In Charts: Seed Deals Keep Getting Bigger As Odds Of Reaching Series A Fall Dramatically

The economics of seed investing have changed dramatically since the AI boom began, a review of SA国际传媒 data shows. Seed rounds are larger than ever, with some startups now raising $8 million to $10 million deals once associated with later stages. But the path forward has also become tougher: startups are taking longer to reach Series A, and a shrinking share are making it there at all.

Size increase

Median seed round sizes have been climbing since 2023, SA国际传媒 data shows, with the median U.S. seed round last year now standing at around $3 million. That鈥檚 3x larger than it was in 2018.

The upper quartile median last year was around $5.6 million 鈥� more than double what it was in 2018聽鈥� and the lowest quartile was $1 million. (Although, underlying those medians is a much wider range of deal sizes.)

At seed, 鈥淲hat we see is everything from the inception stage, which is typically $3 million to $5 million, unless it’s a truly unique and obvious founder, all the way through to $8 million to $10 million-plus rounds,鈥� said , managing partner at , one of the earliest institutional Bay Area seed funds founded in 2004.

McLoughlin noted that the typical check size his firm writes for a seed round has almost doubled from 18 months ago. 鈥淲e’re still trying to buy at least 10% ownership, ideally more, and our average check has grown from $2.5 million or less, to $4.5 million,鈥� he said.

The speed at which those round sizes have accelerated is mind-bending, he said. 鈥淚f you’d asked me 18 months ago, would the $8 million to $10 million-plus seed round become de facto, I would have said you were crazy鈥�

Series A rounds have also grown in size, per SA国际传媒 data. Last year, the median U.S. Series A deal was $15 million, with the upper quartile at $25 million and the lower quartile at $7 million. That trend has continued into 2026, with median Series A rounds moving still higher.

Longer time frame to Series A

But while companies that are funded at the seed stage are typically raising larger checks, they鈥檙e also taking longer to move on to Series A and face lower odds of graduating to that phase at all, SA国际传媒 data shows.

Since 2023, U.S. startups have been taking longer to raise a Series A round following an initial seed round of $1 million and over, per SA国际传媒 data, with that time frame now stretching to more than two years.

That continues a general upward trend since 2018 of startups taking longer to raise a Series A round after seed, with notable exceptions in the previous peak funding years of 2021 and 2022, when the timeline shrunk by six months.

The threshold for raising a successful Series A is no longer $1 million in annual recurring revenue, said McLoughlin. In the AI era, startups are expected to show $2 million to $3 million 鈥� even $4 million 鈥� in ARR as proof that the business has the momentum to scale, he said.

鈥淲hen you’re fundraising for your [Series] A, you’re not in competition with the startups you deem to be competitors,鈥� said McLoughlin. Rather, he noted, you’re in competition with every other deal floating around in the venture ecosystem 鈥� not just the partner you’re talking to and their ability to do the deal, but what the entire team is doing, how far along they are, how far ahead of pace they are on their investment cycle, and whether they’re being pushed to only do things that truly look like breakouts.

Fewer graduates

Since 2021, drastically fewer companies that raised an initial seed round of $1 million or more have progressed to a later-stage funding or exited, SA国际传媒 data shows.

Through 2020, companies that raised a seed round of $1 million-plus had a typical graduate rate of 55% or higher.

Since then, graduation rates appear to be falling dramatically. Of the companies that raised a $1 million-plus seed round in 2023, only 27% have progressed further, SA国际传媒 data shows. For the 2024 cohort of seed-funded companies, that鈥檚 even lower: just 24%.

While these cohorts are staying at the seed stage longer, still McLoughlin predicts, 鈥渨e’re going to see the mortality rate from seed to A will be much, much higher.鈥�

As the dynamics of seed funding change, investors are being forced to rethink their portfolio strategies 鈥� adjusting to the right number of bets, reserving enough capital for follow-on rounds, and deciding whether to invest earlier or in larger seed rounds with potentially less ownership.

鈥淲e’ve also got to be comfortable with this notion that there will probably be more early outcomes or failures in the portfolio, but if we do our job well, the big outcomes will be bigger than they’ve ever been before,鈥� said McLoughlin.

SA国际传媒