Will Your Seed Stage Startup Make It to Series A

Will your seed-stage startup make it to Series A?

Let's dig into data from 5,418 US startups using Carta.

Each cohort in the chart refers to companies that raised their priced equity seed round in that year (2018, 2019, or 2020).

Then we just looked at the most recent funding round for each company. How far have they gotten?

For seed-stage in 2018 (so 4.5-5.5 years):

• 47% have not raised another round (meaning 53% made it past seed)

• 6% have made it to Series C or beyond!

Seed-stage in 2019 (3.5-4.5 years):

• 50% have not made it past seed

Seed-stage in 2020 (2.5-3.5 years):

• 56% have not made it past seed

Important to note that this data does NOT look at whether the underlying companies are still in business. This is not an analysis of failure rate, simply of funding progression.

So big takeaway: looks like for these 3 years, you could reasonably assume about 50% of companies would end up raising at least a Series A if they had already raised a priced equity seed round.

Is that...above expectations? Perhaps slightly, given some other studies. Perhaps companies using Carta have a slight bias towards further funding in some way.

Will this percentage hold for companies that raised in 2021 or early last year, given macro changes to the funding environment? My bet is the percent making it to Series A might be a little lower.

And of course, the funnel only gets narrower as the alphabet stages rise. Only about 1 in 5 of the 2018 cohort has hit Series B so far.

Startups are not for the faint of heart! But salute to the founders out there making it happen.

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