Question
What is seed capital? Give example.

Answer

Capital needed to set up a new business or enterprise. It can be obtained from owners or his/ her relatives or from outside sources.
  • It is that money used for the initial investment in a project or startup company provided to an entrepreneur to prove the feasibility of the project and quality of startup capital.
  • To avail this sources of finance he may concern and contact various agencies, financial institutions.
  • Example: Narayan Murthy started Infosys in 1981, had no capital and his wife Sudhamurthy gave him ₹10, 000 which can be considered as seed capital.

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