Want a Pre-seed Check? You Better Have a Product Ready
Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.
![Want a Pre-seed Check? You Better Have a Product Ready](https://dot.la/media-library/image.jpg?id=22839135&width=2000&height=1500&quality=85&coordinates=26%2C0%2C26%2C0)
It was not long ago that having a brilliant idea or even a "pre-idea" was sufficient enough to get someone to write you a pre-seed check. Those were the days. Now, according to an analysis released Tuesday of 174 pre-seed companies, founders have to be much more prepared when they're pitching investors.
"The pre-seed round is now more formalized, and investor expectations of pre-seed startups are changing," said Russ Heddleston, co-founder and CEO of DocSend, which released the analysis, in a prepared statement. "Institutional investors are moving downstream and establishing pre-seed funds, and they're bringing their sophisticated and rigorous investment approach with them."
Here are key findings from the report:
- The average amount raised in the U.S. during a pre-seed round is $500,188
- 92% of companies with successful pitch decks in the pre-seed round had either an alpha, beta, or shipping product. This is in contrast with the unsuccessful pitch decks analyzed, where only 68% of companies presented the same type of product readiness
- The average pre-seed pitch deck length is 20 pages.
- Investors spend an average of 3 minutes, 21 seconds reviewing a deck
- Investors spend nearly 50% more time on the product slides in successful pitch decks and over 18% longer on the business model in unsuccessful pitch decks
- Contacting more investors and holding more meetings doesn't yield better results for fundraising in the pre-seed round. The average fundraising round for pre-seed startups lasts 20.5 weeks with an average of 63 investors contacted, which garners 32 investor meetings for successful startups
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Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.