Ignore Headlines About Startups Raising A Rounds in Six Months

Founders - ignore the FOMO headlines of startups raising massive rounds just months apart.

That's not the full market. In fact, it's just a small sliver of what's happening now.

Data below shows the time between a Seed and a Series A round for 3,000+ startups on Carta (all US companies).

The teal slice is the percent of Series As raised 1.5-2 years after the Seed.

The dark blue slice is the percent of Series As raised 3+ years after the Seed.

So far this year:

• 24% of startups raised their A in 1.5-2 years after the prior round

• 39% of startups raised their A 3+ years after the prior round.

And only 15% got to the next round in less than a year.

𝗦𝗼𝗺𝗲 𝗟𝗲𝘀𝘀𝗼𝗻𝘀

• If you're not planning on making your seed round cash last for 1,000 days (2.7 years), you should!

• Don't expect bridges or extensions. It can feel like a safe harbor but many founders will find conversation about a bridge difficult even with their current, supportive investors.

• Maybe some of the extended time between seed and A is a good thing (founders proactively choosing not to raise for longer because they don't need to). If this is you, awesome.

• What does this mean for round sizes? They are rising at Seed (gently, but rising - median is currently $3.5M). Perhaps the argument for raising a slightly bigger round is more impactful in the current environment.

• Maybe skip seed and go directly to A 😈

Run your own race & don't let the company die, that's all.

#startups #founders