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Startup seed money is the initial capital invested in a new business to help it develop its product, conduct market research, and cover early operational costs. It is typically the first round of funding that a startup raises to turn its idea into a viable business.
Synonyms: seed capital, initial startup funding, early-stage investment, startup initial capital
Seed money is crucial because it provides the financial resources needed to move from an idea to a functioning business. Without this early investment, startups may struggle to develop their product, attract customers, or prepare for larger funding rounds.
Startups use seed money to build prototypes, hire key team members, conduct market research, and cover initial marketing and operational expenses. This funding helps validate the business concept and prepares the startup for future investment.
Examples include funds raised from angel investors, seed funding rounds, or personal savings used to launch a startup. For instance, a tech startup might use seed money to develop a minimum viable product (MVP) and test it with early users.
