Seed capital is money used as the initial investment for a new product or service launch. It enables businesses to launch a new product or service without depending fully on a business loan. Seed capital is typically provided by private investors who are looking for a high return on their investment of at least 30 percent. They are generally looking to invest in an industry with a market of at least $1 billion, and often want one with few competitors. 
Seed capital typically involves significantly less money than venture capital. It often comes from the company's founders' personal assets or from their friends and families. The capital is needed for research and development, to cover initial operating expenses and to attract the attention of venture capitalists.