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India’s startup ecosystem is thriving, yet early-stage entrepreneurs often find themselves navigating a labyrinth of challenges when seeking pre-seed funding. To address this critical gap, we at Eximius Ventures collaborated with WeWork Labs to launch The Pre-Seed Playbook: A Guide to Raising Pre-Seed Funding in India.
This initiative aimed to demystify the pre-seed stage, providing essential guidance for founders who often lack access to resources and networks during the earliest phases of their entrepreneurial journey.
Pre-seed funding is the initial capital that helps startups transition from concept to operational reality. Often referred to as the “friends and family” round, this stage enables entrepreneurs to validate ideas, build prototypes, and hire foundational team members. The amount raised typically ranges from $100,000 to $500,000, depending on the industry and scope of the idea.
In India, where entrepreneurial aspirations are surging, the importance of pre-seed funding cannot be overstated. This stage represents a startup’s first brush with external capital and often serves as a litmus test for the viability of its business model. Unlike later funding rounds, where metrics and performance indicators play a significant role, pre-seed investments hinge on the strength of the idea, the founding team’s vision, and their ability to articulate long-term potential.
Startups in emerging sectors like gaming, which we at Eximius have identified as a growing frontier, are particularly well-suited for pre-seed investment. Founders in these fields often leverage this funding to conduct early experiments, refine user experiences, and achieve initial traction- all of which are crucial for attracting larger investments later on.
Pre-seed funding is vital for startups to move from ideation to initial traction, often laying the groundwork for subsequent seed and Series A rounds. However, India’s funding ecosystem has historically overlooked this stage. While larger seed rounds have become common- with average amounts climbing to $1.8–$2.1 million- founders are under increasing pressure to deliver rapid growth and revenue within 18–24 months to secure the next round of funding. This rush often leads to unsustainable scaling and exposes startups to the “valley of death,” where lack of early capital and unrealistic growth ambitions culminate in failure.
While pre-seed funding is gaining traction globally, its scope and structure vary significantly across regions. In the U.S., where mature venture ecosystems dominate, pre-seed rounds are often highly competitive, with investors scrutinizing innovative ideas for scalability and early traction. In Southeast Asia, on the other hand, pre-seed funding serves as a critical enabler for founders exploring high-growth sectors like fintech and e-commerce.
India finds itself at a unique crossroads. As one of the fastest-growing startup ecosystems globally, the country’s focus on pre-seed funding has the potential to establish a stronger foundation for sustainable entrepreneurial success. The launch of The Pre-Seed Playbook is not just a milestone for Indian founders but a signal of the country’s ambition to evolve into a global hub for early-stage innovation.
A survey of over 500 early-stage founders revealed significant challenges in the pre-seed landscape. While 83% felt ready to secure funding, more than 60% struggled to identify and connect with the right investors. Additionally, over 70% highlighted credibility concerns, especially for first-time founders. These hurdles underscore the need for structured resources to guide entrepreneurs through their formative stages.
The Pre-Seed Playbook fills this void by offering actionable strategies to address common pain points such as crafting compelling pitches, overcoming rejections, and building strong networks. It also emphasizes the importance of sustainable growth, helping founders focus on long-term success rather than short-term metrics.
Pearl Agarwal, Founder and Managing Partner of Eximius Ventures, described the playbook as more than just a resource- it’s a movement to transform how early-stage funding operates in India. “Pre-seed is about more than just capital; it’s about equipping founders with the right guidance, networks, and resources to build a solid foundation,” Agarwal noted. She emphasized that drip capital- ranging from $700,000 to $1 million- is crucial for reducing risks and preparing startups for larger investments.
Arvind Radhakrishnan, Head of WeWork Labs India, echoed this sentiment, highlighting the unique challenges of pre-seed funding. He described the playbook as a “roadmap for navigating this complex yet pivotal stage,” further underscoring WeWork Labs’ commitment to fostering entrepreneurial success
At the pre-seed stage, investors are betting on potential rather than performance. While later funding rounds demand tangible metrics- such as customer acquisition costs or revenue growth- pre-seed investors prioritize qualitative factors like the founding team’s expertise, their understanding of the market, and the novelty of their solution.
For us at Eximius, identifying founders with a unique perspective on emerging sectors like gaming, wellness, or Web3 is key. This focus not only diversifies portfolios but also aligns with long-term trends shaping India’s economy. For example, our analysis of the gaming sector highlights how pre-seed funding has allowed founders to experiment with innovative business expansions and bring value through their unique insights, pushing the envelope on innovation while still building on market understanding.
These sectors, often on the cutting edge, demand forward-thinking approaches that may not be immediately obvious in terms of return on investment. However, pre-seed investors like Eximius Ventures understand that nurturing these businesses early will yield exponential growth in the long run, especially as the ecosystems around them mature.
At the pre-seed stage, investors also look for a clear roadmap- how a startup intends to deploy initial capital and achieve product-market fit. The funding is expected to cover early costs such as prototyping, hiring key team members, or building an MVP (Minimum Viable Product). Thus, investors seek entrepreneurs with a strong vision, a thorough understanding of their target audience, and the ability to pivot if needed. In this sense, the pre-seed round becomes a proving ground, testing both the startup’s adaptability and the founder’s grit.
In practice, investors also look for “founder-market fit,” meaning the alignment of the team’s vision with the problem they are trying to solve. An entrepreneur’s deep understanding of their target market, paired with their ability to execute, forms the basis of a successful pre-seed pitch. At Eximius Ventures, we have a unique approach of supporting founders by providing them not only with capital but also access to mentorship and strategic guidance at this early stage, ensuring they are set up for scalable growth in the years to come.
India’s startup ecosystem has witnessed unprecedented growth, with significant capital flowing into later-stage investments. However, a glaring gap persists at the pre-seed level, leaving many high-potential ventures struggling to secure the foundational support needed to scale. This imbalance not only stifles innovation but also disrupts the pipeline of startups reaching investment readiness for larger funding rounds.
Efforts like The Pre-Seed Playbook are crucial in addressing this gap. By offering early-stage entrepreneurs a clear roadmap, these initiatives ensure that more founders can secure their first cheque and establish a strong footing. This focus on pre-seed funding does more than just support individual startups- it strengthens the entire entrepreneurial ecosystem. A robust pipeline of well-prepared startups reduces investor risk, improves overall returns, and fosters sustainable long-term growth.
The pre-seed gap also presents challenges for venture capitalists. A lack of nurturing at the earliest stages means fewer high-quality, investment-ready opportunities down the line. By emphasizing pre-seed funding, investors like Eximius Ventures and platforms like WeWork Labs are playing a pivotal role in sustaining innovation. Early interventions at this stage allow investors to build trust with founders, guide them through critical milestones, and position them for future success..
Moreover, supporting pre-seed startups aligns with India’s broader economic aspirations. As the country seeks to position itself as a global innovation hub, cultivating a steady flow of groundbreaking startups is imperative. Empowering founders with resources, mentorship, and capital at the pre-seed level creates a fertile ground for transformative ideas, reinforcing India’s reputation as a leader in entrepreneurship.
By addressing the pre-seed funding gap, Eximius Ventures and WeWork Labs are not just investing in businesses- we’re investing in the future of India’s innovation economy.
The launch of The Pre-Seed Playbook marks a pivotal moment in India’s startup ecosystem. By addressing critical gaps in early-stage funding and offering actionable guidance, this initiative strengthens the foundation for a more equitable, innovative, and sustainable entrepreneurial landscape.
With coverage from leading platforms like The Economic Times, the playbook has already begun to shape the narrative around pre-seed funding in India.
For founders, it represents a lifeline- equipping them with the resources, insights, and confidence to take their ventures from concept to reality. For investors, it’s an opportunity to nurture groundbreaking ideas and secure long-term returns. Above all, this initiative underscores Eximius Ventures and WeWork Labs’ commitment to empowering India’s next wave of entrepreneurs, ensuring the country remains at the forefront of global innovation.
Eximius Capital Ventures Private Limited is the investment manager of the funds licensed by SEBI under AIF categories CAT I – Eximius Trust I (IN/AIF1/20-21/0855) and CAT II – Eximius Fund (IN/AIF2/24-25/1566).
Eximius Capital Ventures Private Limited is the investment manager of the funds licensed by SEBI under AIF categories CAT I – Eximius Trust I (IN/AIF1/20-21/0855) and CAT II – Eximius Fund (IN/AIF2/24-25/1566).
