What Valuation Should I Raise at for My Seed Round?

Seed Round Valuation Ranges

Seed round valuations typically fall in these ranges (pre-money):

SaaS: $4M–$15M pre-money, depending on ARR (typically 20-40x ARR at seed) AI/ML: $5M–$20M pre-money (higher due to sector premium and capital requirements) Fintech: $5M–$15M pre-money Marketplace: $4M–$12M pre-money Healthcare: $5M–$15M pre-money

These ranges are broad because valuation depends on multiple factors: growth rate, team pedigree, market size, competitive dynamics, geographic location, and investor demand. A YC-backed AI company in SF will command a different valuation than a bootstrapped SaaS company in a smaller market.

The right valuation for your company falls within these ranges based on your specific situation — not on what you heard another founder raised at.

The Step-Up Test

The most important valuation framework: can you justify a 2-3x step-up to Series A?

If you raise at $10M pre-money seed, Series A investors need to see a path to $25M-$30M+ valuation. That requires significantly more traction — typically $1.5M-$2.5M ARR with strong growth and retention.

If you raise at $5M pre-money seed, the same Series A valuation is easier to reach, requiring less traction to justify the step-up.

The valuation that 'feels good' now might create impossible expectations for the next round. A lower valuation with achievable milestones is often better than a high valuation that creates down-round risk.

Model the scenarios: at your proposed valuation, what metrics do you need 18 months from now to raise Series A? Can you realistically hit them?

How to Set Your Valuation

Step 1: Research comparable raises. Find 5-10 companies at your stage and vertical that raised in the last 12 months. Use Crunchbase, PitchBook, or founder networks.

Step 2: Assess your position relative to comparables. Are your metrics above, below, or in line? Adjust accordingly.

Step 3: Apply the step-up test. Make sure your target valuation leaves room for a healthy Series A.

Step 4: Set a range, not a point. 'We're targeting $6M-$8M pre-money' gives negotiation room without signaling uncertainty.

Step 5: Let the market validate. If multiple investors offer within your range, you're calibrated correctly. If everyone passes, the valuation may be too high.

This analysis should be complete before your first investor conversation. Walking in without a valuation framework means the investor sets the anchor — and they'll anchor low.