Preseed SAFE Valuation Caps Rise With Amount Raised

Founders raising pre-seed: what's the "right" SAFE valuation cap for you?

As the chart below shows, it often depends on how much you're trying to raise.

Almost no startup raising $500K will do so on a SAFE (Simple Agreement for Future Equity) with a valuation cap of $1 million...because that's 50% of the company sold. Too much dilution.

On the other end, it's rare to find a company raising $500K on a val cap of $20M or more because that's not enough cash to justify the giant cap.

𝗗𝗮𝘁𝗮 𝗦𝗮𝘆𝘀

• Less than $250K raise = $5M-$6M median valuation cap (friends & family)

• $250K-$500K raised = $7M-$8M median val cap (angel round)

• $500K-$999K raised = $10M val cap (probably a pre-seed here)

• $1M-$1.9M raised = $12M val cap (pre-seed)

• $2M-$2.9M raised = $16M val cap (big jump up, often considered a "seed" round)

• $3M-$3.9M raised = $18M val cap (definitely a seed round)

Obviously the industry plays a role in your raise as well - but the data is quite variable. Industry will likely dictate less about the ultimate valuation cap and more about the ease (or otherwise) of finding interested investors. Building an enterprise AI SaaS? Step right up :)

BTW, we're still seeing about $1 billion invested every quarter into Carta startups on SAFEs or Convertible Notes. Pre-seed is alive and kicking these days.

Happy fundraising!

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