SA国际传媒

When venture funding started to turn south after a blockbuster year in 2021, seed and early-stage funding was at first relatively unscathed. Investment into seed startups globally actually grew in Q2 2022, even as venture investment overall dropped off dramatically.

That鈥檚 no longer the case.

Seed funding starts to slip

Seed and angel investment to U.S. startups fell 45% year over year in the first quarter of 2023, to $3.1 billion, SA国际传媒 data shows. That鈥檚 the lowest quarterly amount since Q4 2020.

The size of a typical seed round also shrank, an analysis of SA国际传媒 data shows. After peaking in 2022 at $2.5 million, the median U.S. seed round dipped to $2.3 million in Q1 2023. The average dipped slightly from $3.7 million to $3.6 million.

Of course, that鈥檚 still far above where those deal sizes were less than a decade ago. In 2014, the median and average were both under $1 million.

Series A tumbles

Series A is suffering too. SA国际传媒 data shows Series A investment into U.S.-based startups has fallen for five consecutive quarters, dwindling from $14.5 billion in Q4 2021 to $5.7 billion last quarter.

Series A round sizes also dipped. The median Series A for a U.S. startup was $12 million last quarter 鈥� down $2 million compared to the 2022 median. Average deal size dipped from $19.1 million in 2022 and 2021 to $18.7 million last quarter.

Still, last quarter鈥檚 typical Series A deals were double or triple their size in 2014.

And some massive Series A checks have gone to biotech startups and companies in the red-hot artificial intelligence space this year.

, a clinical trials platform, raised a $203 million Series A round last quarter. , a biotech working on cancer treatments, raised $200 million.

In AI, competitor raised $150 million in a round led by that landed it on The SA国际传媒 Unicorn Board.

Investors look for more than good ideas

But all in all, the early-stage funding environment is tougher than it once was.

鈥淚deas are not as fundable as they used to be,鈥� Steve Lehman, chair of entrepreneur networking and skill-building platform , told SA国际传媒 News recently. 鈥淪ure, I think investors, particularly in seed to Series A, are looking for something a little more tangible where the wheels are already on the bus. It doesn鈥檛 have to necessarily be rolling down the highway yet, but it鈥檚 got to have good momentum with unique value propositions.鈥�

Related Reading

• These 4 Charts Show That Slowly But Surely, Startup Funding Deal Sizes Are Shrinking聽
• Laid-Off Tech Workers Roll The Dice In Iffy Funding Market To Start Their Own Companies
• Getting To Series A Has Gotten Harder

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Illustration: Dom Guzman