Are venture rounds under $5M really going away?
...no, not if you count SAFE rounds. And you should count SAFE rounds.
But first, why does this matter? Who cares if rounds are bigger or smaller than $5M?
Well, founders care. It's a pretty high bar if you're being told don't even try to raise less than $5M in capital.
And thankfully - that's just not true. The <$5M round is harder to find in priced equity, but in the world of SAFEs they are plentiful.
𝗜𝗳 𝘆𝗼𝘂 𝗮𝗿𝗲 𝗿𝗮𝗶𝘀𝗶𝗻𝗴 𝗹𝗲𝘀𝘀 𝘁𝗵𝗮𝗻 $𝟮𝗠, 𝘆𝗼𝘂 𝗮𝗿𝗲 𝗼𝘃𝗲𝗿𝘄𝗵𝗲𝗹𝗺𝗶𝗻𝗴𝗹𝘆 𝗹𝗶𝗸𝗲𝗹𝘆 𝘁𝗼 𝘂𝘀𝗲 𝗦𝗔𝗙𝗘𝘀.
Other points from this data:
The "barbell" in venture is getting wider. As in more founders are raising less than $1M and more are raising above $3M as the first capital in.
Some startups are moving straight to Series A (something like a $10M raise).
Many are starting with a small round and then seeing how far they can get on less cash.
AI is making this all more confusing.
But deep breaths, founders - ignore the headlines, you don't have to raise a mega round out of the gate.
#startups #founders #firstround #fundraising
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