First Round Financing
In venture capital terminology, the term First Round Financing refers to the very first formal funding of a company. This should not to be confused with seed money, which is usually obtained prior to the First Round Financing.
For example, once the start-up company has grown to the point where it has passed its preliminary trials and used up most of its seed money, the company is now ready for First Round Financing. The company will ideally have proven that it can perform in the marketplace and has achieved a position of continuing growth as long as the company can obtain more funds. Typically, this sort of First Round Financing will be provided after the company has successfully sold its products to an audience which it has identified and targeted with the objective of expanding its business. A solid management team and good earnings prospects usually qualify the start-up for First Round Financing.