Thanks for the reply. So, to clarify, raised capital goes into the pockets of the founders? There is not typically a contract involved that requires company registration (i.e. incorporated), or suggestion on where to put the money?

Thanks again!

I have not raised money myself, but everyone I know who raised a seed round, incorporating was one of the stipulations. There is always a contract (term sheet), which spells out certain requirements. But typically the bulk of the money raised, goes toward supporting the founders as they build/launch the product.