Founders are having to build with less cash across the board —except in seed-stage.
Data compares the cash raised distribution for US primary venture rounds for Q1 2022 vs Q1 2024.
Now with all the turmoil across venture since 2022, the expectation would have been that founders were having to do more with less. But it turns out that the median cash raised for a priced seed round was actually higher in this most recent quarter.
(Yes, we only looked a priced seed rounds - but the dynamics in SAFE seeds are pretty similar. More out on that soon).
Once you move past seed, however, rounds sizes have shrunk substantially.
Down 18% from Q1 2022 to Q1 2024 for Series A.
Down 20% for Series B.
Down 43% for Series C.
Down 68% (!) for Series D.
This is all intimately related to the "dry powder" debate across VC right now. Either VCs will have to make a 𝗹𝗼𝘁 more investments at these smaller round sizes or that powder will stay dry for another year. It can't all go to seed-stage!
Now is this bad? No, probably not overall. The focus on capital efficiency is a net healthy change for the ecosystem. But founders shouldn't compare notes with their friends who raised in 2022 because that was a whole different world.
Do more with less was the mantra in 2023, looks like 2024 may be more of the same.
#cartadata #founders #startups #fundraising #seedrounds __________
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