A company gets more expensive as it gets less risky
Every financing stage answers a different question, and the price of the round reflects how much of that question has already been answered. A pre-seed check is a bet almost entirely on the team, because there's nothing else yet. A Series C check is a bet on execution at scale, because the team, product, and market have all already been proven.
| Stage | Typical check | Typical valuation | Ownership target | What's being proven |
|---|---|---|---|---|
| Pre-seed | $250k-$1m | $3m-$8m | 10-15% | The team and the idea |
| Seed | $1m-$4m | $8m-$20m | 15-20% | Early product-market fit signal |
| Series A | $5m-$15m | $20m-$60m | 15-20% | A repeatable go-to-market model |
| Series B | $15m-$40m | $60m-$200m | 10-15% | Scaling what's already working |
| Series C+ | $30m-$100m+ | $200m+ | 5-10% | Efficient growth at scale |
Not every company raises every stage in order, some skip a round entirely, some raise an extra "A1" or bridge in between (Lesson 30 covers this directly), but the underlying pattern holds: later stages command higher valuations because more risk has already been retired.
Checkpoint
- Pre-seed/seed: betting mostly on team and early signal.
- Series A: proving the go-to-market model is repeatable.
- Series B+: scaling a model that's already working, then doing it efficiently.
- Valuation steps up with each round because risk is being retired, not because the company is simply "worth more" in the abstract.
If anything here still feels unclear, ask before moving to Lesson 5.