Top Pre-Seed Investors & VC Firms in 2025

The State of Pre-Seed Investing in 2025: What Startups Need to Know

The pre-seed funding landscape has evolved, with investors becoming more focused on feasibility, frugality, and tangible early progress. While this stage has traditionally been about betting on founders and ideas, investors now expect clearer plans for reaching milestones on a limited budget.

The era of backing "ideas on a napkin" is fading unless the founding team has an exceptional track record or is entering a particularly hot sector like AI or deep tech.

In 2024, many pre-seed investors began asking for an MVP, pilot users, or some form of validation, even at this early stage. The emphasis is on capital efficiency—founders must demonstrate how they can stretch an initial $500K–$1M round to reach product-market fit and secure follow-on funding.

How Pre-Seed Deals Are Being Structured

Pre-seed deal structures have shifted, favoring flexible instruments like SAFE notes and convertible notes over traditional priced equity rounds. By mid-2023, nearly 80% of pre-seed capital was invested via SAFEs, a trend that has continued into 2025.

This preference allows investors to commit capital without negotiating a valuation too early, especially in uncertain market conditions.

Valuations have also normalized after the highs of 2021. The median valuation cap for pre-seed SAFEs has dropped to around $10 million, down from $15 million in early 2022. This adjustment reflects a more cautious investment environment where founders must justify their valuations with clear differentiation and execution ability