The amount of money startups raise in their early rounds is inversely correlated with success

runwaysuccess

Companies that raise larger seed and Series A rounds are less successful than those that raise smaller rounds. However, the amount of money startups raise in their seed and Series A rounds is inversely correlated with success. It’s actually quite random. Read >> There is No Relationship Between Financial Runway and Startup Success.

One Response

  1. As the article by CB Insights points out, Fred’s comment and perspective of the relationship between seed/A round funds raised and exit value is not proven by industry data. The problem really arises because not many people will read the rebuttal, but many will hear Fred’s comment. Thus, “more $ at start-up means less $ at exit” will enter the lexicon of VC lore and be difficult to stamp out.

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