Early-stage deals: Bigger and fewer between
Early-stage venture capital is experiencing a fascinating paradox. While Series Seed deal sizes continue to grow, the frequency of early-stage deals is declining, and fewer startups are making it from Seed to Series A.
This is what the data shows:
Deal size vs deal frequency
Since 2022, there has been an inverse trend in Series Seed financings, with deal sizes steadily increasing while deal frequency has dropped. But deeper analysis seems to reveal a bifurcated market. The top quartile of Aumni-tracked seed rounds surpassed $7M for the first time, while the median and bottom quartile of raises experienced a more gradual increase—only recently returning to their 2022 highs. This divergence is unique to seed deals. At Series A and beyond, deal sizes have remained below 2021/2022 peaks.
Graduation rates
The 2-year graduation rate from Seed to Series A has fallen since 2020. 41% of Q3 2020 seed-stage companies made it to Series A within 2 years of their initial round. In contrast, only 12% of the Q1 2023 cohort had raised their Series A by Q1 2025. While this is a slight improvement from the 2022 cohorts, it remains much lower than historical norms.
As reported in the Venture Beacon Report, the fundraising cycle for companies raising priced equity rounds across stages accelerated in Q1 2025. This trend is observed among companies that raised their Series A in the first few months of the year. Startups that raised their Series A in Q1 2025 did so a median of 2 years after their primary seed round—down from Q4 2024 but overall lengthened from ~1.5 years in 2021.
Looking forward
The early-stage venture capital market is undergoing significant changes, with larger seed rounds becoming concentrated among fewer startups. These dynamics may indicate a more cautious, performance-driven environment or a recalibrated market where fundraising milestones take longer to achieve.
Investors are increasingly turning to data-driven insights to navigate these complexities. Aumni’s Market Insights provides valuable data-driven insights to assist investors in balancing risk and reward, offering an alternative to anecdotal comparables or gut feel. Discover how you can leverage data to make informed investment decisions.
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