Top 8 Pre-seed Venture Capital Firms in 2024

The pre-seed stage is the earliest phase in the lifecycle of a startup, typically before the company has fully developed its product, achieved market fit, or generated significant revenue. This stage is crucial as it's when the foundational elements of a business are established, including the initial team formation, product idea validation, and the development of a minimum viable product (MVP) or prototype.

At the pre-seed stage, startups are often in the process of refining their business model and value proposition. Funding at this stage is usually directed towards conducting market research, product development, and building a user base to validate the business concept.

Given the early and often speculative nature of investments at this stage, pre-seed venture capital firms usually invest amounts smaller compared to later funding rounds.

How is the Pre-seed Stage Different Than the Seed Stage?

The distinction between pre-seed and seed stages has become more pronounced over time. While the seed stage has traditionally been the initial phase of external funding, the emergence of the pre-seed category acknowledges the need for financial support even earlier in the startup journey. Among different startup funding stages, it helps entrepreneurs bridge the gap from an idea to a scalable business model.

As we navigate through 2024, the ecosystem of venture capital has seen significant transformations, adapting to the changing needs of startups and the broader economic environment. And in this rapidly evolving landscape, pre-seed venture capital firms have emerged as pivotal players as they offer crucial support to entrepreneurs at the earliest stages of their ventures.

So, without further ado, let’s take a look at the best pre-seed venture capital firms in 2024:

1. RareBreed Ventures

• Located in: Baltimore, Maryland
• Range of Investment: Up to $250,000
• Industries: Business, Financial Services
• Notable Companies in Portfolio: Nectaro, Mainstreet, Early Bird, Americana

Operating out of Baltimore, Maryland, RareBreed Ventures aims to empower pre-seed technology companies through targeted investments. By allowing angel investors to become limited partners, RareBreed Ventures leverages additional funds to support the growth of its portfolio companies.

With 49 investments to date, including a notable $40 million raised in September 2022, RareBreed has demonstrated a commitment to driving the success of startups in its portfolio through financial backing and strategic guidance, despite typically offering smaller investment amounts up to $250,000.

2. 2048 Ventures

• Located in: New York
• Range of Investment: NA
• Industries: Digital Health, Biotech, Fintech
• Notable Companies in Portfolio: Soona, Nomic, Gloss Genios, Airspace Link

Located in New York, 2048 Ventures positions itself among different pre-seed venture capital firms as a thesis-driven venture capital firm as it prioritizes early-stage investments in companies that promise to shape the future through biotech, fintech, and digital health innovations.

The firm is distinguished by its focus on mission-driven teams embarking on their entrepreneurial journey, with an undisclosed investment range but a strong track record of supporting over 200 startups. 2048 Ventures is also notable for its partnerships with industry giants. This further enhances its ability to support startups aiming to disrupt traditional markets and technologies.

3. Fulgur Ventures

• Located in: Wilmington, Delaware
• Range of Investment: Between $50,000 and $200,000
• Industries: Cryptocurrency, Fintech
• Notable Companies in Portfolio: Voltage, IBEX, Galoy, Bitlum, ScareCity

Since 2019, Fulgur Ventures has brought a wealth of experience in nurturing companies from their inception, with a particular focus on the rapidly evolving cryptocurrency and fintech sectors. Since its establishment, it has been instrumental in guiding startups through the complexities of the pre-seed stage, offering financial support of up to $200,000 and valuable industry insights.

The firm's commitment extends to later-stage investments as well, showcasing a growing portfolio that includes innovative companies in the cryptocurrency space.

4. Twenty-Seven Ventures

• Located in: Bloomington, Indiana
• Range of Investment: Between $25,000 and $500,000
• Industries: Robotics, Edtech, Enterprise Software
• Notable Companies in Portfolio: Pango, Toggle, Fiveable

Next on the list of the best pre-seed venture capital firms is Twenty-Seven Ventures (27V). It focuses on supporting very early-stage startups that innovate in the education and labor sectors. With a modest team led by a single individual, 27V commits to nurturing startups through crucial initial funding, providing up to $500,000 to propel these companies into their next growth phase.

Despite its small size, 27V has made significant strides in the global edtech space, leading pre-seed funding rounds and actively searching for groundbreaking startups in edtech and robotics to add to its portfolio, including companies like Out of the Box Education that are at the forefront of educational technology.

Also read: Early-Stage VC Firms for Startups Seeking Funding

5. Precursor Ventures

• Located in: San Francisco, California
• Range of Investment: Between $250,000 and $500,000
• Industries: Fintech, Digital Health, Education,
• Notable Companies in Portfolio: Panda Tree, Aunt Flow, Boost

Precursor Ventures specializes in providing pre-seed funding to startups with the potential to lead in SaaS, digital health, fintech, and education sectors. The firm is committed to a sector-agnostic approach, backing companies at their nascent stages, including those pre-product and pre-launch.

With investments ranging from $250,000 to $500,000, Precursor Ventures not only funds startups but also seeks to build lasting professional relationships. It actively engages with new teams through various outreach efforts and has supported over 200 startups to date.

6. Bee Partners

• Located in: San Francisco, California
• Range of Investment: NA
• Industries: Robotics, Machine Learning, IT
• Notable Companies in Portfolio: Glide Health, Erthos, Crowdbotics

With the focus on investing in the convergence of advanced technology and human expertise, particularly in robotics and health IT, Bee Partners champions the belief that emerging technologies can significantly enhance healthcare delivery.

With a portfolio exceeding 100 investments, the company aims to support exceptional founders who are passionate about pushing the boundaries of their industries.

7. Vitalize Venture Capital

• Located in: Chicago, Illinois
• Range of Investment: Between $50,000 and $750,000
• Industries: B2B Software
• Notable Companies in Portfolio: Going Public, AllVoices, AIRIA, Allocations

Vitalize Venture Capital specializes in early-stage and angel-stage investments in B2B software startups. The firm initiated Vitalize Angels in 2021, creating a vibrant community of investors to support pre-seed companies needing financial backing for continued growth.

Vitalize's reputation among Chicago's startup community and beyond is bolstered by over 20 active investments and a network of partners, reflecting its commitment to fostering high-potential B2B technology startups.

8. Launchpad Capital

• Located in: Oakland, California
• Range of Investment: NA
• Industries: Fintech, Real Estate, Insurance
• Notable Companies in Portfolio: Harmonic, Empower, Copper

Launchpad Capital focuses on building and investing in fintech, proptech, and insurtech companies, aiming to drive permanent structural changes in global financial services. The firm leverages its deep expertise in to champion startups that are ready to unlock new economic and technological innovations.

With an expansive portfolio that includes companies like Trash Warrior, Xplore, and Derisk, Launchpad has managed to amass significant assets, showing its ability to make impactful investments. The firm's approach is not just about providing financial support but also about fostering an ecosystem where transformative financial technologies can thrive, reflecting a deep understanding of the complexities and opportunities within diverse sectors.

What to Consider When Selecting a Pre-seed VC Firm for Your Startup?

Now that you know about the top pre-seed venture capital firms in 2024, the question arises, how to select the best out of the lot. Taking into account the following factors can help you in this regard:

Alignment of Vision and Values

A VC whose goals align with yours is more likely to provide the support needed to navigate the early stages of your startup's growth.

So, the first step in choosing a pre-seed VC is to ensure alignment in vision and values. Your VC partner will be with you through thick and thin, so it's crucial that they believe in your mission and approach to business.

Industry Expertise and Network

Look for VCs with expertise in your startup's industry. A VC firm that understands your market can offer invaluable insights, strategic guidance, and access to a network of potential customers, partners, and hires.

They can also help you navigate industry-specific challenges, from regulatory hurdles to competitive landscapes.

Investment and Support Beyond Capital

While capital is essential, the right VC offers more than just money. Evaluate what other resources a VC can bring to the table. This can include mentorship, operational support, and access to a community of fellow entrepreneurs.

Some VCs provide extensive hands-on assistance, including help with product development, marketing strategies, and scaling operations.

Track Record and Portfolio

A VC's track record and portfolio can tell you a lot about its credibility and the success of its investment strategy. Look into the startups they've invested in: How many have succeeded? What stages are those companies in now? A strong portfolio indicates that the VC not only has a keen eye for promising startups but also contributes to their growth.

Terms and Conditions of the Investment

Transparent and fair terms signal a VC's confidence in your startup's potential and their commitment to a mutually beneficial partnership. Therefore, understanding the terms and conditions attached to a VC's investment is crucial.

This includes the valuation of your company, the equity stake the VC will receive, and any specific conditions or rights attached to their investment.

Chemistry and Communication

The relationship between founders and their VC partners is pivotal. You'll be working closely with your investors, so it's important to have good chemistry. Look for investors who communicate clearly and effectively, show genuine interest in your team and product, and whose working style complements yours.

Exit Strategy

While it might seem premature to think about an exit strategy, understanding a VC's expectations in this regard is important. Some VCs may look for a quick return on their investment through an acquisition, while others may be prepared for a longer journey towards an initial public offering (IPO).

Make sure your and your VC's expectations for the future align.

‍