Seed
Also known as Seed Round, Seed Funding, Seed Stage
Seed is the first substantial financing round for an early-stage startup, usually the first priced round if it is not still on SAFE. Carta's 2025 data shows a $4M median round at a $20M median post-money valuation, with AI startups commanding a premium ($19M pre-money median vs $13M for non-AI).
In depth
Seed used to be the first money in. Today it is the first money after the SAFE stack converts. The economic content of a 2025 seed round is closer to what a 2015 Series A looked like: a priced round with a lead, preferred stock terms, often a board seat, and an expectation of $1M+ ARR within twelve months.
The instrument transitioned. Through 2018 most seeds were on convertibles; today roughly half of named seed rounds are priced and the other half are large post-money SAFEs that operate like priced rounds in practice. The lead writes a $1-2M anchor check and brings $1-2M of syndicate alongside, settling around the $4M Carta median.
Carta's seed data shows a bifurcated market. The median is $4M at $20M post-money, but the 95th percentile is $16.6M raised at $80.5M post-money. AI-native companies dominate the upper tail. The median pre-money valuation for AI seeds was $19M in early 2025; for non-AI it was $13M.
Why it matters
Seed defines the dilution path for the entire company. Founders who take a $4M seed at $20M post-money give up 20% of their equity. Combined with a typical 10-12% option pool, founders walk out of seed owning around 56% of fully diluted shares per Carta's founder ownership data.
The bar to graduate has also moved. The 2025 Series A test is roughly $3M ARR and the kind of growth curve that can model to $10M ARR in twelve months. Only about 20% of seed companies hit it. The rest extend, bridge, or run a process that ends in acqui-hire territory.
Worked example
A team raises $4M on a priced seed at $16M pre-money, $20M post-money. The lead asks for a 10% option pool top-up included in the pre-money.
Pre-money before pool top-up: $16M
Option pool top-up: $2M (10% of $20M post)
Effective pre-money: $14M
Seed dilution: $4M / $20M = 20%
Option pool dilution: $2M / $20M = 10%
Founder dilution this round: 30% combined
If founders owned 100% before the round, they exit seed with roughly 70% on a fully diluted basis, with employees holding the 10% option pool and the seed investors holding the remaining 20%.
Frequently asked
What is a good seed round size in 2025?
The Carta median is $4M raised at a $20M post-money valuation, but the distribution is wide. The 95th percentile reached $16.6M in 2025, over 4x the median. AI startups skew higher: median pre-money valuation is $19M for AI seeds vs $13M for non-AI.
What milestones do I need for a seed round?
Most 2025 seed leads want a working product with early users, a coherent ICP, and signal that the next 12-18 months can produce $1M ARR. Pure idea-stage capital lives at pre-seed. Carta data shows the bar for Series A is now roughly $3M ARR, so the seed milestone is the path to that number.
How much dilution at seed?
Median seed dilution is around 18-20% according to Carta. Founders own approximately 56% of the company on a fully-diluted basis after their first priced round. The dilution math is straightforward: round size divided by post-money valuation, plus any option pool top-up taken pre-money.
Is a seed round always priced?
No. Many 2025 seeds still use post-money SAFEs with valuation caps, particularly when raise size is below $3M. The transition to priced preferred stock typically happens once a clear lead investor takes the round and demands a board seat plus protective provisions.
How long between seed and Series A?
Median time from seed to Series A reached 2.1 years in 2025, up from 1.5 years in 2019. The 75th percentile extends to 3.4 years. Roughly 50% of seed companies on Carta graduate to Series A within four years; the rest stall, bridge, or die.