Seed is Strong
on the seed stage and the dynamics and potential for which venture capital was created
Venture capital is in a curious era. AI has shifted some investment decisions into a binary. Enormous multi-stage funds dominant headlines. Growth rounds stretch into the billions. Many partnerships have stratified in this stratosphere, reclassifying as asset management firms. The market has institutionalized. Professionalized. Inflated. And yet, there’s at least one constant that endures: the seed stage still offers the most singular opportunity in venture capital.
By some measures, seed may seem saturated. The number of firms writing early checks has exploded. Founders often raise with polished decks, strong pedigrees, and waitlists of investors vying to get in. Nevertheless, the dynamics, challenges, and nature of seed remains the same. Seed is still truly early; where ideas are fragile, ambiguous, often invisible to the broader market. Great companies are still forming in the quiet, before they’re picked up by TechCrunch or a tweetstorm signals they’ve “arrived.” The best opportunities are still invisible at the moment they matter most. The most important companies still start as barely-formed ideas, often pre-announcement, pre-launch, and pre-traction.
Some of the craft of seed is orienting around this invisibility. A mix of presence, prescience, pattern recognition and proximity that can lead to encountering a company before it’s a company. Early awareness and early access are earned. Staying close to the builders tinkering, reading the edges of subcultures, studying technology frontiers, and participating in communities where ideas are still half-spoken can build a reputation for adding real value before a term sheet is in play. It’s the opposite of formulaic, and it doesn’t scale cleanly. That’s why the opportunity persists. Seed is belief before consensus, conviction before validation.
Structural pressures are reshaping the upper end of the market. Later-stage, mega-fund venture tacks to a capital accumulation business: raise billions, deploy aggressively, optimize for ownership in companies already scaling. The model can work for what it is, it’s just looking more like private equity with each passing year: compressed returns, expensive entry points, and limited ability to partner or participate in early trajectory. By contrast, seed retains the highest potential for asymmetric outcomes. Entry points are extremely viable. In many cases, risk-adjusted prices are lower. Meaningful ownership is earned earlier. The ability to partner deeply with founders and early teams is still real. Done with intention, discipline, studiousness, seed can compound over time into breakout companies and outlier returns.
It ain’t easy. The signal-to-noise ratio is punishing. Context shifts can send the mind spinning. In a somewhat contradictory stew of self-awareness and humility combined with unique perspective and independent conviction may be found the willingness the be early and wrong, and to cultivate these that may not pay off for five or ten years, if ever. It’s an opaque, amorphous, perpetually evolving endeavor to build networks and systems that uncover novel ideas yet surfaced, and relationships with founders who are still deciding whether to even be founders at all.
For those who are at home in this terrain, who love rough edges, ambiguity, and the sparks of something new, the seed stage can produce those rarest of rarities: profound companies and outsized outcomes, not because they’re easy, but because they’re still hard to see. As structural changes abound across venture, seed fosters the original promise of the asset class. Lots of consequential companies still begin as non-obvious bets. Lots of superlative founders still start small, quiet, and unproven. And seed remains the most meaningful time to find founders and ideas the rest of the world doesn’t yet understand, back them before they’re obvious, and help them become inevitable.