The numbers I’ve heard from most everyone is that only about 20 percent of companies that have gotten a seed round in the last year will be able to raise a Series A.
“The Series A crunch is hitting now. Have we even noticed?” via PandoDaily
Folks, this is not a Series Whatever crunch, this is how the system should work. In the first DotCom era, companies would get $5 million out of the gate and most would crash and burn without so much as a working demo of the product. That was an expensive learning experience for investors and entrepreneurs.
Nowadays, entrepreneurs can experiment and create fully functioning products and money making tech companies for significant less investors dollars. The table stakes are simply much less costly. While it may mean an uptick in seed stage flame outs, the net result is a greater pool of talent is being created and drawn into the ecosystem, more ideas are being tested, and innovation is accelerating.
Source: pandodaily.com
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