Deal terms, and the requirements to raise startup funding, are constantly in flux. The below metrics reflect what we are seeing across dozens of deals per month, and across most major geographic markets and industries.
The below are the average milestones and deal metrics we are observing across the globe on the date displayed.
Please note these figures are an approximate average, since deals vary widely across geographic markets, industries, and companies. In the end, a company is worth what an investor/ acquirer is willing to agree it is worth and the below should only be used as a baseline guide.
|Traction||Customer Validation||Product-Market Fit||Expansion||
Pre-Seed Customer Validation
Seed Product-Market Fit
Series A Expansion
|Growth Rate||0 - 20% MoM||15% - 30% MoM||25%+ MoM||
Pre-Seed 0 - 20% MoM
Seed 15% - 30% MoM
Series A 25%+ MoM
|Monthly Revenue||$0 - $75k||$75k - $200k||$200k+||
Pre-Seed $0 - $75k
Seed $75k - $200k
Series A $200k+
Series A 20+
Series A Commercial
|Investors||F&F, Seed Accelerators, Angels, Pre-Seed/ Micro VC Funds||Seed Accelerators, Angels, Seed VC Funds||Series A/ Growth VC Funds, Existing Investors||
Pre-Seed F&F, Seed Accelerators, Angels, Pre-Seed/ Micro VC Funds
Seed Seed Accelerators, Angels, Seed VC Funds
Series A Series A/ Growth VC Funds, Existing Investors
|Round Size||$25k - $750k||$750k - $4m||$4m+||
Pre-Seed $25k - $750k
Seed $750k - $4m
Series A $4m+
|Company Valuation||$1m - $5m||$5m - $12m||$18m - $50m||
Pre-Seed $1m - $5m
Seed $5m - $12m
Series A $18m - $50m
|Investment Vehicle||SAFE/ Convertible Note||Priced Round||Priced Round||
Pre-Seed SAFE/ Convertible Note
Seed Priced Round
Series A Priced Round
In general, investors invest in "traction" over ideas. But the definition of "traction" changes across industries, and over time. The below are the average traction metrics/ milestones we are observing across the globe on the date displayed.
|Industry||Pre-Seed Traction||Seed Traction||Series A Traction|
|Marketplaces/ eCommerce||$5k - $500k Transaction Revenue||$250k - $2m Revenue Run Rate||$5m - $20m Revenue Run Rate||
Pre-Seed Traction $5k - $500k Transaction Revenue
Seed Traction $250k - $2m Revenue Run Rate
Series A Traction $5m - $20m Revenue Run Rate
|Consumer Audience||Demonstrable Customer Demand, 5k+ DAUs, Great Retention||25k - 100k DAUs, Network Effects||500k+ DAUs||
Pre-Seed Traction Demonstrable Customer Demand, 5k+ DAUs, Great Retention
Seed Traction 25k - 100k DAUs, Network Effects
Series A Traction 500k+ DAUs
|Saas||Paid Pilots||$20k - $100k MRR||$200k MRR, 12 months of Cohort Data||
Pre-Seed Traction Paid Pilots
Seed Traction $20k - $100k MRR
Series A Traction $200k MRR, 12 months of Cohort Data
|Deep Tech||Strong Leadership, PoC, GitHub Stars||Strong Leadership, PoC, IP, GitHub Stars||Commercial Validation||
Pre-Seed Traction Strong Leadership, PoC, GitHub Stars
Seed Traction Strong Leadership, PoC, IP, GitHub Stars
Series A Traction Commercial Validation
This most recent update includes lowered valuations and round sizes for Series A rounds.
Economic confidence is shaken as a result of the SVB fallout, and we expect the later-stage funding market (Series A+) to remain very challenging throughout 2023. SVB also represented a large portion of the global venture debt market (and was widely relied on to offer the best terms), and many later-stage companies were relying on venture debt to extend their runway. As such, we expect to see many more layoffs, closures, and acquisitions at large, late-stage companies.
We are still seeing a strong market for seed funding, with valuations holding steady. Anecdotally, we believe this is due to an influx of later-stage VCs into the seed market.
Pre-seed and angel funding levels also remain strong, but we do believe there will be a short slowdown across all funding levels as people 'exhale' from the stresses of the SVB ordeal and monitor the turbulent public markets. We expect this slowdown to subside in April.
The Founder Institute is the world's largest pre-seed startup accelerator, with over 6,800 portfolio companies spanning 100 countries. Our data is derived from working closely with FI Alumni on their financing efforts on a daily basis, and observing dozens of term sheets and deals per month. In addition, this data leverages feedback from the FI Venture Network (a network of investors that participate in the earliest startup funding rounds) and our sister company, VC Lab (the leading accelerator to launch new venture funds).
100% accuracy is impossible due to the variances across each deal, market, and industry over time. These figures are an average approximation of what we are seeing, and should be viewed as such. In the end, a company is worth what an investor/ acquirer is willing to agree it is worth.
We plan to update these figures approximately 2-3 times per year, based on the market. This number could increase or decrease depending on market volatility.
Below are some resources that can help you get started:
- How to Raise the First Round of Funding for Your Startup
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