, and the importance of strategic decision-making in a rapidly changing market.
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Quick takeaways
- Three types of seed rounds: discovery, classic, and Megatron Jumbo, each catering to different founder profiles and funding needs.
- High pricing in seed rounds is a concerning trend, with risks of detrimental impact on startups.
Deep dives
Different types of funding rounds
The podcast episode discusses the three different types of funding rounds: discovery round, classic round, and Megatron Jumbo round. The discovery round is for first-time founders exploring new markets with funding less than 2 million. The classic round is for first or second-time founders seeking funding between 3 to 5 million. The Megatron Jumbo round is for seasoned founders with prior exits, seeking funding greater than 5 million, usually between 6 to 10 million.
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