Seed funding also known as seed money or capital is a form of securities offering in which CAPIS invest discretionary income (from its pool of venture capital fund) in an early stage startup. Seed money is usually meant to cover for preliminary operations such as market research, product development, procurement of operational equipment, setting up of operational premises and cost of early stage administrative and operational expenses. Seed funding supports a new business until it can generate cash of its own or ready for further investment.
Under our Venture Capital Fund Program every subscriber is qualified to receive seed funding upon completion of the requisite entrepreneurship capacity building classes. Traditionally seed money from an institutional investor like CAPIS comes in the form of equity investment making CAPIS a co-owner of the new venture. This is however not the case under our VCFP. Recipient of seed funding own their businesses one hundred percent because CAPIS exercises its right of first refusal by divesting itself of its presumed equity stake, which is why all seed funded businesses begin to remit, via micro installment, fifty percent of the fund received at the end of their third financial year.
CAPIS also provide seed funding to non-subscribers. Under this format the seed money is provided in exchange for equity in the new business. One of the benefits, besides finance, of receiving seed funding from CAPIS, under this format, is the inclusion of a top notch management team to oversee the management of the new venture. Ideally CAPIS gets a minimum controlling stake of about sixty percent.