They are not probing for a dollar amount. Your answer to this seemingly innocent question will convey your knowledge of venture capital and could increase their interest in you. Your answer should depend upon the current stage of your company, nothing else. Some funds might be used to build some demonstrator models for the marketing research. This capital is generally the highest risk and most difficult to acquire.
Typical sources are state and regional seed funds.
It would be very wise to use a significant amount of this capital to demonstrate the strength of the market and acquire testimonials from users. You should also have a strong management team in place. If you have sales, they are probably minimal, and profits are months away. Startup capital is generally used to launch a significant marketing effort for your product or service, as well as provide the facility to fulfill orders promptly. This type of capital is still considered very high risk.