What would be considered "enough traction" before going for a seed round?

If you can skip investors and run with your customers money - do this until you're ready for big round. What is good traction...? It depends on how you sell it to investors, how you pitch them, actually. It's not about real traction on this stage in 99% of the cases. But... if you really want to understand what the best traction is, I think it's all about retention and customer happiness. If you have very less amount of money, or companies can't leave without your software and are going to use it daily, switch from other e t. c., so this is the best traction measurements. You can grow money and # of customers, but if they really use your product and like it - the best traction you can have. If you want understand your best traction before the launch, so initiate pre-orders with great discount. How much traction you have is not so important as how fast and how good it is.

With the progress you have made you should be able to get seed funding.

The advantage of waiting longer is that you will be able to set a higher valuation and retail more of your company.

If you need the money to properly support the business and customers then it sounds like about now is the time to seek investment.

Happy to discuss further if you want to schedule a call.

Based on what you have written here, you have proven "The dogs will eat the dog food." Do you have the cost to deliver the product in an analysis that will show a potential investor it will be profitable? Do you have a business plan? You need this information in order to get through the filtering process a potential investor will put you through. Make sure as you are beginning to deliver the product, you maintain an accurate list of costs you can compare to your projections and make sure they are realistic.

I have reviewed a number of business plans presented to investors. The best ones have a one page executive summary with a very high level describing the "Why" the product exists, macro projections and a high level summary of the leadership team. The detail follows in the actual business plan. You only have a few minutes to get the investors attention enough to turn the page and keep reading.

Feel free to reach out for a call if you would like to discuss further.

There are two clear paths for you.

After having raised several rounds of multi million dollars for my venture, My suggestion would be the following.

I understand that your SaaS solution would be in the 10-20K/year range. The risk because of the pricing is that scaling this would require lot of tactile and strategic thinking and experimentation. The most important thing for you is to figure out if there is a market for something. Hint: You will figure out only after you have acquired at-least 50 customers.
I would suggest you try and do it as a side business at-least until you have reached 10 paying customers from your existing 3.
By the time you reach 10, you will have enough confidence to jump full time into this.
By the time you reach 50, you know that there is enough uptake for this.
Now you can decide if you want to bootstrap or raise capital and you could go to series A directly. In your case both are possible.

Do let me know if you need more inputs. Would be happy to help you think through this and also help you in scaling up.

Vivek