State of Pre-Seed 2025 in review

Introduction

2025’s a wrap, so we crunched the numbers to bring you our definitive breakdown of the year in pre-seed startup funding. Over the course of the full year, U.S.-based startups on Carta raised $10.4 billion across 50,316 SAFEs and convertible notes. 

Compared to 2024, that’s a 1% decline in total cash invested—not  a significant difference—but a 13% decline in the count of instruments. As we also saw on the priced equity side of fundraising, venture capital grew increasingly concentrated in 2025. 

The post-money SAFE with a valuation cap but no discount continues to be the standard pre-seed instrument. In 2025, median val caps on post-money SAFEs hovered around $10 million for rounds in the $250,000 to $1 million range and $15 million for rounds in the $1 million to $2.5 million range.

Continue reading for detailed charts and data on pre-seed investment volume, common deal terms, industry trends, top metro areas, and more.

2025 in review

• Concentration of capital: 11,672 SAFEs and convertible notes were issued in Q4 2025, the lowest we’ve seen in recent years. However, those instruments represented $2.62 billion in investments, which is similar to the last several quarters.

• The popularity of pre-priced funding: Founders are raising larger sums of money on convertible instruments before switching to priced equity. In 2025, the majority of early-stage rounds under $4 million were completed using SAFEs or convertible notes. 

• SAFE valuation caps rise: In 2025, val caps on SAFEs increased across deal sizes, while caps on convertible notes experienced greater fluctuation. Also, convertible notes tend to have lower val caps than SAFEs.

• Founders building in atoms: While SaaS remains the largest startup industry, hardware and biotech/pharma finished 2025 as the second and third largest by total cash raised. This is a noticeable difference from 2024, when hardware was third and biotech/pharma was fifth.

Key trends

SAFEs

Convertible notes

Industries

Methodology

Carta helps more than 50,000 primarily venture-backed companies and 2.5 million security holders manage over $3.0 trillion in equity. We share insights from this unmatched dataset about the private markets and venture ecosystem to help founders, employees, and investors make informed decisions and understand market conditions. 

Overview

This study uses an aggregated and anonymized sample of Carta customer data. Companies that have contractually requested that we not use their data in anonymized and aggregated studies are not included in this analysis.

The data presented in this pre-seed report represents a snapshot as of February 17, 2026. It encompasses 315,000+ convertible instruments raised by more than 23,000 startups in the United States from Q1 2021 to Q4 2025, with a focus on the 50,000+ instruments raised in 2025.

Historical data may change in future studies because there is typically an administrative lag between the time a transaction took place and when it is recorded in Carta. In addition, new companies signing up for Carta’s services will increase historical data available for the report.

Definitions

This report defines “pre-seed” as any fundraising activity that occurs on convertible instruments prior to a company’s first priced equity round. Convertible notes and SAFEs are the two types of convertible instruments analyzed.

A pre-priced “round” (or “deal”) is defined as encompassing all of the convertible instruments that a given company has raised with the same valuation cap, prior to raising any priced equity.