The share of seed-funded companies reaching Series A within two years halved between the 2018 and 2022 cohorts. Raising is now the exception, and the advice mostly hasn't caught up.
The bar moved and most of the advice didn't
Carta's cap-table data records the change plainly. Of companies that raised a seed round in Q1 2018, 30.6% reached a Series A within two years. For the Q1 2022 cohort the figure was 15.4%. The path narrowed by half.
At the same time the bar for clearing it rose. Median ARR at Series A now sits around $3 million — a level that would have been a strong Series B story a decade ago, and that many founders are still being advised they can skip.
Rounds got bigger and rarer simultaneously, which is a specific and awkward combination. It means the median seed-funded company is no longer on a path to a Series A; it is on a path to profitability, an acquisition, or a shutdown, and the sooner that is planned for the better the outcome tends to be.
Three consequences run through this pack.
Raising is now the exception, not the milestone. So the first prompt asks whether to raise at all rather than how.
A round has to be sized to a milestone that clears the next bar. Money that buys eighteen months and gets you to $1.2M ARR has bought you a hard conversation, not a runway.
Every founder number will be checked against a dataset the investor has and you do not. Investors see hundreds of companies a year and have benchmark data on all of them. A number that cannot survive that comparison damages more than the number.
Decide whether, then how much
Decide Whether You Should Raise Money at All works through what venture capital actually requires of a business — a plausible path to a very large outcome, on a timeline someone else sets — and whether that describes yours. Plenty of good businesses fail that test, and building one of them on venture terms is how a healthy company becomes a failed one.
Work Out How Much to Raise and What It Buys You ties the amount to specific milestones with dates and a defensible bridge to the next round, rather than to a number that sounded normal at a conference.
Work Out Your Runway and How to Extend It and Decide How to Fund a Gap or a Growth Push cover the arithmetic underneath, and Apply for a Grant or Non-Dilutive Funding covers the option most founders skip because it is slower and less exciting. Given a 15% graduation rate, slower and less exciting deserves more consideration than it gets. The business finance pack covers the operating side of the same numbers.
Never produce a number you cannot defend
The editorial rule for every quantitative prompt here: no top-down TAMs, no hockey sticks, and every assumption labelled with its source.
Size Your Market Without Making Up a TAM builds bottom-up from customers, price and reachable segments. A top-down 1% of a $50 billion market
is the single fastest way to signal that you have not done the work, because the investor has seen that slide several hundred times.
Build a Financial Model an Investor Will Believe makes the assumptions the visible part of the model. The projection is not what gets evaluated — the assumptions are, and a model whose growth rate is unexplained is a model nobody reads twice.
The narrative and the process
Write the Pitch Deck Narrative Before You Design a Slide enforces a useful order. Design work on a deck whose argument does not hold is expensive procrastination.
Build an Investor Target List and Work Out Who Actually Fits treats fundraising as a sales process with a qualification stage — check size, stage, sector, portfolio conflicts, and whether the fund is actually deploying. A meeting with a fund that cannot write your cheque is a day gone.
Write an Investor Cold Email That Earns a Meeting is the outreach artifact. Prepare for the Questions That Kill Pitches builds the list you are hoping to avoid, on the reasoning that every founder has two or three questions they cannot answer well and investors find them within ten minutes.
Prepare a Data Room and Survive Diligence covers the stage where deals quietly die — not from a disqualifying discovery, but from slow, disorganised responses that read as an operational warning.
Write an Investor or Lender Update That Builds Confidence is the highest-leverage recurring document a founder writes. Investors fund people whose bad news they trust.
Terms, dilution, and equity between founders
Dilution and control are priced in the terms, not the valuation. A higher headline valuation with a larger option pool carved out pre-money, a participating preference, or a stack of prior post-money SAFEs converting at once can leave you owning less than a lower-valuation clean deal would have.
Understand What a Term Sheet Actually Costs You explains the economics of the terms that matter, and Work Out Your Dilution Before You Sign Anything makes you run the actual cap table through the conversion rather than trusting the summary.
Split Equity With a Co-Founder Without Wrecking It covers the conversation that is hardest early and catastrophic late, including vesting and what happens if someone leaves.
Handle a Raise That Isn't Coming Together is the prompt this cohort data makes necessary. Most raises do not come together, and the difference between a company that survives that and one that does not is usually how early it stopped pretending otherwise.
Where this stops
Every prompt in this pack that touches terms, equity, or securities explains the economics and stops at the point where you need a startup lawyer. Term sheets, SAFEs, option pools, co-founder agreements and vesting schedules are legal instruments with jurisdiction-specific consequences, and the cost of getting them wrong is measured in years. Nothing here is legal, tax, or investment advice, and no prompt will invent a benchmark, comparable, or valuation for you.
Sources
- Carta, Graduation rate from seed to Series A — 30.6% of Q1 2018 seed cohort reached Series A within two years, against 15.4% of the Q1 2022 cohort
- Carta, ARR at Series A — median ARR at Series A near $3M