What Check Sizes Should Pre-Seed Founders Expect From Angels

What sort of checks should pre-seed founders expect?

Analyzed 8,910 individual SAFEs on Carta from the first half of 2023. These SAFEs funded a total of 2,211 companies. US only.

Split the distribution of check sizes by the amount each company raised in total. To no one's surprise, an early startup raising $5M does so with very different checks than one raise $250K.

But especially for those just starting out, small checks matter! Checks under $25K make up nearly 60% of all checks into companies raising $250K or less (which many would classify as the friends & family stage).

These small checks are also quite persistent. Nearly 30% of all checks into companies raising $1M on SAFEs are for less than $25K.

Couple other key takeaways for early founders:

• Median number of checks into a company raising $250K or less was 4.6. That jumps up to over 8 for a company raising $1M and up past 17 for companies raising multiple millions.

• Not much pattern across all these companies on which checks come first. Some founders sign the big investor first, others aggregate small checks until they can close the larger ones.

• Founders raising on convertible notes tend to see fewer small checks involved in their fundraise.

• There has been a drift towards larger cap tables at the earliest stages - a few pre-seed companies in the data now have over 35 angels on the cap!

It's pre-seed week for Carta Insights - more views into this early market coming throughout the week culminating in our first Pre-Seed Report on Friday! Sign up at the link in graphic to stay in the loop.

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