SaaS Founders Sell Less Equity Than Other Sectors at Seed

SaaS founders have it pretty good these days.

Now - that comes with a lot of caveats. Way harder to raise a round than it was a couple years back, expectations for traction and momentum are much higher, no doubt.

But when it comes to ownership, SaaS founders keep more of their companies than founders in other major VC sectors.

Just look at priced seed rounds from 2023:

- SaaS founders sold a median of 20.3% to investors

- Fintech founders sold a median of 20.4% to investors

- Hardware sold 21.7%

- Renewable Energy companies sold 25%

- Biotech companies sold 25.5%

Big gap there for the more software-focused startups vs the harder tech venture-backed companies.

And the distance between industries only gets larger as you move up the venture ladder.

Median Series A dilution - in SaaS, it's 20%. in Biotech, it's 28.2%

Median Series B dilution - in SaaS, 15.9%. Biotech 24.5%

Of course dilution doesn't only happen in primary rounds. There's a whole collection of bridges, extensions, convertible financings that eat into the founder ownership share as well.

But when it comes to the standard, clean venture round - SaaS founders have it pretty good.

Silver linings I guess! Sorry Biotech folks.

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