What is Series A Funding? A Complete Guide For Startup Founders

Raising money isn’t just about getting a check. It’s about proving your idea works, showing you can grow, and convincing others that you’re ready for the next big step. That’s where Series A funding comes in.

After seed funding, this is usually the first serious round startups go after. The average Series A deal size in the U.S. is around $15 million, and investors expect more than just a pitch—they want numbers, traction, and a plan that makes sense.

This guide breaks down everything you need to know about Series A. What it is, how it works, when to raise, and what investors look for. You’ll also get tips on building your pitch, finding the right VCs, and avoiding common mistakes that cost founders time and money.

By the end, you’ll know what makes a startup ready for Series A—and how to get there faster.

Let’s get into it.

Series A funding is the first major round of venture capital investment a startup raises after its seed round.

At this stage, the product or service already exists, and early users or customers are in place. The goal is to raise money to grow faster, improve the product, and reach more people.

Unlike seed funding, which helps get things off the ground, Series A is for scaling. Investors want proof that the idea works. They expect real data—user numbers, early revenue, or engagement. This round is less about belief and more about evidence.

Startups usually raise between $2 million and $20 million in Series A. The average in the U.S. hovers around $15 million, though this can vary by industry. In exchange, founders give up equity—often 15% to 30% of the company.

Series A is also the point where serious investors step in. These are often top venture capital firms, and they bring more than just money. They bring connections, advice, and pressure to grow fast.

If a startup can’t show growth potential or product-market fit, it won’t pass this stage. That’s why understanding what Series A really means—and preparing for it properly—is so important.

People often mix up seed funding and Series A, but they serve very different goals.

Seed funding is the very first money a startup raises. It helps turn an idea into a working product or service. Founders use it to build a prototype, run early tests, and get their first users. Most seed rounds raise between $100,000 and $2 million, often from angel investors, friends, family, or early-stage venture firms.

At this stage, investors are betting on the idea, not the numbers. There’s usually no revenue yet. It’s all about potential.

Series A funding comes after that. Now the product exists. The team has gathered real feedback. There may be steady users, early revenue, or signs of growth. Series A money is used to scale—to hire, market, and improve the product.

A typical Series A round is bigger—$2 million to $20 million, and often led by venture capital firms. These investors look for proof, not just promise. They want to see growth metrics, retention data, and a clear plan for the next 12–24 months.

Here’s a quick side-by-side look:

If you're still building or testing your product, you’re likely not ready for Series A yet. But once you have solid usage or sales data, and you know how to grow faster, Series A becomes the next step.

Timing matters a lot in fundraising. Go too early, and investors won’t take you seriously. Wait too long, and you might miss your best chance to grow.

So, how do you know when you're ready to raise Series A funding?

This means real people are using your product—and coming back. It’s not about downloads or sign-ups alone. It’s about retention. Are people still using your service after a week? A month? Good signs include:

If you have solid answers to those, you’re getting close.

Most startups raising Series A are already making money. You don’t need to be profitable, but you should show:

Example: A SaaS startup making $30,000 MRR and growing 8% monthly is in a solid position.

Investors back people. If you're still solo or missing key hires, it's a red flag. Before Series A, try to have:

If you’ve already raised seed money, make sure you've used it well. That means:

VCs want to see that you're ready to use their money wisely. That means you’ve mapped out:

If all this is in place, it's a good time to raise Series A.

Series A funding is a key step in growing a startup. At this point, the product is working, users are active, and there’s a clear need for money to grow faster. Here's how the process works, step by step:

Startups don’t just accept the first check that comes in. Founders usually look for investors who know their industry and have helped similar companies before. These are usually venture capital firms. Sometimes, angel investors join in too.

Most investors want to see strong early signs like customer growth, steady revenue, or strong user engagement before agreeing to fund.

Once you’ve found potential investors, you’ll pitch your business. This means showing them:

Your pitch should be clear, honest, and backed by real numbers.

If an investor is interested, they’ll offer a term sheet. This is a document that outlines the basic terms of the investment—like how much money they’ll invest, how much of your company they’ll own, and other rights or conditions.

This part can involve back-and-forth. Founders and investors need to agree on valuation, equity, and control.

After signing the term sheet, investors do a full review of your business. This is called due diligence. They’ll look at:

It’s their way of making sure everything checks out before the money is transferred.

Once everything is approved, the deal closes. The money is wired to your business bank account. You now officially have Series A funding.

After that, your focus shifts. You’re expected to use the funds to grow your business —hire the right people, boost your product, bring in more customers, and hit new targets.

Raising Series A funding takes planning, proof, and timing. This part of the guide walks you through the first two important steps to get ready and make a strong start.

Before reaching out to investors, you need to make sure your startup is in the right place. Series A is not about early ideas—it’s about growth. Investors want to see that your product works and that real people use it.

Here’s what most investors expect at this stage:

If these pieces aren’t in place, it’s better to wait and focus on hitting milestones first. Raising Series A too early can waste months and hurt your credibility with future investors.

Once your startup is ready, it’s time to get your documents in order. Investors won’t just go by your pitch—they’ll ask for proof. This is where a data room helps.

Your data room is a shared folder that includes all the files investors will ask for. It shows them you’re serious, organized, and ready for the next step.

Here’s what to include:

A strong data room can speed up the process and help build trust early on. You don’t need to overdo it—just be clear, complete, and honest. If something’s not ready, explain why and how you plan to fix it.

Getting Series A funding is not just about cold emails. It’s about who knows you and who trusts you. Most deals at this stage happen through warm introductions.

Start this process early. Don’t wait until you need money. Begin by building relationships 6–12 months before you plan to raise. Here’s how:

Example message:

“Hi [Name], I’m building [Startup Name], a tool that helps [X audience] do [Y]. We’ve grown from 100 to 2,000 users in 4 months with zero spend. We’re now planning a Series A round and would love to get your input.”

That kind of message shows traction and respect for their time.

Your pitch deck is the tool that opens doors. It’s your story, numbers, and plan—all in one place. Investors see hundreds of decks, so yours should be sharp, clear, and fast to understand.

Here’s what to include:

Keep slides clean. Use visuals where possible. Most pitch decks are 10–12 slides long. If you’re unsure, look at examples from successful startups like Airbnb or Intercom—they’re easy to find online.

One tip: don’t just dump facts. Connect the dots. Show how everything fits together. Good storytelling helps investors remember you.

Once you have your deck and data room ready, and your investor list is built, it’s time to start the outreach. This part is like sales. Be consistent, patient, and ready for questions.

Example: A startup pitching 30–40 investors can often close their Series A in 6 to 12 weeks, depending on traction and market fit.

Series A investors don’t fund ideas. They fund companies that have already proven something. If you want to raise money at this stage, you need to show real progress—not just promise.

Here’s what most venture capital firms and professional investors expect before they write a check:

You’ve built something that people want—and they’re using it regularly. Investors want proof:

If users drop off after trying your product, that’s a red flag.

You don’t need millions in revenue, but you should be showing clear signals of demand. Here are a few examples of healthy traction:

These kinds of numbers get attention. Investors want to know their money will help speed things up—not start from scratch.

Can your startup grow without costs exploding? That’s what investors want to see.

Good signs include:

The more you understand your numbers, the more confidence you give investors.

People back people. At this stage, VCs want to see a team that can execute, handle pressure, and adjust fast.

Make sure you have:

Even with a great product, a weak or confused team can hold you back.

Investors want to know where their money will go. Be specific. Don’t just say “grow the team” or “scale up.”

Break it down like this:

This shows you’ve thought things through.

Your pitch can make or break your Series A round. Investors get hundreds of decks. To stand out, yours needs to be clear, real, and focused on growth.

Here’s how to get it right—starting with the first two essential steps.

Start with the problem. What real issue are you solving? Make sure it’s clear in the first minute. Investors don’t have time to figure things out. Avoid jargon or technical fluff. A good pitch makes sense to anyone—fast.

Next, explain your solution. What’s your product or service? Why is it better? Is it faster, cheaper, or more helpful than what people use today?

Then, show how big the opportunity is. Investors want startups that can grow. Use clear numbers—like market size, number of potential users, or current demand. Keep it tied to real data, not guesses.

Finally, walk through your traction. Use hard numbers:

This part of the story is your proof. It shows you’re not just talking—you’ve already built something that works.

Most Series A decks are around 10–12 slides. More than that, and you’ll lose people. Less than that, and you might miss key points. Here’s what to include:

Keep each slide clean. Use one idea per slide. Show real screenshots over mockups. Don’t overload slides with text—your voice should explain the story.

Having a great pitch is good—but being ready for questions is better. Investors won’t just nod and smile. They’ll dig into your numbers, your strategy, and even your team.

Here are common questions you’ll likely hear in a Series A meeting, and what they’re really trying to learn:

They want to know if your startup is picking up speed. Share:

Tip: Use a simple chart to show growth over time. It’s easier to read than talking numbers.

Be specific. Don’t say “team” or “scale.” Break it down:

Investors want to know their money won’t be wasted.

Be honest. Every business has risks. Maybe it’s a crowded market. Maybe it’s early tech. Show that you understand the challenge—and have a plan to handle it.

If it costs $100 to get a user and you make $50 from them, that’s a problem. Show your CAC, how it’s changing, and what you’re doing to improve it.

Don't say "we have none." That’s a red flag. List 2–3 real ones. Then explain:

This shows if you have a real plan. Share targets like:

This tells investors where their money will take you—and if you’re thinking ahead.

Getting these answers right shows you're ready—not just to raise—but to lead and grow.

Startup valuation can feel tricky, but it’s a key part of your Series A funding round. Founders often ask, “How much is my company worth?” and “How much equity will I give up?”

Let’s break down the first two things you need to know.

Valuation at Series A isn’t based on profit—most startups aren’t profitable yet. Instead, it’s based on what your company has built so far and how fast it can grow with more funding.

Here’s what investors usually consider:

There’s no fixed formula, but most early-stage companies are valued between $10 million and $30 million pre-money in the U.S. This means before new investment is added in.

For example, if your startup is valued at $15 million pre-money, and you raise $5 million, your post-money valuation becomes $20 million.

That $5 million is usually exchanged for around 20–25% equity. That’s the range many founders see in Series A rounds.

Giving up equity means giving up part ownership of your startup. But that’s not a bad thing—if the right investor helps your company grow faster, the smaller piece of a bigger pie is often worth more.

Here’s what’s common:

Let’s say you raise $4 million at a $16 million pre-money valuation. The investor now owns 20% of your company after the round.

A fair deal should benefit both sides. You get money and support to grow. They get a chance to earn a return if your business does well.

Choosing the right investor is just as important as raising the money. Not all VCs are the same. Some offer more than just cash—they bring experience, a strong network, and useful advice.

Let’s go over two key steps to help you find the right fit.

It’s not just about writing big checks. The best venture capital firms for Series A have certain things in common:

Your relationship with a VC lasts years. Pick carefully.

Here are a few well-known firms with strong track records in early-stage investing. These VCs are active in Series A and have backed many startups you’ve heard of.

These firms are just a few examples. There are many more great investors depending on your niche, country, and startup type.

You don’t need the biggest name—you need the right fit.

Series A is a big step up from seed funding. Investors expect more. They ask tougher questions. And they take longer to decide.

Here are two of the most common challenges founders run into—and how to handle them.

One of the biggest reasons deals fall apart is a mismatch on valuation. You think your startup is worth $20 million. The investor says $10 million.

Why does this happen?

To avoid problems:

Don’t chase the highest number. A fair deal with the right partner is more valuable than squeezing out a few extra percentage points.

Example: A startup that raised $5 million at a $25 million post-money valuation but failed to meet growth targets struggled in the next round. The high valuation boxed them in.

Raising Series A isn’t fast. Many rounds take 3 to 6 months—sometimes longer. This can distract your team and slow your business.

Here’s what slows things down:

To speed things up:

Plan your fundraising like a campaign. Block out time for it. Keep the momentum going.

Once you close your Series A round, the real work begins. You now have money to grow, but you also have expectations to meet. Investors want to see progress, and fast. The first thing most startups do is build their team. This means hiring more engineers, bringing in someone to lead growth, or building a sales team if needed. With a stronger team, you can move faster and fix what’s holding you back.

Next, you focus on improving the product. You’ve already got users. Now it’s about making the product better based on their feedback. That could mean adding new features, fixing bugs, or making the experience smoother so more people stay and pay.

At the same time, you’ll need to set clear goals. These aren’t just ideas—they’re numbers. How many users do you want in 6 months? How much revenue do you want to hit this quarter? What’s your target for retention or conversion? These goals keep the team focused and give your investors something to track.

Raising Series A means more pressure, but it also means more power to build something great. Use it well.

Series A funding is a big leap. To make it work, you need more than just a good product—you need to show that you’re ready to grow fast. Here are four clear tips to help you stand out and close your round.

Start collecting and tracking key metrics from day one. Investors care about how many users you have, how often they come back, and how much they pay. Tools like Mixpanel, ChartMogul, or Google Analytics can help. If you wait until you’re raising, it’s too late. Having clean, organized data builds trust and proves your story.

Example: A B2B startup that tracked user retention from month one used that data to show they had a 45% 3-month retention rate—this helped close a $5M Series A round quickly.

Don’t wait until you need money. Start talking to investors early—share updates, get feedback, and keep them in the loop. That way, when it’s time to raise, they already know your story.

Think of it like planting seeds. The more familiar they are with your progress, the easier it is to get a “yes” when you’re ready.

Your pitch isn’t one-and-done. It should get better over time. Use feedback from early meetings to tighten your story. Focus on the problem you solve, the traction you’ve got, and why now is the right time to grow.

Practice helps too. Talk to other founders. Pitch your friends. Join demo events. The more you talk about your company, the better you’ll get at explaining it clearly and confidently.

You don’t have to figure it all out alone. Bring in advisors who’ve raised money before or scaled companies. They can help you fix your pitch, connect you with VCs, and steer you away from common mistakes.

Having the right people in your corner also gives investors more confidence. They’ll feel better knowing you’re backed by folks who’ve done it before.

Raising Series A funding is a major step. It means you’ve shown early proof, and now you’re ready to grow faster. But getting there takes more than a product or a pitch—it takes users, numbers, and a clear plan.

If your startup has real traction, a solid team, and a clear path ahead, you might be ready. But if you're still testing your idea or chasing early customers, it may be better to wait and focus on your foundation first.

Use the steps in this guide to check your readiness. Track your progress. Talk to investors early. Keep improving your pitch. And when it’s time, raise with confidence.

Series A funding isn’t the finish line. It’s fuel. The real work starts after the money lands. So make sure you raise at the right time—and use it wisely.

Series A funding typically ranges from $2 million to $20 million, depending on the startup’s growth, market, and team. The average in the U.S. is around $15 million.

Series A funding usually lasts 12 to 24 months, giving startups time to grow, hit key milestones, and prepare for their next funding round.

To invest in Series A funding, you usually need to be an accredited investor or join a venture capital firm, angel syndicate, or early-stage fund that participates in startup deals.

Seed funding comes before Series A. It helps startups build their product, test ideas, and reach early users before raising a larger round to scale.

Series A helps startups scale after proving early traction. Series B funding comes later and supports bigger growth, like expanding teams, entering new markets, or boosting revenue faster.