If you are Building a startup today, it may be harder for you to raise money than it was a year ago. New data, however, makes it clear that not all startups experience the same headwinds.
Inconsistency in the startup fundraising climate is nothing new. Differently, we’ve seen Series A falter at one point and Series B at another. Today, however, we’re seeing something altogether different: the Series C crunch.
This does not mean that all primary rounds are in good shape or that later rounds are healthy. Everywhere you look, there are venture capital failures that founders must contend with. But new data from Map suggests that the Series C is the current and real bottleneck in venture land, meaning it’s the new problem for startups looking to raise their next round of funding.
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The data point is not that surprising. It’s a bit of conventional wisdom that the later a startup is in its maturity cycle, the more funding it needs the more scrutiny it receives. With the IPO window closed, public-market valuations in the proverbial toilet, and leveraged capital suddenly in short supply, late-stage startups are being scrutinized more as public companies today. And many of them are not ready.
