What Happens to Series A Startups After They Raise

What happens to Series A startups?

We think of Series A as a major checkpoint in a startup's lifecycle, often as evidence of product-market fit.

But raising Series A is no guarantee of anything, really.

Data below is from 4,514 US startup using Carta that raised their Series A rounds from 2019-2021. We did a simple check-in to answer the question: how far have they gotten?

𝗗𝗮𝘁𝗮 𝗳𝗼𝗿 𝟮𝟬𝟭𝟵 𝗦𝗲𝗿𝗶𝗲𝘀 𝗔𝘀

• 52% of Series As from 2019 made it to Series B

• 21% made it to Series C (so far)

• 6% to Series D (so far)

26% of 2019 Series A companies are still kicking at Series A

𝗗𝗮𝘁𝗮 𝗳𝗼𝗿 𝟮𝟬𝟮𝟬 𝗦𝗲𝗿𝗶𝗲𝘀 𝗔𝘀

• 54% of Series As from 2020 made it to Series B (ZIRP boost!)

• 16% made it to Series C (so far)

• 3% to Series D (so far)

27% of 2020 Series A companies are still kicking at Series A

𝗗𝗮𝘁𝗮 𝗳𝗼𝗿 𝟮𝟬𝟮𝟭 𝗦𝗲𝗿𝗶𝗲𝘀 𝗔𝘀

• 35% of Series As from 2021 made it to Series B (end-of-ZIRP decline)

• 7% made it to Series C (so far)

• 1.3% to Series D (so far)

50% of 2021 Series A companies are still kicking at Series A.

I think one of the biggest remaining questions in venture is this: what happens to companies that had raised significant VC money before the AI explosion really began in late 2022?

Will they be able to re-ignite growth to catch up to new AI-native rates? If not, will they be able to get to profitability and exit the venture track meet on their own terms? And failing that, are there really any major buyers for those companies left?

We're talking about many, many startups in this bucket. More than 1,000 startups using Carta raised Series A in 2021 and haven't raised a round since.

The more time passes, the more I worry about those cohorts 😬

#startups #SeriesA #SeriesB #founders #venturecapital