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7/8/2025
Serious A! The State of Series A in non-coastal markets like Austin and Denver Though we are a pre-seed fund investing in the first institutional round a company raises, the majority of our companies go on to raise a seed round—and a few skip straight to Series A. Fundraising trends downstream from us are therefore critical to our portfolio management and board work. We use this data to coach our pre-Series A founders on fundraising strategies and help them manage expectations around timing and potential valuation ranges based on their progress. The Series A round is a critical milestone, often raised when a company shows strong product–market fit and is ready to shift its focus from R&D to scaling sales and marketing. Like many funds, we eagerly await quarterly data from Carta, Pitchbook, and Crunchbase to see whether what we’re observing in our portfolio aligns with broader market trends. So far in 2025—with only Q1 data available—the Series A environment hasn’t shown dramatic improvement over 2024. Valuations and Deal Volume Show a Mixed Message On one hand, median valuations are ticking up and bridge rounds are down. On the other hand, deal volume is off from last year’s quarterly highs and has reverted to Q1 2024 levels. In the U.S., the median pre-money valuation for a Series A reached $48 million in Q1, up 9% year-over-year. However, the number of closed Series A rounds declined by 10%.  Because we are a geo-focused fund—investing in two of the fastest-growing tech hubs outside the coasts, Texas and Colorado—it’s worth asking how relevant national Series A trends are to startups in non-coastal markets. Coastal post-money Series A valuations averaged $74M from Q2 2024 to Q1 2025. There’s a notable drop-off after that: NYC at $59.2M, Denver/Boulder at $57.9M, Seattle at $55M, and Austin at $52.3M. This coastal valuation premium is nothing new—and it’s part of why smaller firms like FirstMile can deliver outsized returns. We’re able to invest at significantly lower prices than our coastal peers. Yet, in every deal, we’re swinging for the fences and working hard to help founders hit the milestones that will attract the next investors. As one partner from a nationwide tech law firm with offices in Austin put it: /
A is a hard place to be. I do a bunch of transactions in the Valley and now in Austin. A’s here (Austin) are a tale of have’s and have nots. You either have ‘coastal- hype’ - stellar growth, super high valuation and a short closing timeline - or you are raising what feels like a healthy seed round on the coast. Diligence and terms tend to be the same across geos.
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Time from Seed to A Stabilizing Another key metric we track is the time between a company’s Seed and Series A. During the peak in 2021, startups could go from Seed to A in just over a year—regardless of geography. It wasn’t uncommon to hear about a Series A and feel like you had just read about their Seed. Rounds were being raised on projected growth and future adoption; founders didn’t necessarily need to show repeatable product–market fit.  As of Q1 2025, the median time from Seed to Series A (and from A to B) has returned to more than two years. While some charts make this seem like a dramatic slowdown, it's important to remember that 2021 was an anomaly. If we remove that outlier, the data shows we’ve simply returned to a more normalized cadence of ~2 years between rounds, according to Crunchbase. It’s also important to note that the size of Series A rounds and the traction to get them done has also gone up materially over the past 10 years - “A is the new B.” To compensate for this, Seed has widened from a single round into a phase.  One investor at a large non-coastal focused Series A fund noted the differential they are seeing between AI-native startups raising versus traditional Saas startups: /
We are consistently seeing AI-native companies operating with improved capital efficiency, leaner teams, and accelerated speed to revenue. This has a cascading effect on Series A raises – companies who fit this high-speed, high-agency narrative tend to draw investor attention while those who don’t tend to result in investors treading with caution.
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There’s Always Capital for Great Companies
For founders in Austin, Denver, and other non-coastal markets, the Series A path today requires a blend of patience, progress, and narrative clarity. Gone are the days of leapfrogging from Seed to A based on forecasts alone. Investors are looking for hard evidence of traction and product–market fit—especially outside the coastal echo chambers. That makes runway management, disciplined growth, and regional support networks more important than ever. The good news? Great companies still get funded. And if you can raise a Series A in a tougher, more disciplined market, you're building with the kind of resilience that lasts. Sources: Carta, Crunchbase, Pitchbook, friendly lawyers, and Series A VCs. Comments are closed.
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