Founders — raising your Series A these days will be immensely difficult. But there may be a little fundraising light at the end of the tunnel. Startups that raised their seed rounds in 2024 are graduating to Series A a bit faster than their counterparts did in 2023. The trend is positive. But time has almost run out for those that raised their seeds in 2021 and 2022. 𝗖𝗵𝗮𝗿𝘁 𝗘𝘅𝗽𝗹𝗮𝗶𝗻𝗲𝗿 • Each row is a group of companies that raised their seed round in that quarter. • Each column shows the time elapsed since that seed round. • Percentages reflect the share of seed companies from that cohort that raised a Series A in that timeframe. For example: of the startups that raised their seed round in Q1 2021, 32.8% had gone on to raise a Series A in 2 years (Q8 in the columns) The reduction of green and gold cells, along with the steady march of red and pink into Year 2 and Year 3, make it clear that the boom times of venture fundraising are behind us. But for the first time in a long time, graduation rates are picking up. 9% of startups that raised their seed in Q2 2024 have gotten to A so far (in just one year). Now 9% doesn't sound like a lot, but it's a hell of a lot better than 3-4% Optimism! Now for the gloomy side. So many startups raised frothy rounds in 2021 and early 2022. If they have yet to get to A, the likelihood of them every doing so is diminishing by the day. We celebrate resilience in founders. But when does scrappy persistence become stubborn refusal to accept reality? No easy answers, but the data is sadly pretty clear. #startups #graduationrate #Seed #SeriesA #founders
The answer is not to need a series A
Thanks for sharing, Peter. Always insightful posts! We work with many startups and growth-stage companies, and this is exactly why I keep encouraging pre-seed and seed-stage founders to explore venture leasing (or venture debt for SaaS) early - not only because it’s non-dilutive and reduces hardware ownership risk, but also because it can meaningfully extend runway and position the company to raise its next round from a place of strength rather than desperation. If the Series A bar is rising, then having more time, traction, and optionality matters more than ever. Over the last 3-5 years, CSC has seen a clear uptick in the use of venture debt and leasing as founders look for alternative, flexible forms of capital in today’s constrained fundraising environment.
What a great data chart!
Very interesting! Claude's forecast in Q1 2025 was directionally accurate but still undershot Q1 2023 by -2.4%. That means things are looking up!
Peter Walker legend! Really like this chart. Question - did you notice any trends on location, e.g. anywhere in particular significantly dominating graduations? I imagine it's mostly SV but I'd be interested to see if any other cities surprised / stood out.
Love this, Peter
As someone who is trying to learn about the VC/startup world, I find your posts and the discussions they spurn so helpful. Also, your data visualizations are so pretty!
Trusted advisor to Founders and CEOs
1wVery interesting. A Seed round is roughly 2 years of runway. In the old days, about 30%-40% could get to Series A within 2 years. Now, only about 15%-20% are graduating to Series A within 2 years. Getting an extra 2 years (Seed Extension?) allowed another 10%-20% of companies to graduate to Series A.