Thread by @tylertringas

The concept of “pre-seed VC funds” has been a devastating net negative for entrepreneurship as a whole primarily through misunderstanding (even tho I think the actual strategy has some merit in the game that it’s specifically playing)

Here’s what pre-seed is: 1/ there is a small class of founders that have such an accumulation of unfair advantages that it’s just *obvious* they will generate some amount of traction on an idea and be able to raise a seed round

2/ a mix of entrepreneurial investors + seed investors looking to build a dealflow advantage identified this and created a category for it.

If you’re thinking about SaaS for hotels + you own a boutique hotel + spent 10 years at Airbnb... you’re pre-seed material

But there are like a few dozen firms doing ~2k pre-seed deals a year. That’s it. Basically *nobody* raises a pre-seed round from professional investors.

But now the idea of pre-seed exists... in a stage in which there are 10s of millions (more?) entrepreneurs that now think they should spend time and energy to raise a “pre-seed” round.

You almost definitely shout not. Basically no one does and it shouldn’t be part of your plan.

If you are not drowning in unfair advantages and an absolute lock for eventually raising a much larger seed round in 6-12 months, don’t waste your time pitching investors on a pre-seed round. If you can do “family & friends” do it otherwise bootstrap.

I deeply, personally understand the challenges at this stage and I’m not saying this is how entrepreneurship should work (and I spend a lot of time thinking about how we can make it better). But this how it is. Almsot no one should be raising a pre-seed.

To be clear, I think it “has been” a real net negative, but i support the general line of inquiry of providing capital to founders at earlier and earlier stages.

Some great ideas that are pre-seed but not pre-seed-VC. Need much much more of this.

https://twitter.com/millerannette/status/1274564713763004418