Average and median deal sizes have dipped since the latter half of 2022, Crunchbase data shows. That follows a systematic rise over the previous decade for U.S.-based startups.

Within that decade-long rise, there was a noticeable upward inflection in recent years. In 2021, round size from seed to Series B leapt up between 25% and 59% year over year — even more than in prior years. For Series C, the initial surge took place a year earlier in 2020, based on an analysis of Crunchbase data.

But starting in the second half of last year, average and median round sizes have flattened or shifted down. The downward shift is noticeable but gradual, with more mature companies from Series C onward hit the hardest for now. For the past quarter, seed through Series B fundings hovered above 2020 average and median size, while Series C fundings remained below.

We also see another interesting trend as the decade progresses: The gap between median and average funding by type has widened in recent years. This shows that sizable rounds at each stage have become more common, pushing averages up more dramatically. (We did place an upper limit for each funding type to limit the impact of outlier rounds on average fundings.)

Let’s dive in and look at each stage as they illustrate some matching and some divergent dynamics.

Seed

The size of the typical seed funding round peaked in 2022, Crunchbase data shows, but has since dipped.

If you go back about 10 years to 2014, the median and average seed funding for a U.S.-based startup was below $1 million.

Since 2014, the typical seed deal has increased in size and peaked in 2022 at a median of $2.5 million and an average of $3.7 million.1

In contrast to the overall venture funding pullback in 2022, seed funding was higher in the first half of 2022 compared to 2021 and showed a decline year over year starting in the fourth quarter.

Series A

The median and average Series A deal size also peaked in 2022 before dropping more recently, Crunchbase data shows.

The growth of the seed ecosystem impacted Series A fundings as it expanded the number of years a startup could build in advance of a Series A funding.

Median and average Series A fundings in 2014 were $5 million and $7.7 million, respectively, for U.S.-based startups.

The typical Series A deal size peaked in 2022 at $14 million (median) and $19.1 million (average). It has since come down to $12 million and $18.7 million, respectively — not a big drop, one could say. (But, keep in mind, we expect those amounts for the most recent quarter to trend down further as fundings continue to be added to the database after the end of the quarter. We find that deals added after the close of a quarter tend to be smaller.)

Series B

Series B fundings peaked sooner than seed and Series A — all the way back in 2021, Crunchbase data shows. This indicates a sharper pullback in funding in 2022 from Series B onward.

In 2014, Series B deals tracked at a median of $11.7 million and an average of $16.3 million.

That ramped up substantially over the following decade to peak in 2021 at a median of $32 million and an average of $46 million.

That’s dipped again somewhat to $28 million and $40 million, respectively, in 2023.

Series C

Similar to Series B funding, Series C peaked in 2021. But the jump in funding happened in 2020, a year earlier than prior funding stages.

Series C fundings show the greatest decline for all stages analyzed here. In 2014, the median Series C funding was $18 million and the average $26.4 million. That peaked in 2021 at $60 million and $82 million, respectively.

In Q1 2023, a median Series C round for a U.S.-based startup was $42 million and the average $59 million. The gap has also narrowed slightly, indicating fewer larger rounds at Series C.

Never going back again

While it is clear we are not going back to funding levels from a decade ago, the question is whether round sizes will shrink back to pre-pandemic levels.

For now, the only stage we analyze here that’s dropped below 2020 levels is Series C funding. But even Series C is still above the 2019 median and average round size.

What we can say is that the reset is only two to three quarters in and likely has not yet hit bottom. Each distinct funding stage is reacting to the cuts in the stage after it. If late-stage funding continues to contract due to the closure of the IPO markets, then startups at earlier stages face an uncertain future.

Related reading

• Getting To Series A Has Gotten Harder
• Series B Funding Has Also Fallen Sharply
• Series C Isn’t What It Used To Be
• Series D Hits Lowest Point In Years. What Does That Mean?

Methodology

For this analysis we only include U.S.-headquartered companies to remove the impact of distinct trends in different geographies.

For seed funding we exclude angel and pre-seed rounds. For each funding type we exclude outlier rounds. At seed we excluded fundings of $100 million and more. At Series A we exclude fundings at or above $200 million. For Series B we exclude fundings at or above $300 million and for Series C fundings at or above $500 million.

Illustration: Dom Guzman

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Boston-based , , ,��, and several angel investors also participated in the round. Accel’s will join the company’s board as part of the financing.

The San Francisco-based company says it “gives more people the ability to create powerful websites and applications without having to write code.” With over 45,000 customers, including and , Webflow says it is profitable and, according to , has been for two years with annualized revenue of over $20 million. It plans to use the new capital to build out its executive team and hire in general. (The company currently has over 120 employees, up from about 70 a year ago, according to CEO and co-founder ).

Webflow also wants to continue growing its customer base, and plans to invest in “extensibility, accessibility, performance, security, and data privacy” to do so. Current customers range from individual freelancers to Fortune 500 companies. They include Johnson & Johnson, Yelp, and Adobe, among others.

A $72 million round for a company of 120 people is quite outsized; presumably the firm will hire rapidly to scale its workforce to match its capital base. Or in more crass terms, the company will quickly expand its spend. (This is a standard move post-financing for nearly any startups, we’re merely reacting to the scale of new funds that Webflow now has at its disposal compared to its new capital base.)

In a , detailed the company’s early struggles, noting the company launched almost six years ago. Several months later, the company was accepted into . But the company’s trio of co-founders were struggling. All had left their previous jobs, according to Magdalin, “and had no meaningful income.” Magdalin had cashed out his 401-K to pay for surgery for one of his daughters, and he and his wife “had racked up over $50K in credit card debt.”

Webflow eventually landed $2.9M from several seed funds and angels, with contributing more than half its seed round.

Not Alone

While Webflow’s Series A is certainly outsized compared to historical norms, the company is in raising such a huge sum for what should be its first institutional round (the real definition of a Series A). Indeed, some other entrants for large nine-figure Series A financings in 2019 include for biotech company , for London-based fintech startup , and for South Korean cryptocurrency exchange platform .

The list continues. Turning to China, for example, raised a , for supply chain focused business and more.

In short, yes, Webflow’s Series A round is abnormal historically. It is also perfectly normal when it comes to 2019.

Illustration: .

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In addition to funding, the company said it’s nearly doubled the number of customers it serves in the past year. Wallarm says it grew recurring revenue by 100 percent, year-on-year, in Q3 2018 as well.

Commenting on the new funding, Wallarm co-founding CEO observed in a statement from the company that, “Many companies in Silicon Valley strive to raise vast sums of money, but strategically, we’ve decided to only raise what we need and fund the rest of our growth organically.”

The company’s last funding came by way of a Partech-led announced in December 2016. At the time, the company that it became profitable during Summer 2016. A representative from the company said the company has fluctuated in and out of profitability since then. Because Wallarm is taking on sales and marketing staff, the business loses money today, but hopes to return to profitability shortly.

As part of the Series A transaction, a number of individuals will be joining the company’s executive team and its various boards. Speaking of sales and marketing: , a former executive at Imperva and Arbor Networks will join Wallarm as its chief business development officer and HyTrust cofounder joined as chief marketing officer.

On the board side: , a partner at Toba Capital, will join the company’s board of directors.  of Partech will join as a board observer. Wallarm is also beefing up its advisory board with the addition of two folks: LendingClub CISO and , who serves as Juniper Networks’s VP of technology and strategy.

In a statement provided to Crunchbase News, the company said it will use the proceeds from this round to accelerate its deployment into Fortune 1000 companies and to roll out its new FAST toolkit. Wallarm’s (FAST) fits into companies’ existing continuous integration (CI) or continuous deployment (CD) infrastructure and lets security researchers, developers, and quality assurance professionals generate hundreds of security tests to locate and reproduce vulnerabilities in application code using a simple scripting interface.

In of the company and its technology, Forbes quoted CEO Novikov about its toolkit: “Wallarm FAST takes existing manual or automated tests, like Selenium, and uses those as a basis for generating all the possible security tests out there. Security teams can then create a policy to chip off everything that doesn’t belong. The resulting set of tests runs automatically, making a great addition to the release acceptance criteria.”

Apart from FAST, Wallarm offers product that doesn’t require manual configuration of threat detection rules. It’s a product sold to CEOs, said Novikov. FAST, on the other hand, is a product marketed to and priced for front-line engineering and QA teams.

Novikov admitted it’s a bit unusual for a startup to have two products in the market at once. Novikov said both pieces of software are built around the same core engine. “If it weren’t, we’d have to hire a dozen engineers for each product,” said the chief executive of the 55-person company. Wallarm’s built-from-scratch technology is flexible and extensible, allowing the company to slide into other market verticals like network and endpoint security.

The application security market is consolidating rapidly. On October 10th, publicly-traded application security firm . And, one week ago, app firewall company announced its sale to Rapid7 for . Novikov told Crunchbase News that he’s fended off four acquisition attempts in the past two years.

Wallarm is an example of the other approach to raising venture funding. Rather than chasing vanity valuations or attention-grabbing fundraising figures, the company is trying to use its own financial momentum to expand. Now five years old, Wallarm was founded in 2013 by a group of former white hat hackers who previously worked with Russian companies like Yandex and Mail.ru identify and mitigate security threats. The company and participated in Y Combinator’s .

Instead of raising and torching countless millions in VC money in the name of moving fast and breaking budgets, Wallarm took its time to mature into an actual business, which is a lot more than one can say about many companies in the Bay Area.

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Although a lot of attention has been paid to huge funding rounds at the later stage – in particular, the recent spate of mega-rounds led by SoftBank’s $100 billion Vision Fund – outsized rounds abound at all stages. Crunchbase News has also explored some of the smallest funding rounds startups raise. But up to this point, we haven’t taken a look at big rounds at early stages. And this is a somewhat glaring omission because seed and early-stage funding rounds make up the surpassing majority of deal volume around the world.

If you’ll forgive the pun, it’s kind of a big deal.

Today, we’re going to take a look at this growing phenomenon, what it means, and what might be happening “under the hood” in supergiant seed rounds.

The Rise And Rise Of Supergiant Rounds

In this section, we’re going to zip through a fairly large amount of funding data rather quickly. The exact numbers are less important than the overall trends they indicate. To wit, that both middle-of-the-road rounds and their supergiant counterparts alike have grown significantly in size over the past decade.

But before showing the charts and analyzing the data behind them, allow us a second to explain what, exactly, we’re talking about when we talk about supergiant rounds.

For our purposes here, we’ve borrowed the term “supergiant” from astronomy. , as the name may suggest, are some of the most massive and luminous celestial bodies in the universe. Similarly, the supergiant funding rounds we’re examining here are among the largest raised by startups, and they’re the rounds that grab the most headlines.

Hunting For Giants

We define the set of “supergiant” rounds as the top ten percent of deals struck for each round type, by year. So, for example, if there were 5,000 Seed rounds closed in a given year, the “supergiants” would be the top 500 seed rounds – ranked by the amount of money raised – for that year. Likewise, if there were 1,500 Series A rounds closed in that same year, we’d call the 150 largest Series A rounds supergiants as well.

The following analysis is based on a dataset of . We’ll compare the average size of supergiant rounds against a of round sizes, which doesn’t include the top or bottom ten percent of rounds.

Why go with a trimmed average? We want to exclude the supergiant rounds because they’d artificially skew the general average upward, but by the same token we want to filter out the smallest rounds (, for example) that would artificially skew figures lower. To reiterate, by comparing an average of the median eighty percent rounds to the average of the top ten percent of rounds, we’ll be able to see how supergiant round sizes related to those “in the middle of the road” over the past decade.

Our primary focus here will be deals from the earliest stages – Seed and Angel, Series A, and Series B – but we’ll get into some findings from later stages too. Let’s start with the earliest rounds and move later from there. And once we’ve shown the data, we’ll share some observations gleaned from it.

Seed And Angel Rounds

For , we found both that the size of both middle-of-the-road and supergiant rounds have grown significantly over the past decade, as the chart below shows.

The size of middle-of-the-road Seed and Angel rounds grew by roughly 145 percent over the course of the last ten years, and supergiant rounds are just under 63 percent larger than the supergiant average from a decade ago.

And – in what will become a common refrain – the companies that raised these large rounds are primarily located in just a few cities.

A majority of supergiant Seed and Angel rounds were raised by startups based in the SF Bay Area and New York City. Let’s see if the same pattern occurs at Series A.

Series A Rounds

Like with seed and angel rounds, the chart below aggregates data from and shows how much Series A rounds have grown over the past decade.

The size of supergiant Series A rounds grew by a similar amount to middle-of-the-road Seed and Angel deals, increasing by 140 percent over the course of the last ten years. More pedestrian Series A rounds are just under 130 percent larger, up from a trimmed average of $4.93 million in 2008 to $11.29 million in 2018, year to date.

The distribution of startups raising supergiant Series A rounds is similar to even earlier-stage counterparts.

Again, a majority of supergiant Series A rounds are raised by startups headquartered in just a few cities. In addition to San Francisco and New York City, life-sciences heavy Boston takes second place in the ranking of a decade’s worth of huge Series A rounds.

Last but not least, it’s on to Series B.

Series B Rounds

Our Series B dataset contained , but unlike earlier rounds the general “up and to the right” trendline isn’t so clear. As the chart below shows, it appears as though the size of Series B rounds has somewhat leveled off, at least on an annual timescale.

Supergiant Series B rounds have grown by 65 percent over the last decade. The more middle-of-the-road Series B round has also grown, but by a more significant 83 percent since 2008.

The geographic distribution of startups that raised the most supergiant Series B rounds is strikingly similar to the population of Series A fundraisers.

Again, San Francisco and the broader Bay Area ranks at the top of the charts, followed by Boston, NYC, Los Angeles, and San Diego – the same rank order as the prior round type.

And now that we’ve got the raw data out there, let’s see what we can take away from all of this.

The Pie Shrinks As The Middle Grows

Higher Growth Rates Amongst Middle-Of-The-Road Rounds

Although the growing size of supergiant rounds may be impressive due to sheer size alone, it’s actually middle-of-the-road rounds that have grown the most consistently over the past decade.

In two of the three round types we reviewed above, the compound annual growth rate (or CAGR, for those of you who like acronyms) of supergiants underperformed more quotidian rounds, as the table below shows.

This all suggests that despite supergiant rounds getting all the attention, performance in more middle-of-the-road rounds has been even better, at least from a dollars-raised standpoint.

Growing Geographic Concentration Of Supergiant Rounds

By definition, supergiant rounds suck up a lot of capital, and they seem to be primarily located in just a few deep pools. As the funding cycle progresses, it appears as though more of the supergiant rounds are raised in just a handful of cities.

As the funding cycle progresses, the percentage of rounds raised by startups located in the top three cities seems to increase after an initial drop following Seed. 55 percent of supergiant A rounds were raised by startups from the Bay Area, NYC, and Los Angeles. Although not pictured above, 67 percent of supergiant Series C deals were struck by companies from the Bay Area, Boston, and New York City.

But what’s even more striking is the declining percentage share of supergiant rounds raised by startups outside the top-five rankings for a particular stage.

The chart above shows that the ability to close very large rounds is generally concentrated in fewer and fewer places as the funding cycle progresses.

We stopped our analysis at Series D due to limited sample size.

The Growing Dominance Of Supergiant Rounds

Some have shown that it’s not just the average round size that’s growing across most stages over time, but the number of large outlier rounds as well. For example, , a venture investor at , that the proportion of Series A deals larger than $50 million grew by an astonishing 721 percent from 2008 to 2017. The share of Series B rounds in the $50 million-plus range grew three hundred percent over the same period. He concluded that “venture is being increasingly driven by large rounds.”

Inspired by Levine’s research, , an economist, and strategy advisor, that between 2007 and 2017, deal volume has declined while dollar volume rose across almost all stages of funding he analyzed. This is in line with analysis from Crunchbase News from late 2017. And in , he charted the growing number of large rounds over that time period.

Indeed, it was Levine and Hathaway’s analysis that prompted us to look at the numbers as well, albeit from a slightly different angle, one more focused on geography and population-scale shifts in round size at the highest end of the spectrum. Our findings confirm a piece of common sense: expensive cities (see: NYC and the Bay Area) or and those home to capital-intensive industries like biotechnology and advanced manufacturing (see: Boston and San Diego) are the primary drivers and beneficiaries of the trend toward supergiant rounds

A decade’s worth of history suggests that this is one status quo that won’t be disrupted soon, no matter how much “disruptive” startups may raise in the future.