What is Series Funding Rounds?

When a startup crossed the seed stage and have an acceptable amount of footing in the market — regardless of whether it’s the number of clients, income, or views, then they move toward vying for Series Funding. We often hear of startups receiving substantial capital in different series funding rounds, but does that mean? What are these series funding rounds?

Series A Funding

In Series A Funding Round, startups must have a plan in order to develop their business model.  These organizations are also expected to utilize the money raised from the funding rounds in order to increase their revenue. As soon as the common stock gets issued during the seed round, Series A funding provides the first series of the favored stock to venture capitalists. Generally speaking, a Series A Funding provides a runway to the startups for the development of its products and expansion of the team.

Normally, Series A rounds raise around $2 million to $15 million, however this number has increased because of innovative industry valuations, or unicorns. The normal Series A Funding as of 2020 is $15.6 million. In this funding round, investors search for organizations with extraordinary thoughts just as a solid methodology for transforming that thought into an effective, lucrative business. Some of the top investors of the Series A Funding Round are:

1. Sequoia Capital
2. Matrix Partners China
3. Index Ventures
4. Google Ventures
5. Accel
6. Bessemer Venture Partners

Series B Funding

Series B funding rounds are all about taking organizations to the next level, past the stage of advancing their business. Financial experts assist new companies in reaching the next level by expanding their market reach. Organizations that have experienced seed and Series A funding rounds should have developed a considerable client base and demonstrated to financial experts that they are ready to begin scaling. 

The normal assessed capital brought up in a Series B round is $33 million. Organizations going through a Series B funding round are entrenched, and their valuations in general mirror that; most Series B organizations have valuations between around $30 million and $60 million, with an average of $58 million. Some of the top investors of Series B Funding Round are:

1. Google Ventures
2. New Enterprise Associates
3. Khosla Ventures
4. General Catalyst Partners
5. Kleiner Perkins Caufield and Buyers

Series C Funding

Organizations that make it to the Series C funding round are already successful. These organizations search for extra financing so as to assist them in developing new products, venture into new business sectors, or even to acquire different organizations. In the Series C funding round, financial specialists infuse capital into the meat of fruitful organizations, with a goal to get more than twofold that amount back. Series C Funding is centered around scaling the organization, enhancing the development of the organization. The estimated capital raised in Series C Funding Round is $52.5 million to $59 million with an average of $118 million.

Series C Funding Round is followed by Series D, E, F, G, and private equity funding rounds, and so forth. While there is a great deal of capital prepared, a ton of organizations don’t make it to Series C. The explanation behind this is on the grounds that Series C financial specialists are searching for breakout organizations that have just shown critical foothold. Accordingly, the deal size of the Series C funding round has continued to increase.

Some of the investors of the Series C Funding Round are:

1. Venture Capital Firms
2. Private Equity Firms
3. Hedge Funds and Banks

Series D Funding

As soon as the companies discover a new opportunity for business expansion before going for an IPO (Initial Public Offering) and in order to achieve a boost to get there, they go for Series D Funding. The companies who wish to stay private for a longer duration in order to increase their value opt for Series D Funding. The organization which has not been able to meet the expectations laid out after raising funds from Series C Funding Round also choose the Series D Funding Round. This is often referred to as Down Round.

Series D Funding Round is normally supported by Venture Capital Firms. The funds raised and valuations vary broadly, particularly in light of the fact that scarcely any new businesses arrive at this stage.

Series E Funding

On the off chance that a couple of organizations make it to Series D, significantly less make it to a Series E. Organizations that arrive at this point might be raising funding for a number of reasons recorded in the Series D round such as they’ve neglected to meet desires, they need to remain private longer, or they need more assistance before opening up to the world. Organization profiles vary with each contextual analysis, yet by and large, have diverse risk profiles and maturity levels at each funding stage. Seed speculators and Series A, B, and C financial experts, all assist entrepreneurs with turning their ideas into reality.

Series Funding empowers investors to help business visionaries. The various rounds of funding all work in the same way fundamentally; financial specialists offer money as an end-result of a value stake in the business. These funding rounds give international investors and business angels the chance to put money into a developing organization in return for equity or partial ownership of that company.