Startup Funding Benchmarks

Coming into 2025, we projected that strong IPO debuts would catalyze larger growth across the entire funding stack, while weak or middling debuts would lead to a "stabilization and slow growth" trend akin to 2024.

Thus far the IPO market has underperformed, but the expected increase in M&A and secondary sales have begun to return a modest amount of capital and gradually create a "cautiously optimistic" feeling amongst most investors.

In this latest update, we have seen a slight increase in Pre-Seed "Caps", while Seed valuations have slightly fallen and Series A valuations have risen. Keep in mind that most cumulative metrics will show that Seed valuations have risen in 2025, but this data is heavily skewed by just a few AI 'mega-rounds' (Ex. Thinking Machines' $2BN "Seed" round).

We have also seen the Equity Sold at Seed slightly rise, but we have not yet seen this dynamic at Series A.

2025 had more "first-time financings" (ie. angel and pre-seed rounds) than we have seen in many years, perhaps since the height of the pandemic-driven tech boom. However, we have seen the funding amounts at the earliest stages slightly drop as investors continue to demand higher efficiency. This is in sharp contrast to the Series A and later stages, where funding rounds are some of the highest we have ever seen and capital has been concentrated on a very small number of companies.

To successfully fundraise in 2026, entrepreneurs must showcase traction (even pre-revenue startups), capital efficiency, and a strong vision/ narrative for their future growth. Be prepared to pitch to a large number of investors (100-200), using the process as a way to both find investment and improve your narrative/ pitch. More than ever before, investors want to see a thoughtful plan for how you plan to deploy their capital to reach the metrics needed for your next round of funding.