Time between financing rounds shortened
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Startups began to see a pickup in the pace of capital raising in the second quarter of this year.
Aumni-tracked equity financings show that the median and average number of months it took companies to raise capital declined.
The median time between rounds across all stages fell to ~22 months in Q2, from a more than five-year high of ~25 months in Q1.
The average time between rounds also decreased over that same period, and became more in line with the median. When the average time between rounds is higher than the median, it implies that outlier companies are taking particularly long to raise capital.
This pick-up in pace of fundraising comes after the time between financing rounds elongated sharply at the start of 2022.
Notably, last year, even top companies were taking longer to raise. Whereas historically, companies that achieved valuations above the 75th percentile usually closed subsequent financing rounds much faster than those at lower valuations, in 2023 even top-quartile companies saw a sharp increase in the number of months it took to raise the subsequent round of capital.
Fundraising Environments Remain Challenging
While the improving pace of financings is a spark of welcome news to the market, the length of time between rounds remains elevated from a multi-year perspective, indicating a still challenging fundraising environment – especially relative to pre-2022 conditions. Aumni will continue to monitor developments.
The chart above is just one of dozens of data sets in the upcoming 1H 2024 Aumni Venture Beacon, our biannual report on the state of fundraising. If you’re already an Aumni content subscriber, keep an eye on your inbox for the report, which comes out later this month. If you’re not a subscriber, but would like insights like these delivered straight to you, scroll down to subscribe to our Venture Insights newsletter.
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