What 10x More Seed Capital Means for Founders

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tomtunguz.comToday, 70% of startups in the US that raise a Series A have raised a seed round. That’s up from 50% ten years ago. In the same period, the amount of seed capital invested in the US has increased about 10x from $200M per year to $2B. What does this imply for early stage founders?

First, it implies greater competition at the Series A. Larger seed rounds enable a seed stage company to achieve more – more growth, more revenue, more hiring. In addition, these larger seed rounds enable successful startups to raises larger series As, and the data supports it. The correlation coefficient between seed round size and Series A size in the Crunchbase data set is 0.89 across all startup sectors.

Read more at tomtunguz.com

 

photo CC by Pictures of Money

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